As filed with the Securities and Exchange Commission on May 14, 2018

1933 Act Registration No. 333-222786

1940 Act Registration No. 811-08517

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

PRE-EFFECTIVE AMENDMENT NO. 1

And

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

AMENDMENT NO. 617

Lincoln Life Variable Annuity Account N

(Exact Name of Registrant)

Lincoln Level Advantage^SM B-Share

Lincoln Level Advantage^SM Advisory
Lincoln Level Advantage^SM B-Class

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

(Name of Depositor)

1300 South Clinton Street

Post Office Box 1110

Fort Wayne, Indiana 46801

(Address of Depositor’s Principal Executive Offices)

Depositor’s Telephone Number, Including Area Code: (260) 455-2000

Kirkland L. Hicks, Esquire

The Lincoln National Life Insurance Company

1300 South Clinton Street

Post Office Box 1110

Fort Wayne, IN 46801

(Name and Address of Agent for Service)

Copy to:

Scott C. Durocher, Esquire

The Lincoln National Life Insurance Company
350 Church Street

Hartford, Connecticut 06103

Approximate Date of Proposed Public Offering:

As soon as practicable after the effective date of the Registration Statement.

Title of Securities being registered:

Interests in a separate account under individual flexible

payment deferred variable annuity contracts.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a) shall determine.

Prospectus 1

Lincoln Level Advantage^SM Advisory Individual Variable and Index-Linked Annuity Contracts
Lincoln Life Variable Annuity Account N  

May 18, 2018

Home Office:
The Lincoln National Life Insurance Company
1300 South Clinton Street
Fort Wayne, IN 46802
www.LincolnFinancial.com
1-877-737-6872

This prospectus describes an individual flexible premium variable and index-linked deferred annuity contract issued by The Lincoln National Life Insurance Company (Lincoln Life or Company).

This contract can be purchased as either a nonqualified annuity or qualified retirement annuity under Section 408 (IRAs) or 408A (Roth IRAs) of the tax code. Generally, you do not pay federal income tax on the contract's growth until it is paid out. You receive tax deferral for an IRA whether or not the funds are invested in an annuity contract. Further, if your contract is a Roth IRA, you generally will not pay income tax on a distribution, provided certain conditions are met. Therefore, there should be reasons other than tax deferral for purchasing a qualified annuity contract. We offer other types of annuity contracts that may offer different investment options, features, and optional benefits. You should carefully consider whether or not this contract is the best product for you.

The contract is designed to accumulate Contract Value and to provide retirement income over a certain period of time or for life subject to certain conditions. The benefits offered under this contract may be a variable or index-linked amount or both. This contract also offers a Death Benefit payable upon the death of the Contractowner or Annuitant. This prospectus is used by both new purchasers and current Contractowners.

This prospectus describes all material rights and obligations of annuity purchasers under the contract.

The state in which your contract is issued will govern whether or not certain features, riders, restrictions, limitations, charges and fees will apply to your contract. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

The minimum initial Purchase Payment for the contract is $25,000. Additional Purchase Payments may be made to the contract, subject to certain restrictions, and must be at least $100 per payment ($25 if transmitted electronically), and at least $300 annually. We reserve the right to limit, restrict, or suspend Purchase Payments made to the contract upon advance written notice. Purchase Payments and Contract Value may be allocated to the Indexed Accounts only on the initial Start Date or Indexed Anniversary Date and must be at least $2,000.

You choose whether to invest in variable investment options, in one or more index-linked accounts, or both.

You invest in the index-linked portion of the contract by choosing one or more of the available Indexed Accounts. Indexed Accounts are established for either 1- or 6-year terms, and the return on these accounts at the end of the term is based in part on the performance of a specified index. The gain for each Indexed Segment is limited by a specified Performance Cap, and your Contract Value will not be impacted by any loss up to the applicable Protection Level if you hold for the length of the term. The returns on the 6-year Indexed Accounts are calculated either with an Annual Lock or without an Annual Lock. An Interim Value for each Indexed Segment is calculated each Valuation Date prior to the last day of the term.

The Indexed Accounts of the contract are supported by the assets of a non-registered, non-insulated separate account of the Company which has been established to support the Company’s obligations with respect to the Indexed Accounts. The Indexed Accounts are not invested in any underlying fund. We do not guarantee how any of the Indexed Accounts will perform. There is a risk of loss of your investment because you agree to absorb all losses in excess of the level of protection you selected.

Index-linked annuity contracts are complex insurance and investment vehicles. Investors should speak with a financial professional about the contract’s features, benefits, risks, and fees, and whether the contract is appropriate for the investor based upon his or her financial situation and objectives.

The available Indexed Accounts are listed below:

1

1-Year Indexed Accounts

S&P 500^{® (1)}, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^{® (2)}, 10% Protection

Capital Strength Net Fee Index^{SM (3)}, 10% Protection

MSCI EAFE⁽⁴⁾, 10% Protection

6-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 20% Protection

S&P 500^®, 30% Protection

Russell 2000^®, 10% Protection

Russell 2000^®, 20% Protection

Russell 2000^®, 30% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM , 10% Protection

Annual Lock MSCI EAFE, 10% Protection

We calculate an Interim Value in the event you take a withdrawal in the middle of a term. The Interim Value calculation is not based on the value of the Index. This means that you could have a negative performance, even if the Index Value has increased. We do not guarantee that an Indexed Account option will always be available. Amounts paid to you from the Indexed Accounts are subject to our credit worthiness and claims paying ability.

Refer to the Risk Factors section beginning on page 12 of this prospectus for more information.

All Purchase Payments allocated to underlying funds will be placed in Lincoln Life Variable Annuity Account N (Variable Annuity Account [VAA]). The VAA is a segregated investment account of Lincoln Life. You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the contract’s variable options (“Subaccounts”), which, in turn, invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, it goes down. How much it goes up or down depends on the performance of the Subaccounts you select. We do not guarantee how any of the Subaccounts or their funds will perform. Also, neither the U.S. Government nor any federal agency insures or guarantees your investment in the contract. The contracts are not bank deposits and are not endorsed by any bank or government agency.

The available Subaccounts are listed below:

AIM Variable Insurance Funds (Invesco Variable Insurance Funds)

Invesco V.I. Equally-Weighted S&P 500 Fund⁵

American Funds Insurance Series^®

American Funds Asset Allocation Fund

American Funds Growth Fund

BlackRock Variable Series Funds, Inc.

BlackRock Global Allocation V.I. Fund

Fidelity^® Variable Insurance Products

Fidelity^® VIP Mid Cap Portfolio

First Trust Variable Insurance Trust

First Trust/Dow Jones Dividend & Income Allocation Portfolio⁶

Franklin Templeton Variable Insurance Products Trust

Franklin Rising Dividends VIP Fund

JPMorgan Insurance Trust

JPMorgan Insurance Trust Core Bond Portfolio

Lincoln Variable Insurance Products Trust

LVIP Government Money Market Fund

LVIP MFS Value Fund

LVIP PIMCO Low Duration Bond Fund

LVIP SSGA International Index Fund

LVIP SSGA S&P 500 Index Fund⁴

LVIP SSGA Small-Cap Index Fund

 

 

This prospectus gives you information about the contract that you should know before you decide to buy a contract and make Purchase Payments. The risk of loss can become greater in the case of an early withdrawal due to the Interim Value of such withdrawals. You should also review the prospectuses for the funds and keep all prospectuses for future reference.

Neither the SEC nor any state securities commission has approved this contract or determined that this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

2

More information about the contract is in the current Statement of Additional Information (SAI), dated the same date as this prospectus. The SAI is incorporated by reference into this prospectus and is legally part of this prospectus. The SAI is part of the registration statement filed on Form N-4. For a free copy of the SAI, write: The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. The SAI and other information about Lincoln Life and the VAA are also available on the SEC's website (http://www.sec.gov). There is a table of contents for the SAI on the last page of this prospectus.

¹ The S&P 500 Price Return Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by The Lincoln National Life Insurance Company. Standard & Poor’s^®, S&P^®, and S&P 500^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s product is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index.

² The Russell 2000 Price Return Index (the “Index”) is a trademark of Frank Russell Company (“Russell”) and has been licensed for use by The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s products are not in any way sponsored, endorsed, sold or promoted by Russell or the London Stock Exchange Group companies (“LSEG”) (together the “Licensor Parties”), and none of the Licensor Parties make any claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to (i) the results to be obtained from the use of the Index (upon which The Lincoln National Life Insurance Company’s product is based), (ii) the figure at which the Index is said to stand at any particular time on any particular day or otherwise, or (iii) the suitability of the Index for the purpose to which it is being put in connection with The Lincoln National Life Insurance Company product. None of the Licensor Parties have provided or will provide any financial or investment advice or recommendation in relation to the Index to The Lincoln National Life Insurance Company or to its clients. The Index is calculated by Russell or its agent. None of the Licensor Parties shall be (a) liable (whether in negligence or otherwise) to any person for any error in the Index or (b) under any obligation to advise any person of any error therein.

³ Capital Strength Net Fee Index^SM. The Product(s) is not sponsored, endorsed, sold or promoted by NASDAQ, Inc. or its affiliates (NASDAQ, with its affiliates, are referred to as the “Corporations”). The Corporations have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to, the Product(s). The Corporations make no representation or warranty, express or implied to the owners of the Product(s) or any member of the public regarding the advisability of investing in securities generally or in the Product(s) particularly, or the ability of the Capital Strength Net Fee Index to track general stock market performance. The Corporations' only relationship to Lincoln Financial Group (“Licensee”) is in the licensing of the Nasdaq^® and certain trade names of the Corporations and the use of the Capital Strength Net Fee Index which is determined, composed and calculated by NASDAQ without regard to Licensee or the Product(s). NASDAQ has no obligation to take the needs of the Licensee or the owners of the Product(s) into consideration in determining, composing or calculating the Capital Strength Net Fee Index. The Corporations are not responsible for and have not participated in the determination of the timing of, prices at, or quantities of the Product(s) to be issued or in the determination or calculation of the equation by which the Product(s) is to be converted into cash. The Corporations have no liability in connection with the administration, marketing or trading of the Product(s).

THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED CALCULATION OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE PRODUCT(S), OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE CAPITAL STRENGTH NET FEE INDEX^® OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES

⁴ MSCI Price Return EAFE. The securities referred to herein are not sponsored, endorsed or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities, or any index on which such securities are based. The Prospectus contains a more detailed description of the limited relationship MSCI has with Lincoln Financial Group and any related funds.

⁵ Standard & Poor’s^®,” “S&P^®,” “Standard & Poor’s Equal Weight Index,” “S&P EWI,” “S&P 500^®,” “Standard & Poor’s 500” and “500” are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by the Invesco V.I. Equally-Weighted S&P 500 Fund. The fund is not sponsored, endorsed, sold or promoted by S&P, and S&P makes no representation regarding the advisability of investing in the fund.

⁶ Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The trademark has been licensed to S&P Dow Jones Indices LLC and has been sublicensed for use for certain purposes by First Trust Advisors L.P. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of purchasing the product.

3

Table of Contents

Item	Page
Special Terms	5
Summary of Common Questions	7
Expense Tables	10
Risk Factors	12
Condensed Financial Information	14
The Lincoln National Life Insurance Company	15
Investments of the Indexed Accounts	16
Variable Annuity Account (VAA)	21
Investments of the Variable Annuity Account	21
Charges and Other Deductions	24
The Contracts	25
Contracts Offered in this Prospectus	25
Purchase Payments	26
Transfers On or Before the Annuity Commencement Date	28
Surrenders and Withdrawals	30
Death Benefit	32
i4LIFE® Indexed Advantage	34
Annuity Payouts	38
Distribution of the Contracts	41
Federal Tax Matters	42
Additional Information	47
Voting Rights	47
Return Privilege	48
State Regulation	48
Records and Reports	48
Contents of the Statement of Additional Information (SAI) for Lincoln Life Variable Annuity Account N	51
Appendix A – Interim Value Calculation	A-1

4

Special Terms

In this prospectus, the following terms have the indicated meanings:

Access Period—Under i4LIFE^® Indexed Advantage, a defined period of time during which we make Periodic Income Payments to you while you still have access to your Account Value. This means that you may make withdrawals, surrender the contract, and have a Death Benefit.

Account or Variable Annuity Account (VAA)—The segregated investment account, Account N, into which we set aside and invest the assets for the Subaccounts offered in this prospectus.

Account Value—Under i4LIFE^®Indexed Advantage, the Account Value on a Valuation Date equals the total value of all the Contractowner’s Accumulation Units plus the Contractowner’s value in the Indexed Segments and the Periodic Income Payment Account, if any.

Accumulation Unit—A measure used to calculate the assets in the Subaccounts before the Annuity Commencement Date and to calculate the variable side of the i4LIFE^® Indexed Advantage Account Value during the Access Period.

Annuitant—The person upon whose life the annuity benefit payments are based, and upon whose death a Death Benefit may be paid.

Annuity Commencement Date—The Valuation Date when funds are withdrawn or converted into Annuity Units or fixed dollar payout for payment of retirement income benefits under the Annuity Payout option you select (other than i4LIFE^® Indexed Advantage).

Annuity Payout—A regularly scheduled payment (under any of the available annuity options) that occurs after the Annuity Commencement Date (or the i4LIFE^® Indexed Advantage effective date if applicable). Payments may be variable or index-linked under i4LIFE^® Indexed Advantage or variable and fixed under other options.

Annuity Unit—A measure used to calculate the amount of Annuity Payouts for the variable side of the contract after the Annuity Commencement Date.

Beneficiary—The person you choose to receive any Death Benefit paid if you die before the Annuity Commencement Date.

Contractowner (you, your, owner)—The person who can exercise the rights within the contract (decides on investment allocations, transfers, payout option, designates the Beneficiary, etc.). Usually, but not always, the Contractowner is the Annuitant.

Contract Value (may be referred to as Account Value in marketing materials)—At any given time before the Annuity Commencement Date, the total value of any allocations in the Subaccounts, the Indexed Segments, and the transfer account, if any.

Contract Year—Each 12-month period starting with the effective date of the contract and starting with each contract anniversary after that.

Death Benefit—Before the Annuity Commencement Date, the amount payable to your designated Beneficiary if the Contractowner dies. As an alternative, the Contractowner may receive a Death Benefit on the death of the Annuitant prior to the Annuity Commencement Date.

End Date—The last day of the Indexed Term.

Fee-Based Financial Plan—A wrap account, managed account or other investment program whereby an investment firm/professional offers asset allocation and/or investment advice for a fee. Such programs can be offered by broker-dealers, banks and registered investment advisers, trust companies and other firms. Under this arrangement, the Contractowner pays the investment firm/professional directly for services.

Good Order—The actual receipt at our Home Office of the requested transaction in writing or by other means we accept, along with all information and supporting legal documentation necessary to effect the transaction. The forms we provide will identify the necessary documentation. We may, in our sole discretion, determine whether any particular transaction request is in Good Order, and we reserve the right to change or waive any Good Order requirements at any time.

Index Value—The published closing value of an index on a Valuation Date. If an Index Value is not published for a particular day, we will use the closing Index Value on the next Valuation Date it is published.

Indexed Account—An investment option that provides a return based, in part, on the performance of an index.

Indexed Anniversary Date—The same calendar day, each calendar year, as the day you first invested in an Indexed Segment.

Indexed Crediting Base—An amount used in the calculation of the performance return and the Interim Value for an Indexed Segment.

Indexed Segment—The specific Indexed Account option(s) selected by a Contractowner for allocations of Purchase Payments or transfer of Contract Value.

Indexed Term—The period of time during which Contract Value is invested in a particular Indexed Segment.

Interim Value—Your Contract Value for an Indexed Segment during an Indexed Term. The Interim Value is a calculated value and is used in the event that a withdrawal, Death Benefit payment, transfer, annuitization, or surrender occurs at any time other than the Start Date or End Date of an Indexed Term.

Lifetime Income Period—Under i4LIFE^® Indexed Advantage, the period of time following the Access Period during which we make Periodic Income Payments to you for the rest of your life (and Secondary Life, if applicable). During the Lifetime Income Period, you will no longer have access to your Account Value or receive a Death Benefit.

Lincoln Life (we, us, our, Company)—The Lincoln National Life Insurance Company.

Performance Cap or Cap—The highest Performance Rate that can be credited to an Indexed Segment over a specified period of time. A different Cap may be declared for each Indexed Segment and for each Death Benefit type.

Performance Rate—A rate of return for an Indexed Segment based on the performance of an Index over a period of time, adjusted for the Protection Level and subject to the Performance Cap.

 

 

5

Periodic Income Payments—The amounts paid under i4LIFE^® Indexed Advantage.

Periodic Income Payment Account—The account from which the Periodic Income Payments will be paid under i4LIFE^® Indexed Advantage.

Protection Level—The portion of any negative index performance of an Indexed Account that the Company will absorb.

Purchase Payments—Amounts paid into the contract.

Rider Year—Under i4LIFE^® Indexed Advantage, the 12-month period starting with the effective date of the rider and starting with each anniversary of the rider effective date after that.

Secondary Life—Under i4LIFE^® Indexed Advantage, the person designated by the Contractowner upon whose life the annuity payments will also be contingent.

Segment Maturity Value—The value of an Indexed Segment on the End Date after adjustment for the Performance Rate.

Selling Group Individuals—A Contractowner who meets one of the following criteria at the time of the contract purchase and who purchases the contract without the assistance of a registered representative under contract with us:

• Employees and registered representatives of any member

	of the selling group (broker-dealers who have selling agreements with us for the products described in this prospectus) and their spouses and minor children.
•	Officers, directors, trustees or bona-fide full-time employees and their spouses and minor children of Lincoln Financial Group or any of the investment advisers of the funds currently being offered, or their affiliated or managed companies.

Start Date—The Valuation Date on which the Indexed Segment begins.

Subaccount—Each portion of the VAA that reflects investments in Accumulation and Annuity Units of a class of a particular fund available under the contracts. There is a separate Subaccount which corresponds to each class of a fund.

Valuation Date—Each day the New York Stock Exchange (NYSE) is open for trading.

Valuation Period—The period starting at the close of trading (normally 4:00 p.m. New York time) on each day that the NYSE is open for trading (Valuation Date) and ending at the close of such trading on the next Valuation Date.

6

Summary of Common Questions

What kind of contract am I buying? It is an individual variable and/or index-linked deferred annuity contract between you and Lincoln Life. This contract and certain riders, benefits, service features and enhancements may not be available in all states, and the charges may vary in certain states. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

Who can purchase this contract? This contract is issued as part of a Fee-Based Financial Plan. A Fee-Based Financial Plan generally refers to a wrap account, managed account or other investment program whereby an investment firm/professional offers asset allocation and/or investment advice for a fee. Such programs can be offered by broker-dealers, banks and registered investment advisors, trust companies and other firms. Under this arrangement, the Contractowner pays the investment firm/professional directly for services. You may be able to pay this fee by taking partial withdrawals from your Contract Value. See Additional Services for more information.

What is the Variable Annuity Account (VAA)? It is a separate account we established under Indiana insurance law, and registered with the SEC as a unit investment trust. VAA assets are allocated to one or more Subaccounts, according to your investment choices. VAA assets are not chargeable with liabilities arising out of any other business which we may conduct. See Variable Annuity Account.

What are Indexed Accounts? The Indexed Accounts provide a return, in part, based on the performance of an index you select. The return may be positive or negative and is called the Performance Rate. The Performance Rate includes a Performance Cap, which is the maximum percentage amount you can earn during the Indexed Term and a Protection Level, which is the percentage of any negative index performance we will absorb. You may allocate all or a portion of your Purchase Payments into one or more Indexed Segments of Indexed Accounts. Each Indexed Segment has its own Indexed Term, Contract Value and Performance Cap. An Indexed Account is defined by the index tracked, the length of the term, and the Protection Level it provides, and whether or not the calculation includes an Annual Lock.

The Performance Cap and Protection Level will not change during an Indexed Term. At the end of the Index Term, new Indexed Segments will be available which may have different Performance Caps and different Protection Levels. We will notify you in advance of your Indexed Anniversary Date. If we do not hear from you by the end of the Indexed Term, we will transfer your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for the new Indexed Segment will apply. Subsequent transfers from the new Indexed Segment will be at Interim Value. If the same type Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund.

What is the Index-Linked Separate Account? Assets supporting the Indexed Accounts are held in a non-insulated separate account established under Indiana insurance law. These assets are not insulated from the creditors of Lincoln Life. Therefore, the benefits provided under the Indexed Accounts are subject to the claims paying ability of Lincoln Life.

What is the Interim Value? We calculate the Interim Value of your Indexed Segments each Valuation Date. This calculation is based on a formula and may not correspond to the current performance of the Index you selected. This formula includes the value of derivatives at the time of the calculation of the Interim Value. The derivatives replicate what the performance credited would be based on the performance of the Index to the end of the Indexed Segment. Your Contract Value for Indexed Segments during the Indexed Term will equal the Interim Value. This means that the Contract Value in the Segments available for withdrawals, surrenders, transfers, annuitizations, and Death Benefit payments during an Indexed Term will be at the Interim Value. This Interim Value formula may result in a loss even if the Index Value at the time of the withdrawal is higher than the Index Value at the beginning of the Indexed Term.

Can the available Indexed Accounts and indices change over the life of the contract? We reserve the right to add or withdraw Indexed Accounts at any time. If you are invested in an Indexed Segment, it will not be withdrawn from your contract until the end of the Indexed Term. There is no guarantee that an Indexed Account with a Protection Level will be available or that a particular Index will be available in the future. If an Index is discontinued or substantially changed during a Segment Term, we reserve the right to select an alternative Index and we will notify you of such change. This may impact the calculation of your Segment Maturity Value and your future Interim Value.

What are my investment choices? You may allocate your Purchase Payments to the VAA or to one or more Indexed Segments. Based upon your instruction, Purchase Payments into the VAA will be applied to one or more of the Subaccounts, which, in turn, invest in a corresponding underlying fund. Each fund holds a portfolio of securities consistent with its investment policy. See Investments of the Variable Annuity Account – Description of the Funds. Purchase Payments into the Indexed Segments will be held in a non-insulated separate account and payments are subject to the financial strength of the Company. Indexed Accounts with Indexed Terms of 1 or 6 years are currently available. The currently offered Indices are S&P 500^® Price Return Index, Russell 2000^® Price Return Index, MSCI EAFE Price Return Index and Capital Strength Net Fee Index^SM. See Indexed Accounts.

7

Who invests my money? Several different investment advisers manage the investment options for the Subaccounts. See Investments of the Variable Annuity Account – Description of the Funds. Assets allocated to the Indexed Segments are invested by the investment advisers of the Company’s general account.

How does the contract work? If we approve your application, we will send you a contract. When you make Purchase Payments during the accumulation phase, you buy Accumulation Units with amounts allocated to the variable side of the contract. Amounts allocated to the Indexed Accounts are valued each day, as described in the Interim Value section. If you decide to receive an Annuity Payout, your Accumulation Units are converted to Annuity Units. Your Annuity Payouts will be based on the number of Annuity Units you receive and the value of each Annuity Unit on payout days. Indexed Accounts are not available for Annuity Payouts (except i4LIFE^® Indexed Advantage). A fixed Annuity Payout is also available. See The Contracts.

What charges do I pay under the contract? We apply a Product Charge to the daily net asset value in the Subaccounts for the Death Benefit you select. The Product Charge consists of a mortality and expense risk charge and an administrative charge. There is also a charge for any riders applicable to your contract. See Charges and Other Deductions.

We will deduct any applicable premium tax from Purchase Payments or Contract Value, unless the governmental entity dictates otherwise, at the time the tax is incurred or at another time we choose.

See Expense Tables and Charges and Other Deductions for information regarding additional fees and expenses that may be incurred.

The funds’ investment management fees, expenses and expense limitations, if applicable, are more fully described in the prospectuses for the funds.

Charges may also be imposed during the Annuity Payout period. See Annuity Payouts.

For information about the compensation we pay for sales of contracts, see The Contracts – Distribution of the Contracts.

Am I limited in the amount of Purchase Payments I can make into the contract? Your Purchase Payments are flexible but subject to the following limitations. Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. Upon providing advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract, including those made into any or all of the Indexed Accounts.

How will my Annuity Payouts be calculated? If you decide to annuitize, you may select an annuity option and start receiving Annuity Payouts from your contract as a fixed option or variable option or a combination of both. See Annuity Payouts - Annuity Options. Any portion of Contract Value invested in the Indexed Accounts must be transferred to the VAA prior to the annuitization, or must be used to purchase a fixed annuity. Remember that participants in the VAA benefit from any gain, and take a risk of any loss, in the value of the securities in the funds' portfolios, which would decrease the amount applied to any payout option and the related payments.

What happens if I die before I annuitize? The Death Benefit may be paid upon the death of either the Contractowner or the Annuitant. Upon the death of the Contractowner, your Beneficiary will receive Death Benefit proceeds. Your Beneficiary has options as to how the Death Benefit is paid. In the alternative, upon the death of the Annuitant the Contractowner may choose to receive a Death Benefit. See The Contracts – Death Benefit.

What are the Death Benefit options available under my Contract? The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of your current Contract Value (including the Interim Value of the Indexed Accounts) or the sum of all Purchase Payments (reduced by withdrawals) as of the date the death claim is approved for payment. The Account Value Death Benefit is also available, which provides a Death Benefit equal to the Contract Value (including the Interim Value) on the date we approve the death claim for payment. See The Contracts – Death Benefits for a complete description of these Death Benefit options. Refer to the i4LIFE^® Indexed Advantage Death Benefits for specific Death Benefit features when i4LIFE^® Indexed Advantage is elected.

What happens if I die on or after the Annuity Commencement Date? Once you reach the Annuity Commencement Date, any applicable Death Benefit will terminate.

May I transfer Contract Value between variable options and between the Subaccounts and Indexed Accounts? Yes, subject to certain restrictions. Generally, transfers made before the Annuity Commencement Date are restricted to no more than 12 per Contract Year. There is no charge for a transfer. Transfers into new Indexed Segments can only be made on the Indexed Anniversary Date. Transfers out of the Indexed Segments will be made at Interim Value unless your transfer occurs on the End Date. No transfers can be made into existing Indexed Segments. The minimum amount that can be transferred to an Indexed Account is $2,000. See The Contracts – Transfers on or Before the Annuity Commencement Date and Transfers After the Annuity Commencement Date.

What is i4LIFE^® Indexed Advantage?i4LIFE^® Indexed Advantage is an Annuity Payout option, available for purchase at an additional charge, that provides periodic lifetime income payments. During the Access Period, you have access to your Account Value, which means you have a Death Benefit and may surrender the contract or make withdrawals.

8

May I surrender the contract or make a withdrawal? Yes, subject to contract requirements and to the restrictions of any qualified retirement plan for which the contract was purchased. If you surrender the contract or make a withdrawal, certain surrender charges may apply. Withdrawals or surrenders from the Indexed Accounts will be at Interim Value unless the surrender or withdrawal occurs on the End Date. A portion of surrender or withdrawal proceeds may be taxable. In addition, if you decide to take a distribution before age 59½, a 10% Internal Revenue Service (IRS) additional tax may apply. A surrender or a withdrawal also may be subject to 20% withholding. See The Contracts – Surrenders and Withdrawals, Charges and Other Deductions and Federal Tax Matters.

Can I cancel this contract? Yes. You can cancel the contract within ten days (in some states longer) of the date you first receive the contract. You need to return the contract, postage prepaid, to our Home Office. In most states you assume the risk of any market drop on Purchase Payments you allocate to the variable side of the contract and the Interim Value of the Indexed Segments. See Return Privilege.

9

Expense Tables

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the contract.

The first table describes the fees and expenses that you will pay at the time that you surrender or make a withdrawal from the contract. State premium taxes may also be deducted. The premium tax rates range from zero to 5%.

CONTRACTOWNER TRANSACTION EXPENSES

Accumulation Phase:

There are no sales charges, deferred sales charges, or surrender charges associated with this contract.

The following tables describe the fees and expenses that you will pay periodically during the time that you own the contract, not including fund fees and expenses.

• Table A reflects the subaccount expenses for the VAA.

• Table B reflects the i4LIFE^® Indexed Advantage Rider Charge.

TABLE A

Subaccount Expenses for the VAA

VAA Separate Account Annual Expenses (as a percentage of average daily net assets in the Subaccounts):1
Guaranteed Maximum and Current Product Charges:
Guarantee of Principal Death Benefit
Mortality and Expense Risk Charge	0.20%
Administrative Charge	0.10%
Total Separate Account Expenses	0.30%
Account Value Death Benefit
Mortality and Expense Risk Charge	0.10%
Administrative Charge	0.00%
Total Separate Account Expenses	0.10%

¹ The Product Charge is 0.10% after the Annuity Commencement Date.

TABLE B

i4LIFE^® Indexed Advantage

i4LIFE® Indexed Advantage rider charge:1
Guaranteed Maximum and Current Annual Charge	0.40%

¹ The i4LIFE^® IndexedAdvantage charge will be deducted from your variable and index-linked Account Value on each rider anniversary. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information. During the Lifetime Income Period, the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The next item shows the minimum and maximum total annual operating expenses charged by the funds that you may pay
periodically during the time that you own the contract. The expenses are for the year ended December 31, 2017, adjusted to reflect anticipated changes in fees and expenses, or, for new portfolios, are based on estimates for the current fiscal year. More detail concerning each fund's fees and expenses is contained in the prospectus for each fund.

10

	Minimum	Maximum
Total Annual Fund Operating Expenses (expenses that are deducted from fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses)	0.49%	1.23%
Total Annual Fund Operating Expenses (after contractual waivers/reimbursements*)	0.49%	1.20%

*Some of the funds have entered into contractual waiver or reimbursement arrangements that may reduce fund management and other fees and/or expenses during the period of the arrangement. These arrangements vary in length, but no arrangement will terminate before April 30, 2019. There can be no assurance that fund expense waivers or reimbursements will be extended beyond their current terms as outlined in each fund prospectus, and they may not cover certain expenses such as extraordinary expenses. Certain of these arrangements may provide that amounts previously waived or reimbursed may be recovered in future years. See each fund prospectus for complete information regarding annual operating expenses and any waivers or reimbursements in effect for a particular fund.

The following table shows the expenses charged by each fund for the year ended December 31, 2017:
(as a percentage of each fund’s average net assets):

	Management Fees (before any waivers/ reimburse- ments)	+	12b-1 Fees (before any waivers/ reimburse- ments)	+	Other Expenses (before any waivers/ reimburse- ments)	+	Acquired Fund Fees and Expenses	=	Total Expenses (before any waivers/ reimburse- ments)	Total Contractual waivers/ reimburse- ments (if any)	Total Expenses (after Contractual waivers/ reimburse- ments)
American Funds Asset Allocation Fund - Class 4	0.27%		0.25%		0.27%		0.00%		0.79%	0.00%	0.79%
American Funds Growth Fund - Class 4	0.33%		0.25%		0.27%		0.00%		0.85%	0.00%	0.85%
BlackRock Global Allocation V.I. Fund - Class III	0.63%		0.25%		0.25%		0.01%		1.14%	-0.13%	1.01%
Fidelity® VIP Mid Cap Portfolio - Service Class 2	0.54%		0.25%		0.09%		0.00%		0.88%	0.00%	0.88%
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I	0.60%		0.25%		0.38%		0.00%		1.23%	-0.03%	1.20%
Franklin Rising Dividends VIP Fund - Class 4	0.60%		0.35%		0.02%		0.00%		0.97%	0.00%	0.97%
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares	0.12%		0.25%		0.20%		0.00%		0.57%	0.00%	0.57%
JPMorgan Insurance Trust Core Bond Portfolio - Class 2	0.40%		0.25%		0.22%		0.00%		0.87%	-0.02%	0.85%
LVIP Government Money Market Fund - Service Class	0.38%		0.25%		0.11%		0.00%		0.74%	0.00%	0.74%
LVIP MFS Value Fund - Service Class	0.61%		0.25%		0.07%		0.00%		0.93%	0.00%	0.93%
LVIP PIMCO Low Duration Bond Fund - Service Class	0.50%		0.25%		0.25%		0.00%		1.00%	-0.04%	0.96%
LVIP SSGA International Index Fund - Service Class	0.40%		0.25%		0.11%		0.00%		0.76%	-0.12%	0.64%
LVIP SSGA S&P 500 Index Fund - Service Class	0.17%		0.25%		0.07%		0.00%		0.49%	0.00%	0.49%
LVIP SSGA Small-Cap Index Fund - Service Class	0.32%		0.25%		0.08%		0.00%		0.65%	0.00%	0.65%

Certain underlying funds have reserved the right to impose fees when fund shares are redeemed within a specified period of time of purchase (“redemption fees”) which are not reflected in the table above. As of the date of this prospectus, none have done so. See The Contracts - Market Timing for a discussion of redemption fees.

For information concerning compensation paid for the sale of the contracts, see Distribution of the Contracts.

EXAMPLES

The following Example is intended to help you compare the cost of investing in the contract with the cost of investing in other variable annuity contracts. These costs include Contractowner transaction expenses, contract fees, separate account annual expenses, and fund fees and expenses. The Example has been calculated using the fees and expenses of the funds prior to the application of any contractual waivers and/or reimbursements, and assumes that no money was invested in the Indexed Accounts.

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the i4LIFE^® Indexed Advantage with the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

11

1 year	3 years	5 years	10 years
$196	$606	$1,042	$2,254

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$196	$606	$1,042	$2,254

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$156	$483	$834	$1,823

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$156	$483	$834	$1,823

For more information, see Charges and Other Deductions in this prospectus, and the prospectus for the funds. Premium taxes may also apply, although they do not appear in the examples. Different fees and expenses not reflected in the examples may be imposed during a period in which Annuity Payouts are made. See Annuity Payouts. These examples should not be considered a representation of past or future expenses. Actual expenses may be more or less than those shown.

Risk Factors

This section describes potential risks associated with your contract.

General Risks

1.

We reserve the right, within the law, to make certain changes to the structure and operation of the VAA or Indexed Accounts at our discretion and without your consent. We reserve the right to limit Purchase Payments into the contract. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. We may add to or delete Indexed Accounts currently available. We do not guarantee that an Indexed Account option will always be available.

2.

Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s can experience outages or slowdowns for a variety of reasons and may not always be available. These outages or slowdowns may delay or prevent our processing your surrender, withdrawal, or transfer request.

Risks of Investing in the Indexed Accounts

1.	There is a risk of loss of your investment in the Indexed Segments since the performance tracks a market index. You are responsible for all losses in excess of the Protection Level you choose. The Protection Level exists for the full term of the Indexed Segment including Segments with Annual Locks. When you move into a new Indexed Segment after the end of an Indexed Term the performance will be calculated for the new Segment, which may have a new Protection Level, which could also result in a loss. There is also a risk of loss upon an early withdrawal. For Annual Lock accounts, since the gain or loss is established each year, losses can accumulate so that you could actually lose more than the percentage amount in excess of the Protection Level percent. For example, if you chose a 10% Protection Level, you could lose more than 90% of your principal in an Annual Lock account.
2.	Gains in your Indexed Segments are limited by any applicable Performance Cap, which means that your return could be lower than if you had invested directly in a fund based on the applicable Index. The Performance Cap exists for the full term of the Indexed Segment. The Performance Cap rate is lower for contracts with the Guarantee of Principal Death Benefit. Generally, Indexed Segments with greater Protection Levels have lower Performance Caps. Performance Caps for new Segments will be declared 5 business days in advance of the beginning of a Segment.
3.	To determine the Interim Value, we apply a formula which does not reflect the actual performance of the applicable Index, but rather a determination of the value of hypothetical underlying investments at the time of the Interim Value calculation. This amount could be less than if you had held the Indexed Segment for the full Indexed Term. It also means that you could have a

12

	negative performance, even if the value of the Index has increased during the calculation period. All withdrawals from the Indexed Segment, including Death Benefits paid during the Indexed Term, will be based on the Interim Value.
4.	If you withdraw Contract Value allocated to an Indexed Account, the withdrawal will cause an immediate reduction to your Indexed Crediting Base in a proportion equal to the reduction in your Interim Value. A proportional reduction could be larger than the dollar amount of your withdrawal. Reductions to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Indexed Segment Maturity Value at the end of the Indexed Term. Once your Indexed Crediting Base is reduced due to a withdrawal during any Indexed Term, you cannot increase it during the remainder of the Indexed Term.
5.	For Indexed Accounts without an Annual Lock, the indexed performance credited to your Indexed Segment is determined on the last day of the Indexed Term. It is not affected by the price of the Index on any date in between the effective date of the Indexed Account and the End Date of the Indexed Term. Annual Lock accounts are not affected by Index prices between the Annual Lock anniversaries.
6.	We may change the Index on a particular Indexed Account if the Index is discontinued or if we feel the Index is no longer appropriate. This change may occur in the middle of an Indexed Segment and this change may impact how your Indexed Segment performance and Interim Value are calculated.
7.	The available Indexed Accounts with applicable Performance Caps and Protection Levels will vary over time. Before investing in a new Indexed Segment, you should determine exactly what Indexed Accounts, Protection Levels and Performance Caps are available to you. There is no guarantee that an Indexed Account will be available in the future. You should make sure the Segment(s) you select is appropriate for your investment goals.
8.	The risks associated with the currently available Indices are as follows:

• Equity markets are subject to the risk that the value of the securities may fall due to general market and economic conditions. Market volatility may exist with these indices, which means that the value of the indices can change dramatically over a short period of time in either direction. Additional risks for specific indices are as follows:

• Russell^® 2000 Price Return Index: Compared to mid-and large-capitalization companies, small-capitalization companies may be less stable and more susceptible to adverse developments, and their securities may be more volatile and less liquid.

• MSCI EAFE Price Return Index: International investing involves special risks not found in domestic investing, including political and social differences and currency fluctuations due to economic decisions. Emerging markets can be riskier than investing in well established foreign markets. The risks associated with investing on a worldwide basis include differences in the regulation of financial data and reporting, currency exchange differences, as well as economic and political systems differences.

• Capital Strength Net Fee Index^SM: This index has fewer stocks than broad based indices; therefore, the risk is spread between fewer equity securities. This index may not track other large cap indices.

9.	If we do not receive investment instructions from you by the end of an Indexed Term, we will invest your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for new Indexed Segments will apply. If the same type of Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund. If your Contract Value has been invested in a new Segment and you wish to withdraw your investment, the Contract Value for that Segment will equal the Interim Value.
10.	You will not have voting rights or rights to receive cash dividends or other rights that shareholders who invest in mutual funds based on these Indices would have.
11.	Your receipt of funds invested in the Indexed Segments is based on the claims paying ability of Lincoln Life. You have no ownership rights in the underlying securities. The assets backing the Indexed Accounts are not segregated from other business of Lincoln Life.
12.	The only available annuitization option for the Indexed Accounts is i4LIFE® Indexed Advantage, which has an additional charge.

Risks of Investing in the Subaccounts

1.	You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the Subaccounts, which invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, your Contract Value goes down. How much it goes up or down depends on the performance of the Subaccounts you select.
2.	The dollar amount of the charge for certain optional Death Benefits may increase as your Contract Value increases.
3.	Your receipt of a Death Benefit over and above the amounts invested in the VAA is based on the claims paying ability and credit worthiness of Lincoln Life.
4.	Certain classes of funds are subject to risk factors as outlined below:

13

a. Certain funds offered as part of this contract have similar investment objectives and policies to other portfolios managed by the adviser. The investment results of the funds, however, may be higher or lower than the other portfolios that are managed by the adviser or sub-adviser. There can be no assurance, and no representation is made, that the investment results of any of the funds will be comparable to the investment results of any other portfolio managed by the adviser or sub-adviser, if applicable.

b. Certain funds invest their assets in other funds. As a result, you will pay fees and expenses at both fund levels. This will reduce your investment return. These arrangements are referred to as funds of funds or master-feeder funds, which may have higher expenses than funds that invest directly in debt or equity securities. An advisor affiliated with us manages some of the available funds of funds. Our affiliates may promote the benefits of such funds to Contractowners and/or suggest that Contractowners consider whether allocating some or all of their Contract Value to such portfolios is consistent with their desired investment objectives. In doing so, we may be subject to conflicts of interest insofar as we may derive greater revenues from the affiliated fund of funds than certain other funds available to you under your contract.

5.	Some of the underlying funds have reserved the right to temporarily or permanently refuse payments or transfer requests received from us, especially in cases of suspected market timing. To the extent permitted by applicable law, we, in turn, reserve the right to defer or reject your transfer request at any time we are unable to redeem shares of an underlying fund.
6.	Annuity Payouts will fluctuate with the performance of the Subaccounts.

Cyber Security

We rely heavily on interconnected computer systems and digital data to conduct our annuity products business. Because our business is highly dependent upon the effective operation of our computer systems and those of our business partners, our business is vulnerable to disruptions from utility outages, and susceptible to operational and information security risks resulting from information systems failure (e.g., hardware and software malfunctions), and cyber-attacks. These risks include, among other things, the theft, misuse, corruption and destruction of data maintained online or digitally, interference with or denial of service, attacks on websites and other operational disruption and unauthorized release of confidential customer information. Such systems failures and cyber-attacks affecting us, any third-party administrator, the underlying funds, intermediaries and other affiliated or third-party service providers may adversely affect us and your Contract Value. For instance, systems failures and cyber-attacks may interfere with our processing of contract transactions, including the processing of orders from our website or with the underlying funds, impact our ability to calculate Accumulation Unit value, cause the release and possible destruction of confidential customer or business information, impede order processing, subject us and/or our service providers and intermediaries to regulatory fines and financial losses and/or cause reputational damage. Cyber security risks may also impact the issuers of securities in which the underlying funds invest, which may cause the funds underlying your contract to lose value. There can be no assurance that we or the underlying funds or our service providers will avoid losses affecting your contract due to cyber-attacks or information security breaches in the future.

Condensed Financial Information

Since no sales of this product occurred before the date of this prospectus, financial information for the Subaccounts is not included in this prospectus or in the SAI.

Investment Results for the VAA

At times, the VAA may compare its investment results to various unmanaged indices or other variable annuities in reports to shareholders, sales literature and advertisements. The results will be calculated on a total return basis for various periods. Total returns include the reinvestment of all distributions, which are reflected in changes in unit value. The money market Subaccount's yield is based upon investment performance over a 7-day period, which is then annualized.

There can be no assurance that a money market fund will be able to maintain a stable net asset value of $1.00 per share. During periods of low interest rates, the yield of a money market fund may become extremely low and possibly negative. In addition, if the yield of a Subaccount investing in a money market fund becomes negative, due in part to Contract fees and expenses, your Contract Value may decline. An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The sponsor of a money market fund has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time. If, under SEC rules, a money market fund suspends payments of redemption proceeds, we will delay payment of any transfer, withdrawal, or benefit from a Subaccount investing in the money market fund until the fund resumes payment. If, under SEC rules, a money market fund institutes a liquidity fee, we may assess the fee against your Contract Value if a payment is made to you from a Subaccount investing in the money market fund.

The annual performance of the Subaccounts are based on past performance and do not indicate or represent future performance.

14

Investment Results for the Indexed Accounts

It is possible that you will not earn any gain on investments in the Indexed Segments. Investments in the Indexed Segments are not guaranteed unless you have elected the 100% Protection Level and hold the investment until the end of the Indexed Term. There is a risk of substantial loss of your principal. You agree to absorb all losses that exceed the Protection Level percentage you select.

The Lincoln National Life Insurance Company

The Lincoln National Life Insurance Company (Lincoln Life or Company), organized in 1905, is an Indiana-domiciled insurance company, engaged primarily in the direct issuance of life insurance contracts and annuities. Lincoln Life is wholly owned by Lincoln National Corporation (LNC), a publicly held insurance and financial services holding company incorporated in Indiana. Lincoln Life is obligated to pay all amounts promised to Contractowners under the contracts.

The portion of your Contract Value invested in the Indexed Segments is part of our general account. Therefore, any amounts that we may pay under the contract in excess of the value in the Subaccounts are subject to our financial strength, claims-paying ability, credit worthiness, and our long-term ability to make such payments.

We issue other types of insurance policies and financial products as well. In addition to any amounts we are obligated to pay in excess of Subaccounts under the contracts, we also pay our obligations under these products from our assets in the general account. Moreover, unlike assets held in the VAA, the assets of the general account are subject to the general liabilities of the Company and, therefore, to the Company’s general creditors. In the event of an insolvency or receivership, payments we make from our general account to satisfy claims under the contract would generally receive the same priority as our other Contractowner obligations.

The general account is not segregated or insulated from the claims of the insurance company’s creditors. Investors look to the financial strength of the insurance companies for these insurance guarantees. Therefore, guarantees provided by the insurance company as to benefits promised in the prospectus are subject to the claims paying ability of the insurance company and are subject to the risk that the insurance company may not be able to cover or may default on its obligations under those guarantees.

Our Financial Condition.  Among the laws and regulations applicable to us as an insurance company are those which regulate the investments we can make with assets held in our general account. In general, those laws and regulations determine the amount and type of investments which we can make with general account assets.

In addition, state insurance regulations require that insurance companies calculate and establish on their financial statements, a specified amount of reserves in order to meet the contractual obligations to pay the claims of our Contractowners. In order to meet our claims-paying obligations, we regularly monitor our reserves to ensure we hold sufficient amounts to cover actual or expected contract and claims payments. However, it is important to note that there is no guarantee that we will always be able to meet our claims paying obligations, and that there are risks to purchasing any insurance product.

State insurance regulators also require insurance companies to maintain a minimum amount of capital in excess of liabilities, which acts as a cushion in the event that the insurer suffers a financial impairment, based on the inherent risks in the insurer’s operations. These risks include those associated with losses that we may incur as the result of defaults on the payment of interest or principal on assets held in our general account, which include bonds, mortgages, general real estate investments, and stocks, as well as the loss in value of these investments resulting from a loss in their market value.

How to Obtain More Information.  We encourage both existing and prospective Contractowners to read and understand our financial statements. We prepare our financial statements on both a statutory basis and according to Generally Accepted Accounting Principles (GAAP). Our audited GAAP financial statements, as well as the financial statements of the VAA, are located in the SAI. If you would like a free copy of the SAI, please write to us at: PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. In addition, the SAI is available on the SEC’s website at http://www.sec.gov. You may obtain our audited statutory financial statements and any unaudited statutory financial statements that may be available by visiting our website at www.LincolnFinancial.com.

You also will find on our website information on ratings assigned to us by one or more independent rating organizations. These ratings are opinions of an operating insurance company’s financial capacity to meet the obligations of its insurance and annuity contracts based on its financial strength and/or claims-paying ability. Additional information about rating agencies is included in the SAI.

Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE:LNC) and its affiliates. Through its affiliates, Lincoln Financial Group offers annuities, life, group life and disability insurance, 401(k) and 403(b) plans, and comprehensive financial planning and advisory services.

15

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life are located in the SAI. The SAI is part of the registration statement filed on Form N-4. If you would like a free copy of the SAI, complete and mail the request on the last page of this prospectus, or call 1-877-737-6872.

Investments of the Indexed Accounts

This contract offers several Indexed Accounts which provide a rate of return based in part on the performance of an index you select. This is the Performance Rate, and it may be positive or negative. An Indexed Account is defined by the index tracked, the length of the term, the Protection Level it provides, and whether or not the performance crediting method includes an Annual Lock.

You may allocate all or a portion of your Purchase Payments into one or more Indexed Accounts. The minimum allocation to an Indexed Account is $2,000; there is no maximum allocation limit. A new Indexed Segment is established upon an allocation to an Indexed Account. Each Indexed Segment has its own Start Date, Crediting Base, Performance Cap, Performance Rate, Contract Value, and End Date.

At this time, the available Indexed Accounts are:

1-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^®, 10% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 20% Protection

S&P 500^®, 30% Protection

Russell 2000^®, 10% Protection

Russell 2000^®, 20% Protection

Russell 2000^®, 30% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM , 10% Protection

Annual Lock MSCI EAFE, 10% Protection

Indices. Each Indexed Account references an index that determines the performance of its associated Indexed Segments. These indices are not funds and are not available for direct investment. We currently offer Indexed Accounts based on the performance of the following securities indices:

S&P 500^® Price Return Index (SPX). The S&P 500^® Index is comprised of 500 stocks considered representative of the overall market. An index is unmanaged and not available for direct investments.

Russell^® 2000 Price Return Index (RTY). The Russell 2000^® Index measures the performance of the 2,000 smallest companies in the Russell 3000^® Index. It is considered representative of small capitalization stocks. The prices of small company stocks generally are more volatile than those of large company stocks. An index is unmanaged and not available for direct investments.

MSCI EAFE Price Return Index (MXEA). The MSCI EAFE Index measures the equity market performance of 22 developed market country indices located in Europe, Australasia and the Far East. An index is unmanaged and not available for direct investments.

Capital Strength Net Fee Index^SM(NQCAPSTNF). The Index is comprised of 50 securities selected based on cash on hand, debt ratios and volatility. The Capital Strength Price Return Index^SM will be reduced by 0.65% to result in the Capital Strength Net Fee Index^SM. An index is unmanaged and not available for direct investment.

The indices used are price indices and do not reflect dividends paid on the underlying stocks. If an Index is discontinued or substantially changes (for example if an index sponsor announces that it will make a material change in the formula for or the method of calculating the Index or in any other way materially modifies the Index), we reserve the right to select an alternative Index and we will notify the Contractowner of such changes. In selecting an alternative Index we will attempt to approximate the performance of the

16

original Index in a commercially reasonable manner in light of relevant market circumstances at the time. Any substitution of an Index is subject to approval by the state insurance authorities where the contract and rider were issued, if required by law. A change to the Index in the middle of a Segment may impact the calculation of the Performance Rate for the Segments. When we notify you of a change to the Index, we will also state how the change will impact your Performance Rate. If you do not choose to remain in the Segment, you can transfer your Interim Value to a variable Subaccount. Investments in new Segments are available on an Indexed Anniversary Date.

Indexed Term. The Indexed Term is the specified period of time of a particular Indexed Account. Indexed Terms of 1 or 6 years are available. An Indexed Segment begins on the day your money is allocated to an Indexed Segment, called the Start Date. The yearly anniversary of the Start Date of the initial Indexed Segment is the Indexed Anniversary Date of your contract. This is the Indexed Anniversary Date for the life of your contract.

You may choose to allocate your Purchase Payments to different Indexed Accounts, but all Indexed Segments must begin on the Indexed Anniversary Date. All future Indexed Terms must begin on the same Indexed Anniversary Date. This means that after the initial Indexed Segment is created, you can only allocate future Purchase Payments or make transfers of Contract Value to Indexed Accounts one time a year. For example, you may start a 6-Year Segment, and two years later, you can start a 1-Year Indexed Segment, as long as the 1-Year Indexed Segment begins on the Indexed Anniversary Date for your contract. If you have more than one 6-Year Term Indexed Segment in effect at any time, these Indexed Segments must have the same Start Date and End Date.

Lincoln reserves the right to make additional Indexed Account options available or to withdraw currently available Indexed Account options in the future.

Indexed Contract Value. For each Indexed Segment the daily value is determined as follows:

a. On the Start Date of the Indexed Segment, the value of the Indexed Segment equals the initial Indexed Crediting Base. The initial Indexed Crediting Base is the amount of Purchase Payment or Contract Value allocated to the Indexed Segment.

b. On each Valuation Date during the Indexed Term, the value of the Indexed Segment equals the Interim Value.

c. On the last date of the Indexed Term, called the End Date, the value of the Indexed Segment equals the Indexed Segment Maturity Value.

Crediting Methods. Any performance earned is credited to or amounts for any loss are deducted from an Indexed Segment only upon the End Date of an Indexed Term. If the End Date is not a Valuation Date, then the amount will be credited or deducted on the next Business Day. Performance is calculated differently depending on whether or not the Indexed Account contains Annual Locks. An Indexed Account with Annual Locks is a multi-year account in which the performance is calculated on each Indexed Anniversary Date, but the performance is not credited to or deducted from the Indexed Segment until the End Date.

Indexed Segments Without Annual Locks. For an Indexed Segment without Annual Locks, the Performance Rate is the percentage change in the Index Value from the Start Date to the End Date, adjusted by the Protection Level and subject to the Performance Cap. The Performance Rate can be positive, negative or zero. The percentage change in the Index Value is calculated by subtracting the Index Value on the Start Date from the Index Value on the End Date. The difference is divided by the Index Value on the Start Date. The daily Index Value is posted on the index’s website. If an Index Value is not published for a particular day, we will use the Index Value at the close of the next Valuation Date the index is published.

If the percentage change of the Index Value from the Start Date to the End Date is positive and equal to or greater than the Performance Cap, then the Performance Rate equals the Performance Cap. If the percentage change is positive and less than the Performance Cap, the Performance Rate equals the percentage change of the Index Value. If the percentage change is negative but is absorbed by the Protection Level percentage, the Performance Rate equals zero. If the percentage change is negative, and is greater than the Protection Level percentage, the Performance Rate is equal to the percentage change in excess of the Protection Level. The Performance Rate for Indexed Segments with a 100% Protection Level is zero if the percentage change is negative.

The amount credited to or deducted from the Indexed Segment is equal to the Performance Rate times the Indexed Crediting Base on the End Date. This will be used to determine the Segment Maturity Value as set forth below. The Indexed Crediting Base is the amount you allocated to the Indexed Segment, less any transfers and withdrawals during the Index Term deducted proportionately by the amount that the transfer or withdrawal reduced the Interim Value (described later in the Interim Value section). Withdrawals include any premium tax or rider charge deductions. If the Performance Rate is positive, the value of your Indexed Segment will increase. If the Performance Rate is negative (after calculation including the Protection Level), the value of your Indexed Segment is reduced. If the Performance Rate is zero, the value of your Indexed Segment will not change. The Segment Maturity Value on the End Date is equal to the sum of A plus (A times B) where:

A = the Indexed Crediting Base on the End Date and

B = the Performance Rate.

For Example:

17

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year with a 10% Performance Cap
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base = $100,000

Indexed Start Date	Index Value	Index % Change	Account Performance Rate (adjusted for Cap)	Segment Maturity Value
1/8/2019	1,679	+7%	+7%	$107,000
1/8/2020	1,880	+12%	+10%	$117,700

This example assumes that a new 1-Year Indexed Segment was selected in 2019 to show the impact of the Performance Cap.In this example, the Performance Cap did not change for the new Segment. (The numbers were rounded for ease of understanding.)

The Indexed Crediting Base is used only to calculate the performance of Indexed Accounts on the End Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit.

Indexed Segment with Annual Locks. For an Indexed Segment with Annual Locks, the Performance Rate will be calculated in the same manner as above, except it will be calculated on each Index Anniversary Date. However, the performance will NOT be credited to or deducted from the Indexed Segment until the End Date of the Indexed Term (at the end of the 6^th year). The amount of the performance credited or deducted from the Indexed Segment on the End Date equals the sum of each Indexed Anniversary’s performance as adjusted for any withdrawals, transfers, or annuitization. On the first Indexed Anniversary Date, the performance equals the Percentage Rate times the Indexed Crediting Base. This performance amount is added to or deducted from the Indexed Crediting Base. This adjusted Indexed Crediting Base becomes the Indexed Crediting Base for the next one-year period. On each Indexed Anniversary Date thereafter, the return for the year is credited to or deducted from the Index Crediting Base and the adjusted Indexed Crediting Base carries over for the next one-year period. As a result, a loss you incur in one year will reduce the amount invested for the next year. In a continuing down market, you could lose in excess of the percentage remaining after the Protection Level. For example, if the Protection Level is 10%, in a continuing down market, you could lose more than 90% of your investment. On the other hand, a gain you incur in one year will increase the Indexed Crediting Base for the next year, upon which future gains (if any) will be calculated. The Segment Maturity Value will equal the value of the Crediting Base on the End Date (after the adjustment for performance on the last Indexed Anniversary Date).

The Indexed Crediting Base is used only to calculate the performance of Indexed Segments on the Indexed Anniversary Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit. In addition to the Indexed Crediting Base adjustment for performance, withdrawals and transfers reduce the Indexed Crediting Base in the same proportion that withdrawals and transfers reduce the Interim Value.

The following example demonstrates the impact of the Performance Cap and Protection Level on an Indexed Account with a 6-Year Annual Lock and assumes no withdrawals have been made.

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 6-Year with Annual Locks with a 10% Performance Cap and 10% Protection Level
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base at Beginning of Term = $100,000

Indexed Segment Anniversary	Index Value	Index % Change	Account Performance Rate (adjusted for Cap or Protection Level)	Indexed Segment Performance Amount	Adjusted Indexed Crediting Base/ Anniversary Value
1/8/2019	1,679	+7%	+7%	$7,000	$107,000
1/8/2020	1,880	+12%	+10%	$10,700	$117,700
1/8/2021	1,636	-13%	-3%	-$3,531	$114,169
1/8/2022	1,554	-5%	-0%	0	$114,169
1/8/2023	1,632	+5%	+5%	+$5,708	$119,877
1/8/2024	1,909	+10%	+10%	+$11,988	$131,865

18

Note: The Segment Maturity Value is $131,865. The $31,865 (the sum of the values on each Index Anniversary) is not credited to your Contract Value until the end of the 6-year Indexed Term. Until that time, the Interim Value calculations apply. The anniversary amounts are not available to you and are used only for calculation purposes as the Indexed Crediting Base for the next year.

Reallocation. You will be notified thirty days prior to each Indexed Anniversary Date regarding the timing of investing in new Indexed Segments. The available Indexed Accounts and applicable Performance Caps will be provided 5 business days in advance of the Indexed Anniversary Date on LFG.com/leveladvantage or by calling 1-877-737-6872. If your existing Indexed Segment is at the end of the Indexed Term, you may reallocate the value of the Indexed Segment Maturity Value to any available Indexed Account or variable subaccount as long as the reallocation request is received at least two business days prior to the end of the Indexed Term. We will hold reallocation instructions for up to 25 calendar days prior to the Indexed Anniversary Date. The reallocation will take place on the Indexed Anniversary Date. If we do not receive a reallocation notice from you, all Indexed Segments that are ending will invest into a new Indexed Segment with the same term, index, and Protection Level as the Indexed Segment in which they were previously invested and with the currently applicable Performance Cap. If the same type of Indexed Segment is no longer available, the funds will be moved to LVIP PIMCO Low Duration Bond Fund, and will not be eligible for allocation into an Indexed Account until the next Indexed Anniversary Date.

Performance Cap. The Performance Cap is the maximum Performance Rate that can be credited to the Indexed Segment for an Indexed Term for which it is declared. If an Indexed Account with Annual Lock is selected, the Performance Cap is the maximum percentage that can be credited each year during the Indexed Term. The Performance Cap may vary depending on the Death Benefit option, the index, and the Protection Level you select. Typically, Indexed Segments with greater Protection Levels have lower Performance Caps. The Performance Cap will not change during the Indexed Term.

The initial Performance Cap applies to the initial Indexed Term. Indexed Segments with a Guarantee of Principal Death Benefit will have lower Performance Caps than Indexed Segments with the Account Value Death Benefit. The Company will declare, at its discretion, a Performance Cap for each subsequent Indexed Term. If no Performance Cap is declared for an Indexed Term, there is no maximum Performance Rate for that Indexed Term.

Subsequent Performance Caps may be higher or lower than the initial Performance Cap. Subsequent Performance Caps may differ from the Performance Cap used for new contracts or for other contracts issued at different times. The Company will determine new Performance Caps on a basis that does not discriminate unfairly within any class of contracts.

Protection Levels. The Protection Level is the portion of any negative index performance that will not impact your Contract Value during the Indexed Term if you hold until the End Date of the Segment. Your Contract Value will not be impacted up to the amount of the Protection Level you elect, and, after that, you will be impacted for the remaining portion of the loss. This loss will reduce the amount of your investment (principal) in the Indexed Segments. This contract offers Indexed Accounts with Protection Levels that protect you against losses of 10% to 100%. If you choose an Indexed Account with a 10% Protection Level, your Contract Value will not be impacted by the first 10% of negative Performance if you stay invested until the End Date of the Segment. Any remaining negative percentage will be absorbed by you. If you choose an Indexed Account with a 100% Protection Level, you will not lose any of your principal allocated to the Indexed Account if you stayed invested until the End Date of the Segment. If an Indexed Account with Annual Locks is selected, the Protection Level is the percentage of the index loss that will not impact your Crediting Base each year during the Indexed Term.

For example:

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year S&P 500 with a 10% Protection Level
Index Value at beginning of term = 1,569
Indexed Crediting Base = $100,000
Indexed Term Segment End Date = 1/8/2019
Index Value at End Date = 1,333
Index Value percentage change = -15% ((1,333 – 1,569) / 1569)
Indexed Segment Maturity Value = $95,000 ($100,000 - $5,000)

Because your Contract Value is not impacted by the first 10% of the loss, you only experience a 5% loss (-15% Index Value percentage change + 10% Protection Level = 5% loss) or $100,000 * 5.00% = $5,000.

The following year assuming you chose a new 1-Year Segment with a 10% Protection Level:

Indexed Term Segment End Date = 1/8/2020
Index Value at end of term = 1,298
Index Value percentage change = -3%
Indexed Segment Maturity Value = $95,000

Because your Contract Value is not impacted by the first 10% of the loss, you experience no loss of Contract Value for this Segment because the Index Value percentage change was less than the 10% Protection Level.

19

Interim Value. The Interim Value is a daily value we calculate to provide you with a value of your Indexed Segment after the Start Date and before the End Date of an Indexed Term. The Contract Value for an Indexed Segment is equal to the Interim Value on each Valuation Date except the End Date. The Interim Value is used to calculate amounts available for withdrawal, surrender, transfer (including any premium tax or rider charge deductions), annuitization or payment of a death claim for each day during an Indexed Term. The Interim Value also is used to determine how much the Index Crediting Base will be reduced after a transfer or withdrawal. See Surrenders and Withdrawals. Once you reach the End Date of the Indexed Term, there is no Interim Value, and the actual performance will be credited to or deducted from your Indexed Segment based on the Performance Rate (with a Cap or Protection Level) as described above. The Interim Value calculation will vary depending on the Indexed Account selected.

The Interim Value calculation is designed to represent the fair value of the Indexed Segment on each Business Day, taking into account the potential gain or loss of the applicable Index at the end of the Indexed Term, including the impacts of the Cap and Protection Level. The calculation is also designed to reflect the change in fair value due to economic factors, including, but not limited to, the impact of market rates, volatility, and correlation (if applicable) of the investment instruments supporting the contract. The Interim Value is based on this calculation and not the actual value of any underlying investments or the current value of any index.

The specifics of the Interim Value calculation are in Appendix A of this prospectus. In simplified terms, the calculation is the lesser of A or B:

A = the present value of the Indexed Crediting Base (or, for Annual Lock Indexed Accounts, the initial Crediting Base, as adjusted for transactions) plus the current fair value of a replicating package of derivatives that replicates the Segment Maturity Value (if it was held to the End Date) based on the Index Performance and taking into account the Protection Level and Performance Cap.

B = the Indexed Crediting Base times (1 + the pro rata portion of the Performance Cap) (which is calculated differently for the 6 year Annual Lock method).

The following examples demonstrate how the Interim Value is calculated in different scenarios for Indexed Segments without an Annual Lock.    

	1 Year	6 Year	6 Year
Indexed Term length	12 months	72 months	72 months
Months since Indexed Term Start Date	9	69	15
Indexed Crediting Base	$1,000	$1,000	$1,000
Protection Level	10%	10%	10%
Performance Cap	7.25%	82%	82%
Months to End Date	3	3	57

Change in Index Value is -30%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$(198)	$(197)	$(165)
3. Sum of 1 + 2	$796	$800	$771
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$796	$800	$771

Change in Index Value is -10%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$(20)	$(20)	$(5)
3. Sum of 1 + 2	$973	$977	$932
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$973	$977	$932

20

Change in Index Value is 20%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$68	$203	$231
3. Sum of 1 + 2	$1,061	$1,200	$1,167
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$1,054	$1,200	$1,167

Change in Index Value is 40%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$71	$401	$353
3. Sum of 1 + 2	$1,064	$1,398	$1,289
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$1,054	$1,398	$1,171

Refer to the Surrender and Withdrawal section for information about the Interim Value and how surrenders or withdrawals are calculated.

Variable Annuity Account (VAA)

On November 3, 1997, the VAA was established as an insurance company separate account under Indiana law. It is registered with the SEC as a unit investment trust under the provisions of the Investment Company Act of 1940 (1940 Act). The VAA is a segregated investment account, meaning that its assets may not be charged with liabilities resulting from any other business that we may conduct. Income, gains and losses, whether realized or not, from assets allocated to the VAA are, in accordance with the applicable annuity contracts, credited to or charged against the VAA. They are credited or charged without regard to any other income, gains or losses of Lincoln Life. We are the issuer of the contracts and the obligations set forth in the contract, other than those of the Contractowner, are ours. The VAA satisfies the definition of a separate account under the federal securities laws. We do not guarantee the investment performance of the VAA. Any investment gain or loss depends on the investment performance of the funds. You assume the full investment risk for all amounts allocated to the VAA.

The VAA is used to support other annuity contracts offered by us in addition to the contracts described in this prospectus. The other annuity contracts supported by the VAA generally invest in the same funds as the contracts described in this prospectus. These other annuity contracts may have different charges that could affect the performance of their Subaccounts, and they offer different benefits.

Investments of the Variable Annuity Account

You decide the Subaccount(s) to which you allocate Purchase Payments. There is a separate Subaccount which corresponds to each class of each fund. You may change your allocation without penalty or charges. Shares of the funds will be sold at net asset value with no initial sales charge to the VAA in order to fund the contracts. The funds are required to redeem fund shares at net asset value upon our request.

Investment Advisers

As compensation for its services to the funds, each investment adviser for each fund receives a fee from the funds which is accrued daily and paid monthly. This fee is based on the net assets of each fund, as defined in the prospectuses for the funds.

Certain Payments We Receive with Regard to the Funds

We (and/or our affiliates) incur expenses in promoting, marketing, and administering the contracts and the underlying funds. With respect to a fund, including affiliated funds, the adviser and/or distributor, or an affiliate thereof, may make payments to us (or an affiliate) for certain services we provide on behalf of the funds. Such services include, but are not limited to, recordkeeping; aggregating and processing purchase and redemption orders; providing Contractowners with statements showing their interests within the funds; processing dividend payments; providing subaccounting services; and forwarding shareholder communications, such as proxies, shareholder reports, tax notices, and printing and delivering prospectuses and updates to Contractowners. It is anticipated that

21

such payments will be based on a percentage of assets of the particular fund attributable to the contracts along with certain other variable contracts issued or administered by us (or an affiliate). These percentages are negotiated and vary with each fund. Some advisers and/or distributors may pay us significantly more than other advisors and/or distributors and the amount we receive may be substantial. These percentages currently range up to 0.43%, and as of the date of this prospectus, we were receiving payments from most fund families. We (or our affiliates) may profit from these payments. These payments may be derived, in whole or in part, from the investment advisory fee deducted from fund assets. Contractowners, through their indirect investment in the funds, bear the costs of these investment advisory fees (see the funds' prospectuses for more information). Additionally, a fund's adviser and/or distributor or its affiliates may provide us with certain services that assist us in the distribution of the contracts and may pay us and/or certain affiliates amounts for marketing programs and sales support, as well as amounts to participate in training and sales meetings.

In addition to the payments described above, all of the funds offered as part of this contract make payments to us under their distribution plans (12b-1 plans) for the marketing and distribution of fund shares. The payment rates range up to 0.35% based on the amount of assets invested in those funds. Payments made out of the assets of the fund will reduce the amount of assets that otherwise would be available for investment, and will reduce the fund's investment return. The dollar amount of future asset-based fees is not predictable because these fees are a percentage of the fund's average net assets, which can fluctuate over time. If, however, the value of the fund goes up, then so would the payment to us (or our affiliates). Conversely, if the value of the funds goes down, payments to us or our affiliates would decrease.

Description of the Funds

Each of the Subaccounts of the VAA is invested solely in shares of one of the funds available under the contract. Each fund may be subject to certain investment policies and restrictions which may not be changed without a majority vote of shareholders of that fund.

We select the funds offered through the contract based on several factors, including, without limitation, asset class coverage, the strength of the manager's reputation and tenure, brand recognition, performance, the capability and qualification of each sponsoring investment firm, and whether the fund is affiliated with us. Another factor we consider during the initial selection process is whether the fund or an affiliate of the fund will make payments to us or our affiliates. We review each fund periodically after it is selected. We reserve the right to remove a fund or restrict allocation of additional Purchase Payments to a fund if we determine the fund no longer meets one or more of the factors and/or if the fund has not attracted significant Contractowner assets. Finally, when we develop a variable annuity product in cooperation with a fund family or distributor (e.g., a “private label” product), we generally will include funds based on recommendations made by the fund family or distributor, whose selection criteria may differ from our selection criteria.

Following are brief summaries of the fund descriptions. More detailed information may be obtained from the current prospectus for each fund. You should read each fund prospectus carefully before investing. Prospectuses for each fund are available by contacting us. In addition, if you receive a summary prospectus for a fund, you may obtain a full statutory prospectus by referring to the contact information for the fund company on the cover page of the summary prospectus. Please be advised that there is no assurance that any of the funds will achieve their stated objectives.

AIM Variable Insurance Funds (Invesco Variable Insurance Funds), advised by Invesco Advisers, Inc.

• Invesco V.I. Equally-Weighted S&P 500 Fund (Series II Shares): To seek to achieve a high level of total return on its assets through a combination of capital appreciation and current income.

American Funds Insurance Series^®, advised by Capital Research and Management Company

• American Funds Asset Allocation Fund (Class 4): High total return (including income and capital gains) consistent with preservation of capital over the long term.

• American Funds Growth Fund (Class 4): Growth of capital.

BlackRock Variable Series Funds, Inc., advised by BlackRock Advisors, LLC

• BlackRock Global Allocation V.I. Fund (Class III): High total investment return.

Fidelity^® Variable Insurance Products, advised by Fidelity Management and Research Company

• Fidelity^® VIP Mid Cap Portfolio (Service Class 2): Long-term growth of capital.

First Trust Variable Insurance Trust, advised by First Trust Advisors L.P.

• First Trust/Dow Jones Dividend & Income Allocation Portfolio (Class I): To provide total return by allocating among dividend-paying stocks and investment grade bonds.

Franklin Templeton Variable Insurance Products Trust, advised by Franklin Advisers, Inc. for the Franklin Income VIP Fund

• Franklin Rising Dividends VIP Fund (Class 4): Long-term capital appreciation; preservation of capital is also an important consideration.

22

JPMorgan Insurance Trust, advised by J.P. Morgan Investment Management Inc.

• JPMorgan Insurance Trust Core Bond Portfolio (Class 2): To maximize total return by investing primarily in a diversified portfolio of intermediate and long-term debt securities.

Lincoln Variable Insurance Products Trust, advised by Lincoln Investment Advisors Corporation

• LVIP Government Money Market Fund (Service Class): Current income while (i) maintaining a stable value of your shares (providing stability of net asset value) and (ii) preserving the value of your initial investment (preservation of capital).

• LVIP MFS Value Fund (Service Class): Capital appreciation.

• LVIP PIMCO Low Duration Bond Fund (Service Class): To seek a high level of current income consistent with preservation of capital.

• LVIP SSGA International Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of a broad market index of non-U.S. foreign securities.

• LVIP SSGA S&P 500 Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the total rate of return of common stocks publicly traded in the United States, as represented by the S&P 500 Index.

• LVIP SSGA Small-Cap Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of the Russell 2000^® Index, which emphasizes stocks of small U.S. companies.

Fund Shares

We will purchase shares of the funds at net asset value and direct them to the appropriate Subaccounts of the VAA. We will redeem sufficient shares of the appropriate funds to pay Annuity Payouts, Death Benefits, surrender/withdrawal proceeds or for other purposes described in the contract. If you want to transfer all or part of your investment from one Subaccount to another, we may redeem shares held in the first Subaccount and purchase shares of the other. Redeemed shares are retired, but they may be reissued later.

Shares of the funds are not sold directly to the general public. They are sold to us, and may be sold to other insurance companies, for investment of the assets of the Subaccounts established by those insurance companies to fund variable annuity and variable life insurance contracts.

When a fund sells any of its shares both to variable annuity and to variable life insurance separate accounts, it is said to engage in mixed funding. When a fund sells any of its shares to separate accounts of unaffiliated life insurance companies, it is said to engage in shared funding.

The funds currently engage in mixed and shared funding. Therefore, due to differences in redemption rates or tax treatment, or other considerations, the interest of various Contractowners participating in a fund could conflict. Each of the fund’s Board of Directors will monitor for the existence of any material conflicts, and determine what action, if any, should be taken. The funds do not foresee any disadvantage to Contractowners arising out of mixed or shared funding. If such a conflict were to occur, one of the separate accounts might withdraw its investment in a fund. This might force a fund to sell portfolio securities at disadvantageous prices. See the prospectuses for the funds.

Reinvestment of Dividends and Capital Gain Distributions

All dividends and capital gain distributions of the funds are automatically reinvested in shares of the distributing funds at their net asset value on the date of distribution. Dividends are not paid out to Contractowners as additional units, but are reflected as changes in unit values.

Addition, Deletion or Substitution of Investments

We reserve the right, within the law, to make certain changes to the structure and operation of the VAA at our discretion and without your consent. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. New or substitute funds may have different fees and expenses, and may only be offered to certain classes of Contractowners.

Substitutions may be made with respect to existing investments or the investment of future Purchase Payments, or both. We may close Subaccounts to allocations of Purchase Payments or Contract Value, or both, at any time in our sole discretion. The funds, which sell their shares to the Subaccounts pursuant to participation agreements, also may terminate these agreements and discontinue offering their shares to the Subaccounts.

We may also:

• remove, combine, or add Subaccounts and make the new Subaccounts available to you at our discretion;

• transfer assets supporting the contracts from one Subaccount to another or from the VAA to another separate account;

• combine the VAA with other separate accounts and/or create new separate accounts;

• deregister the VAA under the 1940 Act; and

23

• operate the VAA as a management investment company under the 1940 Act or as any other form permitted by law.

We may modify the provisions of the contracts to reflect changes to the Subaccounts and the VAA and to comply with applicable law. We will not make any changes without any necessary approval by the SEC. We will also provide you written notice.

Charges and Other Deductions

We will deduct the charges described below to cover our costs and expenses, services provided and risks assumed under the contracts. We incur certain costs and expenses for the distribution and administration of the contracts and for providing the benefits payable thereunder.

Our administrative services include:

• processing applications for and issuing contracts;

• processing purchases and redemptions of fund shares and from Indexed Accounts as required (including portfolio rebalancing, and automatic withdrawal services if available – See Additional Services and the SAI for more information on these programs);

• maintaining records;

• administering Annuity Payouts;

• furnishing accounting and valuation services (including the calculation and monitoring of daily Subaccount values, Indexed Contract Values and Interim Values);

• reconciling and depositing cash receipts;

• providing contract confirmations;

• providing toll-free inquiry services; and

• furnishing telephone and other electronic surrenders, withdrawals and fund transfer services.

The risks we assume include:

• the risk that Annuitants upon which Annuity Payouts are based live longer than we assumed when we calculated our guaranteed rates (these rates are incorporated in the contract and cannot be changed);

• the risk that our costs in providing the services will exceed our revenues from contract charges (which we cannot change);

• the risks related to absorbing losses equal to the Protection Levels in Indexed Accounts; and

• the risk that Death Benefits paid will exceed the actual Contract Value.

The amount of a charge may not necessarily correspond to the costs associated with providing the services or benefits indicated by the description of the charge. Any remaining expenses will be paid from our general account which may consist, among other things, of proceeds derived from mortality and expense risk charges deducted from the account. We may profit from one or more of the fees and charges deducted under the contract and from amounts earned on the Indexed Accounts. We may use these profits for any corporate purpose, including financing the distribution of the contracts.

Deductions from the VAA

For the base contract, we apply to the average daily net asset value of the Subaccounts a Product Charge which is equal to an annual rate of:

Guarantee of Principal Death Benefit	0.30%
Account Value Death Benefit	0.10%

*0.10% of the Product Charge is attributable to an administrative charge, and the remaining amount is attributable to a mortality and expense risk charge.

Rider Charge

i4LIFE^® Indexed Advantage Charge. While this rider is in effect, there is a charge for i4LIFE^® Indexed Advantage. The current annual rider charge rate is 0.40%. This charge is in addition to the applicable Death Benefit charge assessed against the Subaccounts. This charge is based on your Account Value at the beginning of the Rider Year less the Periodic Income Payment(s) for that year. The charge will be deducted from the Account Value in a lump sum at the end of each Rider Anniversary beginning with the first Rider Year anniversary. This deduction will be made proportionately from Subaccount(s) and the Indexed Segment(s), and then from the Periodic Income Payment Account, if the value of the Subaccounts and the Indexed Segments has reached zero. During the Lifetime Income Period, the charge will reduce the Periodic Income Payment for each Indexed Segment, and the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The rider charge will be discontinued upon termination of the rider. A portion of the rider charge, based on the number of days the rider was in effect that Rider Year, will be deducted upon termination of the rider (except for death) or surrender of the contract.

24

Deductions for Premium Taxes

Any premium tax or other tax levied by any governmental entity as a result of the existence of the contracts or the VAA will be deducted from the Contract Value, unless the governmental entity dictates otherwise, when incurred, or at another time of our choosing.

The applicable premium tax rates that states and other governmental entities impose on the purchase of an annuity are subject to change by legislation, by administrative interpretation or by judicial action. These premium tax rates generally depend upon the law of your state of residence. The tax rates range from zero to 5%.

Other Charges and Deductions

The mortality and expense risk and administrative charge of 0.10% of the value in the VAA will be assessed on all variable Annuity Payouts, except for i4LIFE^® Indexed Advantage, which has a different charge, including options that may be offered that do not have a life contingency and therefore no mortality risk. This charge covers the expense risk and administrative services listed previously in this prospectus. The expense risk is the risk that our costs in providing the services will exceed our revenues from contract charges.

There are additional deductions from and expenses paid out of the assets of the underlying funds that are more fully described in the prospectuses for the funds. Among these deductions and expenses are 12b-1 fees which reimburse us or an affiliate for certain expenses incurred in connection with certain administrative and distribution support services provided to the funds.

Additional Information

The charges described previously may be reduced or eliminated for any particular contract. However, these reductions may be available only to the extent that we anticipate lower distribution and/or administrative expenses, or that we perform fewer sales or administrative services than those originally contemplated in establishing the level of those charges, or when required by law. Lower distribution and administrative expenses may be the result of economies associated with:

• the use of mass enrollment procedures,

• the performance of administrative or sales functions by the employer,

• the use by an employer of automated techniques in submitting deposits or information related to deposits on behalf of its employees,

• the issue of a new Lincolncontract with the proceeds from the surrender of an existing Lincoln variable annuity contract, if available in your state, or

• any other circumstances which reduce distribution or administrative expenses.

The exact amount of charges and fees applicable to a particular contract will be stated in that contract.

The maximum commission paid to broker-dealers selling this contract is 6% of Purchase Payments. See Distribution of the Contracts for further information.

The Contracts

Contracts Offered in this Prospectus

This contract offers you Indexed Accounts, Subaccounts, the optional Guarantee of Principal Death Benefit, and various Annuity Payout options.

Purchase of Contracts

If you wish to purchase a contract, you must apply for it through a registered representative authorized by us. The completed application is sent to us and we decide whether to accept or reject it. If the application is accepted, a contract is prepared and executed by our legally authorized officers. The contract is then sent to you either directly or through your registered representative. See Distribution of the Contracts. The purchase of multiple contracts with identical Contractowners, Annuitants and Beneficiaries will be allowed only upon Home Office approval.

When a completed application and all other information necessary for processing a purchase order is received in Good Order at our Home Office, an initial Purchase Payment will be priced no later than two business days after we receive the order. If you submit your application and/or initial Purchase Payment to your registered representative, we will not begin processing your purchase order until we receive the application and initial Purchase Payment from your registered representative’s broker-dealer. While attempting to finish an incomplete application, we may hold the initial Purchase Payment for no more than five business days unless we receive your consent to our retaining the payment until the application is completed. If the incomplete application cannot be completed within those five days and we have not received your consent, you will be informed of the reasons, and the Purchase Payment will be returned immediately. Once the application is complete, we will allocate your initial Purchase Payment within two business days.

25

The Guarantee of Principal Death Benefit is available for both qualified and nonqualified contracts, and can only be elected at the time the contract is purchased.

Who Can Invest

To apply for a contract, you must be of legal age in a state where the contracts may be lawfully sold and also be eligible to participate in any of the qualified or nonqualified plans for which the contracts are designed. At the time of issue, the Contractowner, joint owner and Annuitant must be under age 86. The oldest of the Contractowner, joint owner, and Annuitant must be under age 76 to elect the Guarantee of Principal Death Benefit. Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account in an effort to help the government fight the funding of terrorism and money laundering activities. When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license, photo i.d. or other identifying documents.

In accordance with anti-money laundering laws and federal economic sanction policy, the Company may be required in a given instance to reject a Purchase Payment and/or freeze a Contractowner’s account. This means we could refuse to honor requests for transfers, withdrawals, surrenders or Death Benefits. Once frozen, monies would be moved from the VAA and Indexed Account to an interest-bearing account maintained solely for the Contractowner, and held in that account until instructions are received from the appropriate regulator.

Do not purchase this contract if you plan to use it, or any of its riders, for speculation, arbitrage, viatical arrangement, or other similar investment scheme. The contract may not be resold, traded on any stock exchange, or sold on any secondary market.

If you are purchasing the contract through a tax-favored arrangement, including traditional IRAs and Roth IRAs, you should consider carefully the costs and benefits of the contract (including annuity income benefits) before purchasing the contract, since the tax-favored arrangement itself provides tax-deferred growth.

Replacement of Existing Insurance

Careful consideration should be given prior to surrendering or withdrawing money from an existing insurance contract to purchase a contract described in this prospectus. Surrender charges may be imposed on your existing contract. The benefits offered under this contract may be less favorable or more favorable than the benefits offered under your current contract. It also may have different charges. You should also consult with your registered representative and/or your tax advisor prior to making an exchange. Cash surrenders from an existing contract may be subject to tax and tax penalties.

Purchase Payments

You may make Purchase Payments to the contract at any time, prior to the Annuity Commencement Date, subject to certain conditions. You are not required to make any additional Purchase Payments after the initial Purchase Payment. The minimum initial Purchase Payment is $25,000. The minimum for Selling Group Individuals is $1,500. Please check with your registered representative about making additional Purchase Payments since the requirements of your state may vary. The minimum payment to the contract at any one time must be at least $100 ($25 if transmitted electronically). If a Purchase Payment is submitted that does not meet the minimum amount, we will contact you to ask whether additional money will be sent, or whether we should return the Purchase Payment to you.

Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. If you stop making Purchase Payments, the contract will remain in force, however, we may terminate the contract as allowed by your state's non-forfeiture law for individual deferred annuities. Purchase Payments may be made or, if stopped, resumed at any time until the Annuity Commencement Date, the surrender of the contract, or the death of the Contractowner, whichever comes first.

In addition to the specific Purchase Payment restrictions and limitations immediately above, upon advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract.

These restrictions and limitations will limit your ability to increase your Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments to the contract. You should carefully consider these limitations and restrictions, and any other limitations and restrictions of the contract, and how they may impact your long-term investment plans, especially if you intend to increase Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments over a long period of time.

Valuation Date

Accumulation and Annuity Units and Indexed Segments will be valued once daily at the close of trading (normally, 4:00 p.m., New York time) on each day the New York Stock Exchange is open (Valuation Date). On any date other than a Valuation Date, the Accumulation Unit value and the Annuity Unit value and value of the Indexed Segment will not change.

26

Allocation of Purchase Payments

Purchase Payments will be allocated, according to your instructions, among one or more of the investment options available under your contract. Allocation made to the variable side of the contract are placed into the VAA’s Subaccounts. You may also allocate Purchase Payments to the available Indexed Accounts.

Allocations to the Subaccounts. The minimum amount that can be put into any one Subaccount is $20. Purchase Payments received from you or your broker-dealer in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time), will be processed using the Accumulation Unit value computed on that Valuation Date. Purchase Payments received in Good Order after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. Purchase Payments submitted to your registered representative will generally not be processed until they are received from your representative’s broker-dealer. Purchase Payments submitted to us by your broker-dealer through the Depository Trust and Clearing Corporation (DTCC) or, pursuant to terms agreeable to us, uses a proprietary order placement system to submit your Purchase Payment to us, and your Purchase Payment was placed with your broker-dealer prior to market close, then we will use the Accumulation Unit value computed on that Valuation Date when processing your Purchase Payment. Purchase Payments placed with your broker-dealer after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances, Purchase Payments received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date.

The number of Accumulation Units determined in this way is not impacted by any subsequent change in the value of an Accumulation Unit. However, the dollar value of an Accumulation Unit will vary depending not only upon how well the underlying fund’s investments perform, but also upon the expenses of the VAA and the underlying funds.

Allocations to the Indexed Accounts. The minimum amount that may be allocated into an Indexed Account is $2,000. An initial Purchase Payment that is received in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time) will be allocated to the Indexed Accounts according to your instructions. The date this initial allocation occurs is the first date of the Indexed Term and the Indexed Anniversary Date. Allocations cannot be made on February 29^th. After the Indexed Anniversary Date is established, that is the only date each year that allocations can be invested in the Indexed Accounts. If additional Purchase Payments for the Indexed Accounts are received prior to the Indexed Anniversary Date, these Purchase Payments must be accompanied with instructions to invest in a variable Subaccount until the Purchase Payment can be allocated to the Indexed Account. We will hold allocation instructions for the Indexed Accounts for up to 25 calendar days prior to the Indexed Anniversary Date.

A rate hold is available for Purchase Payments received within thirty days from the date your application is received at our Home Office. The rate hold will provide the Performance Cap and the Protection Level for your elected Indexed Account that were in effect on the date your application was received at the Home Office for any Purchase Payments allocated to the Indexed Accounts during this 30-day period. If you elect the rate hold, all Purchase Payments will be held in a non-interest bearing transfer account for 30 days (or the next Valuation Day), and then will be allocated to the Indexed Account(s) selected. Purchase Payments received after day 30 will be allocated to the variable Subaccounts you selected. If no variable Subaccounts were selected, these Purchase Payments will be allocated to the LVIP PIMCO Low Duration Bond Fund. You can allocate to Indexed Accounts on the next Indexed Anniversary Date.

Valuation of Accumulation Units

Purchase Payments allocated to the VAA are converted into Accumulation Units. This is done by dividing the amount allocated by the value of an Accumulation Unit for the Valuation Period during which the Purchase Payments are allocated to the VAA. The Accumulation Unit value for each Subaccount was or will be established at the inception of the Subaccount. It may increase or decrease from Valuation Period to Valuation Period. Accumulation Unit values are affected by investment performance of the funds, fund expenses, and the contract charges. The Accumulation Unit value for a Subaccount for a later Valuation Period is determined as follows:

1.	The total value of the fund shares held in the Subaccount is calculated by multiplying the number of fund shares owned by the Subaccount at the beginning of the Valuation Period by the net asset value per share of the fund at the end of the Valuation Period, and adding any dividend or other distribution of the fund if an ex-dividend date occurs during the Valuation Period; minus
2.	The liabilities of the Subaccount at the end of the Valuation Period; these liabilities include daily charges imposed on the Subaccount, and may include a charge or credit with respect to any taxes paid or reserved for by us that we determine result from the operations of the VAA; and
3.	The result is divided by the number of Subaccount units outstanding at the beginning of the Valuation Period.

The daily charges imposed on a Subaccount for any Valuation Period are equal to the daily Product Charge multiplied by the number of calendar days in the Valuation Period. Contracts with different features have different daily charges, and therefore, will have different corresponding Accumulation Unit values on any given day. In certain circumstances (for example, when separate account assets are less than $1,000), and when permitted by law, it may be prudent for us to use a different standard industry method for this calculation, called the Net Investment Factor method. We will achieve substantially the same result using either method.

27

Transfers On or Before the Annuity Commencement Date

After the first 30 days from the effective date of your contract, you may transfer all or a portion of your investment from one Subaccount to another. A transfer among Subaccounts involves the surrender of Accumulation Units in one Subaccount and the purchase of Accumulation Units in the other Subaccount. A transfer will be done using the respective Accumulation Unit values determined at the end of the Valuation Date on which the transfer request is received.

Transfers (among the Subaccounts and as permitted between the Subaccounts and Indexed Accounts) are limited to 12 per Contract Year unless otherwise authorized by us. This limit does not apply to transfers made under the automatic transfer programs of portfolio rebalancing programs elected on forms available from us. See Additional Services and the SAI for more information on these programs. These transfer rights and restrictions also apply during the i4LIFE^® Indexed Advantage Access Period (the time period during which you may make withdrawals from the i4LIFE^® Indexed Advantage Account Value). See i4LIFE^® Indexed Advantage.

Transfers into a new Indexed Account are only available on the Indexed Anniversary Date. Transfers are not allowed into an existing Indexed Segment. Transfers from Indexed Segments prior to the end of the Indexed Term will be valued at the Interim Value. In addition, the Indexed Crediting Base is reduced proportionately by the amount that the transfer reduced the Interim Value. You cannot transfer an amount greater than your Interim Value.

The minimum amount which may be transferred between Subaccounts is $300 (or the entire amount in the Subaccount, if less than $300). If the transfer from a Subaccount would leave you with less than $300 in the Subaccount, we may transfer the total balance of the Subaccount.

A transfer request may be made to our Home Office in writing, or by fax or other electronic means. A transfer request may also be made by telephone provided the appropriate authorization is on file with us. Our address, telephone number, and Internet address are on the first page of this prospectus. Requests for transfers will be processed on the Valuation Date that they are received when they are received in Good Order at our Home Office before the close of the New York Stock Exchange (normally 4:00 p.m., New York time). If we receive a transfer request in Good Order after market close, we will process the request using the Accumulation Unit value computed on the next Valuation Date.

There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances transfers received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date. We will hold a transfer request to move Contract Value from the Subaccounts to the Indexed Accounts for up to 25 days prior to the Indexed Anniversary Date. During this time, your assets will remain in the Subaccounts previously selected by you.

We may defer or reject a transfer request that is subject to a restriction imposed by an underlying fund.

Transfers may be delayed as permitted by the 1940 Act. See Delay of Payments.

Telephone and Electronic Transactions

A surrender, withdrawal, or transfer request may be made to our Home Office using a fax or other electronic means. In addition, withdrawal and transfer requests may be made by telephone, subject to certain restrictions. In order to prevent unauthorized or fraudulent transfers, we may require certain identifying information before we will act upon instructions. We may also assign the Contractowner a Personal Identification Number (PIN) to serve as identification. We will not be liable for following instructions we reasonably believe are genuine. Telephone and other electronic requests will be recorded and written confirmation of all transactions will be mailed to the Contractowner on the next Valuation Date.

Please note that the telephone and/or electronic devices may not always be available. Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s, 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 limit these problems, we cannot promise complete reliability under all circumstances. If you are experiencing problems, you should make your request by writing to our Home Office.

Market Timing

Frequent, large, or short-term transfers among Subaccounts, such as those associated with “market timing” transactions, can affect the funds and their investment returns. Such transfers may dilute the value of the fund shares, interfere with the efficient management of the fund's portfolio, and increase brokerage and administrative costs of the funds. As an effort to protect our Contractowners and the funds from potentially harmful trading activity, we utilize certain market timing policies and procedures (the “Market Timing Procedures”). Our Market Timing Procedures are designed to detect and prevent such transfer activity among the Subaccounts and the Indexed Accounts that may affect other Contractowners or fund shareholders.

In addition, the funds may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares. The prospectuses for the funds describe any such policies and procedures, which may be more or less restrictive than the frequent trading policies and procedures of other funds and the Market Timing Procedures we have adopted to discourage frequent transfers among Subaccounts. While we reserve the right to enforce these policies and procedures,

28

Contractowners and other persons with interests under the contracts should be aware that we may not have the contractual authority or the operational capacity to apply the frequent trading policies and procedures of the funds. However, under SEC rules, we are required to: (1) enter into a written agreement with each fund or its principal underwriter that obligates us to provide to the fund promptly upon request certain information about the trading activity of individual Contractowners, and (2) execute instructions from the fund to restrict or prohibit further purchases or transfers by specific Contractowners who violate the excessive trading policies established by the fund.

You should be aware that the purchase and redemption orders received by the funds generally are “omnibus” orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. The omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan participants and/or individual owners of variable insurance contracts. The omnibus nature of these orders may limit the funds’ ability to apply their respective disruptive trading policies and procedures. We cannot guarantee that the funds (and thus our Contractowners) will not be harmed by transfer activity relating to the retirement plans and/or other insurance companies that may invest in the funds. In addition, if a fund believes that an omnibus order we submit may reflect one or more transfer requests from Contractowners engaged in disruptive trading activity, the fund may reject the entire omnibus order.

Our Market Timing Procedures detect potential “market timers” by examining the number of transfers made by Contractowners within given periods of time. In addition, managers of the funds might contact us if they believe or suspect that there is market timing. If requested by a fund company, we may vary our Market Timing Procedures from Subaccount to Subaccount to comply with specific fund policies and procedures.

We may increase our monitoring of Contractowners who we have previously identified as market timers. When applying the parameters used to detect market timers, we will consider multiple contracts owned by the same Contractowner if that Contractowner has been identified as a market timer. For each Contractowner, we will investigate the transfer patterns that meet the parameters being used to detect potential market timers. We will also investigate any patterns of trading behavior identified by the funds that may not have been captured by our Market Timing Procedures.

Once a Contractowner has been identified as a market timer under our Market Timing Procedures, we will notify the Contractowner in writing that future transfers (among the Subaccounts and/or the Indexed Account) will be temporarily permitted to be made only by original signature sent to us by U.S. mail, first-class delivery for the remainder of the Contract Year (or calendar year if the contract is an individual contract that was sold in connection with an employer sponsored plan). Overnight delivery or electronic instructions (which may include telephone, facsimile, or Internet instructions) submitted during this period will not be accepted. If overnight delivery or electronic instructions are inadvertently accepted from a Contractowner that has been identified as a market timer, upon discovery, we will reverse the transaction within 1 or 2 business days. We will impose this “original signature” restriction on that Contractowner even if we cannot identify, in the particular circumstances, any harmful effect from that Contractowner's particular transfers.

Contractowners seeking to engage in frequent, large, or short-term transfer activity may deploy a variety of strategies to avoid detection. Our ability to detect such transfer activity may be limited by operational systems and technological limitations. The identification of Contractowners determined to be engaged in such transfer activity that may adversely affect other Contractowners or fund shareholders involves judgments that are inherently subjective. We cannot guarantee that our Market Timing Procedures will detect every potential market timer. If we are unable to detect market timers, you may experience dilution in the value of your fund shares and increased brokerage and administrative costs in the funds. This may result in lower long-term returns for your investments.

Our Market Timing Procedures are applied consistently to all Contractowners. An exception for any Contractowner will be made only in the event we are required to do so by a court of law. In addition, certain funds available as investment options in your contract may also be available as investment options for owners of other, older life insurance policies issued by us. Some of these older life insurance policies do not provide a contractual basis for us to restrict or refuse transfers which are suspected to be market timing activity. In addition, because other insurance companies and/or retirement plans may invest in the funds, we cannot guarantee that the funds will not suffer harm from frequent, large, or short-term transfer activity among Subaccounts or the Indexed Accounts of variable contracts issued by other insurance companies or among investment options available to retirement plan participants.

In our sole discretion, we may revise our Market Timing Procedures at any time without prior notice as necessary to better detect and deter frequent, large, or short-term transfer activity to comply with state or federal regulatory requirements, and/or to impose additional or alternate restrictions on market timers (such as dollar or percentage limits on transfers). If we modify our Market Timing Procedures, they will be applied uniformly to all Contractowners or as applicable to all Contractowners investing in underlying funds.

Some of the funds have reserved the right to temporarily or permanently refuse payments or transfer requests from us if, in the judgment of the fund’s investment adviser, the fund would be unable to invest effectively in accordance with its investment objective or policies, or would otherwise potentially be adversely affected. To the extent permitted by applicable law, we reserve the right to defer or reject a transfer request at any time that we are unable to purchase or redeem shares of any of the funds available through the VAA, including any refusal or restriction on purchases or redemptions of the fund shares as a result of the funds' own policies and procedures on market timing activities. If a fund refuses to accept a transfer request we have already processed, we will reverse the transaction within 1 or 2 business days. We will notify you in writing if we have reversed, restricted or refused any of your transfer

29

requests. Some funds also may impose redemption fees on short-term trading (i.e., redemptions of mutual fund shares within a certain number of business days after purchase). We reserve the right to administer and collect any such redemption fees on behalf of the funds. You should read the prospectuses of the funds for more details on their redemption fees and their ability to refuse or restrict purchases or redemptions of their shares.

Transfers After the Annuity Commencement Date

You may transfer all or a portion of your investment in one Subaccount to another Subaccount, as permitted under your contract. Those transfers will be limited to three times per Contract Year. You may also transfer from a variable Annuity Payout to a fixed Annuity Payout. You may not transfer from a fixed Annuity Payout to a variable Annuity Payout. Once elected, the fixed Annuity Payout is irrevocable. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation.

Ownership

The Contractowner on the date of issue will be the person or entity designated in the contract specifications. The Contractowner of a nonqualified contract may name a joint owner.

As Contractowner, you have all rights under the contract. According to Indiana law, the assets of the VAA are held for the exclusive benefit of all Contractowners and their designated Beneficiaries; and the assets of the VAA are not chargeable with liabilities arising from any other business that we may conduct. We reserve the right to approve all ownership and Annuitant changes. Nonqualified contracts may not be sold, discounted, or pledged as collateral for a loan or for any other purpose. Qualified contracts are not transferable unless allowed under applicable law. Nonqualified contracts may not be collaterally assigned. Assignments may have an adverse impact on your Death Benefits and may be prohibited under the terms of a particular feature. We assume no responsibility for the validity or effect of any assignment. Consult your tax advisor about the tax consequences of an assignment.

Joint Ownership

If a contract has joint owners, the joint owners shall be treated as having equal undivided interests in the contract. Either owner, independently of the other, may exercise any ownership rights in this contract. Not more than two owners (an owner and joint owner) may be named and contingent owners are not permitted.

Annuitant

The following rules apply prior to the Annuity Commencement Date. You may name only one Annuitant (unless you are a tax-exempt entity, then you can name two joint Annuitants). You (if the Contractowner is a natural person) have the right to change the Annuitant at any time by notifying us in writing of the change. However, we reserve the right to approve all Annuitant changes. This may not be allowed if certain riders are in effect. The new Annuitant must be under age 86 as of the effective date of the change. A contingent Annuitant may be named or changed by notifying us in writing. Contingent Annuitants are not allowed on contracts owned by non-natural owners. On or after the Annuity Commencement Date, the Annuitant or joint Annuitants may not be changed and contingent Annuitant designations are no longer applicable.

Surrenders and Withdrawals

Before the Annuity Commencement Date, we will allow the surrender of the contract or a withdrawal of the Contract Value upon your written request on an approved Lincoln distribution request form (available from the Home Office), fax, or other electronic means approved by Lincoln. Withdrawal requests may be made by telephone, subject to certain restrictions. All surrenders and withdrawals may be made in accordance with the rules discussed below. Surrender or withdrawal rights after the Annuity Commencement Date are not available.

The amount available upon surrender/withdrawal is the Contract Value less any applicable charges, fees, and taxes at the end of the Valuation Period during which the written request for surrender/withdrawal is received in Good Order at the Home Office. If we receive a surrender or withdrawal request in Good Order at our Home Office before the close of the NYSE (normally 4:00 p.m., New York time), we will process the request from the VAA using the Accumulation Unit value computed on that Valuation Date. If we receive a surrender or withdrawal request in Good Order at our Home Office after market close, we will process the request using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. There may be circumstances under which the NYSE may close early (prior to 4:00 p.m., New York time). In such instances, surrender or withdrawal requests received after such early market close will be processed using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. The minimum amount which can be withdrawn is $300. Unless a request for withdrawal specifies otherwise, withdrawals will be made in the following order:

1.	proportionately from all Subaccounts within the VAA, until exhausted; then
2.	the transfer account; then
3.	proportionately from all Indexed Accounts.

30

Unless prohibited, surrender/withdrawal payments will be mailed within seven days after we receive a valid written request at the Home Office. The payment may be postponed as permitted by the 1940 Act.

When withdrawals are made from the Indexed Accounts, an amount equal to the Interim Value of the Segment is available for surrender or withdrawal. In addition, the Indexed Crediting Base for each individual Indexed Segment is reduced proportionately by the amount that the withdrawal reduced the Interim Value. A proportional reduction could be larger than the dollar amount of the withdrawal. Reductions to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Segment Maturity Value at the end of the Indexed Term. You cannot withdraw an amount equal to the Indexed Crediting Base. The following examples show how the Index Crediting Base is impacted by a withdrawal, and assumes that you have invested in an Indexed Account and no Subaccounts.

Example 1:

1/1/2017 Allocation to Indexed Segment = $80,000
1/1/2017 Indexed Crediting Base = $80,000
6/1/2017 Indexed Crediting Base = $80,000; Interim Value = $100,000; Withdrawal = $80,000
Withdrawal/Interim Value = $80,000 ÷ $100,000 = 80%
Removed Amount from the Indexed Crediting Base = $64,000 (80% of $80,000)
Indexed Crediting Base after withdrawal = $80,000 - $64,000 = $16,000
Interim Value after withdrawal ($100,000 - $80,000) = $20,000
Interim Value calculation going forward and Segment Maturity Value will be based on the $16,000 Indexed Crediting Base

Example 2:

Indexed Crediting Base = $16,000; Interim Value = $15,000; Withdrawal = $15,000
Withdrawal/Interim Value = $15,000 ÷ $15,000 = 100%
Removed Amount from the Indexed Crediting Base = $16,000 (100% of $16,000)
Indexed Crediting Base after withdrawal = $0
Interim Value after withdrawal = $0 ($15,000 - $15,000)

Note: The $15,000 Interim Value is the maximum that could be withdrawn because this value reflects the index gain or loss during the Indexed Term. The Indexed Crediting Base is not available for withdrawal or transfer.

The tax consequences of a surrender/withdrawal are discussed later in this prospectus. See Federal Tax Matters – Taxation of Withdrawals and Surrenders.

Additional Services

These additional services may be available to you under your contract: automatic withdrawal service (AWS) and portfolio rebalancing. Currently, there is no charge for these services. However, we reserve the right to impose one after appropriate notice to Contractowners. In order to take advantage of one of these services, you will need to complete the appropriate election form that is available from our Home Office. These services will stop once we are notified of a pending death claim. For further detailed information on these services, please see Additional Services in the SAI.

Automatic Withdrawal Service. The automatic withdrawal service (AWS) provides for an automatic periodic withdrawal of your Contract Value. Withdrawals from Indexed Accounts will be at Interim Value. See – Indexed Accounts – Interim Value. Withdrawals under AWS will be noted on your quarterly statement. Confirmation statements for each individual withdrawal will not be issued. AWS is not available when i4LIFE^® Indexed Advantage is in effect.

Portfolio Rebalancing. Portfolio rebalancing is an option that restores to a pre-determined level the percentage of Contract Value allocated to each variable account Subaccount. The rebalancing may take place monthly, quarterly, semi-annually or annually. Rebalancing events will be noted on your quarterly statement. Confirmation statements for each individual rebalancing event will not be issued. Portfolio rebalancing is not available for the portion of Contract Value held in the Indexed Accounts.

Fees Associated with Fee-Based Financial Plans. You have purchased this contract as part of a Fee-Based Financial Plan whereby an investment firm or professional offers investment advice for a fee. The fee for this advice is covered in a separate agreement between you and the firm or professional, and is in addition to the fees and expenses that apply to this contract. You may elect to have the fee paid to your investment firm or professional from your Contract Value by using AWS, if certain conditions apply.

Partial withdrawals to pay the fee may be taken automatically by enrolling in an AWS designated specifically for this purpose. Withdrawals are available in monthly, quarterly, semi-annual, or annual frequencies. You may enroll in this service by completing the appropriate election form that is available from your investment adviser. Additionally, you may authorize your investment adviser to set up or change your AWS program, or to take one-time withdrawals to pay for the advisory fee. Once you have elected this service, it will continue until you instruct us in writing to terminate it. Withdrawals under this AWS option will be noted on your quarterly statement as an advisory fee withdrawal. This service may not be available through all broker-dealers.

31

This service is not available if i4LIFE^® Indexed Advantage is in effect and will automatically terminate upon election of i4LIFE^® Indexed Advantage.

These withdrawals may decrease your guarantees under a Death Benefit rider. Advisory fee withdrawals may also have tax consequences. For nonqualified contracts, partial withdrawals to pay the advisory fee will be treated as a distribution for federal tax purposes, and will be reported as income on Form 1099R. For qualified contracts, partial withdrawals to pay the advisory fee will not be reported as a distribution from the contract.

We reserve the right to discontinue any or all of these administrative services at any time.

Death Benefit

The chart below provides a brief overview of how the Death Benefit proceeds will be distributed if death occurs prior to the Annuity Commencement Date. Refer to your contract for the specific provisions applicable upon death.

upon death of:	and...	and...	Death Benefit proceeds pass to:
Contractowner	There is a surviving joint owner	The Annuitant is living or deceased	Joint owner
Contractowner	There is no surviving joint owner	The Annuitant is living or deceased	Designated Beneficiary
Contractowner	There is no surviving joint owner and the Beneficiary predeceases the Contractowner	The Annuitant is living or deceased	Contractowner's estate
Annuitant	The Contractowner is living	There is no contingent Annuitant	The youngest Contractowner becomes the contingent Annuitant and the contract continues. The Contractowner may waive* this continuation and receive the Death Benefit proceeds.
Annuitant	The Contractowner is living	The contingent Annuitant is living	Contingent Annuitant becomes the Annuitant and the contract continues
Annuitant**	The Contractowner is a trust or other non-natural person	No contingent Annuitant allowed with non-natural Contractowner	Designated Beneficiary

* Notification from the Contractowner to receive the Death Benefit proceeds must be received within 75 days of the death of the Annuitant.

** Death of Annuitant is treated like death of the Contractowner.

If the Contractowner (or a joint owner) or Annuitant dies prior to the Annuity Commencement Date, a Death Benefit may be payable. This Death Benefit terminates on the Annuity Commencement Date.

You should consider the following provisions carefully when designating the Beneficiary, Annuitant, any contingent Annuitant and any joint owner, as well as before changing any of these parties. The identity of these parties under the contract may significantly affect the amount and timing of the Death Benefit or other amount paid upon a Contractowner's or Annuitant's death.

You may designate a Beneficiary during your lifetime and change the Beneficiary by filing a written request with our Home Office. Each change of Beneficiary revokes any previous designation. We reserve the right to request that you send us the contract for endorsement of a change of Beneficiary.

Upon the death of the Contractowner, a Death Benefit will be paid to the Beneficiary. Upon the death of a joint owner, the Death Benefit will be paid to the surviving joint owner. If the Contractowner is a corporation or other non-individual (non-natural person), the death of the Annuitant will be treated as death of the Contractowner.

If an Annuitant who is not the Contractowner or joint owner dies, then the contingent Annuitant, if named, becomes the Annuitant and no Death Benefit is payable on the death of the Annuitant. If no contingent Annuitant is named, the Contractowner (or younger of joint owners) becomes the Annuitant. Alternatively, a Death Benefit may be paid to the Contractowner (and joint owner, if applicable, in equal shares). Notification of the election of this Death Benefit must be received by us within 75 days of the death of the Annuitant. The contract terminates when any Death Benefit is paid due to the death of the Annuitant.

Only the Contract Value as of the Valuation Date we approve the payment of the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

32

Account Value Death Benefit. The Account Value Death Benefit provides a Death Benefit equal to the Contract Value on the Valuation Date the Death Benefit is approved by us for payment. No additional Death Benefit is provided. (Your contract may refer to this benefit as the Contract Value Death Benefit.)

Guarantee of Principal Death Benefit. The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of:

• the Contract Value as of the Valuation Date we approve the payment of the claim; or

• the sum of all Purchase Payments decreased by all withdrawals in the same proportion that withdrawals reduce the Contract Value.

Note: The Contract Value for Indexed Segments is the Interim Value unless the claim is processed on a Segment End Date. In a declining market, withdrawals deducted in the same proportion that withdrawals reduce the Contract Value may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more that the dollar amount of the withdrawal from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals and premium taxes, if any.

The Guarantee of Principal Death Benefit may not be terminated unless you surrender the contract. In addition, the rider will terminate:

1.	on the Annuity Commencement Date;
2.	upon payment of a Death Benefit under the Guarantee of Principal Death Benefit (unless the contract is continued by the surviving spouse); or
3.	at any time all Contractowners or Annuitants are changed.

General Death Benefit Information

Your Death Benefit terminates on and after the Annuity Commencement Date. i4LIFE^® Indexed Advantage, which is an Annuity Payout option, only provides Death Benefit options during the Access Period. There are no Death Benefits during the Lifetime Income Period. Please see the i4LIFE^® Indexed Advantage – i4LIFE^® Indexed Advantage Death Benefit section of this prospectus for more information.

If there are joint owners, upon the death of the first Contractowner, we will pay a Death Benefit to the surviving joint owner. The surviving joint owner will be treated as the primary, designated Beneficiary. Any other Beneficiary designation on record at the time of death will be treated as a contingent Beneficiary. If the surviving joint owner is the spouse of the deceased joint owner, he/she may continue the contract as sole Contractowner. Upon the death of the spouse who continued the contract, we will pay the Account Value Death Benefit to the designated Beneficiary(s) unless the Guarantee of Principal Death Benefit is in effect.

If the Beneficiary is the spouse of the Contractowner, then the spouse may elect to continue the contract as the new Contractowner. In this situation, a portion of the Death Benefit may be credited to the contract. Any portion of the Death Benefit that would have been payable (if the contract had not been continued) that exceeds the current Contract Value on the Valuation Date we approve the claim will be added to the Contract Value and placed in the variable Subaccounts according to the allocations on the contract. If no variable Subaccounts are selected, the proceeds will be placed in the LVIP PIMCO Low Duration Bond Fund Subaccount. If the contract is continued in this way, the Guarantee of Principal Death Benefit rider and charge will continue. The rider charge rate that was in effect immediately prior to the death will continue to apply.

Same-sex spouses should carefully consider whether to purchase annuity products that provide benefits based upon status as a spouse, and whether to exercise any spousal rights under the contract. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

The value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of a claim submitted in Good Order or one year from the date of the death for nonqualified contracts and December 31^st of the year following death for IRAs. To be in Good Order, we require all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Unless otherwise provided in the Beneficiary designation, one of the following procedures will take place on the death of a Beneficiary:

• if any Beneficiary dies before the Contractowner, that Beneficiary’s interest will go to any other Beneficiaries named, according to their respective interests; and/or

33

• if no Beneficiary survives the Contractowner, the proceeds will be paid to the Contractowner’s estate.

If the Beneficiary is a minor, court documents appointing the guardian/custodian may be required.

The Beneficiary may choose the method of payment of the Death Benefit unless the Contractowner has already selected a settlement option. The Death Benefit payable to the Beneficiary or joint owner must be distributed within five years of the Contractowner’s date of death unless the Beneficiary begins receiving within one year of the Contractowner’s death the distribution in the form of a life annuity or an annuity for a designated period not extending beyond the Beneficiary’s life expectancy.

Note: Indexed Accounts cannot be divided into separate contracts when there are multiple beneficiaries. If more than one beneficiary chooses a death benefit option other than a lump sum, the existing Indexed Account(s) will need to be surrendered at the Interim Value to be allocated to multiple beneficiaries. New Indexed Accounts can be selected on the new contracts if desired with the currently available features.

Upon the death of the Annuitant, Federal tax law requires that an annuity election be made no later than 60 days after we have approved the death claim for payment.

The recipient of a Death Benefit may elect to receive payment either in the form of a lump sum settlement or an Annuity Payout. If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Abandoned Property. Every state has unclaimed property laws which generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from the date a benefit is due and payable. For example, if the payment of a Death Benefit has been triggered, but, if after a thorough search, we are still unable to locate the Beneficiary of the Death Benefit, or the Beneficiary does not come forward to claim the Death Benefit in a timely manner, the Death Benefit will be “escheated”. This means that the Death Benefit will be paid to the abandoned property division or unclaimed property office of the state in which the Beneficiary or the Contractowner last resided, as shown on our books and records, or to our state of domicile. This escheatment is revocable and 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 such escheatment, it is important that you update your Beneficiary designations, including addresses, if and as they change. You may update your Beneficiary designations by submitting a Beneficiary change form to our Home Office.

i4LIFE^® Indexed Advantage

i4LIFE^® Indexed Advantage is an optional Annuity Payout rider you may purchase for an additional charge, and is separate and distinct from other Annuity Payout options offered under your contract and described later in this prospectus. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information on how the charge is calculated.

i4LIFE^® Indexed Advantage provides Periodic Income Payments for life subject to certain conditions. These payments are made during two time periods: an Access Period and a Lifetime Income Period, which are discussed in further detail below. i4LIFE^® Indexed Advantage is different from other Annuity Payout options provided by Lincoln because with i4LIFE^® Indexed Advantage, you have the ability to make additional withdrawals or surrender the contract during the Access Period.

When you elect i4LIFE^® Indexed Advantage, you must choose the Annuitant and Secondary Life (if applicable). The Annuitant and Secondary Life may not be changed after i4LIFE^® Indexed Advantage is elected. For qualified contracts, the Secondary Life must be the spouse. See i4LIFE^® Indexed Advantage Death Benefit regarding the impact of a change to the Annuitant prior to the i4LIFE^® Indexed Advantage election.

Only Indexed Accounts with 1-Year Indexed Terms are available. If you elect i4LIFE^® Indexed Advantage while you are currently allocated to an Indexed Account with an Indexed Term greater than one year, the funds allocated to the Indexed Account(s) will be transferred to the LVIP PIMCO Low Duration Bond Fund at Interim Value unless you provide instructions otherwise. Additionally, once i4LIFE^® Indexed Advantage is in effect, any automatic withdrawal service will terminate.

Additional Purchase Payments may be made during the Access Period for an IRA annuity contract. Additional Purchase Payments will not be accepted at any time for a nonqualified annuity contract.

Availability. i4LIFE^® Indexed Advantage is available for contracts with a Contract Value of at least $50,000 and may be elected at the time of contract application or on any subsequent Indexed Anniversary Date by sending a written request to our Home Office. i4LIFE^® Indexed Advantage is not available if another Annuity Payout option is in effect. If you have not established an Indexed Anniversary Date, your i4LIFE^® Indexed Advantage Rider Date can be any Valuation Date.

i4LIFE^® Indexed Advantage is available on nonqualified annuities, IRAs and Roth IRAs (check with your registered representative regarding availability with SEP market). i4LIFE^® Indexed Advantage for IRA contracts is only available if the Annuitant and Secondary Life are age 59½ or older at the time the option is elected. Additional limitations on issue ages and features may be necessary to comply with federal tax law for required minimum distributions.

34

Access Period. The Access Period is a defined period of time during which we pay Periodic Income Payments and provide a Death Benefit. During this period, you may surrender the contract and make withdrawals from your Account Value (defined below). The Lifetime Income Period begins immediately at the end of the Access Period, the remaining Account Value is used to make Periodic Income Payments for the rest of your life (or the Secondary Life if applicable). During the Lifetime Income Period, you will no longer be able to make withdrawals or surrenders or receive a Death Benefit. If your Account Value is reduced to zero because of withdrawals or market loss, your Access Period ends.

The minimum and maximum Access Periods are established at the time you elect i4LIFE^® Indexed Advantage. The current Access Period requirements are outlined in the following chart:

Minimum Access Period	Maximum Access Period
The greater of 20 years or the difference between your nearest age and age 90, based on the youngest covered life if joint life is elected	The length of time between your age and age 115 for nonqualified contracts (based on the youngest covered life if joint life is elected); age 100 for qualified contracts.

You may also choose any period of time between the minimum Access Period and maximum Access Period.

Generally, shorter Access Periods will produce a higher initial Periodic Income Payment than longer Access Periods, but you will have a shorter period of time within which to access your Account Value. A longer Access Period will generally produce a lower initial Periodic Income Payment but will provide you with a longer period of time within which to access your Account Value. At any time during the Access Period, you may extend the length of the Access Period subject to Home Office approval and the Access Period rules in effect at that time. Additional restrictions may apply if you are under age 59½ when you request a change to the Access Period. Currently, if you extend the Access Period, it must be extended at least 5 years. If you change the Access Period, subsequent Periodic Income Payments will be adjusted accordingly, and the Account Value remaining at the end of the new Access Period will be applied to continue Periodic Income Payments for your life. Currently, changes to the Access Period can only be made on Rider Date anniversaries.

Additional limitations on issue ages and features may be necessary to comply with the IRC provisions for required minimum distributions. We may reduce or terminate the Access Period for IRA i4LIFE^® Indexed Advantage contracts in order to keep the Periodic Income Payments in compliance with federal tax law for required minimum distributions.

Account Value. The initial Account Value is the Contract Value on the i4LIFE^® Indexed Advantage Rider Date, less any applicable premium taxes. During the Access Period, the Account Value on a Valuation Date will equal the total value of all of the Contractowner's Indexed Account(s), variable subaccount(s), and Periodic Income Payment Account, and will be reduced by Periodic Income Payments made, rider fees, as well as any withdrawals taken. You will have access to your Account Value during the Access Period. After the Access Period ends, the remaining Account Value will be applied to continue Periodic Income Payments for your life (and/or the Secondary Life, if applicable) and the Account Value will be reduced to zero.

Periodic Income Payments during the Access Period.i4LIFE^® Indexed Advantage provides for Periodic Income Payments for as long as an Annuitant (or Secondary Life, if applicable) is living.

Periodic Income Payments must begin within one year of the date you elect i4LIFE^® Indexed Advantage. Once they begin, they will continue until the death of the Annuitant or Secondary Life, if applicable, unless i4LIFE^® Indexed Advantage is terminated or the contract is surrendered. If you do not choose a Periodic Income Payment frequency, the default frequency is monthly.

For information regarding income tax consequences of Periodic Income Payments, see Federal Tax Matters.

The initial, annual Periodic Income Payment amount is calculated as of the date the rider is elected (Rider Date). This is the same date the Access Period begins. The amount of the initial Periodic Income Payment is determined on the Rider Date by dividing the Account Value, less applicable premium taxes by 1,000 and multiplying the result by an annuity factor. This amount is then transferred to the Periodic Income Payment Account to be paid out based on the payment frequency you selected. The annuity factor is based upon:

• the age and sex of the Annuitant and Secondary Life, if applicable;

• the length of the Access Period selected;

• the 3% Assumed Interest Rate (AIR); and

• the Individual Annuity Mortality table specified in your contract.

The annuity factor used to determine the Periodic Income Payments reflects the fact that, during the Access Period, you have the ability to withdraw the entire Account Value and that a Death Benefit of the entire Account Value will be paid to your Beneficiary upon your death. These benefits during the Access Period result in a slightly lower Periodic Income Payment, during both the Access Period and the Lifetime Income Period, than would be payable if this access was not permitted and no lump-sum Death Benefit was payable. The

35

annuity factor also reflects the requirement that there be sufficient Account Value at the end of the Access Period to continue your Periodic Income Payments for the remainder of your life (and/or the Secondary Life if applicable), during the Lifetime Income Period, with no further access or Death Benefit.

The Account Value will vary with the actual net investment return, which then determines the subsequent Periodic Income Payments during the Access Period. Each subsequent Periodic Income Payment is determined by dividing the Account Value on the Rider Date anniversary by 1,000 and multiplying this result by an annuity factor revised to reflect the declining length of the Access Period. As a result of this calculation, the actual net returns in the Account Value are measured against the AIR to determine subsequent Periodic Income Payments. If the actual net investment return (annualized) for the contract exceeds the AIR, the Periodic Income Payment will increase at a rate approximately equal to the amount of such excess. Conversely, if the actual net investment return for the contract is less than the AIR, the Periodic Income Payment will decrease. For example, if net investment return is 3% higher (annualized) than the AIR, the Periodic Income Payment for the next Rider Year will increase by approximately 3%. Conversely, if actual net investment return is 3% lower than the AIR, the Periodic Income Payment for the next Rider Year will decrease by approximately 3%.

For IRA i4LIFE^® Indexed Advantage contracts, if at any time A is greater than the sum of B and C and no additional withdrawals were made, we will distribute an additional payment, calculated and withdrawn on the Rider Date anniversary, equal to A – (B + C) where,

A = the RMD amount for the calendar year for this contract, as determined by us in accordance with the Internal Revenue Code.

B = the sum of Periodic Income Payment paid in the calendar year immediately prior to the Rider Year anniversary and,

C = the sum of the Periodic Income Payment to be paid from the Rider Year anniversary to the end of the calendar year.

This additional payment will be deducted and distributed within 7 days following the applicable Rider Date anniversary. This amount will be treated as a Periodic Income Payment and not a Withdrawal for Death Benefit calculations.

Withdrawals made during the Access Period will also reduce the Account Value that is available for Periodic Income Payments. Subsequent Periodic Income Payments will be recalculated on the next Rider Date anniversary using the reduced Account Value.

For a joint life option, if either the Annuitant or Secondary Life dies during the Access Period, Periodic Income Payments will be recalculated using a revised annuity factor based on the single surviving life, if doing so provides a higher Periodic Income Payment. On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, the annuity factor will be revised for a non-life contingent Periodic Income Payment and Periodic Income Payments will continue until the Account Value is fully paid out and the Access Period ends. For qualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, i4LIFE^® Indexed Advantage will terminate.

Periodic Income Payments during the Lifetime Income Period. The Lifetime Income Period begins at the end of the Access Period if either the Annuitant or Secondary Life is living. Your earlier election regarding the Periodic Income Payment frequency does not change. The initial Periodic Income Payment during the Lifetime Income Period is determined by dividing the Account Value for each Indexed Account and Subaccount on the last Valuation Date of the Access Period by 1,000 and multiplying the result by an annuity factor revised to reflect that the Access Period has ended. The result for each variable Subaccount is converted to annuity units.

Subsequent Periodic Income Payments are calculated on the Rider Date anniversary and are equal to the sum of each Periodic Income Payment as calculated for each individual allocation. Subsequent Periodic Income Payments for the variable Subaccounts are determined by multiplying the number of Annuity Units per Subaccount by the Annuity Unit value. To determine subsequent Periodic Income Payments for the Indexed Segment(s), the prior Periodic Income Payment for each Segment is multiplied by the performance of the Segment less the rider charge divided by the AIR. Subsequent Periodic Income Payments are adjusted for any reallocations between accounts and Subaccounts.

Your Periodic Income Payments will vary based on the value of your Annuity Units and the performance of your Indexed Segments(s). Your payment(s) will not be affected by market performance during that year. You may also discontinue variable and index-linked payouts and select a fixed level payment.

Periodic Income Payments will continue for as long as the Annuitant or Secondary Life, if applicable, is living, and will vary with Account Value performance.

Periodic Income Payment Account. The Periodic Income Payment Account is designated to hold an amount equal to the annual Periodic Income Payments during the Access Period only.

On the Rider Date and each Rider Date anniversary thereafter, we will transfer Account Value equal to the annual amount of the Periodic Income Payment valued as of that date to the Periodic Income Payment Account. Amounts transferred to the Periodic Income Payment Account will no longer participate in the variable Subaccounts or Indexed Segment(s). The Periodic Income Payment Account is a non-interest bearing account. The Account Value will be transferred proportionately from the variable Subaccounts, and the Indexed Segment(s) in which you are allocated. Transfers of Account Value to the Periodic Income Payment Account may reduce

36

the value in the Subaccounts to zero. Periodic Income Payments will first be deducted from the Periodic Income Payment Account. Only after the Periodic Income Payment Account has been exhausted will any amounts be deducted proportionally from the Variable Subaccounts and lastly proportionally from the Indexed Segment(s).

The Periodic Income Payment Account is not available for allocations or transfers; unless there are any remaining amounts in the Periodic Income Payment Account on the Rider Anniversary after the Periodic Income Payment has been made for the prior Rider Year.

i4LIFE^® Indexed Advantage Death Benefit

The Death Benefit option in effect under the contract will continue to be in effect after the i4LIFE^® Indexed Advantage Rider Date and during the Access Period only and will be adjusted as follows:

Any withdrawal or Periodic Income Payment from the Account Value during the Access Period will result in a death benefit reduction.

If the Account Value Death Benefit is in effect, your Death Benefit will be equal to the Account Value as of the Valuation Date we approve the payment of the claim.

If the Guarantee of Principal Death Benefit is in effect, your Death Benefit will be equal to the greater of:

• the Account Value as of the Valuation Date we approve the payment of the claim; or

• the sum of all Purchase Payments, less the sum of the Periodic Income Payments and other withdrawals where:

• Periodic Income Payments and any additional Required Minimum Distribution payments reduce the Death Benefit by the dollar amount of the payment; and

• All other withdrawals, if any, reduce the Death Benefit in the same proportion that withdrawals reduce the Contract Value or Account Value.

References to Purchase Payments and withdrawals include Purchase Payments and withdrawals made prior to the election of i4LIFE^® Indexed Advantage Rider Date.

In a declining market, withdrawals which are deducted in the same proportion that withdrawals reduce the Contract Value or Account Value, may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more than the dollar amount withdrawn from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals and premium taxes, if any.

The following example demonstrates the impact of a proportionate withdrawal on your Death Benefit:

Guarantee of Principal Death Benefit	$200,000
i4LIFE® Indexed Advantage Periodic Income Payment	$25,000
Additional withdrawal	$15,000 ($15,000/$150,000 = 10% withdrawal)
Account Value at the time of withdrawal	$150,000

Death Benefit value after i4LIFE^® Indexed Advantage Periodic Income Payment = $200,000 - $25,000 = $175,000
Reduction in Death Benefit value for withdrawal = $175,000 x 10% = $17,500
Death Benefit value after withdrawal = $175,000 - $17,500 = $157,500

The Periodic Income Payment reduces the Death Benefit by $25,000 and the withdrawal causes a 10% reduction in the Death Benefit, the same percentage that the withdrawal reduced the Account Value.

Only the Contract Value as of the Valuation Date we approve the payment the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

General Death Benefit Provisions. This Death Benefit option is only available during the Access Period and will terminate when the Account Value equals zero, because the Access Period terminates.

On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, upon the death of the Contractowner, joint owner or Annuitant, the Contractowner (or Beneficiary) may elect to terminate the contract and receive full payment of the Death Benefit or may elect to continue the contract and receive Periodic Income Payments. Upon the death of the Secondary Life, who is not also an owner, only the surrender value is paid.

If you are the owner of an IRA annuity contract, and there is no Secondary Life, and you die during the Access Period, the i4LIFE^® Indexed Advantage will terminate. A spouse Beneficiary may start a new i4LIFE^® Indexed Advantage program.

37

If a death occurs during the Access Period, the value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Upon notification to us of the death, Periodic Income Payments may be suspended until the death claim is approved. Upon approval, a lump sum payment for the value of any suspended payments will be made as of the date the death claim is approved, and Periodic Income Payments will continue, if applicable.

If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Transfers. During the Access Period and subject to the provisions of Transfers On Or Before The Annuity Commencement Date, the following transfers are permitted at any time:

(a) transfers between the variable Subaccounts or

(b) transfers from the Indexed Accounts to the variable Subaccounts. Transfers between the Indexed Accounts and from the variable Subaccounts to the Indexed Accounts are only permitted on a Rider Date anniversary.

After the Access Period and subject to the provisions of Transfers After the Annuity Commencement Date, transfers between the variable Subaccounts are permitted at any time. The following transfers are only permitted on the Rider Date anniversary:

(a) transfers from the variable Subaccounts to the Indexed Accounts;

(b) transfers between the Indexed Accounts; and

(c) transfers from the variable Subaccounts and/or Indexed Accounts to a fixed level payment.

Transfers from the Indexed Account(s) to the Subaccounts or from the fixed level payment to Indexed Account(s) or Subaccounts are not permitted.

Withdrawals. You may request a withdrawal at any time prior to the end of the Access Period. We reduce the Account Value by the amount of the withdrawal, which will impact all subsequent Periodic Income Payments. Withdrawals cannot be taken from the Periodic Income Payment Account. Withdrawals will be taken proportionately from the Subaccounts first and then proportionately from the Indexed Accounts. Any Withdrawal that reduces the Subaccounts and Indexed Accounts to zero will be treated as a withdrawal of the entire Account Value. Any remaining Account Value in the Periodic Income Payment Account will be paid out in a lump sum with the withdrawal, and the contract and rider will terminate. Withdrawals may have tax consequences. See Federal Tax Matters.

Surrender. At any time prior to the end of the Access Period, you may surrender the contract by withdrawing the surrender value. If the contract is surrendered, the contract terminates and no further Periodic Income Payments will be made.

Termination. For IRA contracts, you may terminate i4LIFE^® Indexed Advantage prior to the end of the Access Period by notifying us in writing. The termination will be effective on the next Rider Date anniversary after we receive the notice. Upon termination, the i4LIFE^® Indexed Advantage charge will end. Your Contract Value upon termination will be equal to the Account Value on the Valuation Date we terminate i4LIFE^® Indexed Advantage.

For nonqualified contracts, you may not terminate i4LIFE^® Indexed Advantage once you have elected it without terminating the entire contract..

Annuity Payouts

When you apply for a contract, you may select any Annuity Commencement Date permitted by law, which is usually on or before the Annuitant's 99^th birthday. Your broker-dealer may recommend that you annuitize at an earlier age.

The contract provides optional forms of payouts of annuities (annuity options), each of which is payable on a variable basis, a fixed basis or a combination of both as you specify. The Indexed Accounts are not available as Annuity Payout options. Any amounts in the Indexed Segments must be transferred out of the Indexed Segments at Interim Value prior to the Annuity Commencement Date. The contract provides that all or part of the Contract Value may be used to purchase an Annuity Payout option.

38

You may elect Annuity Payouts in monthly, quarterly, semiannual or annual installments. If the payouts from any Subaccount would be or become less than $50, we have the right to reduce their frequency until the payouts are at least $50 each. Following are explanations of the annuity options available.

Annuity Options

The annuity options outlined below do not apply to Contractowners who have elected i4LIFE^® Indexed Advantage.

Life Annuity. This option offers a periodic payout during the lifetime of the Annuitant and ends with the last payout before the death of the Annuitant. This option offers the highest periodic payout since there is no guarantee of a minimum number of payouts or provision for a Death Benefit for Beneficiaries. However, there is the risk under this option that the recipient would receive no payouts if the Annuitant dies before the date set for the first payout; only one payout if death occurs before the second scheduled payout, and so on.

Life Annuity with Payouts Guaranteed for Designated Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and then continues throughout the lifetime of the Annuitant. The designated period is selected by the Contractowner.

Joint Life Annuity. This option offers a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. However, under a joint life annuity, if both Annuitants die before the date set for the first payout, no payouts will be made. Only one payment would be made if both deaths occur before the second scheduled payout, and so on.

Joint Life Annuity with Guaranteed Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and continues during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. The designated period is selected by the Contractowner.

Joint Life and Two Thirds to Survivor Annuity. This option provides a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. When one of the joint Annuitants dies, the survivor receives two thirds of the periodic payout made when both were alive.

Joint Life and Two-Thirds Survivor Annuity with Guaranteed Period. This option provides a periodic payout during the joint lifetime of the Annuitant and a joint Annuitant. When one of the joint Annuitants dies, the survivor receives two-thirds of the periodic payout made when both were alive. This option further provides that should one or both of the Annuitants die during the elected guaranteed period, usually 10 or 20 years, full benefit payment will continue for the rest of the guaranteed period.

Life Annuity with Cash Refund. Fixed annuity benefit payments that will be made for the lifetime of the Annuitant with the guarantee that upon death, should (a) the total dollar amount applied to purchase this option be greater than (b) the fixed annuity benefit payment multiplied by the number of annuity benefit payments paid prior to death, then a refund payment equal to the dollar amount of (a) minus (b) will be made.

Under the annuity options listed above, you may not make withdrawals. Other options, with or without withdrawal features, may be made available by us. You may pre-select an Annuity Payout option as a method of paying the Death Benefit to a Beneficiary. If you do, the Beneficiary cannot change this payout option. You may change or revoke in writing to our Home Office, any such selection, unless such selection was made irrevocable. If you have not already chosen an Annuity Payout option, the Beneficiary may choose any Annuity Payout option. At death, options are only available to the extent they are consistent with the requirements of the contract as well as Sections 72(s) and 401(a)(9) of the tax code, if applicable.

General Information

Any previously selected Death Benefit in effect before the Annuity Commencement Date will no longer be available on and after the Annuity Commencement Date. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation. If we have not heard from you by 30 days prior to the maturity date of the contract, we will transfer the Interim Value for each Indexed Segment to the LVIP PIMCO Low Duration Bond Fund. You may change the Annuity Commencement Date, change the annuity option or change the allocation of the investment among Subaccounts up to 30 days before the scheduled Annuity Commencement Date, upon written notice to the Home Office. You must give us at least 30 days’ notice before the date on which you want payouts to begin. We may require proof of age, sex, or survival of any payee upon whose age, sex, or survival payments depend.

Unless you select another option, the contract automatically provides for a life annuity with Annuity Payouts guaranteed for 10 years (on a fixed, variable or combination of fixed and variable basis, in proportion to the account allocations at the time of annuitization) except when a joint life payout is required by law. Under any option providing for guaranteed period payouts, the number of payouts which remain unpaid at the date of the Annuitant’s death (or surviving Annuitant’s death in case of joint life Annuity) will be paid to you or your Beneficiary as payouts become due after we are in receipt of:

• proof, satisfactory to us, of the death;

39

• written authorization for payment; and

• all claim forms, fully completed.

Variable Annuity Payouts

Variable Annuity Payouts will be determined using:

• the Contract Value on the Annuity Commencement Date, less any applicable premium taxes;

• the annuity tables contained in the contract;

• the annuity option selected; and

• the investment performance of the fund(s) selected.

To determine the amount of payouts, we make this calculation:

1.	Determine the dollar amount of the first periodic payout; then
2.	Credit the contract with a fixed number of Annuity Units equal to the first periodic payout divided by the Annuity Unit value; and
3.	Calculate the value of the Annuity Units each period thereafter.

Annuity Payouts assume an investment return of 3%, 4%, 5% or 6% per year, as applied to the applicable mortality table. Some of these assumed interest rates may not be available in your state; therefore, please check with your registered representative. You may choose your assumed interest rate at the time you elect a variable Annuity Payout on the administrative form provided by us. The higher the assumed interest rate you choose, the higher your initial annuity payment will be. The amount of each payout after the initial payout will depend upon how the underlying fund(s) perform, relative to the assumed rate. If the actual net investment rate (annualized) exceeds the assumed rate, the payment will increase at a rate proportional to the amount of such excess. Conversely, if the actual rate is less than the assumed rate, annuity payments will decrease. The higher the assumed interest rate, the less likely future annuity payments are to increase, or the payments will increase more slowly than if a lower assumed rate was used. There is a more complete explanation of this calculation in the SAI.

Small Contract Surrenders

We may surrender your contract, in accordance with the laws of your state if:

• your Contract Value drops below certain state specified minimum amounts ($1,000 or less) for any reason, including if your Contract Value decreases due to the performance of the Subaccounts you selected;

• no Purchase Payments have been received for two (2) full, consecutive Contract Years; and

• the annuity benefit at the Annuity Commencement Date would be less than $20.00 per month (these requirements may differ in some states).

At least 60 days before we surrender your contract, we will send you a letter at your last address we have on file, to inform you that your contract will be surrendered. You will have the opportunity to make additional Purchase Payments to bring your Contract Value above the minimum level to avoid surrender.

Delay of Payments

Contract proceeds from the VAA will be paid within seven days, except:

• when the NYSE is closed (other than weekends and holidays);

• times when market trading is restricted or the SEC declares an emergency, and we cannot value units or the funds cannot redeem shares; or

• when the SEC so orders to protect Contractowners.

If, pursuant to SEC rules, an underlying money market fund suspends payment of redemption proceeds in connection with a liquidation of the fund, we will delay payment of any transfer, partial withdrawal, surrender, loan, or Death Benefit from the money market sub-account until the fund is liquidated.

Due to federal laws designed to counter terrorism and prevent money laundering by criminals, we may be required to reject a Purchase Payment and/or deny payment of a request for transfers, withdrawals, surrenders, or Death Benefits, until instructions are received from the appropriate regulator. We also may be required to provide additional information about a Contractowner's account to government regulators.

Reinvestment Privilege

You may elect to make a reinvestment purchase with any part of the proceeds of a surrender/withdrawal, and we will recredit that portion of the surrender/withdrawal charges attributable to the amount returned.

40

This election must be made by your written authorization to us on an approved Lincoln reinvestment form and received in our Home Office within 30 days of the date of the surrender/withdrawal, and the repurchase must be of a contract covered by this prospectus. In the case of a qualified retirement plan, a representation must be made that the proceeds being used to make the purchase have retained their tax-favored status under an arrangement for which the contracts offered by this prospectus are designed. The number of Accumulation Units which will be credited when the proceeds are reinvested will be based on the value of the Accumulation Unit(s) on the next Valuation Date. This computation will occur following receipt of the proceeds and request for reinvestment at the Home Office. You may utilize the reinvestment privilege only once. For tax reporting purposes, we will treat a surrender/withdrawal and a subsequent reinvestment purchase as separate transactions (and a Form 1099 may be issued, if applicable). Any taxable distribution that is reinvested may still be reported as taxable. You should consult a tax advisor before you request a surrender/withdrawal or subsequent reinvestment purchase. Any portion of your Contract Value that was previously allocated to an Indexed Account will be placed in the LVIP PIMCO Low Duration Bond Fund. Indexed Accounts cannot be invested until the next Indexed Anniversary Date.

Amendment of Contract

We reserve the right to amend the contract to meet the requirements of the 1940 Act or other applicable federal or state laws or regulations. You will be notified in writing of any changes, modifications or waivers. Any changes are subject to prior approval of your state’s insurance department (if required).

Distribution of the Contracts

Lincoln Financial Distributors, Inc. (“LFD”) serves as Principal Underwriter of this contract. LFD is affiliated with Lincoln Life and is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934 and is a member of FINRA. The Principal Underwriter has entered into selling agreements with Lincoln Financial Advisors Corporation and/or Lincoln Financial Securities Corporation (collectively “LFN”), also affiliates of ours. The Principal Underwriter has also entered into selling agreements with broker-dealers that are unaffiliated with us (“Selling Firms”). While the Principal Underwriter has the legal authority to make payments to broker-dealers which have entered into selling agreements, we will make such payments on behalf of the Principal Underwriter in compliance with appropriate regulations. We also pay on behalf of LFD certain of its operating expenses related to the distribution of this and other of our contracts. The Principal Underwriter may also offer “non-cash compensation”, as defined under FINRA’s rules, which includes among other things, merchandise, gifts, marketing support, sponsorships, seminars, entertainment and travel expenses. You may ask your registered representative how he/she will personally be compensated, in whole or in part, for the sale of the contract to you or for any alternative proposal that may have been presented to you. You may wish to take such compensation payments into account when considering and evaluating any recommendation made to you in connection with the purchase of a contract. The following paragraphs describe how payments are made by us and the Principal Underwriter to various parties.

Compensation Paid to LFN. Lincoln Life also pays for the operating and other expenses of LFN, including the following sales expenses: registered representative training allowances; compensation and bonuses for LFN's management team; advertising expenses; and all other expenses of distributing the contracts. LFN registered representatives and their managers are also eligible for various cash benefits, such as bonuses, insurance benefits and financing arrangements. In addition, LFN registered representatives who meet certain productivity, persistency and length of service standards and/or their managers may be eligible for additional compensation. Sales of the contracts may help LFN registered representatives and/or their managers qualify for such benefits. LFN registered representatives and their managers may receive other payments from us for services that do not directly involve the sale of the contracts, including payments made for the recruitment and training of personnel, production of promotional literature and similar services.

Compensation Paid to Unaffiliated Selling Firms. LFD also acts as wholesaler of the contracts and performs certain marketing and other functions in support of the distribution and servicing of the contracts. LFD may pay certain Selling Firms or their affiliates additional amounts for, among other things: (1) “preferred product” treatment of the contracts in their marketing programs, which may include marketing services and increased access to registered representatives; (2) sales promotions relating to the contracts; (3) costs associated with sales conferences and educational seminars for their registered representatives; (4) other sales expenses incurred by them; and (5) inclusion in the financial products the Selling Firm offers.

Lincoln Life may provide loans to broker-dealers or their affiliates to help finance marketing and distribution of the contracts, and those loans may be forgiven if aggregate sales goals are met. In addition, we may provide staffing or other administrative support and services to broker-dealers who distribute the contracts. LFD, as wholesaler, may make bonus payments to certain Selling Firms based on aggregate sales of our variable insurance contracts (including the contracts) or persistency standards.

These additional types of compensation are not offered to all Selling Firms. The terms of any particular agreement governing compensation may vary among Selling Firms and the amounts may be significant. The prospect of receiving, or the receipt of, additional compensation may provide Selling Firms and/or their registered representatives with an incentive to favor sales of the contracts over other variable annuity contracts (or other investments) with respect to which a Selling Firm does not receive additional compensation, or

41

lower levels of additional compensation. You may wish to take such payment arrangements into account when considering and evaluating any recommendation relating to the contracts. Additional information relating to compensation paid in 2017 is contained in the SAI.

Compensation Paid to Other Parties. Depending on the particular selling arrangements, there may be others whom LFD compensates for the distribution activities. For example, LFD may compensate certain “wholesalers”, who control access to certain selling offices, for access to those offices or for referrals, and that compensation may be separate from the compensation paid for sales of the contracts. LFD may compensate marketing organizations, associations, brokers or consultants which provide marketing assistance and other services to broker-dealers who distribute the contracts, and which may be affiliated with those broker-dealers. Commissions and other incentives or payments described above are not charged directly to Contractowners or the VAA. All compensation is paid from our resources, which include fees and charges imposed on your contract.

We pay an education and support fee to First Trust Portfolios L.P. (First Trust) for their educational and sales support in connection with the Capital Strength Net Fee Index^SM. This fee is an annual fee of 0.15% of the average daily value of the amount invested in the Capital Strength Indexed Accounts. First Trust will pay Lincoln an annual rate of 0.05% of the average daily value of the amount invested in the Capital Strength Indexed Accounts to compensate Lincoln for the expenses it incurs in assisting First Trust as it provides this education and support. These payments are not charged directly to Contractowners, but are paid from our resources.

Contractowner Questions

The obligations to purchasers under the contracts are those of Lincoln Life. This prospectus provides a general description of the material features of the contract. Contracts, endorsements and riders may vary as required by state law. Questions about your contract should be directed to us at 1-877-737-6872.

Federal Tax Matters

Introduction

The Federal income tax treatment of the contract is complex and sometimes uncertain. The Federal income tax rules may vary with your particular circumstances. This discussion does not include all the Federal income tax rules that may affect you and your contract. This discussion also does not address other Federal tax consequences (including consequences of sales to foreign individuals or entities), or state or local tax consequences, associated with the contract. As a result, you should always consult a tax advisor about the application of tax rules found in the Internal Revenue Code (“Code”), Treasury Regulations and applicable IRS guidance to your individual situation.

Nonqualified Annuities

This part of the discussion describes some of the Federal income tax rules applicable to nonqualified annuities. A nonqualified annuity is a contract not issued in connection with a qualified retirement plan, such as an IRA or a section 403(b) plan, receiving special tax treatment under the Code. We may not offer nonqualified annuities for all of our annuity products.

Tax Deferral On Earnings

Under the Code, you are generally not subject to tax on any increase in your Contract Value until you receive a contract distribution. However, for this general rule to apply, certain requirements must be satisfied:

• An individual must own the contract (or the Code must treat the contract as owned by an individual).

• The investments of the VAA must be “adequately diversified” in accordance with Treasury regulations.

• Your right to choose particular investments for a contract must be limited.

• The Annuity Commencement Date must not occur near the end of the Annuitant’s life expectancy.

Contracts Not Owned By An Individual

If a contract is owned by an entity (rather than an individual) the Code generally does not treat it as an annuity contract for Federal income tax purposes. This means that the entity owning the contract pays tax currently on the excess of the Contract Value over the investment in the contract. Examples of contracts where the owner pays current tax on the contract’s earnings are contracts issued to a corporation or a trust. Some exceptions to the rule are:

• Contracts in which the named owner is a trust or other entity that holds the contract as an agent for an individual; however, this exception does not apply in the case of any employer that owns a contract to provide deferred compensation for its employees;

• Immediate annuity contracts, purchased with a single premium, when the annuity starting date is no later than a year from purchase and substantially equal periodic payments are made, not less frequently than annually, during the Annuity Payout period;

• Contracts acquired by an estate of a decedent;

• Certain qualified contracts;

42

• Contracts purchased by employers upon the termination of certain qualified plans; and

• Certain contracts used in connection with structured settlement agreements.

Investments In The VAA Must Be Diversified

For a contract to be treated as an annuity for Federal income tax purposes, the investments of the VAA must be “adequately diversified.” Treasury regulations define standards for determining whether the investments of the VAA are adequately diversified. If the VAA fails to comply with these diversification standards, you could be required to pay tax currently on the excess of the Contract Value over the investment in the contract. Although we do not control the investments of the underlying investment options, we expect that the underlying investment options will comply with the Treasury regulations so that the VAA will be considered “adequately diversified.”

Restrictions

The Code limits your right to choose particular investments for the contract. Because the IRS has issued little guidance specifying those limits, the limits are uncertain and your right to allocate Contract Values among the Subaccounts may exceed those limits. If so, you would be treated as the owner of the assets of the VAA and thus subject to current taxation on the income and gains, if applicable, from those assets. We do not know what limits may be set by the IRS in any guidance that it may issue and whether any such limits will apply to existing contracts. We reserve the right to modify the contract without your consent in an attempt to prevent you from being considered as the owner of the assets of the VAA for purposes of the Code.

Loss Of Interest Deduction

After June 8, 1997, if a contract is issued to a taxpayer that is not an individual, or if a contract is held for the benefit of an entity, the entity may lose a portion of its deduction for otherwise deductible interest expenses. However, this rule does not apply to a contract owned by an entity engaged in a trade or business that covers the life of one individual who is either (i) a 20% Owner of the entity, or (ii) an officer, director, or employee of the trade or business, at the time first covered by the contract. This rule also does not apply to a contract owned by an entity engaged in a trade or business that covers the joint lives of the 20% Owner or the entity and the Owner’s spouse at the time first covered by the contract.

Age At Which Annuity Payouts Begin

The Code does not expressly identify a particular age by which Annuity Payouts must begin. However, those rules do require that an annuity contract provide for amortization, through Annuity Payouts, of the contract’s Purchase Payments and earnings. As long as annuity payments begin or are scheduled to begin on a date on which the Annuitant’s remaining life expectancy is enough to allow for a sufficient Annuity Payout period, the contract should be treated as an annuity. If the annuity contract is not treated as an annuity, you would be currently taxed on the excess of the Contract Value over the investment in the contract.

Tax Treatment Of Payments

We make no guarantees regarding the tax treatment of any contract or of any transaction involving a contract. However, the rest of this discussion assumes that your contract will be treated as an annuity under the Code and that any increase in your Contract Value will not be taxed until there is a distribution from your contract.

Taxation Of Withdrawals And Surrenders

You will pay tax on withdrawals to the extent your Contract Value exceeds your investment in the contract. This income (and all other income from your contract) is considered ordinary income (and does not receive capital gains treatment and is not qualified dividend income). You will pay tax on a surrender to the extent the amount you receive exceeds your investment in the contract. In certain circumstances, your Purchase Payments and investment in the contract are reduced by amounts received from your contract that were not included in income. Surrender and reinstatement of your contract will generally be taxed as a withdrawal.

Taxation Of Annuity Payouts, including Periodic Income Payments

The Code imposes tax on a portion of each Annuity Payout (at ordinary income tax rates) and treats a portion as a nontaxable return of your investment in the contract. We will notify you annually of the taxable amount of your Annuity Payout. Once you have recovered the total amount of the investment in the contract, you will pay tax on the full amount of your Annuity Payouts. If Annuity Payouts end because of the Annuitant’s death and before the total amount in the contract has been distributed, the amount not received will generally be deductible. If withdrawals, other than Periodic Income Payments, are taken from i4LIFE^® Indexed Advantage during the Access Period, they are taxed subject to an exclusion ratio that is determined based on the amount of the payment.

Taxation Of Death Benefits

We may distribute amounts from your contract because of the death of a Contractowner or an Annuitant. The tax treatment of these amounts depends on whether the Contractowner or the Annuitant dies before or after the Annuity Commencement Date.

Death prior to the Annuity Commencement Date:

43

• If the Beneficiary receives Death Benefits under an Annuity Payout option, they are taxed in the same manner as Annuity Payouts.

• If the Beneficiary does not receive Death Benefits under an Annuity Payout option, they are taxed in the same manner as a withdrawal.

Death after the Annuity Commencement Date:

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of a Contractowner who is not the Annuitant, they are excludible from income in the same manner as the Annuity Payout prior to the death of the Contractowner.

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of the Annuitant (whether or not the Annuitant is also the Contractowner), the Death Benefits are excludible from income if they do not exceed the investment in the contract not yet distributed from the contract. All Annuity Payouts in excess of the investment in the contract not previously received are includible in income.

• If Death Benefits are received in a lump sum, the Code imposes tax on the amount of Death Benefits which exceeds the amount of Purchase Payments not previously received.

Additional Taxes Payable On Withdrawals, Surrenders, Or Annuity Payouts

The Code may impose a 10% additional tax on any distribution from your contract which you must include in your gross income. The 10% additional tax does not apply if one of several exceptions exists. These exceptions include withdrawals, surrenders, or Annuity Payouts that:

• you receive on or after you reach 59½,

• you receive because you became disabled (as defined in the Code),

• you receive from an immediate annuity,

• a Beneficiary receives on or after your death, or

• you receive as a series of substantially equal periodic payments based on your life or life expectancy (non-natural owners holding as agent for an individual do not qualify).

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax, which affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual's “unearned income”, or (ii) the dollar amount by which the individual's modified adjusted gross income exceeds the applicable threshold. Unearned income includes the taxable portion of distributions that you take from your annuity contract. If you take a distribution from your contract that may be subject to the tax, we will include a Distribution Code “D” in Box 7 of the Form 1099-R issued to report the distribution. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Special Rules If You Own More Than One Annuity Contract

In certain circumstances, you must combine some or all of the nonqualified annuity contracts you own in order to determine the amount of an Annuity Payout, a surrender, or a withdrawal that you must include in income. For example, if you purchase two or more deferred annuity contracts from the same life insurance company (or its affiliates) during any calendar year, the Code treats all such contracts as one contract. Treating two or more contracts as one contract could affect the amount of a surrender, a withdrawal or an Annuity Payout that you must include in income and the amount that might be subject to the additional tax described previously.

Loans and Assignments

Except for certain qualified contracts, the Code treats any amount received as a loan under your contract, and any assignment or pledge (or agreement to assign or pledge) of any portion of your Contract Value, as a withdrawal of such amount or portion.

Gifting A Contract

If you transfer ownership of your contract to a person other than to your spouse (or to your former spouse incident to divorce), and receive a payment less than your contract’s value, you will pay tax on your Contract Value to the extent it exceeds your investment in the contract not previously received. The new owner’s investment in the contract would then be increased to reflect the amount included in income.

Charges for Additional Benefits

Your contract automatically includes a basic Death Benefit and may include other optional riders. Certain enhancements to the basic Death Benefit may also be available to you. The cost of the basic Death Benefit and any additional benefit are deducted from your contract. It is possible that the tax law may treat all or a portion of the Death Benefit and other optional rider charges, if any, as a contract withdrawal.

44

Special Considerations for Same-Sex Spouses

In 2013, the U.S. Supreme Court held that same-sex spouses who are married under state law are treated as spouses for purposes of federal law. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

Qualified Retirement Plans

We have designed the contracts for use in connection with certain types of retirement plans that receive favorable treatment under the Code. Contracts issued to or in connection with a qualified retirement plan are called “qualified contracts.” We issue contracts for use with various types of qualified retirement plans. The Federal income tax rules applicable to those plans are complex and varied. As a result, this prospectus does not attempt to provide more than general information about the use of the contract with the various types of qualified retirement plans. Persons planning to use the contract in connection with a qualified retirement plan should obtain advice from a competent tax advisor.

Types of Qualified Contracts and Terms of Contracts

Qualified retirement plans may include the following:

• Individual Retirement Accounts and Annuities (“Traditional IRAs”)

• Roth IRAs

• Traditional IRA that is part of a Simplified Employee Pension Plan (“SEP”)

• SIMPLE 401(k) plans (Savings Incentive Matched Plan for Employees)

• 401(a) / (k) plans (qualified corporate employee pension and profit-sharing plans)

• 403(a) plans (qualified annuity plans)

• 403(b) plans (public school system and tax-exempt organization annuity plans)

• H.R. 10 or Keogh Plans (self-employed individual plans)

• 457(b) plans (deferred compensation plans for state and local governments and tax-exempt organizations)

Our individual variable annuity products are not available for use with any of the foregoing qualified retirement plan accounts, with the exception of Traditional IRA, SEP IRA, and Roth IRA arrangements. We will amend contracts to be used with a qualified retirement plan as generally necessary to conform to the Code’s requirements for the type of plan. However, the rights of a person to any qualified retirement plan benefits may be subject to the plan’s terms and conditions, regardless of the contract’s terms and conditions. In addition, we are not bound by the terms and conditions of qualified retirement plans to the extent such terms and conditions contradict the contract, unless we consent.

Tax Treatment of Qualified Contracts

The Federal income tax rules applicable to qualified retirement plans and qualified contracts vary with the type of plan and contract. For example:

• Federal tax rules limit the amount of Purchase Payments or contributions that can be made, and the tax deduction or exclusion that may be allowed for the contributions. These limits vary depending on the type of qualified retirement plan and the participant’s specific circumstances (e.g., the participant’s compensation).

• Minimum annual distributions are required under some qualified retirement plans once you reach age 70½ or retire, if later as described below.

• Loans are allowed under certain types of qualified retirement plans, but Federal income tax rules prohibit loans under other types of qualified retirement plans. For example, Federal income tax rules permit loans under some section 403(b) plans, but prohibit loans under Traditional and Roth IRAs. If allowed, loans are subject to a variety of limitations, including restrictions as to the loan amount, the loan’s duration, the rate of interest, and the manner of repayment. Your contract or plan may not permit loans.

Please note that qualified retirement plans such as 403(b) plans, 401(k) plans and IRAs generally defer taxation of contributions and earnings until distribution. As such, an annuity does not provide any additional tax deferral benefit beyond the qualified retirement plan itself.

Tax Treatment of Payments

The Federal income tax rules generally include distributions from a qualified contract in the participant’s income as ordinary income. These taxable distributions will include contributions that were deductible or excludible from income. Thus, under many qualified contracts, the total amount received is included in income since a deduction or exclusion from income was taken for contributions to the contract. There are exceptions. For example, you do not include amounts received from a Roth IRA in income if certain conditions are satisfied.

45

Required Minimum Distributions

Under most qualified plans, you must begin receiving payments from the contract in certain minimum amounts by April 1 of the year following the year you attain age 70½ or retire, if later. You are required to take distributions from your traditional IRAs by April 1 of the year following the year you reach age 70½. If you own a Roth IRA, you are not required to receive minimum distributions from your Roth IRA during your life.

Failure to comply with the minimum distribution rules applicable to certain qualified plans, such as Traditional IRAs, will result in the imposition of an excise tax. This excise tax equals 50% of the amount by which a required minimum distribution exceeds the actual distribution from the qualified plan.

Treasury regulations applicable to required minimum distributions include a rule that may impact the distribution method you have chosen and the amount of your distributions. Under these regulations, the presence of an enhanced Death Benefit, or other benefit which could provide additional value to your contract, may require you to take additional distributions. An enhanced Death Benefit is any Death Benefit that has the potential to pay more than the Contract Value or a return of investment in the contract. Annuity contracts inside Custodial or Trusteed IRAs will also be subject to these regulations. Please contact your tax advisor regarding any tax ramifications.

Additional Tax on Early Distributions from Qualified Retirement Plans

The Code may impose a 10% additional tax on an early distribution from a qualified contract that must be included in income. The Code does not impose the additional tax if one of several exceptions applies. The exceptions vary depending on the type of qualified contract you purchase. For example, in the case of an IRA, the 10% additional tax will not apply to any of the following withdrawals, surrenders, or Annuity Payouts:

• Distribution received on or after the Annuitant reaches 59½,

• Distribution received on or after the Annuitant’s death or because of the Annuitant’s disability (as defined in the Code),

• Distribution received as a series of substantially equal periodic payments based on the Annuitant’s life (or life expectancy), or

• Distribution received as reimbursement for certain amounts paid for medical care.

These exceptions, as well as certain others not described here, generally apply to taxable distributions from other qualified retirement plans. However, the specific requirements of the exception may vary.

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual’s “unearned income”, or (ii) the dollar amount by which the individual’s modified adjusted gross income exceeds the applicable threshold. Distributions that you take from your contract are not included in the calculation of unearned income because your contract is a qualified plan contract. However, the amount of any such distribution is included in determining whether you exceed the modified adjusted gross income threshold. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Transfers and Direct Rollovers

As a result of Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), you may be able to move funds between different types of qualified plans, such as 403(b) and 457(b) governmental plans, by means of a rollover or transfer. You may be able to rollover or transfer amounts between qualified plans and traditional IRAs. These rules do not apply to Roth IRAs and 457(b) non-governmental tax-exempt plans. There are special rules that apply to rollovers, direct rollovers and transfers (including rollovers or transfers of after-tax amounts). If the applicable rules are not followed, you may incur adverse Federal income tax consequences, including paying taxes which you might not otherwise have had to pay. Before we send a rollover distribution, we will provide a notice explaining tax withholding requirements (see Federal Income Tax Withholding). We are not required to send you such notice for your IRA. You should always consult your tax advisor before you move or attempt to move any funds.

The IRS issued Announcement 2014-32 confirming its intent to apply the one-rollover-per-year limitation of 408(d)(3)(B) on an aggregate basis to all IRAs that an individual owns. This means that an individual cannot make a tax-free IRA-to-IRA rollover if he or she has made such a rollover involving any of the individual’s IRAs in the current tax year. If an intended rollover does not qualify for tax-free rollover treatment, contributions to your IRA may constitute excess contributions that may exceed contribution limits. This one-rollover-per-year limitation does not apply to direct trustee-to-trustee transfers.

Direct Conversions and Recharacterizations

The Pension Protection Act of 2006 (PPA) permits direct conversions from certain qualified, retirement, 403(b) or 457(b) plans to Roth IRAs (effective for distributions after 2007). You are also permitted to recharacterize your traditional IRA contribution as a Roth IRA contribution, and to recharacterize your Roth IRA contribution as a traditional IRA contribution. The deadline for the recharacterization is the due date (including extensions) for your individual income tax return for the year in which the contribution

46

was made. Upon recharacterization, you are treated as having made the contribution originally to the second IRA account. The recharacterization does not count toward the one-rollover-per-year limitation described above.

Effective for tax years beginning after December 31, 2017, pursuant to the Tax Cuts and Jobs Act (Pub. L. No. 115-97), recharacterizations are no longer allowed in the case of a conversion from a non-Roth account or annuity to a Roth IRA. This limitation applies to conversions made from pre-tax accounts under an IRA, qualified retirement plan, 403(b) plan, or 457(b) plan. Roth IRA conversions made in 2017 may be recharacterized as a contribution to a traditional IRA if the recharacterization is completed by October 15, 2018.

There are special rules that apply to conversions and recharacterizations, and if they are not followed, you may incur adverse Federal income tax consequences. You should consult your tax advisor before completing a conversion or recharacterization.

Death Benefit and IRAs

Pursuant to Treasury regulations, IRAs may not invest in life insurance contracts. We do not believe that these regulations prohibit the Death Benefit from being provided under the contract when we issue the contract as a Traditional or Roth IRA. However, the law is unclear and it is possible that the presence of the Death Benefit under a contract issued as a Traditional or Roth IRA could result in increased taxes to you. Certain Death Benefit options may not be available for all of our products.

Federal Income Tax Withholding

We will withhold and remit to the IRS a part of the taxable portion of each distribution made under a contract unless you notify us in writing prior to the distribution that tax is not to be withheld. In certain circumstances, Federal income tax rules may require us to withhold tax. At the time a withdrawal, surrender, or Annuity Payout is requested, we will give you an explanation of the withholding requirements.

Certain payments from your contract may be considered eligible rollover distributions (even if such payments are not being rolled over). Such distributions may be subject to special tax withholding requirements. The Federal income tax withholding rules require that we withhold 20% of the eligible rollover distribution from the payment amount, unless you elect to have the amount directly transferred to certain qualified plans or contracts. The IRS requires that tax be withheld, even if you have requested otherwise. Such tax withholding requirements are generally applicable to 401(a), 403(a) or (b), HR 10, and 457(b) governmental plans and contracts used in connection with these types of plans.

Our Tax Status

Under the Code, we are not required to pay tax on investment income and realized capital gains of the VAA. We do not expect that we will incur any Federal income tax liability on the income and gains earned by the VAA. However, the Company does expect, to the extent permitted under the Code, to claim the benefit of the foreign tax credit as the owner of the assets of the VAA. Therefore, we do not impose a charge for Federal income taxes. If there are any changes in the Code that require us to pay tax on some or all of the income and gains earned by the VAA, we may impose a charge against the VAA to pay the taxes.

Changes in the Law

The above discussion is based on the Code, related regulations, and interpretations existing on the date of this prospectus. However, Congress, the IRS, and the courts may modify these authorities, sometimes retroactively.

Additional Information

Voting Rights

As required by law, we will vote the fund shares held in the VAA at meetings of the shareholders of the funds. The voting will be done according to the instructions of Contractowners who have interests in any Subaccounts which invest in classes of the funds. If the 1940 Act or any regulation under it should be amended or if present interpretations should change, and if as a result we determine that we are permitted to vote the fund shares in our own right, we may elect to do so.

The number of votes which you have the right to cast will be determined by applying your percentage interest in a Subaccount to the total number of votes attributable to the Subaccount. In determining the number of votes, fractional shares will be recognized.

Each underlying fund is subject to the laws of the state in which it is organized concerning, among other things, the matters which are subject to a shareholder vote, the number of shares which must be present in person or by proxy at a meeting of shareholders (a “quorum”), and the percentage of such shares present in person or by proxy which must vote in favor of matters presented. Because shares of the underlying fund held in the VAA are owned by us, and because under the 1940 Act we will vote all such shares in the same proportion as the voting instructions which we receive, it is important that each Contractowner provide their voting instructions to us. For funds un-affiliated with Lincoln, even though Contractowners may choose not to provide voting instruction, the shares of a fund to which such Contractowners would have been entitled to provide voting instruction will be voted by us in the same proportion

47

as the voting instruction which we actually receive. For funds affiliated with Lincoln, shares of a fund to which such Contractowners would have been entitled to provide voting instruction will, once we receive a sufficient number of instructions we deem appropriate to ensure a fair representation of Contractowners eligible to vote, be voted by us in the same proportion as the voting instruction which we actually receive. As a result, the instruction of a small number of Contractowners could determine the outcome of matters subject to shareholder vote. All shares voted by us will be counted when the underlying fund determines whether any requirement for a minimum number of shares be present at such a meeting to satisfy a quorum requirement has been met. Voting instructions to abstain on any item to be voted on will be applied proportionately to reduce the number of votes eligible to be cast.

Whenever a shareholders meeting is called, we will provide or make available to each person having a voting interest in a Subaccount proxy voting material, reports and other materials relating to the funds. Since the funds engage in shared funding, other persons or entities besides Lincoln Life may vote fund shares. See Investments of the Variable Annuity Account – Fund Shares.

There are no voting rights associated with the Indexed Accounts.

Return Privilege

Within the free-look period after you receive the contract, you may cancel it for any reason by delivering or mailing it postage prepaid, to The Lincoln National Life Insurance Company at PO Box 2348, Fort Wayne, IN 46801-2348. A contract canceled under this provision will be void. Except as explained in the following paragraph, we will return the Contract Value as of the Valuation Date on which we receive the cancellation request, which includes the Interim Value for the Indexed Accounts, and any premium taxes which had been deducted. No applicable surrender charges will apply. A purchaser who participates in the VAA is subject to the risk of a market loss on the Contract Value during the free-look period.

For contracts written in those states whose laws require that we assume this market risk during the free-look period, a contract may be canceled, subject to the conditions explained before, except that we will return the greater of the Purchase Payment(s) or Contract Value as of the Valuation Date we receive the cancellation request, plus any premium taxes that had been deducted. IRA purchasers will also receive the greater of Purchase Payments or Contract Value as of the Valuation Date on which we receive the cancellation request.

If you cancel this contract within the free-look period, we reserve the right not to accept another application for this contract for a period of six months.

State Regulation

As a life insurance company organized and operated under Indiana law, we are subject to provisions governing life insurers and to regulation by the Indiana Commissioner of Insurance. Our books and accounts are subject to review and examination by the Indiana Department of Insurance at all times. A full examination of our operations is conducted by that Department at least every five years.

Records and Reports

As presently required by the 1940 Act and applicable regulations, we are responsible for maintaining all records and accounts relating to the VAA. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. We will mail to you, at your last known address of record at the Home Office, at least semi-annually after the first Contract Year, reports containing information required by that Act or any other applicable law or regulation.

A written (or electronic, if elected) confirmation of each transaction will be provided to you on the next Valuation Date, except for the following transactions, which are mailed quarterly:

• deduction of any account fee or rider charges;

• any rebalancing event under the portfolio rebalancing service;

• any transfer or withdrawal under AWS; and

• Periodic Income Payments from i4LIFE^® Indexed Advantage.

Electronic Delivery

You may elect to receive your prospectus, prospectus supplements, quarterly statements, and annual and semiannual reports electronically over the Internet, if you have an e-mail account and access to an Internet browser. Once you select eDelivery, via the Internet Service Center, all documents available in electronic format will no longer be sent to you in hard copy. You will receive an e-mail notification when the documents become available online. It is your responsibility to provide us with your current e-mail address. You can resume paper mailings at any time without cost, by updating your profile at the Internet Service Center, or contacting us. To learn more about this service, please log on to www.LincolnFinancial.com, select service centers and continue on through the Internet Service Center.

48

Information Incorporated by Reference

Under the Securities Act of 1933, Lincoln Life has filed with the SEC a registration statement on both Form S-3 and Form N-4 (the “Registration Statement”) relating to the Contracts offered by this prospectus. This prospectus is part of the Registration Statement: it does not contain all of the information set forth in the Registration Statement. As described below, and elsewhere in this prospectus, certain documents are or will be incorporated by reference into (i.e. made part of) this prospectus. Any statement contained in a document incorporated by reference into this prospectus in the future will be considered to supplement, change, or replace the existing information set forth in the prospectus, as applicable.

Lincoln Life files reports and other information with the SEC, as required under the Securities Exchange Act of 1934 (“the Exchange Act”). Lincoln Life’s annual report of Form 10-K for the period ended December 31, 2017 is incorporated by reference into this prospectus. Lincoln Life’s annual reports contain information about Lincoln Life, including its consolidated audited financial statements for Lincoln Life’s latest fiscal year. Lincoln Life files its Exchange Act documents and reports (including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K) electronically with the SEC under File No. 000-55871. In addition, all documents subsequently filed by Lincoln Life pursuant to sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering are also incorporated by reference into this prospectus. We are not incorporating by reference, in any case, any documents or information deemed to have been furnished and not filed in accordance with SEC rules.

Independent Registered Public Accounting Firm

The consolidated financial statements of The Lincoln National Life Insurance Company appearing in LNL’s Annual Report (Form 10-K) for the year ended December 31, 2017 (including schedules appearing therein), have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such financial statements are, and audited financial statements to be included in subsequently filed documents will be, incorporated herein in reliance upon the reports of Ernst & Young LLP pertaining to such financial statements (to the extent covered by consents filed with the Securities and Exchange Commission) given on the authority of such firm as experts in accounting and auditing.

Legal Proceedings

In the ordinary course of its business and otherwise, the Company and its subsidiaries or its separate accounts and Principal Underwriter may become or are involved in various pending or threatened legal proceedings, including purported class actions, arising from the conduct of its business. In some instances, the proceedings include claims for unspecified or substantial punitive damages and similar types of relief in addition to amounts for alleged contractual liability or requests for equitable relief.

After consultation with legal counsel and a review of available facts, it is management’s opinion that the proceedings, after consideration of any reserves and rights to indemnification, ultimately will be resolved without materially affecting the consolidated financial position of the Company and its subsidiaries, or the financial position of its separate accounts or Principal Underwriter. However, given the large and indeterminate amounts sought in certain of these proceedings and the inherent difficulty in predicting the outcome of such legal proceedings, it is reasonably possible that an adverse outcome in certain matters could be material to the Company's operating results for any particular reporting period. Please refer to the Statement of Additional Information for possible additional information regarding legal proceedings.

49

(This page intentionally left blank)

50

Contents of the Statement of Additional Information (SAI)
for Lincoln Life Variable Annuity Account N

Item

Special Terms

Services

Principal Underwriter

Purchase of Securities Being Offered

Annuity Payouts

Determination of Accumulation and Annuity Unit Value

Capital Markets

Advertising & Ratings

About the Indices

Unclaimed Property

Additional Services

Other Information

Financial Statements

For a free copy of the SAI complete the form below:

Statement of Additional Information Request Card
Lincoln Level Advantage^SMAdvisory

Lincoln Life Variable Annuity Account N

Please send me a free copy of the current Statement of Additional Information for Lincoln Life Variable Annuity Account N Lincoln Level Advantage^SMAdvisory.

(Please Print)

Name: 

Address: 

City 

State 

Zip 

Mail to The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348.

51

Appendix A – Interim Value Calculation

Interim Value for Indexed Segment(s) with no Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata portion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1+D)^-E where:

C = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by Us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by ((1 + G) X H) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed in the Indexed Term divided by total days in the Indexed Term.

Interim Value for Indexed Segment(s) with Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata proportion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1 + D)^-E where:

C = the initial Indexed Crediting Base of the Indexed Segment that has been proportionately adjusted for any transfers, withdrawals, Death Benefit payouts, or surrenders that have occurred during the Indexed Segment prior to the Valuation Date of the calculation;

D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by (1 + (G x H)) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed since the prior Indexed Anniversary Date divided by 365.

Each component of the calculation is further explained as follows:

1.	The fair value of the Indexed Crediting Base of an Indexed Segment with no Annual Locks or an Indexed Segment with Annual Locks is meant to represent the market value of the investment instruments supporting the Indexed Segment. It is the present value of the Indexed Crediting Base of the Indexed Segment discounted at a rate that reflects movements in the interest rate market. The Reference Rate will apply on a uniform basis for a class of Contractowners in the same Indexed Segment and will be administered in a uniform and non-discriminatory manner.
	The maximum Reference Rate is the average U.S. Treasury Constant Maturity yield plus the LMVA Composite OAS Index rate. The U.S. Treasury Constant Maturity yield is the rate for the maturity using a set duration. The duration is set to represent the duration of the investment instruments supporting the Indexed Segment and may not match the actual length of the Indexed Segment. The average is measured using yields on the 1st, 8th, 15th, and 22nd day of the calendar month preceding the calendar month for which the Reference Rate applies.
	If the U.S. Treasury Constant Maturity yield is not published for a particular day, then we will use the yield on the next day it is published. If the U.S. Treasury Constant Maturity yield is no longer published, or is discontinued, then we may substitute another suitable method for determining this component of the Reference Rate. If a U.S. Treasury Constant Maturity yield is not published for a time to maturity that matches the selected duration, then the yield will be interpolated between the yield for maturities that are published.
	The LMVA Composite OAS Index rate will be as of the last business day of the month for which the Reference Rate applies.

A-1

	If the LMVA Composite OAS Index rate is no longer available, or is discontinued, we will substitute another suitable index or indexes for determining this component of the Reference Rate.
	The Reference Rate may be reduced by a rate reduction factor, which increases the value of (1) above. This rate reduction factor will vary with each Indexed Account option and will be declared at the same time a Performance Cap is declared. Currently, the rate reduction factor does not apply to 1-year Indexed Accounts. This rate reduction factor is available upon request by calling us.
2.	Fair Value of Replicating Portfolio of Options - We utilize a fair market value methodology to value the replicating portfolio of options that support this product.

For each Segment, we solely designate and value options, each of which is tied to the performance of the Index associated with the Segment in which you are invested. We use derivatives to provide an estimate of the gain or loss on the Indexed Crediting Base that could have occurred at the end of the Indexed Term. This estimate also reflects the impact of the Performance Cap and Protection Level at the end of the Indexed Term as well as the estimated cost of exiting the replicating options prior to the End Date of a Segment (and the time to Index Anniversaries for Annual Lock Segments). The valuation of the options is based on standard methods for valuing derivatives and based on inputs from third party vendors. The methodology used to value these options is determined solely by us and may vary, higher or lower, from other estimated valuations or the actual selling price of identical derivatives. Any variance between our estimated fair value price and other estimated or actual prices may be different from Segment type to Segment type and may also change from day to day.

The three options valued for each Indexed Account type are as follows:

A. At-the money call option: This represents the market value of the potential to receive an amount equal to the percentage growth in the Index during the Indexed Term.

B. Out-of-the-money call option: This represents the market value of the potential for gain in excess of the Performance Cap rate.

C. Out-of-the-money put option: This represents the market value of the potential to receive an amount equal to the excess loss beyond the Protection Level.

NOTE: This put option will always reduce the Interim Value even if the Index has increased during the Indexed Term.

The valuation of the options is based on standard models for valuing options for both the non-Annual Lock and Annual Lock Segments. For non-Annual Lock Segments, the replicating portfolio of options is equal to: A minus B minus C. For each Annual Lock Segment, we designate and value a replicating (derivative) structure which is tied to the compounded performance for each year of the Annual Lock Segment. The market standard model is adjusted by us to account for additional market risks relevant to the Annual Lock Segment. The key inputs, including but not limited to the following, are also incorporated into the models:

(1) Implied Volatility of the Index—This input varies with (i) how much time remains until the Segment End Date, which is determined by using an expiration date for the designated option that corresponds to that time remaining and (ii) the relationship between the strike price of that option and the level of the Index at the time of the calculation (including the potential for resets each Annual Lock Period).

This relationship is referred to as the “moneyness” of the option described above, and is calculated as the ratio of current price to the strike price. Direct market data for these inputs for any given early withdrawal is generally not available. This is because options on the Index that actually trade in the market have specific maturity dates and moneyness values that are unlikely to precisely match the Segment End Date (or remaining Annual Lock Periods) and moneyness of the designated option that we use in our calculations. Accordingly, we interpolate between the implied volatility quotes that are based on the actual maturities and moneyness values.

(2) Interest Rate — We use key derivative interest rates obtained from information provided by independent third-parties which are recognized financial reporting vendors. Interest rates are obtained for maturities adjacent to the actual time remaining in the Segment at the time of the early withdrawal. We use linear interpolation to derive the exact remaining duration rate needed as the input.

(3) Index Dividend Yield — On a daily basis, we use the projected annual dividend yield across the entire Index obtained from information provided by independent third-party financial institutions. This value is a widely used assumption and is readily available from recognized financial reporting vendors.

In addition, when we calculate the Interim Value, we obtain market values of derivatives each business day from outside vendors. If we are delayed in receiving these values, and cannot calculate a new Interim Value, we will use the prior business day’s Interim Value.

3. The pro rata portion of the Performance Cap equal to the days in the Indexed Term until the withdrawal is applied to the Indexed Crediting Base to place an upper limit on the performance credited during the Indexed Term.

A-2

SAI 1

Lincoln Level Advantage^SM Advisory
Lincoln Life Variable Annuity Account N  (Registrant)

The Lincoln National Life Insurance Company   (Depositor)

Statement of Additional Information (SAI)

This SAI should be read in conjunction with the Lincoln Level Advantage^SM Advisory prospectus of Lincoln Life Variable Annuity Account N dated May 18, 2018. You may obtain a copy of the Lincoln Level Advantage^SM Advisory prospectus on request and without charge. Please write Lincoln Life Customer Service, The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46802, or call 1-877-737-6872.

Table of Contents

Item	Page
Special Terms	B-2
Services	B-2
Principal Underwriter	B-2
Purchase of Securities Being Offered	B-2
Annuity Payouts	B-2
Determination of Accumulation and Annuity Unit Value	B-3
Capital Markets	B-3

Item	Page
Advertising & Ratings	B-4
About the S&P 500 Index	B-4
Unclaimed Property	B-4
Additional Services	B-5
Other Information	B-5
Financial Statements	B-5

 

 

This SAI is not a prospectus.
The date of this SAI is May 18, 2018.

Special Terms

The special terms used in this SAI are the ones defined in the prospectus.

Services

Independent Registered Public Accounting Firm

Ernst & Young LLP, independent registered public accounting firm, One Commerce Square, 2005 Market Street, Suite 700, Philadelphia, Pennsylvania, 19103, has audited a) the financial statements of the Lincoln Life Variable Annuity Account N comprised of the subaccounts described in the related appendix to the opinion, as of December 31, 2017, and the related statement of operations and the statements of changes in net assets for the periods indicated in the appendix to the opinion; and b) the consolidated financial statements of The Lincoln National Life Insurance Company as of December 31, 2017 and 2016 and for each of the three years in the period ended December 31, 2017, as set forth in their reports, which are included in this SAI and Registration Statement. The aforementioned financial statements are included herein in reliance on Ernst & Young LLP’s reports, given on their authority as experts in accounting and auditing.

Keeper of Records

All accounts, books, records and other documents which are required to be maintained for the VAA are maintained by us or by third parties responsible to Lincoln Life. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. No separate charge against the assets of the VAA is made by us for this service.

Principal Underwriter

Lincoln Financial Distributors, Inc. (“LFD”), an affiliate of Lincoln Life, serves as principal underwriter (the “Principal Underwriter”) for the contracts, as described in the prospectus. The Principal Underwriter offers the contracts to the public on a continuous basis and anticipates continuing to offer the contracts, but reserves the right to discontinue the offering. The Principal Underwriter offers the contracts through sales representatives, who are associated with Lincoln Financial Advisors Corporation and/or Lincoln Financial Securities Corporation (collectively, “LFN”), our affiliates. The Principal Underwriter also may enter into selling agreements with other broker-dealers (“Selling Firms”) for the sale of the contracts. Sales representatives of Selling Firms are appointed as our insurance agents. LFD, acting as Principal Underwriter, paid $561,689,144, $433,441,077 and $485,694,075 to LFN and Selling Firms in 2015, 2016 and 2017 respectively, as sales compensation with respect to all the contracts offered under the VAA. The Principal Underwriter retained no underwriting commissions for the sale of the contracts.

Purchase of Securities Being Offered

The variable annuity contracts are offered to the public through licensed insurance agents who specialize in selling our products; through independent insurance brokers; and through certain securities brokers/dealers selected by us whose personnel are legally authorized to sell annuity products. There are no special purchase plans for any class of prospective buyers. However, under certain limited circumstances described in the prospectus under the section Charges and Other Deductions, any applicable account fee and/or surrender charge may be reduced or waived.

Both before and after the Annuity Commencement Date, there are exchange privileges between Subaccounts, and from the VAA to the general account (if available) subject to restrictions set out in the prospectus. See The Contracts, in the prospectus. No exchanges are permitted between the VAA and other separate accounts.

The offering of the contracts is continuous.

Annuity Payouts

Variable Annuity Payouts

Variable Annuity Payouts will be determined on the basis of:

• the dollar value of the contract on the Annuity Commencement Date less any applicable premium tax;

• the annuity tables contained in the contract;

• the type of annuity option selected; and

B-2

• the investment results of the fund(s) selected.

In order to determine the amount of variable Annuity Payouts, we make the following calculation:

• first, we determine the dollar amount of the first payout;

• second, we credit the contract with a fixed number of Annuity Units based on the amount of the first payout; and

• third, we calculate the value of the Annuity Units each period thereafter.

These steps are explained below.

The dollar amount of the first periodic variable Annuity Payout is determined by applying the total value of the Accumulation Units credited under the contract valued as of the Annuity Commencement Date (less any premium taxes) to the annuity tables contained in the contract. The first variable Annuity Payout will be paid 14 days after the Annuity Commencement Date. This day of the month will become the day on which all future Annuity Payouts will be paid. Amounts shown in the tables are based on the 1983 Table “a” Individual Annuity Mortality Tables, modified, with an assumed investment return at the rate of 3%, 4%, 5% or 6% per annum, depending on the terms of your contract. The first Annuity Payout is determined by multiplying the benefit per $1,000 of value shown in the contract tables by the number of thousands of dollars of value accumulated under the contract. These annuity tables vary according to the form of annuity selected and the age of the Annuitant at the Annuity Commencement Date. The assumed interest rate is the measuring point for subsequent Annuity Payouts. If the actual net investment rate (annualized) exceeds the assumed interest rate, the payout will increase at a rate equal to the amount of such excess.

Conversely, if the actual rate is less than the assumed interest rate, Annuity Payouts will decrease. If the assumed rate of interest were to be increased, Annuity Payouts would start at a higher level but would decrease more rapidly or increase more slowly.

We may use sex-distinct annuity tables in contracts that are not associated with employer sponsored plans and where not prohibited by law.

At an Annuity Commencement Date, the contract is credited with Annuity Units for each Subaccount on which variable Annuity Payouts are based. The number of Annuity Units to be credited is determined by dividing the amount of the first periodic payout by the value of an Annuity Unit in each Subaccount selected. Although the number of Annuity Units is fixed by this process, the value of such units will vary with the value of the underlying fund. The amount of the second and subsequent periodic payouts is determined by multiplying the Contractowner’s fixed number of Annuity Units in each Subaccount by the appropriate Annuity Unit value for the Valuation Date ending 14 days prior to the date that payout is due.

The value of each Subaccount’s Annuity Unit will be set initially at $1.00. The Annuity Unit value for each Subaccount at the end of any Valuation Date is determined by multiplying the Subaccount Annuity Unit value for the immediately preceding Valuation Date by the product of:

• The net investment factor of the Subaccount for the Valuation Period for which the Annuity Unit value is being determined, and

• A factor to neutralize the assumed investment return in the annuity table.

The value of the Annuity Units is determined as of a Valuation Date 14 days prior to the payment date in order to permit calculation of amounts of Annuity Payouts and mailing of checks in advance of their due dates. Such checks will normally be issued and mailed at least three days before the due date.

Determination of Accumulation and Annuity Unit Value

A description of the days on which Accumulation and Annuity Units will be valued is given in the prospectus. The New York Stock Exchange's (NYSE) most recent announcement (which is subject to change) states that it will be closed on weekends and on these holidays: New Year's Day, Martin Luther King Day, President's Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. If any of these holidays occurs on a weekend day, the Exchange may also be closed on the business day occurring just before or just after the holiday. It may also be closed on other days.

Since the portfolios of some of the funds and series will consist of securities primarily listed on foreign exchanges or otherwise traded outside the United States, those securities may be traded (and the net asset value of those funds and series and of the variable account could therefore be significantly affected) on days when the investor has no access to those funds and series.

Capital Markets

In any particular year, our capital may increase or decrease depending on a variety of factors — the amount of our statutory income or losses (which is sensitive to equity market and credit market conditions), the amount of additional capital we must hold to support business growth, changes in reserving requirements, our inability to secure capital market solutions to provide reserve relief, such as issuing letters of credit to support captive reinsurance structures, changes in equity market levels, the value of certain fixed-income and equity securities in our investment portfolio and changes in interest rates.

B-3

Advertising & Ratings

We may include in certain advertisements, endorsements in the form of a list of organizations, individuals or other parties which recommend Lincoln Life or the policies. Furthermore, we may occasionally include in advertisements comparisons of currently taxable and tax deferred investment programs, based on selected tax brackets, or discussions of alternative investment vehicles and general economic conditions.

Our financial strength is ranked and rated by nationally recognized independent rating agencies. The ratings do not imply approval of the product and do not refer to the performance of the product, or any separate account, including the underlying investment options. Ratings are not recommendations to buy our products. Each of the rating agencies reviews its ratings periodically. Accordingly, all ratings are subject to revision or withdrawal at any time by the rating agencies, and therefore, no assurance can be given that these ratings will be maintained. The current outlook for the insurance subsidiaries is stable for Moody’s, A.M. Best and Standard & Poor’s, and positive for Fitch. Our financial strength ratings, which are intended to measure our ability to meet contract holder obligations, are an important factor affecting public confidence in most of our products and, as a result, our competitiveness. A downgrade of our financial strength rating could affect our competitive position in the insurance industry by making it more difficult for us to market our products as potential customers may select companies with higher financial strength ratings and by leading to increased withdrawals by current customers seeking companies with higher financial strength ratings. For more information on ratings, including outlooks, see www.LincolnFinancial.com/investor.

About the S&P 500 Index

The S&P 500 Index (hereinafter “Index”) is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”), and has been licensed for use by Lincoln Variable Insurance Products Trust and its affiliates (hereinafter “Licensee”). Standard & Poor’s^® and S&P^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”) and Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The fund(s) are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or any of their respective affiliates (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices do not make any representation or warranty, express or implied, to the owners of the funds or any member of the public regarding the advisability of investing in securities generally or in the funds particularly or the ability of the Index to track general market performance. S&P Dow Jones Indices only relationship to Licensee with respect to the Index is the licensing of the Index and certain trademarks, service marks and/or trade names of S&P Dow Jones Indices and/or its licensors. The Index is determined, composed and calculated by S&P Dow Jones Indices without regard to Licensee or the funds. S&P Dow Jones Indices have no obligation to take the needs of Licensee or the owners of the funds into consideration in determining, composing or calculating the Index. S&P Dow Jones Indices are not responsible for and have not participated in the determination of the prices, and amount of the funds or the timing of the issuance or sale of the funds or in the determination or calculation of the equation by which the funds are to be converted into cash, surrendered or redeemed, as the case may be. S&P Dow Jones Indices have no obligation or liability in connection with the administration, marketing or trading of the funds. There is no assurance that investment products based on the Index will accurately track index performance or provide positive investment returns. S&P Dow Jones Indices LLC is not an investment advisor. Inclusion of a security within an index is not a recommendation by S&P Dow Jones Indices to buy, sell, or hold such security, nor is it considered to be investment advice.

S&P DOW JONES INDICES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA RELATED THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS THEREIN. S&P DOW JONES INDICES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR WITH RESPECT TO ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P DOW JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN S&P DOW JONES INDICES AND LICENSEE, OTHER THAN THE LICENSORS OF S&P DOW JONES INDICES.

Unclaimed Property

We have entered into a Global Resolution Agreement with a third party auditor representing multiple states and jurisdictions. Under the terms of the Global Resolution Agreement, the third party auditor has compared expanded matching criteria to the Social Security Master Death File (“SSMDF”) to identify deceased insureds and policy or contract holders where a valid claim has not been made. We

B-4

have also entered into a Regulatory Settlement Agreement with multiple states and jurisdictions. The Regulatory Settlement Agreement applies prospectively and requires us to adopt and implement additional procedures comparing our records to the SSMDF to identify unclaimed death benefits and prescribes procedures for identifying and locating beneficiaries once deaths are identified. Other jurisdictions that are not signatories to the Regulatory Settlement Agreement are conducting examinations and audits of our compliance with unclaimed property laws. Any escheatable property identified as a result of the audits and inquiries could result in additional payments of previously unclaimed death benefits or the payment of abandoned funds to U.S. jurisdictions.

Additional Services

Automatic Withdrawal Service (AWS)—AWS provides an automatic, periodic withdrawal of Contract Value to you. AWS may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. You may elect to participate in AWS at the time of application or at any time before the Annuity Commencement Date by sending a written request to us. The minimum Contract Value required to establish AWS is $10,000. You may cancel or make changes to your AWS program at any time by sending a written request to us. If telephone authorization has been elected, certain changes may be made by telephone. Notwithstanding the requirements of the program, any withdrawal must be permitted under Section 401(a)(9) of the IRC for qualified plans or permitted under Section 72 of the IRC for nonqualified contracts. To the extent that withdrawals under AWS do not qualify for an exemption from the contingent deferred sales charge, we will assess any applicable surrender charges on those withdrawals. See Surrender Charge.

Portfolio Rebalancing — Portfolio rebalancing is an option, which, if elected by the Contractowner, restores to a pre-determined level the percentage of the Contract Value (or Account Value under i4LIFE^® Advantage), allocated to each variable Subaccount. This pre-determined level will be the allocation initially selected when the contract was purchased, unless subsequently changed. The portfolio rebalancing allocation may be changed at any time by submitting a written request to us. If portfolio rebalancing is elected, all Purchase Payments allocated to the variable Subaccounts must be subject to portfolio rebalancing. Portfolio rebalancing may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. The Contractowner may terminate the portfolio rebalancing program or re-enroll at any time by sending a written request to us. If telephone authorization has been elected, the Contractowner may make these elections by phone. The portfolio rebalancing program is not available following the Annuity Commencement Date.

Please note that all of the services discussed in this section will stop once we are notified of a pending death claim.

Other Information

Due to differences in redemption rates, tax treatment or other considerations, the interests of policyholders under the variable life accounts could conflict with those of Contractowners under the VAA. In those cases, where assets from variable life and variable annuity separate accounts are invested in the same fund(s) (i.e., where mixed funding occurs), the Boards of Directors of the fund involved will monitor for any material conflicts and determine what action, if any, should be taken. If it becomes necessary for any separate account to replace shares of any fund with another investment, that fund may have to liquidate securities on a disadvantageous basis. Refer to the prospectus for each fund for more information about mixed funding.

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life appear on the following pages.

B-5

Prospectus 2

Lincoln Level Advantage^SM B-Class Individual Variable and Index-Linked Annuity Contracts
Lincoln Life Variable Annuity Account N  

May 18, 2018

Home Office:
The Lincoln National Life Insurance Company
1300 South Clinton Street
Fort Wayne, IN 46802
www.LincolnFinancial.com
1-877-737-6872

This prospectus describes an individual flexible premium variable and index-linked deferred annuity contract issued by The Lincoln National Life Insurance Company (Lincoln Life or Company).

This contract can be purchased as either a nonqualified annuity or qualified retirement annuity under Section 408 (IRAs) or 408A (Roth IRAs) of the tax code. Generally, you do not pay federal income tax on the contract's growth until it is paid out. You receive tax deferral for an IRA whether or not the funds are invested in an annuity contract. Further, if your contract is a Roth IRA, you generally will not pay income tax on a distribution, provided certain conditions are met. Therefore, there should be reasons other than tax deferral for purchasing a qualified annuity contract. We offer other types of annuity contracts that may offer different investment options, features, and optional benefits. You should carefully consider whether or not this contract is the best product for you.

The contract is designed to accumulate Contract Value and to provide retirement income over a certain period of time or for life subject to certain conditions. The benefits offered under this contract may be a variable or index-linked amount or both. This contract also offers a Death Benefit payable upon the death of the Contractowner or Annuitant. This prospectus is used by both new purchasers and current Contractowners.

This prospectus describes all material rights and obligations of annuity purchasers under the contract.

The state in which your contract is issued will govern whether or not certain features, riders, restrictions, limitations, charges and fees will apply to your contract. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

The minimum initial Purchase Payment for the contract is $25,000. Additional Purchase Payments may be made to the contract, subject to certain restrictions, and must be at least $100 per payment ($25 if transmitted electronically), and at least $300 annually. We reserve the right to limit, restrict, or suspend Purchase Payments made to the contract upon advance written notice. Purchase Payments and Contract Value may be allocated to the Indexed Accounts only on the initial Start Date or Indexed Anniversary Date and must be at least $2,000.

You choose whether to invest in variable investment options, in one or more index-linked accounts, or both.

You invest in the index-linked portion of the contract by choosing one or more of the available Indexed Accounts. Indexed Accounts are established for either 1- or 6-year terms, and the return on these accounts at the end of the term is based in part on the performance of a specified index. The gain for each Indexed Segment is limited by a specified Performance Cap, and your Contract Value will not be impacted by any loss up to the applicable Protection Level if you hold for the length of the term. The returns on the 6-year Indexed Accounts are calculated either with an Annual Lock or without an Annual Lock. An Interim Value for each Indexed Segment is calculated each Valuation Date prior to the last day of the term.

The Indexed Accounts of the contract are supported by the assets of a non-registered, non-insulated separate account of the Company which has been established to support the Company’s obligations with respect to the Indexed Accounts. The Indexed Accounts are not invested in any underlying fund. We do not guarantee how any of the Indexed Accounts will perform. There is a risk of loss of your investment because you agree to absorb all losses in excess of the level of protection you selected.

Index-linked annuity contracts are complex insurance and investment vehicles. Investors should speak with a financial professional about the contract’s features, benefits, risks, and fees, and whether the contract is appropriate for the investor based upon his or her financial situation and objectives.

The available Indexed Accounts are listed below:

1

1-Year Indexed Accounts

S&P 500^{® (1)}, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^{® (2)}, 10% Protection

Capital Strength Net Fee Index^{SM (3)}, 10% Protection

MSCI EAFE ⁽⁴⁾, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM, 10% Protection

Annual Lock MSCI EAFE, 10% Protection

We calculate an Interim Value in the event you take a withdrawal in the middle of a term. The Interim Value calculation is not based on the value of the Index. This means that you could have a negative performance, even if the Index Value has increased. We do not guarantee that an Indexed Account option will always be available. Amounts paid to you from the Indexed Accounts are subject to our credit worthiness and claims paying ability.

Refer to the Risk Factors section beginning on page 12 for more information.

All Purchase Payments allocated to underlying funds will be placed in Lincoln Life Variable Annuity Account N (Variable Annuity Account [VAA]). The VAA is a segregated investment account of Lincoln Life. You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the contract’s variable options (“Subaccounts”), which, in turn, invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, it goes down. How much it goes up or down depends on the performance of the Subaccounts you select. We do not guarantee how any of the Subaccounts or their funds will perform. Also, neither the U.S. Government nor any federal agency insures or guarantees your investment in the contract. The contracts are not bank deposits and are not endorsed by any bank or government agency.

The available Subaccounts are listed below:

AIM Variable Insurance Funds (Invesco Variable Insurance Funds)

Invesco V.I. Equally-Weighted S&P 500 Fund⁵

American Funds Insurance Series^®

American Funds Asset Allocation Fund

American Funds Growth Fund

BlackRock Variable Series Funds, Inc.

BlackRock Global Allocation V.I. Fund

Fidelity^® Variable Insurance Products

Fidelity^® VIP Mid Cap Portfolio

First Trust Variable Insurance Trust

First Trust/Dow Jones Dividend & Income Allocation Portfolio⁶

Franklin Templeton Variable Insurance Products Trust

Franklin Rising Dividends VIP Fund

JPMorgan Insurance Trust

JPMorgan Insurance Trust Core Bond Portfolio

Lincoln Variable Insurance Products Trust

LVIP Government Money Market Fund

LVIP MFS Value Fund

LVIP PIMCO Low Duration Bond Fund

LVIP SSGA International Index Fund

LVIP SSGA S&P 500 Index Fund⁴

LVIP SSGA Small-Cap Index Fund

 

 

This prospectus gives you information about the contract that you should know before you decide to buy a contract and make Purchase Payments. The risk of loss can become greater in the case of an early withdrawal due to any surrender charges and the Interim Value of such withdrawals. You should also review the prospectuses for the funds and keep all prospectuses for future reference.

Neither the SEC nor any state securities commission has approved this contract or determined that this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

More information about the contract is in the current Statement of Additional Information (SAI), dated the same date as this prospectus. The SAI is incorporated by reference into this prospectus and is legally part of this prospectus. The SAI is part of the registration statement filed on Form N-4. For a free copy of the SAI, write: The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. The SAI and other information about Lincoln Life and the VAA are also available on the SEC's website (http://www.sec.gov). There is a table of contents for the SAI on the last page of this prospectus.

¹ The S&P 500 Price Return Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by The Lincoln National Life Insurance Company. Standard & Poor’s^®, S&P^®, and S&P 500^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by

2

The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s product is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index.

² The Russell 2000 Price Return Index (the “Index”) is a trademark of Frank Russell Company (“Russell”) and has been licensed for use by The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s products are not in any way sponsored, endorsed, sold or promoted by Russell or the London Stock Exchange Group companies (“LSEG”) (together the “Licensor Parties”), and none of the Licensor Parties make any claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to (i) the results to be obtained from the use of the Index (upon which The Lincoln National Life Insurance Company’s product is based), (ii) the figure at which the Index is said to stand at any particular time on any particular day or otherwise, or (iii) the suitability of the Index for the purpose to which it is being put in connection with The Lincoln National Life Insurance Company product. None of the Licensor Parties have provided or will provide any financial or investment advice or recommendation in relation to the Index to The Lincoln National Life Insurance Company or to its clients. The Index is calculated by Russell or its agent. None of the Licensor Parties shall be (a) liable (whether in negligence or otherwise) to any person for any error in the Index or (b) under any obligation to advise any person of any error therein.

³ Capital Strength Net Fee Index^SM. The Product(s) is not sponsored, endorsed, sold or promoted by NASDAQ, Inc. or its affiliates (NASDAQ, with its affiliates, are referred to as the “Corporations”). The Corporations have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to, the Product(s). The Corporations make no representation or warranty, express or implied to the owners of the Product(s) or any member of the public regarding the advisability of investing in securities generally or in the Product(s) particularly, or the ability of the Capital Strength Net Fee Index to track general stock market performance. The Corporations' only relationship to Lincoln Financial Group (“Licensee”) is in the licensing of the Nasdaq^® and certain trade names of the Corporations and the use of the Capital Strength Net Fee Index which is determined, composed and calculated by NASDAQ without regard to Licensee or the Product(s). NASDAQ has no obligation to take the needs of the Licensee or the owners of the Product(s) into consideration in determining, composing or calculating the Capital Strength Net Fee Index. The Corporations are not responsible for and have not participated in the determination of the timing of, prices at, or quantities of the Product(s) to be issued or in the determination or calculation of the equation by which the Product(s) is to be converted into cash. The Corporations have no liability in connection with the administration, marketing or trading of the Product(s).

THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED CALCULATION OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE PRODUCT(S), OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE CAPITAL STRENGTH NET FEE INDEX^® OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES

⁴ MSCI Price Return EAFE. The securities referred to herein are not sponsored, endorsed or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities, or any index on which such securities are based. The Prospectus contains a more detailed description of the limited relationship MSCI has with Lincoln Financial Group and any related funds.

⁵ Standard & Poor’s^®,” “S&P^®,” “Standard & Poor’s Equal Weight Index,” “S&P EWI,” “S&P 500^®,” “Standard & Poor’s 500” and “500” are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by the Invesco V.I. Equally-Weighted S&P 500 Fund. The fund is not sponsored, endorsed, sold or promoted by S&P, and S&P makes no representation regarding the advisability of investing in the fund.

⁶ Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The trademark has been licensed to S&P Dow Jones Indices LLC and has been sublicensed for use for certain purposes by First Trust Advisors L.P. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of purchasing the product.

3

Table of Contents

Item	Page
Special Terms	5
Summary of Common Questions	7
Expense Tables	10
Risk Factors	12
Condensed Financial Information	14
The Lincoln National Life Insurance Company	15
Investments of the Indexed Accounts	16
Variable Annuity Account (VAA)	21
Investments of the Variable Annuity Account	21
Charges and Other Deductions	24
The Contracts	26
Contracts Offered in this Prospectus	26
Purchase Payments	27
Transfers On or Before the Annuity Commencement Date	29
Surrenders and Withdrawals	31
Death Benefit	33
i4LIFE® Indexed Advantage	35
Annuity Payouts	39
Distribution of the Contracts	42
Federal Tax Matters	43
Additional Information	48
Voting Rights	48
Return Privilege	49
State Regulation	49
Records and Reports	49
Contents of the Statement of Additional Information (SAI) for Lincoln Life Variable Annuity Account N	52
Appendix A – Interim Value Calculation	A-1

4

Special Terms

In this prospectus, the following terms have the indicated meanings:

Access Period—Under i4LIFE^® Indexed Advantage, a defined period of time during which we make Periodic Income Payments to you while you still have access to your Account Value. This means that you may make withdrawals, surrender the contract, and have a Death Benefit.

Account or Variable Annuity Account (VAA)—The segregated investment account, Account N, into which we set aside and invest the assets for the Subaccounts offered in this prospectus.

Account Value—Under i4LIFE^®Indexed Advantage, the Account Value on a Valuation Date equals the total value of all the Contractowner’s Accumulation Units plus the Contractowner’s value in the Indexed Segments and the Periodic Income Payment Account, if any.

Accumulation Unit—A measure used to calculate the assets in the Subaccounts before the Annuity Commencement Date and to calculate the variable side of the i4LIFE^® Indexed Advantage Account Value during the Access Period.

Annuitant—The person upon whose life the annuity benefit payments are based, and upon whose death a Death Benefit may be paid.

Annuity Commencement Date—The Valuation Date when funds are withdrawn or converted into Annuity Units or fixed dollar payout for payment of retirement income benefits under the Annuity Payout option you select (other than i4LIFE^® Indexed Advantage).

Annuity Payout—A regularly scheduled payment (under any of the available annuity options) that occurs after the Annuity Commencement Date (or the i4LIFE^® Indexed Advantage effective date if applicable). Payments may be variable or index-linked under i4LIFE^® Indexed Advantage or variable and fixed under other options.

Annuity Unit—A measure used to calculate the amount of Annuity Payouts for the variable side of the contract after the Annuity Commencement Date.

Beneficiary—The person you choose to receive any Death Benefit paid if you die before the Annuity Commencement Date.

Contractowner (you, your, owner)—The person who can exercise the rights within the contract (decides on investment allocations, transfers, payout option, designates the Beneficiary, etc.). Usually, but not always, the Contractowner is the Annuitant.

Contract Value (may be referred to as Account Value in marketing materials)—At any given time before the Annuity Commencement Date, the total value of any allocations in the Subaccounts, the Indexed Segments, and the transfer account, if any.

Contract Year—Each 12-month period starting with the effective date of the contract and starting with each contract anniversary after that.

Death Benefit—Before the Annuity Commencement Date, the amount payable to your designated Beneficiary if the Contractowner dies. As an alternative, the Contractowner may receive a Death Benefit on the death of the Annuitant prior to the Annuity Commencement Date.

End Date—The last day of the Indexed Term.

Good Order—The actual receipt at our Home Office of the requested transaction in writing or by other means we accept, along with all information and supporting legal documentation necessary to effect the transaction. The forms we provide will identify the necessary documentation. We may, in our sole discretion, determine whether any particular transaction request is in Good Order, and we reserve the right to change or waive any Good Order requirements at any time.

Index Value—The published closing value of an index on a Valuation Date. If an Index Value is not published for a particular day, we will use the closing Index Value on the next Valuation Date it is published.

Indexed Account—An investment option that provides a return based, in part, on the performance of an index.

Indexed Anniversary Date—The same calendar day, each calendar year, as the day you first invested in an Indexed Segment.

Indexed Crediting Base—An amount used in the calculation of the performance return and the Interim Value for an Indexed Segment.

Indexed Segment—The specific Indexed Account option(s) selected by a Contractowner for allocations of Purchase Payments or transfer of Contract Value.

Indexed Term—The period of time during which Contract Value is invested in a particular Indexed Segment.

Interim Value—Your Contract Value for an Indexed Segment during an Indexed Term. The Interim Value is a calculated value and is used in the event that a withdrawal, Death Benefit payment, transfer, annuitization, or surrender occurs at any time other than the Start Date or End Date of an Indexed Term.

Lifetime Income Period—Under i4LIFE^® Indexed Advantage, the period of time following the Access Period during which we make Periodic Income Payments to you for the rest of your life (and Secondary Life, if applicable). During the Lifetime Income Period, you will no longer have access to your Account Value or receive a Death Benefit.

Lincoln Life (we, us, our, Company)—The Lincoln National Life Insurance Company.

Performance Cap or Cap—The highest Performance Rate that can be credited to an Indexed Segment over a specified period of time. A different Cap may be declared for each Indexed Segment and for each Death Benefit type.

Performance Rate—A rate of return for an Indexed Segment based on the performance of an Index over a period of time, adjusted for the Protection Level and subject to the Performance Cap.

Periodic Income Payments—The amounts paid under i4LIFE^® Indexed Advantage.

Periodic Income Payment Account—The account from which the Periodic Income Payments will be paid under i4LIFE^® Indexed Advantage.

Protection Level—The portion of any negative index performance of an Indexed Account that the Company will absorb.

 

 

5

Purchase Payments—Amounts paid into the contract.

Rider Year—Under i4LIFE^® Indexed Advantage, the 12-month period starting with the effective date of the rider and starting with each anniversary of the rider effective date after that.

Secondary Life—Under i4LIFE^® Indexed Advantage, the person designated by the Contractowner upon whose life the annuity payments will also be contingent.

Segment Maturity Value—The value of an Indexed Segment on the End Date after adjustment for the Performance Rate.

Selling Group Individuals—A Contractowner who meets one of the following criteria at the time of the contract purchase and who purchases the contract without the assistance of a registered representative under contract with us:

• Employees and registered representatives of any member of the selling group (broker-dealers who have selling agreements with us for the products described in this prospectus) and their spouses and minor children.

• Officers, directors, trustees or bona-fide full-time employees and their spouses and minor children of Lincoln Financial Group or any of the investment advisers of the funds currently being offered, or their affiliated or managed companies.

Start Date—The Valuation Date on which the Indexed Segment begins.

Subaccount—Each portion of the VAA that reflects investments in Accumulation and Annuity Units of a class of a particular fund available under the contracts. There is a separate Subaccount which corresponds to each class of a fund.

Valuation Date—Each day the New York Stock Exchange (NYSE) is open for trading.

Valuation Period—The period starting at the close of trading (normally 4:00 p.m. New York time) on each day that the NYSE is open for trading (Valuation Date) and ending at the close of such trading on the next Valuation Date.

6

Summary of Common Questions

What kind of contract am I buying? It is an individual variable and/or index-linked deferred annuity contract between you and Lincoln Life. This contract and certain riders, benefits, service features and enhancements may not be available in all states, and the charges may vary in certain states. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

What is the Variable Annuity Account (VAA)? It is a separate account we established under Indiana insurance law, and registered with the SEC as a unit investment trust. VAA assets are allocated to one or more Subaccounts, according to your investment choices. VAA assets are not chargeable with liabilities arising out of any other business which we may conduct. See Variable Annuity Account.

What are Indexed Accounts? The Indexed Accounts provide a return, in part, based on the performance of an index you select. The return may be positive or negative and is called the Performance Rate. The Performance Rate includes a Performance Cap, which is the maximum percentage amount you can earn during the Indexed Term and a Protection Level, which is the percentage of any negative index performance we will absorb. You may allocate all or a portion of your Purchase Payments into one or more Indexed Segments of Indexed Accounts. Each Indexed Segment has its own Indexed Term, Contract Value and Performance Cap. An Indexed Account is defined by the index tracked, the length of the term, and the Protection Level it provides, and whether or not the calculation includes an Annual Lock.

The Performance Cap and Protection Level will not change during an Indexed Term. At the end of the Index Term, new Indexed Segments will be available which may have different Performance Caps and different Protection Levels. We will notify you in advance of your Indexed Anniversary Date. If we do not hear from you by the end of the Indexed Term, we will transfer your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for the new Indexed Segment will apply. Subsequent transfers from the new Indexed Segment will be at Interim Value. If the same type Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund.

What is the Index-Linked Separate Account? Assets supporting the Indexed Accounts are held in a non-insulated separate account established under Indiana insurance law. These assets are not insulated from the creditors of Lincoln Life. Therefore, the benefits provided under the Indexed Accounts are subject to the claims paying ability of Lincoln Life.

What is the Interim Value? We calculate the Interim Value of your Indexed Segments each Valuation Date. This calculation is based on a formula and may not correspond to the current performance of the Index you selected. This formula includes the value of derivatives at the time of the calculation of the Interim Value. The derivatives replicate what the performance credited would be based on the performance of the Index to the end of the Indexed Segment. Your Contract Value for Indexed Segments during the Indexed Term will equal the Interim Value. This means that the Contract Value in the Segments available for withdrawals, surrenders, transfers, annuitizations, and Death Benefit payments during an Indexed Term will be at the Interim Value. This Interim Value formula may result in a loss even if the Index Value at the time of the withdrawal is higher than the Index Value at the beginning of the Indexed Term.

Can the available Indexed Accounts and indices change over the life of the contract? We reserve the right to add or withdraw Indexed Accounts at any time. If you are invested in an Indexed Segment, it will not be withdrawn from your contract until the end of the Indexed Term. There is no guarantee that an Indexed Account with a Protection Level will be available or that a particular Index will be available in the future. If an Index is discontinued or substantially changed during a Segment Term, we reserve the right to select an alternative Index and we will notify you of such change. This may impact the calculation of your Segment Maturity Value and your future Interim Value.

What are my investment choices? You may allocate your Purchase Payments to the VAA or to one or more Indexed Segments. Based upon your instruction, Purchase Payments into the VAA will be applied to one or more of the Subaccounts, which, in turn, invest in a corresponding underlying fund. Each fund holds a portfolio of securities consistent with its investment policy. See Investments of the Variable Annuity Account – Description of the Funds. Purchase Payments into the Indexed Segments will be held in a non-insulated separate account and payments are subject to the financial strength of the Company. Indexed Accounts with Indexed Terms of 1 or 6 years are currently available. The currently offered Indices are S&P 500^® Price Return Index, Russell 2000^® Price Return Index, MSCI EAFE Price Return Index and Capital Strength Net Fee Index^SM. See Indexed Accounts.

Who invests my money? Several different investment advisers manage the investment options for the Subaccounts. See Investments of the Variable Annuity Account – Description of the Funds. Assets allocated to the Indexed Segments are invested by the investment advisers of the Company’s general account.

How does the contract work? If we approve your application, we will send you a contract. When you make Purchase Payments during the accumulation phase, you buy Accumulation Units with amounts allocated to the variable side of the contract. Amounts allocated to the Indexed Accounts are valued each day, as described in the Interim Value section. If you decide to receive an Annuity Payout, your Accumulation Units are converted to Annuity Units. Your Annuity Payouts will be based on the number of Annuity Units you receive

7

and the value of each Annuity Unit on payout days. Indexed Accounts are not available for Annuity Payouts (except i4LIFE^® Indexed Advantage). A fixed Annuity Payout is also available. See The Contracts.

What charges do I pay under the contract? We apply a Product Charge to the daily net asset value in the Subaccounts for the Death Benefit you select. The Product Charge consists of a mortality and expense risk charge and an administrative charge. There is also a charge for any riders applicable to your contract. See Charges and Other Deductions.

If you withdraw Purchase Payments, you may pay a surrender charge of a certain percentage of the surrendered or withdrawn Purchase Payment, depending upon how long those payments have been invested in the contract. For purposes of calculating surrender charges, we assume that all withdrawals prior to the sixth anniversary come first from Purchase Payments. We may waive surrender charges in certain situations. See Charges and Other Deductions – Surrender Charge.

We will deduct any applicable premium tax from Purchase Payments or Contract Value, unless the governmental entity dictates otherwise, at the time the tax is incurred or at another time we choose.

See Expense Tables and Charges and Other Deductions for information regarding additional fees and expenses that may be incurred.

The funds’ investment management fees, expenses and expense limitations, if applicable, are more fully described in the prospectuses for the funds.

Charges may also be imposed during the Annuity Payout period. See Annuity Payouts.

For information about the compensation we pay for sales of contracts, see The Contracts – Distribution of the Contracts.

Am I limited in the amount of Purchase Payments I can make into the contract? Your Purchase Payments are flexible but subject to the following limitations. Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. Upon providing advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract, including those made into any or all of the Indexed Accounts.

How will my Annuity Payouts be calculated? If you decide to annuitize, you may select an annuity option and start receiving Annuity Payouts from your contract as a fixed option or variable option or a combination of both. See Annuity Payouts - Annuity Options. Any portion of Contract Value invested in the Indexed Accounts must be transferred to the VAA prior to the annuitization, or must be used to purchase a fixed annuity. Remember that participants in the VAA benefit from any gain, and take a risk of any loss, in the value of the securities in the funds' portfolios, which would decrease the amount applied to any payout option and the related payments.

What happens if I die before I annuitize? The Death Benefit may be paid upon the death of either the Contractowner or the Annuitant. Upon the death of the Contractowner, your Beneficiary will receive Death Benefit proceeds. Your Beneficiary has options as to how the Death Benefit is paid. In the alternative, upon the death of the Annuitant the Contractowner may choose to receive a Death Benefit. See The Contracts – Death Benefit.

What are the Death Benefit options available under my Contract? The Guarantee of Principal Death Benefit is the default Death Benefit available with the base contract. The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of your current Contract Value (including the Interim Value of the Indexed Accounts) or the sum of all Purchase Payments, as adjusted for withdrawals. The Guarantee of Principal Death Benefit will automatically terminate and only the Contract Value will be paid upon the death of a Contractowner or Annuitant who was changed (except if the change occurred because of the death of a prior Contractowner or Annuitant). The Account Value Death Benefit provides a Death Benefit equal to the Contract Value (including the Interim Value) on the Valuation Date the death claim is approved by us for payment. It is not available for election at the time your contract is issued. If all the Contractowners and Annuitants under the contract are changed, then the product charge and Death Benefit will change to the Account Value Death Benefit. See The Contracts – Death Benefits for a complete description of these Death Benefit options. Refer to the i4LIFE^® Indexed Advantage Death Benefits for specific Death Benefit features when i4LIFE^® Indexed Advantage is elected.

What happens if I die on or after the Annuity Commencement Date? Once you reach the Annuity Commencement Date, any applicable Death Benefit will terminate.

May I transfer Contract Value between variable options and between the Subaccounts and Indexed Accounts? Yes, subject to certain restrictions. Generally, transfers made before the Annuity Commencement Date are restricted to no more than 12 per Contract Year. There is no charge for a transfer. Transfers into new Indexed Segments can only be made on the Indexed Anniversary Date. Transfers out of the Indexed Segments will be made at Interim Value unless your transfer occurs on the End Date. No transfers can be made into existing Indexed Segments. The minimum amount that can be transferred to an Indexed Account is $2,000. See The Contracts – Transfers on or Before the Annuity Commencement Date and Transfers After the Annuity Commencement Date.

What is i4LIFE^® Indexed Advantage?i4LIFE^® Indexed Advantage is an Annuity Payout option, available for purchase at an additional charge, that provides periodic lifetime income payments. During the Access Period, you have access to your Account Value, which means you have a Death Benefit and may surrender the contract or make withdrawals.

8

May I surrender the contract or make a withdrawal? Yes, subject to contract requirements and to the restrictions of any qualified retirement plan for which the contract was purchased. If you surrender the contract or make a withdrawal, certain surrender charges may apply. Withdrawals or surrenders from the Indexed Accounts will be at Interim Value unless the surrender or withdrawal occurs on the End Date. A portion of surrender or withdrawal proceeds may be taxable. In addition, if you decide to take a distribution before age 59½, a 10% Internal Revenue Service (IRS) additional tax may apply. A surrender or a withdrawal also may be subject to 20% withholding. See The Contracts – Surrenders and Withdrawals, Charges and Other Deductions and Federal Tax Matters.

Can I cancel this contract? Yes. You can cancel the contract within ten days (in some states longer) of the date you first receive the contract. You need to return the contract, postage prepaid, to our Home Office. In most states you assume the risk of any market drop on Purchase Payments you allocate to the variable side of the contract and the Interim Value of the Indexed Segments. See Return Privilege.

9

Expense Tables

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the contract.

The first table describes the fees and expenses that you will pay at the time that you surrender or make a withdrawal from the contract. State premium taxes may also be deducted. The premium tax rates range from zero to 5%.

CONTRACTOWNER TRANSACTION EXPENSES

Accumulation Phase:
Surrender charge (as a percentage of Purchase Payments surrendered/withdrawn):1	7.00%

¹ The surrender charge percentage is reduced over a 6-year period at the following rates: 7%, 7%, 6%, 5%, 4%, 3%. We may reduce or waive this charge in certain situations. See Charges and Other Deductions – Surrender Charge.

The following tables describe the fees and expenses that you will pay periodically during the time that you own the contract, not including fund fees and expenses.

• Table A reflects the subaccount expenses for the VAA.

• Table B reflects the i4LIFE^® Indexed Advantage Rider Charge.

TABLE A

Subaccount Expenses for the VAA

VAA Separate Account Annual Expenses (as a percentage of average daily net assets in the Subaccounts):1
Guaranteed Maximum and Current Product Charges:
Guarantee of Principal Death Benefit
Mortality and Expense Risk Charge	1.20%
Administrative Charge	0.10%
Total Separate Account Expenses	1.30%

¹ The Product Charge is 1.10% after the Annuity Commencement Date. The Guarantee of Principal Death Benefit will automatically terminate at any time all Contractowners or Annuitants are changed. If this happens, the Account Value Death Benefit will be in effect, and the Product Charge of 1.10% for the Account Value Death Benefit will apply.

TABLE B

i4LIFE^® Indexed Advantage

i4LIFE® Indexed Advantage rider charge:1
Guaranteed Maximum and Current Annual Charge	0.40%

¹ The i4LIFE^® IndexedAdvantage charge will be deducted from your variable and index-linked Account Value on each rider anniversary. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information. During the Lifetime Income Period, the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The next item shows the minimum and maximum total annual operating expenses charged by the funds that you may pay
periodically during the time that you own the contract. The expenses are for the year ended December 31, 2017, adjusted to reflect anticipated changes in fees and expenses, or, for new portfolios, are based on estimates for the current fiscal year. More detail concerning each fund's fees and expenses is contained in the prospectus for each fund.

10

	Minimum	Maximum
Total Annual Fund Operating Expenses (expenses that are deducted from fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses)	0.49%	1.23%
Total Annual Fund Operating Expenses (after contractual waivers/reimbursements*)	0.49%	1.20%

*Some of the funds have entered into contractual waiver or reimbursement arrangements that may reduce fund management and other fees and/or expenses during the period of the arrangement. These arrangements vary in length, but no arrangement will terminate before April 30, 2019. There can be no assurance that fund expense waivers or reimbursements will be extended beyond their current terms as outlined in each fund prospectus, and they may not cover certain expenses such as extraordinary expenses. Certain of these arrangements may provide that amounts previously waived or reimbursed may be recovered in future years. See each fund prospectus for complete information regarding annual operating expenses and any waivers or reimbursements in effect for a particular fund.

The following table shows the expenses charged by each fund for the year ended December 31, 2017:
(as a percentage of each fund’s average net assets):

	Management Fees (before any waivers/ reimburse- ments)	+	12b-1 Fees (before any waivers/ reimburse- ments)	+	Other Expenses (before any waivers/ reimburse- ments)	+	Acquired Fund Fees and Expenses	=	Total Expenses (before any waivers/ reimburse- ments)	Total Contractual waivers/ reimburse- ments (if any)	Total Expenses (after Contractual waivers/ reimburse- ments)
American Funds Asset Allocation Fund - Class 4	0.27%		0.25%		0.27%		0.00%		0.79%	0.00%	0.79%
American Funds Growth Fund - Class 4	0.33%		0.25%		0.27%		0.00%		0.85%	0.00%	0.85%
BlackRock Global Allocation V.I. Fund - Class III	0.63%		0.25%		0.25%		0.01%		1.14%	-0.13%	1.01%
Fidelity® VIP Mid Cap Portfolio - Service Class 2	0.54%		0.25%		0.09%		0.00%		0.88%	0.00%	0.88%
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I	0.60%		0.25%		0.38%		0.00%		1.23%	-0.03%	1.20%
Franklin Rising Dividends VIP Fund - Class 4	0.60%		0.35%		0.02%		0.00%		0.97%	0.00%	0.97%
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares	0.12%		0.25%		0.20%		0.00%		0.57%	0.00%	0.57%
JPMorgan Insurance Trust Core Bond Portfolio - Class 2	0.40%		0.25%		0.22%		0.00%		0.87%	-0.02%	0.85%
LVIP Government Money Market Fund - Service Class	0.38%		0.25%		0.11%		0.00%		0.74%	0.00%	0.74%
LVIP MFS Value Fund - Service Class	0.61%		0.25%		0.07%		0.00%		0.93%	0.00%	0.93%
LVIP PIMCO Low Duration Bond Fund - Service Class	0.50%		0.25%		0.25%		0.00%		1.00%	-0.04%	0.96%
LVIP SSGA International Index Fund - Service Class	0.40%		0.25%		0.11%		0.00%		0.76%	-0.12%	0.64%
LVIP SSGA S&P 500 Index Fund - Service Class	0.17%		0.25%		0.07%		0.00%		0.49%	0.00%	0.49%
LVIP SSGA Small-Cap Index Fund - Service Class	0.32%		0.25%		0.08%		0.00%		0.65%	0.00%	0.65%

Certain underlying funds have reserved the right to impose fees when fund shares are redeemed within a specified period of time of purchase (“redemption fees”) which are not reflected in the table above. As of the date of this prospectus, none have done so. See The Contracts - Market Timing for a discussion of redemption fees.

For information concerning compensation paid for the sale of the contracts, see Distribution of the Contracts.

EXAMPLES

The following Example is intended to help you compare the cost of investing in the contract with the cost of investing in other variable annuity contracts. These costs include Contractowner transaction expenses, contract fees, separate account annual expenses, and fund fees and expenses. The Example has been calculated using the fees and expenses of the funds prior to the application of any contractual waivers and/or reimbursements, and assumes that no money was invested in the Indexed Accounts.

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the i4LIFE^® Indexed Advantage with the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

11

1 year	3 years	5 years	10 years
$996	$1,507	$1,943	$3,252

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$296	$907	$1,543	$3,252

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$956	$1,387	$1,745	$2,865

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$256	$787	$1,345	$2,865

For more information, see Charges and Other Deductions in this prospectus, and the prospectus for the funds. Premium taxes may also apply, although they do not appear in the examples. Different fees and expenses not reflected in the examples may be imposed during a period in which Annuity Payouts are made. See Annuity Payouts. These examples should not be considered a representation of past or future expenses. Actual expenses may be more or less than those shown.

Risk Factors

This section describes potential risks associated with your contract.

General Risks

1.	We reserve the right, within the law, to make certain changes to the structure and operation of the VAA or Indexed Accounts at our discretion and without your consent. We reserve the right to limit Purchase Payments into the contract. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. We may add to or delete Indexed Accounts currently available. We do not guarantee that an Indexed Account option will always be available.
2.	You may incur a surrender charge upon the surrender or withdrawal of Contract Value. See Charges and Other Deductions – Surrender Charge.
3.	Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s can experience outages or slowdowns for a variety of reasons and may not always be available. These outages or slowdowns may delay or prevent our processing your surrender, withdrawal, or transfer request.

Risks of Investing in the Indexed Accounts

1.	There is a risk of loss of your investment in the Indexed Segments since the performance tracks a market index. You are responsible for all losses in excess of the Protection Level you choose. The Protection Level exists for the full term of the Indexed Segment including Segments with Annual Locks. When you move into a new Indexed Segment after the end of an Indexed Term the performance will be calculated for the new Segment, which may have a new Protection Level, which could also result in a loss. There is also a risk of loss upon an early withdrawal. For Annual Lock accounts, since the gain or loss is established each year, losses can accumulate so that you could actually lose more than the percentage amount in excess of the Protection Level percent. For example, if you chose a 10% Protection Level, you could lose more than 90% of your principal in an Annual Lock account.
2.	Gains in your Indexed Segments are limited by any applicable Performance Cap, which means that your return could be lower than if you had invested directly in a fund based on the applicable Index. The Performance Cap exists for the full term of the Indexed Segment. The Performance Cap rate is lower for contracts with the Guarantee of Principal Death Benefit. Generally, Indexed Segments with greater Protection Levels have lower Performance Caps. Performance Caps for new Segments will be declared 5 business days in advance of the beginning of a Segment.
3.	To determine the Interim Value, we apply a formula which does not reflect the actual performance of the applicable Index, but

12

	rather a determination of the value of hypothetical underlying investments at the time of the Interim Value calculation. This amount could be less than if you had held the Indexed Segment for the full Indexed Term. It also means that you could have a negative performance, even if the value of the Index has increased during the calculation period. All withdrawals from the Indexed Segment, including Death Benefits paid during the Indexed Term, will be based on the Interim Value.
4.	If you withdraw Contract Value allocated to an Indexed Account, the withdrawal will cause an immediate reduction to your Indexed Crediting Base in a proportion equal to the reduction in your Interim Value. A proportional reduction could be larger than the dollar amount of your withdrawal. Reductions to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Indexed Segment Maturity Value at the end of the Indexed Term. Once your Indexed Crediting Base is reduced due to a withdrawal during any Indexed Term, you cannot increase it during the remainder of the Indexed Term.
5.	For Indexed Accounts without an Annual Lock, the indexed performance credited to your Indexed Segment is determined on the last day of the Indexed Term. It is not affected by the price of the Index on any date in between the effective date of the Indexed Account and the End Date of the Indexed Term. Annual Lock accounts are not affected by Index prices between the Annual Lock anniversaries.
6.	We may change the Index on a particular Indexed Account if the Index is discontinued or if we feel the Index is no longer appropriate. This change may occur in the middle of an Indexed Segment and this change may impact how your Indexed Segment performance and Interim Value are calculated.
7.	The available Indexed Accounts with applicable Performance Caps and Protection Levels will vary over time. Before investing in a new Indexed Segment, you should determine exactly what Indexed Accounts, Protection Levels and Performance Caps are available to you. There is no guarantee that an Indexed Account will be available in the future. You should make sure the Segment(s) you select is appropriate for your investment goals.
8.	The risks associated with the currently available Indices are as follows:

• Equity markets are subject to the risk that the value of the securities may fall due to general market and economic conditions. Market volatility may exist with these indices, which means that the value of the indices can change dramatically over a short period of time in either direction. Additional risks for specific indices are as follows:

• Russell^® 2000 Price Return Index: Compared to mid-and large-capitalization companies, small-capitalization companies may be less stable and more susceptible to adverse developments, and their securities may be more volatile and less liquid.

• MSCI EAFE Price Return Index: International investing involves special risks not found in domestic investing, including political and social differences and currency fluctuations due to economic decisions. Emerging markets can be riskier than investing in well established foreign markets. The risks associated with investing on a worldwide basis include differences in the regulation of financial data and reporting, currency exchange differences, as well as economic and political systems differences.

• Capital Strength Net Fee Index^SM: This index has fewer stocks than broad based indices; therefore, the risk is spread between fewer equity securities. This index may not track other large cap indices.

9.	If we do not receive investment instructions from you by the end of an Indexed Term, we will invest your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for new Indexed Segments will apply. If the same type of Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund. If your Contract Value has been invested in a new Segment and you wish to withdraw your investment, the Contract Value for that Segment will equal the Interim Value.
10.	You will not have voting rights or rights to receive cash dividends or other rights that shareholders who invest in mutual funds based on these Indices would have.
11.	Your receipt of funds invested in the Indexed Segments is based on the claims paying ability of Lincoln Life. You have no ownership rights in the underlying securities. The assets backing the Indexed Accounts are not segregated from other business of Lincoln Life.
12.	The only available annuitization option for the Indexed Accounts is i4LIFE® Indexed Advantage, which has an additional charge.

Risks of Investing in the Subaccounts

1.	You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the Subaccounts, which invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, your Contract Value goes down. How much it goes up or down depends on the performance of the Subaccounts you select.
2.	The dollar amount of the charge for certain optional Death Benefits may increase as your Contract Value increases.
3.	Your receipt of a Death Benefit over and above the amounts invested in the VAA is based on the claims paying ability and credit worthiness of Lincoln Life.

13

4. Certain classes of funds are subject to risk factors as outlined below:

a. Certain funds offered as part of this contract have similar investment objectives and policies to other portfolios managed by the adviser. The investment results of the funds, however, may be higher or lower than the other portfolios that are managed by the adviser or sub-adviser. There can be no assurance, and no representation is made, that the investment results of any of the funds will be comparable to the investment results of any other portfolio managed by the adviser or sub-adviser, if applicable.

b. Certain funds invest their assets in other funds. As a result, you will pay fees and expenses at both fund levels. This will reduce your investment return. These arrangements are referred to as funds of funds or master-feeder funds, which may have higher expenses than funds that invest directly in debt or equity securities. An advisor affiliated with us manages some of the available funds of funds. Our affiliates may promote the benefits of such funds to Contractowners and/or suggest that Contractowners consider whether allocating some or all of their Contract Value to such portfolios is consistent with their desired investment objectives. In doing so, we may be subject to conflicts of interest insofar as we may derive greater revenues from the affiliated fund of funds than certain other funds available to you under your contract.

5.	Some of the underlying funds have reserved the right to temporarily or permanently refuse payments or transfer requests received from us, especially in cases of suspected market timing. To the extent permitted by applicable law, we, in turn, reserve the right to defer or reject your transfer request at any time we are unable to redeem shares of an underlying fund.
6.	Annuity Payouts will fluctuate with the performance of the Subaccounts.

Cyber Security

We rely heavily on interconnected computer systems and digital data to conduct our annuity products business. Because our business is highly dependent upon the effective operation of our computer systems and those of our business partners, our business is vulnerable to disruptions from utility outages, and susceptible to operational and information security risks resulting from information systems failure (e.g., hardware and software malfunctions), and cyber-attacks. These risks include, among other things, the theft, misuse, corruption and destruction of data maintained online or digitally, interference with or denial of service, attacks on websites and other operational disruption and unauthorized release of confidential customer information. Such systems failures and cyber-attacks affecting us, any third-party administrator, the underlying funds, intermediaries and other affiliated or third-party service providers may adversely affect us and your Contract Value. For instance, systems failures and cyber-attacks may interfere with our processing of contract transactions, including the processing of orders from our website or with the underlying funds, impact our ability to calculate Accumulation Unit value, cause the release and possible destruction of confidential customer or business information, impede order processing, subject us and/or our service providers and intermediaries to regulatory fines and financial losses and/or cause reputational damage. Cyber security risks may also impact the issuers of securities in which the underlying funds invest, which may cause the funds underlying your contract to lose value. There can be no assurance that we or the underlying funds or our service providers will avoid losses affecting your contract due to cyber-attacks or information security breaches in the future.

Condensed Financial Information

Since no sales of this product occurred before the date of this prospectus, financial information for the Subaccounts is not included in this prospectus or in the SAI.

Investment Results for the VAA

At times, the VAA may compare its investment results to various unmanaged indices or other variable annuities in reports to shareholders, sales literature and advertisements. The results will be calculated on a total return basis for various periods, with or without surrender charges. Results calculated without surrender charges will be higher. Total returns include the reinvestment of all distributions, which are reflected in changes in unit value. The money market Subaccount's yield is based upon investment performance over a 7-day period, which is then annualized.

There can be no assurance that a money market fund will be able to maintain a stable net asset value of $1.00 per share. During periods of low interest rates, the yield of a money market fund may become extremely low and possibly negative. In addition, if the yield of a Subaccount investing in a money market fund becomes negative, due in part to Contract fees and expenses, your Contract Value may decline. An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The sponsor of a money market fund has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time. If, under SEC rules, a money market fund suspends payments of redemption proceeds, we will delay payment of any transfer, withdrawal, or benefit from a Subaccount investing in the money market fund until the fund resumes payment. If, under SEC rules, a money market fund institutes a liquidity fee, we may assess the fee against your Contract Value if a payment is made to you from a Subaccount investing in the money market fund.

14

The annual performance of the Subaccounts are based on past performance and do not indicate or represent future performance.

Investment Results for the Indexed Accounts

It is possible that you will not earn any gain on investments in the Indexed Segments. Investments in the Indexed Segments are not guaranteed unless you have elected the 100% Protection Level and hold the investment until the end of the Indexed Term. There is a risk of substantial loss of your principal. You agree to absorb all losses that exceed the Protection Level percentage you select.

The Lincoln National Life Insurance Company

The Lincoln National Life Insurance Company (Lincoln Life or Company), organized in 1905, is an Indiana-domiciled insurance company, engaged primarily in the direct issuance of life insurance contracts and annuities. Lincoln Life is wholly owned by Lincoln National Corporation (LNC), a publicly held insurance and financial services holding company incorporated in Indiana. Lincoln Life is obligated to pay all amounts promised to Contractowners under the contracts.

The portion of your Contract Value invested in the Indexed Segments is part of our general account. Therefore, any amounts that we may pay under the contract in excess of the value in the Subaccounts are subject to our financial strength, claims-paying ability, credit worthiness, and our long-term ability to make such payments.

We issue other types of insurance policies and financial products as well. In addition to any amounts we are obligated to pay in excess of Subaccounts under the contracts, we also pay our obligations under these products from our assets in the general account. Moreover, unlike assets held in the VAA, the assets of the general account are subject to the general liabilities of the Company and, therefore, to the Company’s general creditors. In the event of an insolvency or receivership, payments we make from our general account to satisfy claims under the contract would generally receive the same priority as our other Contractowner obligations.

The general account is not segregated or insulated from the claims of the insurance company’s creditors. Investors look to the financial strength of the insurance companies for these insurance guarantees. Therefore, guarantees provided by the insurance company as to benefits promised in the prospectus are subject to the claims paying ability of the insurance company and are subject to the risk that the insurance company may not be able to cover or may default on its obligations under those guarantees.

Our Financial Condition.  Among the laws and regulations applicable to us as an insurance company are those which regulate the investments we can make with assets held in our general account. In general, those laws and regulations determine the amount and type of investments which we can make with general account assets.

In addition, state insurance regulations require that insurance companies calculate and establish on their financial statements, a specified amount of reserves in order to meet the contractual obligations to pay the claims of our Contractowners. In order to meet our claims-paying obligations, we regularly monitor our reserves to ensure we hold sufficient amounts to cover actual or expected contract and claims payments. However, it is important to note that there is no guarantee that we will always be able to meet our claims paying obligations, and that there are risks to purchasing any insurance product.

State insurance regulators also require insurance companies to maintain a minimum amount of capital in excess of liabilities, which acts as a cushion in the event that the insurer suffers a financial impairment, based on the inherent risks in the insurer’s operations. These risks include those associated with losses that we may incur as the result of defaults on the payment of interest or principal on assets held in our general account, which include bonds, mortgages, general real estate investments, and stocks, as well as the loss in value of these investments resulting from a loss in their market value.

How to Obtain More Information.  We encourage both existing and prospective Contractowners to read and understand our financial statements. We prepare our financial statements on both a statutory basis and according to Generally Accepted Accounting Principles (GAAP). Our audited GAAP financial statements, as well as the financial statements of the VAA, are located in the SAI. If you would like a free copy of the SAI, please write to us at: PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. In addition, the SAI is available on the SEC’s website at http://www.sec.gov. You may obtain our audited statutory financial statements and any unaudited statutory financial statements that may be available by visiting our website at www.LincolnFinancial.com.

You also will find on our website information on ratings assigned to us by one or more independent rating organizations. These ratings are opinions of an operating insurance company’s financial capacity to meet the obligations of its insurance and annuity contracts based on its financial strength and/or claims-paying ability. Additional information about rating agencies is included in the SAI.

Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE:LNC) and its affiliates. Through its affiliates, Lincoln Financial Group offers annuities, life, group life and disability insurance, 401(k) and 403(b) plans, and comprehensive financial planning and advisory services.

15

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life are located in the SAI. The SAI is part of the registration statement filed on Form N-4. If you would like a free copy of the SAI, complete and mail the request on the last page of this prospectus, or call 1-877-737-6872.

Investments of the Indexed Accounts

This contract offers several Indexed Accounts which provide a rate of return based in part on the performance of an index you select. This is the Performance Rate, and it may be positive or negative. An Indexed Account is defined by the index tracked, the length of the term, the Protection Level it provides, and whether or not the performance crediting method includes an Annual Lock.

You may allocate all or a portion of your Purchase Payments into one or more Indexed Accounts. The minimum allocation to an Indexed Account is $2,000; there is no maximum allocation limit. A new Indexed Segment is established upon an allocation to an Indexed Account. Each Indexed Segment has its own Start Date, Crediting Base, Performance Cap, Performance Rate, Contract Value, and End Date.

At this time, the available Indexed Accounts are:

1-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^®, 10% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM , 10% Protection

Annual Lock MSCI EAFE, 10% Protection

Indices. Each Indexed Account references an index that determines the performance of its associated Indexed Segments. These indices are not funds and are not available for direct investment. We currently offer Indexed Accounts based on the performance of the following securities indices:

S&P 500^® Price Return Index (SPX). The S&P 500^® Index is comprised of 500 stocks considered representative of the overall market. An index is unmanaged and not available for direct investments.

Russell^® 2000 Price Return Index (RTY). The Russell 2000^® Index measures the performance of the 2,000 smallest companies in the Russell 3000^® Index. It is considered representative of small capitalization stocks. The prices of small company stocks generally are more volatile than those of large company stocks. An index is unmanaged and not available for direct investments.

MSCI EAFE Price Return Index (MXEA). The MSCI EAFE Index measures the equity market performance of 22 developed market country indices located in Europe, Australasia and the Far East. An index is unmanaged and not available for direct investments.

Capital Strength Net Fee Index^SM (NQCAPSTNF). The Index is comprised of 50 securities selected based on cash on hand, debt ratios and volatility. The Capital Strength Price Return Index^SM will be reduced by 0.65% to result in the Capital Strength Net Fee Index^SM. An index is unmanaged and not available for direct investment.

The indices used are price indices and do not reflect dividends paid on the underlying stocks. If an Index is discontinued or substantially changes (for example if an index sponsor announces that it will make a material change in the formula for or the method of calculating the Index or in any other way materially modifies the Index), we reserve the right to select an alternative Index and we will notify the Contractowner of such changes. In selecting an alternative Index we will attempt to approximate the performance of the original Index in a commercially reasonable manner in light of relevant market circumstances at the time. Any substitution of an Index is subject to approval by the state insurance authorities where the contract and rider were issued, if required by law. A change to the Index in the middle of a Segment may impact the calculation of the Performance Rate for the Segments. When we notify you of a change to the Index, we will also state how the change will impact your Performance Rate. If you do not choose to remain in the Segment, you can transfer your Interim Value to a variable Subaccount. Investments in new Segments are available on an Indexed Anniversary Date.

Indexed Term. The Indexed Term is the specified period of time of a particular Indexed Account. Indexed Terms of 1 or 6 years are available. An Indexed Segment begins on the day your money is allocated to an Indexed Segment, called the Start Date. The yearly

16

anniversary of the Start Date of the initial Indexed Segment is the Indexed Anniversary Date of your contract. This is the Indexed Anniversary Date for the life of your contract.

You may choose to allocate your Purchase Payments to different Indexed Accounts, but all Indexed Segments must begin on the Indexed Anniversary Date. All future Indexed Terms must begin on the same Indexed Anniversary Date. This means that after the initial Indexed Segment is created, you can only allocate future Purchase Payments or make transfers of Contract Value to Indexed Accounts one time a year. For example, you may start a 6-Year Segment, and two years later, you can start a 1-Year Indexed Segment, as long as the 1-Year Indexed Segment begins on the Indexed Anniversary Date for your contract. If you have more than one 6-Year Term Indexed Segment in effect at any time, these Indexed Segments must have the same Start Date and End Date.

Lincoln reserves the right to make additional Indexed Account options available or to withdraw currently available Indexed Account options in the future.

Indexed Contract Value. For each Indexed Segment the daily value is determined as follows:

a. On the Start Date of the Indexed Segment, the value of the Indexed Segment equals the initial Indexed Crediting Base. The initial Indexed Crediting Base is the amount of Purchase Payment or Contract Value allocated to the Indexed Segment.

b. On each Valuation Date during the Indexed Term, the value of the Indexed Segment equals the Interim Value.

c. On the last date of the Indexed Term, called the End Date, the value of the Indexed Segment equals the Indexed Segment Maturity Value.

Crediting Methods. Any performance earned is credited to or amounts for any loss are deducted from an Indexed Segment only upon the End Date of an Indexed Term. If the End Date is not a Valuation Date, then the amount will be credited or deducted on the next Business Day. Performance is calculated differently depending on whether or not the Indexed Account contains Annual Locks. An Indexed Account with Annual Locks is a multi-year account in which the performance is calculated on each Indexed Anniversary Date, but the performance is not credited to or deducted from the Indexed Segment until the End Date.

Indexed Segments Without Annual Locks. For an Indexed Segment without Annual Locks, the Performance Rate is the percentage change in the Index Value from the Start Date to the End Date, adjusted by the Protection Level and subject to the Performance Cap. The Performance Rate can be positive, negative or zero. The percentage change in the Index Value is calculated by subtracting the Index Value on the Start Date from the Index Value on the End Date. The difference is divided by the Index Value on the Start Date. The daily Index Value is posted on the index’s website. If an Index Value is not published for a particular day, we will use the Index Value at the close of the next Valuation Date the index is published.

If the percentage change of the Index Value from the Start Date to the End Date is positive and equal to or greater than the Performance Cap, then the Performance Rate equals the Performance Cap. If the percentage change is positive and less than the Performance Cap, the Performance Rate equals the percentage change of the Index Value. If the percentage change is negative but is absorbed by the Protection Level percentage, the Performance Rate equals zero. If the percentage change is negative, and is greater than the Protection Level percentage, the Performance Rate is equal to the percentage change in excess of the Protection Level. The Performance Rate for Indexed Segments with a 100% Protection Level is zero if the percentage change is negative.

The amount credited to or deducted from the Indexed Segment is equal to the Performance Rate times the Indexed Crediting Base on the End Date. This will be used to determine the Segment Maturity Value as set forth below. The Indexed Crediting Base is the amount you allocated to the Indexed Segment, less any transfers and withdrawals during the Index Term deducted proportionately by the amount that the transfer or withdrawal reduced the Interim Value (described later in the Interim Value section). Withdrawals include any applicable surrender charge, premium tax or rider charge deductions. If the Performance Rate is positive, the value of your Indexed Segment will increase. If the Performance Rate is negative (after calculation including the Protection Level), the value of your Indexed Segment is reduced. If the Performance Rate is zero, the value of your Indexed Segment will not change. The Segment Maturity Value on the End Date is equal to the sum of A plus (A times B) where:

A = the Indexed Crediting Base on the End Date and

B = the Performance Rate.

For Example:

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year with a 10% Performance Cap
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base = $100,000

17

Indexed Start Date	Index Value	Index % Change	Account Performance Rate (adjusted for Cap)	Segment Maturity Value
1/8/2019	1,679	+7%	+7%	$107,000
1/8/2020	1,880	+12%	+10%	$117,700

This example assumes that a new 1-Year Indexed Segment was selected in 2019 to show the impact of the Performance Cap.In this example, the Performance Cap did not change for the new Segment. (The numbers were rounded for ease of understanding.)

The Indexed Crediting Base is used only to calculate the performance of Indexed Accounts on the End Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit.

Indexed Segment with Annual Locks. For an Indexed Segment with Annual Locks, the Performance Rate will be calculated in the same manner as above, except it will be calculated on each Index Anniversary Date. However, the performance will NOT be credited to or deducted from the Indexed Segment until the End Date of the Indexed Term (at the end of the 6^th year). The amount of the performance credited or deducted from the Indexed Segment on the End Date equals the sum of each Indexed Anniversary’s performance as adjusted for any withdrawals, transfers, or annuitization. On the first Indexed Anniversary Date, the performance equals the Percentage Rate times the Indexed Crediting Base. This performance amount is added to or deducted from the Indexed Crediting Base. This adjusted Indexed Crediting Base becomes the Indexed Crediting Base for the next one-year period. On each Indexed Anniversary Date thereafter, the return for the year is credited to or deducted from the Index Crediting Base and the adjusted Indexed Crediting Base carries over for the next one-year period. As a result, a loss you incur in one year will reduce the amount invested for the next year. In a continuing down market, you could lose in excess of the percentage remaining after the Protection Level. For example, if the Protection Level is 10%, in a continuing down market, you could lose more than 90% of your investment. On the other hand, a gain you incur in one year will increase the Indexed Crediting Base for the next year, upon which future gains (if any) will be calculated. The Segment Maturity Value will equal the value of the Crediting Base on the End Date (after the adjustment for performance on the last Indexed Anniversary Date).

The Indexed Crediting Base is used only to calculate the performance of Indexed Segments on the Indexed Anniversary Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit. In addition to the Indexed Crediting Base adjustment for performance, withdrawals and transfers reduce the Indexed Crediting Base in the same proportion that withdrawals and transfers reduce the Interim Value.

The following example demonstrates the impact of the Performance Cap and Protection Level on an Indexed Account with a 6-Year Annual Lock and assumes no withdrawals have been made.

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 6-Year with Annual Locks with a 10% Performance Cap and 10% Protection Level
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base at Beginning of Term = $100,000

Indexed Segment Anniversary	Index Value	Index % Change	Account Performance Rate (adjusted for Cap or Protection Level)	Indexed Segment Performance Amount	Adjusted Indexed Crediting Base/ Anniversary Value
1/8/2019	1,679	+7%	+7%	$7,000	$107,000
1/8/2020	1,880	+12%	+10%	$10,700	$117,700
1/8/2021	1,636	-13%	-3%	-$3,531	$114,169
1/8/2022	1,554	-5%	-0%	0	$114,169
1/8/2023	1,632	+5%	+5%	+$5,708	$119,877
1/8/2024	1,909	+10%	+10%	+$11,988	$131,865

Note: The Segment Maturity Value is $131,865. The $31,865 (the sum of the values on each Index Anniversary) is not credited to your Contract Value until the end of the 6-year Indexed Term. Until that time, the Interim Value calculations apply. The anniversary amounts are not available to you and are used only for calculation purposes as the Indexed Crediting Base for the next year.

Reallocation. You will be notified thirty days prior to each Indexed Anniversary Date regarding the timing of investing in new Indexed Segments. The available Indexed Accounts and applicable Performance Caps will be provided 5 business days in advance of the Indexed Anniversary Date on LFG.com/annuities or by calling 1-877-737-6872. If your existing Indexed Segment is at the end of the

18

Indexed Term, you may reallocate the value of the Indexed Segment Maturity Value to any available Indexed Account or variable subaccount as long as the reallocation request is received at least two business days prior to the end of the Indexed Term. We will hold reallocation instructions for up to 25 calendar days prior to the Indexed Anniversary Date. The reallocation will take place on the Indexed Anniversary Date. If we do not receive a reallocation notice from you, all Indexed Segments that are ending will invest into a new Indexed Segment with the same term, index, and Protection Level as the Indexed Segment in which they were previously invested and with the currently applicable Performance Cap. If the same type of Indexed Segment is no longer available, the funds will be moved to LVIP PIMCO Low Duration Bond Fund, and will not be eligible for allocation into an Indexed Account until the next Indexed Anniversary Date.

Performance Cap. The Performance Cap is the maximum Performance Rate that can be credited to the Indexed Segment for an Indexed Term for which it is declared. If an Indexed Account with Annual Lock is selected, the Performance Cap is the maximum percentage that can be credited each year during the Indexed Term. The Performance Cap may vary depending on the Death Benefit option, the index, and the Protection Level you select. Typically, Indexed Segments with greater Protection Levels have lower Performance Caps. The Performance Cap will not change during the Indexed Term.

The initial Performance Cap applies to the initial Indexed Term. Indexed Segments with a Guarantee of Principal Death Benefit will have lower Performance Caps than Indexed Segments with the Account Value Death Benefit. The Company will declare, at its discretion, a Performance Cap for each subsequent Indexed Term. If no Performance Cap is declared for an Indexed Term, there is no maximum Performance Rate for that Indexed Term.

Subsequent Performance Caps may be higher or lower than the initial Performance Cap. Subsequent Performance Caps may differ from the Performance Cap used for new contracts or for other contracts issued at different times. The Company will determine new Performance Caps on a basis that does not discriminate unfairly within any class of contracts.

Protection Levels. The Protection Level is the portion of any negative index performance that will not impact your Contract Value during the Indexed Term if you hold until the End Date of the Segment. Your Contract Value will not be impacted up to the amount of the Protection Level you elect, and, after that, you will be impacted for the remaining portion of the loss. This loss will reduce the amount of your investment (principal) in the Indexed Segments. This contract offers Indexed Accounts with Protection Levels that protect you against losses of 10% to 100%. If you choose an Indexed Account with a 10% Protection Level, your Contract Value will not be impacted by the first 10% of negative Performance if you stay invested until the End Date of the Segment. Any remaining negative percentage will be absorbed by you. If you choose an Indexed Account with a 100% Protection Level, you will not lose any of your principal allocated to the Indexed Account if you stayed invested until the End Date of the Segment. If an Indexed Account with Annual Locks is selected, the Protection Level is the percentage of the index loss that will not impact your Crediting Base each year during the Indexed Term.

For example:

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year S&P 500 with a 10% Protection Level
Index Value at beginning of term = 1,569
Indexed Crediting Base = $100,000
Indexed Term Segment End Date = 1/8/2019
Index Value at End Date = 1,333
Index Value percentage change = -15% ((1,333 – 1,569) / 1569)
Indexed Segment Maturity Value = $95,000 ($100,000 - $5,000)

Because your Contract Value is not impacted by the first 10% of the loss, you only experience a 5% loss (-15% Index Value percentage change + 10% Protection Level = 5% loss) or $100,000 * 5.00% = $5,000.

The following year assuming you chose a new 1-Year Segment with a 10% Protection Level:

Indexed Term Segment End Date = 1/8/2020
Index Value at end of term = 1,298
Index Value percentage change = -3%
Indexed Segment Maturity Value = $95,000

Because your Contract Value is not impacted by the first 10% of the loss, you experience no loss of Contract Value for this Segment because the Index Value percentage change was less than the 10% Protection Level.

Interim Value. The Interim Value is a daily value we calculate to provide you with a value of your Indexed Segment after the Start Date and before the End Date of an Indexed Term. The Contract Value for an Indexed Segment is equal to the Interim Value on each Valuation Date except the End Date. The Interim Value is used to calculate amounts available for withdrawal, surrender, transfer (including any applicable surrender charge, premium tax or rider charge deductions), annuitization or payment of a death claim for each day during an Indexed Term. The Interim Value also is used to determine how much the Index Crediting Base will be reduced after a transfer or withdrawal. See Surrenders and Withdrawals. Once you reach the End Date of the Indexed Term, there is no Interim Value, and

19

the actual performance will be credited to or deducted from your Indexed Segment based on the Performance Rate (with a Cap or Protection Level) as described above. The Interim Value calculation will vary depending on the Indexed Account selected.

The Interim Value calculation is designed to represent the fair value of the Indexed Segment on each Business Day, taking into account the potential gain or loss of the applicable Index at the end of the Indexed Term, including the impacts of the Cap and Protection Level. The calculation is also designed to reflect the change in fair value due to economic factors, including, but not limited to, the impact of market rates, volatility, and correlation (if applicable) of the investment instruments supporting the contract. The Interim Value is based on this calculation and not the actual value of any underlying investments or the current value of any index.

The specifics of the Interim Value calculation are in Appendix A of this prospectus. In simplified terms, the calculation is the lesser of A or B:

A = the present value of the Indexed Crediting Base (or, for Annual Lock Indexed Accounts, the initial Crediting Base, as adjusted for transactions) plus the current fair value of a replicating package of derivatives that replicates the Segment Maturity Value (if it was held to the End Date) based on the Index Performance and taking into account the Protection Level and Performance Cap.

B = the Indexed Crediting Base times (1+ the pro rata portion of the Performance Cap) (which is calculated differently for the 6 year Annual Lock method).

The following examples demonstrate how the Interim Value is calculated in different scenarios for a 1-year Indexed Segment. This does not apply to Segments with an Annual Lock.    

	1 Year
Indexed Term length	12 months
Months since Indexed Term Start Date	9
Indexed Crediting Base	$1,000
Protection Level	10%
Performance Cap	7.25%
Months to End Date	3

Change in Index Value is -30%	1 Year
1. Fair Value of Hypothetical Fixed Instrument	$993
2. Fair Value of Hypothetical Derivatives	$(198)
3. Sum of 1 + 2	$796
4. Pro-rated Cap	$1,054
Account Interim Value = Minimum of 3 and 4	$796

Change in Index Value is -10%	1 Year
1. Fair Value of Hypothetical Fixed Instrument	$993
2. Fair Value of Hypothetical Derivatives	$(20)
3. Sum of 1 + 2	$973
4. Pro-rated Cap	$1,054
Account Interim Value = Minimum of 3 and 4	$973

Change in Index Value is 20%	1 Year
1. Fair Value of Hypothetical Fixed Instrument	$993
2. Fair Value of Hypothetical Derivatives	$68
3. Sum of 1 + 2	$1,061
4. Pro-rated Cap	$1,054
Account Interim Value = Minimum of 3 and 4	$1,054

20

Change in Index Value is 40%	1 Year
1. Fair Value of Hypothetical Fixed Instrument	$993
2. Fair Value of Hypothetical Derivatives	$71
3. Sum of 1 + 2	$1,064
4. Pro-rated Cap	$1,054
Account Interim Value = Minimum of 3 and 4	$1,054

Refer to the Surrender and Withdrawal section for information about the Interim Value and how surrenders or withdrawals are calculated.

Variable Annuity Account (VAA)

On November 3, 1997, the VAA was established as an insurance company separate account under Indiana law. It is registered with the SEC as a unit investment trust under the provisions of the Investment Company Act of 1940 (1940 Act). The VAA is a segregated investment account, meaning that its assets may not be charged with liabilities resulting from any other business that we may conduct. Income, gains and losses, whether realized or not, from assets allocated to the VAA are, in accordance with the applicable annuity contracts, credited to or charged against the VAA. They are credited or charged without regard to any other income, gains or losses of Lincoln Life. We are the issuer of the contracts and the obligations set forth in the contract, other than those of the Contractowner, are ours. The VAA satisfies the definition of a separate account under the federal securities laws. We do not guarantee the investment performance of the VAA. Any investment gain or loss depends on the investment performance of the funds. You assume the full investment risk for all amounts allocated to the VAA.

The VAA is used to support other annuity contracts offered by us in addition to the contracts described in this prospectus. The other annuity contracts supported by the VAA generally invest in the same funds as the contracts described in this prospectus. These other annuity contracts may have different charges that could affect the performance of their Subaccounts, and they offer different benefits.

Investments of the Variable Annuity Account

You decide the Subaccount(s) to which you allocate Purchase Payments. There is a separate Subaccount which corresponds to each class of each fund. You may change your allocation without penalty or charges. Shares of the funds will be sold at net asset value with no initial sales charge to the VAA in order to fund the contracts. The funds are required to redeem fund shares at net asset value upon our request.

Investment Advisers

As compensation for its services to the funds, each investment adviser for each fund receives a fee from the funds which is accrued daily and paid monthly. This fee is based on the net assets of each fund, as defined in the prospectuses for the funds.

Certain Payments We Receive with Regard to the Funds

We (and/or our affiliates) incur expenses in promoting, marketing, and administering the contracts and the underlying funds. With respect to a fund, including affiliated funds, the adviser and/or distributor, or an affiliate thereof, may make payments to us (or an affiliate) for certain services we provide on behalf of the funds. Such services include, but are not limited to, recordkeeping; aggregating and processing purchase and redemption orders; providing Contractowners with statements showing their interests within the funds; processing dividend payments; providing subaccounting services; and forwarding shareholder communications, such as proxies, shareholder reports, tax notices, and printing and delivering prospectuses and updates to Contractowners. It is anticipated that such payments will be based on a percentage of assets of the particular fund attributable to the contracts along with certain other variable contracts issued or administered by us (or an affiliate). These percentages are negotiated and vary with each fund. Some advisers and/or distributors may pay us significantly more than other advisors and/or distributors and the amount we receive may be substantial. These percentages currently range up to 0.43%, and as of the date of this prospectus, we were receiving payments from most fund families. We (or our affiliates) may profit from these payments. These payments may be derived, in whole or in part, from the investment advisory fee deducted from fund assets. Contractowners, through their indirect investment in the funds, bear the costs of these investment advisory fees (see the funds' prospectuses for more information). Additionally, a fund's adviser and/or distributor or its affiliates may provide us with certain services that assist us in the distribution of the contracts and may pay us and/or certain affiliates amounts for marketing programs and sales support, as well as amounts to participate in training and sales meetings.

21

In addition to the payments described above, all of the funds offered as part of this contract make payments to us under their distribution plans (12b-1 plans) for the marketing and distribution of fund shares. The payment rates range up to 0.35% based on the amount of assets invested in those funds. Payments made out of the assets of the fund will reduce the amount of assets that otherwise would be available for investment, and will reduce the fund's investment return. The dollar amount of future asset-based fees is not predictable because these fees are a percentage of the fund's average net assets, which can fluctuate over time. If, however, the value of the fund goes up, then so would the payment to us (or our affiliates). Conversely, if the value of the funds goes down, payments to us or our affiliates would decrease.

Description of the Funds

Each of the Subaccounts of the VAA is invested solely in shares of one of the funds available under the contract. Each fund may be subject to certain investment policies and restrictions which may not be changed without a majority vote of shareholders of that fund.

We select the funds offered through the contract based on several factors, including, without limitation, asset class coverage, the strength of the manager's reputation and tenure, brand recognition, performance, the capability and qualification of each sponsoring investment firm, and whether the fund is affiliated with us. Another factor we consider during the initial selection process is whether the fund or an affiliate of the fund will make payments to us or our affiliates. We review each fund periodically after it is selected. We reserve the right to remove a fund or restrict allocation of additional Purchase Payments to a fund if we determine the fund no longer meets one or more of the factors and/or if the fund has not attracted significant Contractowner assets. Finally, when we develop a variable annuity product in cooperation with a fund family or distributor (e.g., a “private label” product), we generally will include funds based on recommendations made by the fund family or distributor, whose selection criteria may differ from our selection criteria.

Following are brief summaries of the fund descriptions. More detailed information may be obtained from the current prospectus for each fund. You should read each fund prospectus carefully before investing. Prospectuses for each fund are available by contacting us. In addition, if you receive a summary prospectus for a fund, you may obtain a full statutory prospectus by referring to the contact information for the fund company on the cover page of the summary prospectus. Please be advised that there is no assurance that any of the funds will achieve their stated objectives.

AIM Variable Insurance Funds (Invesco Variable Insurance Funds), advised by Invesco Advisers, Inc.

• Invesco V.I. Equally-Weighted S&P 500 Fund (Series II Shares): To seek to achieve a high level of total return on its assets through a combination of capital appreciation and current income.

American Funds Insurance Series^®, advised by Capital Research and Management Company

• American Funds Asset Allocation Fund (Class 4): High total return (including income and capital gains) consistent with preservation of capital over the long term.

• American Funds Growth Fund (Class 4): Growth of capital.

BlackRock Variable Series Funds, Inc., advised by BlackRock Advisors, LLC

• BlackRock Global Allocation V.I. Fund (Class III): High total investment return.

Fidelity^® Variable Insurance Products, advised by Fidelity Management and Research Company

• Fidelity^® VIP Mid Cap Portfolio (Service Class 2): Long-term growth of capital.

First Trust Variable Insurance Trust, advised by First Trust Advisors L.P.

• First Trust/Dow Jones Dividend & Income Allocation Portfolio (Class I): To provide total return by allocating among dividend-paying stocks and investment grade bonds.

Franklin Templeton Variable Insurance Products Trust, advised by Franklin Advisers, Inc. for the Franklin Income VIP Fund

• Franklin Rising Dividends VIP Fund (Class 4): Long-term capital appreciation; preservation of capital is also an important consideration.

JPMorgan Insurance Trust, advised by J.P. Morgan Investment Management Inc.

• JPMorgan Insurance Trust Core Bond Portfolio (Class 2): To maximize total return by investing primarily in a diversified portfolio of intermediate and long-term debt securities.

Lincoln Variable Insurance Products Trust, advised by Lincoln Investment Advisors Corporation

• LVIP Government Money Market Fund (Service Class): Current income while (i) maintaining a stable value of your shares (providing stability of net asset value) and (ii) preserving the value of your initial investment (preservation of capital).

• LVIP MFS Value Fund (Service Class): Capital appreciation.

22

• LVIP PIMCO Low Duration Bond Fund (Service Class): To seek a high level of current income consistent with preservation of capital.

• LVIP SSGA International Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of a broad market index of non-U.S. foreign securities.

• LVIP SSGA S&P 500 Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the total rate of return of common stocks publicly traded in the United States, as represented by the S&P 500 Index.

• LVIP SSGA Small-Cap Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of the Russell 2000^® Index, which emphasizes stocks of small U.S. companies.

Fund Shares

We will purchase shares of the funds at net asset value and direct them to the appropriate Subaccounts of the VAA. We will redeem sufficient shares of the appropriate funds to pay Annuity Payouts, Death Benefits, surrender/withdrawal proceeds or for other purposes described in the contract. If you want to transfer all or part of your investment from one Subaccount to another, we may redeem shares held in the first Subaccount and purchase shares of the other. Redeemed shares are retired, but they may be reissued later.

Shares of the funds are not sold directly to the general public. They are sold to us, and may be sold to other insurance companies, for investment of the assets of the Subaccounts established by those insurance companies to fund variable annuity and variable life insurance contracts.

When a fund sells any of its shares both to variable annuity and to variable life insurance separate accounts, it is said to engage in mixed funding. When a fund sells any of its shares to separate accounts of unaffiliated life insurance companies, it is said to engage in shared funding.

The funds currently engage in mixed and shared funding. Therefore, due to differences in redemption rates or tax treatment, or other considerations, the interest of various Contractowners participating in a fund could conflict. Each of the fund’s Board of Directors will monitor for the existence of any material conflicts, and determine what action, if any, should be taken. The funds do not foresee any disadvantage to Contractowners arising out of mixed or shared funding. If such a conflict were to occur, one of the separate accounts might withdraw its investment in a fund. This might force a fund to sell portfolio securities at disadvantageous prices. See the prospectuses for the funds.

Reinvestment of Dividends and Capital Gain Distributions

All dividends and capital gain distributions of the funds are automatically reinvested in shares of the distributing funds at their net asset value on the date of distribution. Dividends are not paid out to Contractowners as additional units, but are reflected as changes in unit values.

Addition, Deletion or Substitution of Investments

We reserve the right, within the law, to make certain changes to the structure and operation of the VAA at our discretion and without your consent. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. New or substitute funds may have different fees and expenses, and may only be offered to certain classes of Contractowners.

Substitutions may be made with respect to existing investments or the investment of future Purchase Payments, or both. We may close Subaccounts to allocations of Purchase Payments or Contract Value, or both, at any time in our sole discretion. The funds, which sell their shares to the Subaccounts pursuant to participation agreements, also may terminate these agreements and discontinue offering their shares to the Subaccounts.

We may also:

• remove, combine, or add Subaccounts and make the new Subaccounts available to you at our discretion;

• transfer assets supporting the contracts from one Subaccount to another or from the VAA to another separate account;

• combine the VAA with other separate accounts and/or create new separate accounts;

• deregister the VAA under the 1940 Act; and

• operate the VAA as a management investment company under the 1940 Act or as any other form permitted by law.

We may modify the provisions of the contracts to reflect changes to the Subaccounts and the VAA and to comply with applicable law. We will not make any changes without any necessary approval by the SEC. We will also provide you written notice.

23

Charges and Other Deductions

We will deduct the charges described below to cover our costs and expenses, services provided and risks assumed under the contracts. We incur certain costs and expenses for the distribution and administration of the contracts and for providing the benefits payable thereunder.

Our administrative services include:

• processing applications for and issuing contracts;

• processing purchases and redemptions of fund shares and from Indexed Accounts as required (including portfolio rebalancing, and automatic withdrawal services if available – See Additional Services and the SAI for more information on these programs);

• maintaining records;

• administering Annuity Payouts;

• furnishing accounting and valuation services (including the calculation and monitoring of daily Subaccount values, Indexed Contract Values and Interim Values);

• reconciling and depositing cash receipts;

• providing contract confirmations;

• providing toll-free inquiry services; and

• furnishing telephone and other electronic surrenders, withdrawals and fund transfer services.

The risks we assume include:

• the risk that Annuitants upon which Annuity Payouts are based live longer than we assumed when we calculated our guaranteed rates (these rates are incorporated in the contract and cannot be changed);

• the risk that more Contractowners than expected will qualify for waivers of the surrender charge;

• the risk that our costs in providing the services will exceed our revenues from contract charges (which we cannot change);

• the risks related to absorbing losses equal to the Protection Levels in Indexed Accounts; and

• the risk that Death Benefits paid will exceed the actual Contract Value.

The amount of a charge may not necessarily correspond to the costs associated with providing the services or benefits indicated by the description of the charge. For example, the surrender charge collected (if applicable) may not fully cover all of the sales and distribution expenses actually incurred by us. Any remaining expenses will be paid from our general account which may consist, among other things, of proceeds derived from mortality and expense risk charges deducted from the account. We may profit from one or more of the fees and charges deducted under the contract and from amounts earned on the Indexed Accounts. We may use these profits for any corporate purpose, including financing the distribution of the contracts.

Deductions from the VAA

For the base contract, we apply to the average daily net asset value of the Subaccounts a Product Charge which is equal to an annual rate of:

Guarantee of Principal Death Benefit 1.30%

*0.10% of the Product Charge is attributable to an administrative charge, and the remaining amount is attributable to a mortality and expense risk charge.

The Guarantee of Principal Death Benefit is the default Death Benefit under this contract. The only time the charge will change to the Account Value Death Benefit charge is if all Contractowners and Annuitants are changed. The annual charge rate for the Account Value Death Benefit is 1.10%. Once you have the Account Value Death Benefit, it cannot be changed.

Surrender Charge

A surrender charge applies (except as described below) to surrenders and withdrawals of Purchase Payments that have been invested for the periods indicated below. The surrender charge is calculated separately for each Purchase Payment. The contract anniversary is the annually occurring date beginning with the effective date of the contract. For example, if the effective date of your contract is January 1^st, your contract anniversary would be on January 1^st of each subsequent year.

	0	1	2	3	4	5	6
Surrender charge as a percentage of the surrendered or withdrawn Purchase Payments	7%	7%	6%	5%	4%	3%	0%

A surrender charge does not apply to:

• A surrender or withdrawal of a Purchase Payment beyond the sixth anniversary since the Purchase Payment was invested;

24

• Withdrawals of Contract Value during a Contract Year to the extent that the total Contract Value withdrawn during the current Contract Year does not exceed the free amount. The free amount is equal to the greater of 10% of the current Contract Value or 10% of the total Purchase Payments (this does not apply upon surrender of the contract);

• Purchase Payments used in the calculation of the initial benefit payment to be made under an Annuity Payout option (other than the i4LIFE^® Indexed Advantage option);

• A surrender or withdrawal of any Purchase Payments, as a result of permanent and total disability of the Contractowner as defined in Section 22(e)(3) of the tax code, if the disability occurred after the effective date of the contract and before the 65^th birthday of the Contractowner. For contracts issued in the state of New Jersey, a different definition of permanent and total disability applies;

• A surviving spouse, at the time he or she assumes ownership of the contract as a result of the death of the original owner (however, the surrender charge schedule of the original contract will continue to apply to the spouse's contract);

• A surrender or withdrawal of any Purchase Payments, as a result of the admittance of the Contractowner to an accredited nursing home or equivalent health care facility, where the admittance into the facility occurs after the effective date of the contract and the owner has been confined for at least 90 consecutive days;

• A surrender or withdrawal of any Purchase Payments as a result of the diagnosis of a terminal illness of the Contractowner. Diagnosis of a terminal illness must be after the effective date of the contract and results in a life expectancy of less than one year as determined by a qualified professional medical practitioner;

• A surrender of the contract as a result of the death of the Contractowner or Annuitant;

• Purchase Payments when used in the calculation of the initial Account Value under i4LIFE^® Indexed Advantage;

• Periodic Income Payments made under i4LIFE^® Indexed Advantage or periodic payments made under any Annuity Payout option made available by us; or

• A surrender of the contract or a withdrawal of a Contract Value from contracts issued to Selling Group Individuals.

For purposes of calculating the surrender charge on withdrawals, we assume that:

1.	The free amount will be withdrawn from Purchase Payments on a first in-first out (“FIFO”) basis.
2.	Prior to the sixth anniversary of the contract, any amount withdrawn above the free amount during a Contract Year will be withdrawn in the following order:

• from Purchase Payments (on a FIFO basis) until exhausted; then

• from earnings until exhausted.

3. On or after the sixth anniversary of the contract, any amount withdrawn above the free amount during a Contract Year will be withdrawn in the following order:

• from Purchase Payments (on a FIFO basis) to which a surrender charge no longer applies until exhausted; then

• from earnings until exhausted; then

• from Purchase Payments (on a FIFO basis) to which a surrender charge still applies until exhausted.

We apply the surrender charge as a percentage of Purchase Payments, which means that you would pay the same surrender charge at the time of surrender regardless of whether your Contract Value has increased or decreased. The surrender charge is calculated separately for each Purchase Payment. The surrender charges associated with surrender or withdrawal are paid to us to compensate us for the loss we experience on contract distribution costs when Contractowners surrender or withdraw before distribution costs have been recovered.

There are charges associated with surrender of a contract or withdrawal of Contract Value. You may specify whether these charges are deducted from the amount you request to be withdrawn or from the remaining Contract Value. If the charges are deducted from the remaining Contract Value, the amount of the total withdrawal will increase according to the impact of the applicable surrender charge percentage; consequently, the dollar amount of the surrender charge associated with the withdrawal will also increase. In other words, the dollar amount deducted to cover the surrender charge is also subject to a surrender charge.

If the Contractowner is a corporation or other non-individual (non-natural person), the Annuitant or joint Annuitant will be considered the Contractowner or joint owner for purposes of determining when a surrender charge does not apply.

Rider Charge

i4LIFE^® Indexed Advantage Charge. While this rider is in effect, there is a charge for i4LIFE^® Indexed Advantage. The current annual rider charge rate is 0.40%. This charge is in addition to the applicable Death Benefit charge assessed against the Subaccounts. This charge is based on your Account Value at the beginning of the Rider Year less the Periodic Income Payment(s) for that year. The charge will be deducted from the Account Value in a lump sum at the end of each Rider Anniversary beginning with the first Rider Year anniversary. This deduction will be made proportionately from Subaccount(s) and the Indexed Segment(s), and then from the Periodic Income Payment Account, if the value of the Subaccounts and the Indexed Segments has reached zero. During the Lifetime

25

Income Period, the charge will reduce the Periodic Income Payment for each Indexed Segment, and the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The rider charge will be discontinued upon termination of the rider. A portion of the rider charge, based on the number of days the rider was in effect that Rider Year, will be deducted upon termination of the rider (except for death) or surrender of the contract.

Deductions for Premium Taxes

Any premium tax or other tax levied by any governmental entity as a result of the existence of the contracts or the VAA will be deducted from the Contract Value, unless the governmental entity dictates otherwise, when incurred, or at another time of our choosing.

The applicable premium tax rates that states and other governmental entities impose on the purchase of an annuity are subject to change by legislation, by administrative interpretation or by judicial action. These premium tax rates generally depend upon the law of your state of residence. The tax rates range from zero to 5%.

Other Charges and Deductions

The mortality and expense risk and administrative charge of 1.10% of the value in the VAA will be assessed on all variable Annuity Payouts, except for i4LIFE^® Indexed Advantage, which has a different charge, including options that may be offered that do not have a life contingency and therefore no mortality risk. This charge covers the expense risk and administrative services listed previously in this prospectus. The expense risk is the risk that our costs in providing the services will exceed our revenues from contract charges.

There are additional deductions from and expenses paid out of the assets of the underlying funds that are more fully described in the prospectuses for the funds. Among these deductions and expenses are 12b-1 fees which reimburse us or an affiliate for certain expenses incurred in connection with certain administrative and distribution support services provided to the funds.

Additional Information

The charges described previously may be reduced or eliminated for any particular contract. However, these reductions may be available only to the extent that we anticipate lower distribution and/or administrative expenses, or that we perform fewer sales or administrative services than those originally contemplated in establishing the level of those charges, or when required by law. Lower distribution and administrative expenses may be the result of economies associated with:

• the use of mass enrollment procedures,

• the performance of administrative or sales functions by the employer,

• the use by an employer of automated techniques in submitting deposits or information related to deposits on behalf of its employees,

• the issue of a new Lincolncontract with the proceeds from the surrender of an existing Lincoln variable annuity contract, if available in your state, or

• any other circumstances which reduce distribution or administrative expenses.

The exact amount of charges and fees applicable to a particular contract will be stated in that contract.

The maximum commission paid to broker-dealers selling this contract is 4% of Purchase Payments. See Distribution of the Contracts for further information.

The Contracts

Contracts Offered in this Prospectus

This contract offers you Indexed Accounts, Subaccounts, the optional Guarantee of Principal Death Benefit, and various Annuity Payout options.

Purchase of Contracts

If you wish to purchase a contract, you must apply for it through a registered representative authorized by us. The completed application is sent to us and we decide whether to accept or reject it. If the application is accepted, a contract is prepared and executed by our legally authorized officers. The contract is then sent to you either directly or through your registered representative. See Distribution of the Contracts. The purchase of multiple contracts with identical Contractowners, Annuitants and Beneficiaries will be allowed only upon Home Office approval.

When a completed application and all other information necessary for processing a purchase order is received in Good Order at our Home Office, an initial Purchase Payment will be priced no later than two business days after we receive the order. If you submit your application and/or initial Purchase Payment to your registered representative, we will not begin processing your purchase order until

26

we receive the application and initial Purchase Payment from your registered representative’s broker-dealer. While attempting to finish an incomplete application, we may hold the initial Purchase Payment for no more than five business days unless we receive your consent to our retaining the payment until the application is completed. If the incomplete application cannot be completed within those five days and we have not received your consent, you will be informed of the reasons, and the Purchase Payment will be returned immediately. Once the application is complete, we will allocate your initial Purchase Payment within two business days.

The Guarantee of Principal Death Benefit is available for both qualified and nonqualified contracts, and can only be elected at the time the contract is purchased.

Who Can Invest

To apply for a contract, you must be of legal age in a state where the contracts may be lawfully sold and also be eligible to participate in any of the qualified or nonqualified plans for which the contracts are designed. At the time of issue, the Contractowner, joint owner and Annuitant must be under age 76. Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account in an effort to help the government fight the funding of terrorism and money laundering activities. When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license, photo i.d. or other identifying documents.

In accordance with anti-money laundering laws and federal economic sanction policy, the Company may be required in a given instance to reject a Purchase Payment and/or freeze a Contractowner’s account. This means we could refuse to honor requests for transfers, withdrawals, surrenders or Death Benefits. Once frozen, monies would be moved from the VAA and Indexed Account to an interest-bearing account maintained solely for the Contractowner, and held in that account until instructions are received from the appropriate regulator.

Do not purchase this contract if you plan to use it, or any of its riders, for speculation, arbitrage, viatical arrangement, or other similar investment scheme. The contract may not be resold, traded on any stock exchange, or sold on any secondary market.

If you are purchasing the contract through a tax-favored arrangement, including traditional IRAs and Roth IRAs, you should consider carefully the costs and benefits of the contract (including annuity income benefits) before purchasing the contract, since the tax-favored arrangement itself provides tax-deferred growth.

Replacement of Existing Insurance

Careful consideration should be given prior to surrendering or withdrawing money from an existing insurance contract to purchase a contract described in this prospectus. Surrender charges may be imposed on your existing contract and/or a new surrender charge period may be imposed with the purchase of, or transfer into, this contract. The benefits offered under this contract may be less favorable or more favorable than the benefits offered under your current contract. It also may have different charges. You should also consult with your registered representative and/or your tax advisor prior to making an exchange. Cash surrenders from an existing contract may be subject to tax and tax penalties.

Purchase Payments

You may make Purchase Payments to the contract at any time, prior to the Annuity Commencement Date, subject to certain conditions. You are not required to make any additional Purchase Payments after the initial Purchase Payment. The minimum initial Purchase Payment is $25,000. The minimum for Selling Group Individuals is $1,500. Please check with your registered representative about making additional Purchase Payments since the requirements of your state may vary. The minimum payment to the contract at any one time must be at least $100 ($25 if transmitted electronically). If a Purchase Payment is submitted that does not meet the minimum amount, we will contact you to ask whether additional money will be sent, or whether we should return the Purchase Payment to you.

Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. If you stop making Purchase Payments, the contract will remain in force, however, we may terminate the contract as allowed by your state's non-forfeiture law for individual deferred annuities. Purchase Payments may be made or, if stopped, resumed at any time until the Annuity Commencement Date, the surrender of the contract, or the death of the Contractowner, whichever comes first.

In addition to the specific Purchase Payment restrictions and limitations immediately above, upon advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract.

These restrictions and limitations will limit your ability to increase your Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments to the contract. You should carefully consider these limitations and restrictions, and any other limitations and restrictions of the contract, and how they may impact your long-term investment plans, especially if you intend to increase Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments over a long period of time.

27

Valuation Date

Accumulation and Annuity Units and Indexed Segments will be valued once daily at the close of trading (normally, 4:00 p.m., New York time) on each day the New York Stock Exchange is open (Valuation Date). On any date other than a Valuation Date, the Accumulation Unit value and the Annuity Unit value and value of the Indexed Segment will not change.

Allocation of Purchase Payments

Purchase Payments will be allocated, according to your instructions, among one or more of the investment options available under your contract. Allocation made to the variable side of the contract are placed into the VAA’s Subaccounts. You may also allocate Purchase Payments to the available Indexed Accounts.

Allocations to the Subaccounts. The minimum amount that can be put into any one Subaccount is $20. Purchase Payments received from you or your broker-dealer in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time), will be processed using the Accumulation Unit value computed on that Valuation Date. Purchase Payments received in Good Order after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. Purchase Payments submitted to your registered representative will generally not be processed until they are received from your representative’s broker-dealer. Purchase Payments submitted to us by your broker-dealer through the Depository Trust and Clearing Corporation (DTCC) or, pursuant to terms agreeable to us, uses a proprietary order placement system to submit your Purchase Payment to us, and your Purchase Payment was placed with your broker-dealer prior to market close, then we will use the Accumulation Unit value computed on that Valuation Date when processing your Purchase Payment. Purchase Payments placed with your broker-dealer after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances, Purchase Payments received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date.

The number of Accumulation Units determined in this way is not impacted by any subsequent change in the value of an Accumulation Unit. However, the dollar value of an Accumulation Unit will vary depending not only upon how well the underlying fund’s investments perform, but also upon the expenses of the VAA and the underlying funds.

Allocations to the Indexed Accounts. The minimum amount that may be allocated into an Indexed Account is $2,000. An initial Purchase Payment that is received in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time) will be allocated to the Indexed Accounts according to your instructions. The date this initial allocation occurs is the first date of the Indexed Term and the Indexed Anniversary Date. Allocations cannot be made on February 29^th. After the Indexed Anniversary Date is established, that is the only date each year that allocations can be invested in the Indexed Accounts. If additional Purchase Payments for the Indexed Accounts are received prior to the Indexed Anniversary Date, these Purchase Payments must be accompanied with instructions to invest in a variable Subaccount until the Purchase Payment can be allocated to the Indexed Account. We will hold allocation instructions for the Indexed Accounts for up to 25 calendar days prior to the Indexed Anniversary Date.

A rate hold is available for Purchase Payments received within thirty days from the date your application is received at our Home Office. The rate hold will provide the Performance Cap and the Protection Level for your elected Indexed Account that were in effect on the date your application was received at the Home Office for any Purchase Payments allocated to the Indexed Accounts during this 30-day period. If you elect the rate hold, all Purchase Payments will be held in a non-interest bearing transfer account for 30 days (or the next Valuation Day), and then will be allocated to the Indexed Account(s) selected. Purchase Payments received after day 30 will be allocated to the variable Subaccounts you selected. If no variable Subaccounts were selected, these Purchase Payments will be allocated to the LVIP PIMCO Low Duration Bond Fund. You can allocate to Indexed Accounts on the next Indexed Anniversary Date.

Valuation of Accumulation Units

Purchase Payments allocated to the VAA are converted into Accumulation Units. This is done by dividing the amount allocated by the value of an Accumulation Unit for the Valuation Period during which the Purchase Payments are allocated to the VAA. The Accumulation Unit value for each Subaccount was or will be established at the inception of the Subaccount. It may increase or decrease from Valuation Period to Valuation Period. Accumulation Unit values are affected by investment performance of the funds, fund expenses, and the contract charges. The Accumulation Unit value for a Subaccount for a later Valuation Period is determined as follows:

1.	The total value of the fund shares held in the Subaccount is calculated by multiplying the number of fund shares owned by the Subaccount at the beginning of the Valuation Period by the net asset value per share of the fund at the end of the Valuation Period, and adding any dividend or other distribution of the fund if an ex-dividend date occurs during the Valuation Period; minus
2.	The liabilities of the Subaccount at the end of the Valuation Period; these liabilities include daily charges imposed on the Subaccount, and may include a charge or credit with respect to any taxes paid or reserved for by us that we determine result from the operations of the VAA; and
3.	The result is divided by the number of Subaccount units outstanding at the beginning of the Valuation Period.

28

The daily charges imposed on a Subaccount for any Valuation Period are equal to the daily Product Charge multiplied by the number of calendar days in the Valuation Period. Contracts with different features have different daily charges, and therefore, will have different corresponding Accumulation Unit values on any given day. In certain circumstances (for example, when separate account assets are less than $1,000), and when permitted by law, it may be prudent for us to use a different standard industry method for this calculation, called the Net Investment Factor method. We will achieve substantially the same result using either method.

Transfers On or Before the Annuity Commencement Date

After the first 30 days from the effective date of your contract, you may transfer all or a portion of your investment from one Subaccount to another. A transfer among Subaccounts involves the surrender of Accumulation Units in one Subaccount and the purchase of Accumulation Units in the other Subaccount. A transfer will be done using the respective Accumulation Unit values determined at the end of the Valuation Date on which the transfer request is received.

Transfers (among the Subaccounts and as permitted between the Subaccounts and Indexed Accounts) are limited to 12 per Contract Year unless otherwise authorized by us. This limit does not apply to transfers made under the automatic transfer programs of portfolio rebalancing programs elected on forms available from us. See Additional Services and the SAI for more information on these programs. These transfer rights and restrictions also apply during the i4LIFE^® Indexed Advantage Access Period (the time period during which you may make withdrawals from the i4LIFE^® Indexed Advantage Account Value). See i4LIFE^® Indexed Advantage.

Transfers into a new Indexed Account are only available on the Indexed Anniversary Date. Transfers are not allowed into an existing Indexed Segment. Transfers from Indexed Segments prior to the end of the Indexed Term will be valued at the Interim Value. In addition, the Indexed Crediting Base is reduced proportionately by the amount that the transfer reduced the Interim Value. You cannot transfer an amount greater than your Interim Value.

The minimum amount which may be transferred between Subaccounts is $300 (or the entire amount in the Subaccount, if less than $300). If the transfer from a Subaccount would leave you with less than $300 in the Subaccount, we may transfer the total balance of the Subaccount.

A transfer request may be made to our Home Office in writing, or by fax or other electronic means. A transfer request may also be made by telephone provided the appropriate authorization is on file with us. Our address, telephone number, and Internet address are on the first page of this prospectus. Requests for transfers will be processed on the Valuation Date that they are received when they are received in Good Order at our Home Office before the close of the New York Stock Exchange (normally 4:00 p.m., New York time). If we receive a transfer request in Good Order after market close, we will process the request using the Accumulation Unit value computed on the next Valuation Date.

There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances transfers received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date. We will hold a transfer request to move Contract Value from the Subaccounts to the Indexed Accounts for up to 25 days prior to the Indexed Anniversary Date. During this time, your assets will remain in the Subaccounts previously selected by you.

We may defer or reject a transfer request that is subject to a restriction imposed by an underlying fund.

Transfers may be delayed as permitted by the 1940 Act. See Delay of Payments.

Telephone and Electronic Transactions

A surrender, withdrawal, or transfer request may be made to our Home Office using a fax or other electronic means. In addition, withdrawal and transfer requests may be made by telephone, subject to certain restrictions. In order to prevent unauthorized or fraudulent transfers, we may require certain identifying information before we will act upon instructions. We may also assign the Contractowner a Personal Identification Number (PIN) to serve as identification. We will not be liable for following instructions we reasonably believe are genuine. Telephone and other electronic requests will be recorded and written confirmation of all transactions will be mailed to the Contractowner on the next Valuation Date.

Please note that the telephone and/or electronic devices may not always be available. Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s, 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 limit these problems, we cannot promise complete reliability under all circumstances. If you are experiencing problems, you should make your request by writing to our Home Office.

Market Timing

Frequent, large, or short-term transfers among Subaccounts, such as those associated with “market timing” transactions, can affect the funds and their investment returns. Such transfers may dilute the value of the fund shares, interfere with the efficient management of the fund's portfolio, and increase brokerage and administrative costs of the funds. As an effort to protect our Contractowners and

29

the funds from potentially harmful trading activity, we utilize certain market timing policies and procedures (the “Market Timing Procedures”). Our Market Timing Procedures are designed to detect and prevent such transfer activity among the Subaccounts and the Indexed Accounts that may affect other Contractowners or fund shareholders.

In addition, the funds may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares. The prospectuses for the funds describe any such policies and procedures, which may be more or less restrictive than the frequent trading policies and procedures of other funds and the Market Timing Procedures we have adopted to discourage frequent transfers among Subaccounts. While we reserve the right to enforce these policies and procedures, Contractowners and other persons with interests under the contracts should be aware that we may not have the contractual authority or the operational capacity to apply the frequent trading policies and procedures of the funds. However, under SEC rules, we are required to: (1) enter into a written agreement with each fund or its principal underwriter that obligates us to provide to the fund promptly upon request certain information about the trading activity of individual Contractowners, and (2) execute instructions from the fund to restrict or prohibit further purchases or transfers by specific Contractowners who violate the excessive trading policies established by the fund.

You should be aware that the purchase and redemption orders received by the funds generally are “omnibus” orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. The omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan participants and/or individual owners of variable insurance contracts. The omnibus nature of these orders may limit the funds’ ability to apply their respective disruptive trading policies and procedures. We cannot guarantee that the funds (and thus our Contractowners) will not be harmed by transfer activity relating to the retirement plans and/or other insurance companies that may invest in the funds. In addition, if a fund believes that an omnibus order we submit may reflect one or more transfer requests from Contractowners engaged in disruptive trading activity, the fund may reject the entire omnibus order.

Our Market Timing Procedures detect potential “market timers” by examining the number of transfers made by Contractowners within given periods of time. In addition, managers of the funds might contact us if they believe or suspect that there is market timing. If requested by a fund company, we may vary our Market Timing Procedures from Subaccount to Subaccount to comply with specific fund policies and procedures.

We may increase our monitoring of Contractowners who we have previously identified as market timers. When applying the parameters used to detect market timers, we will consider multiple contracts owned by the same Contractowner if that Contractowner has been identified as a market timer. For each Contractowner, we will investigate the transfer patterns that meet the parameters being used to detect potential market timers. We will also investigate any patterns of trading behavior identified by the funds that may not have been captured by our Market Timing Procedures.

Once a Contractowner has been identified as a market timer under our Market Timing Procedures, we will notify the Contractowner in writing that future transfers (among the Subaccounts and/or the Indexed Account) will be temporarily permitted to be made only by original signature sent to us by U.S. mail, first-class delivery for the remainder of the Contract Year (or calendar year if the contract is an individual contract that was sold in connection with an employer sponsored plan). Overnight delivery or electronic instructions (which may include telephone, facsimile, or Internet instructions) submitted during this period will not be accepted. If overnight delivery or electronic instructions are inadvertently accepted from a Contractowner that has been identified as a market timer, upon discovery, we will reverse the transaction within 1 or 2 business days. We will impose this “original signature” restriction on that Contractowner even if we cannot identify, in the particular circumstances, any harmful effect from that Contractowner's particular transfers.

Contractowners seeking to engage in frequent, large, or short-term transfer activity may deploy a variety of strategies to avoid detection. Our ability to detect such transfer activity may be limited by operational systems and technological limitations. The identification of Contractowners determined to be engaged in such transfer activity that may adversely affect other Contractowners or fund shareholders involves judgments that are inherently subjective. We cannot guarantee that our Market Timing Procedures will detect every potential market timer. If we are unable to detect market timers, you may experience dilution in the value of your fund shares and increased brokerage and administrative costs in the funds. This may result in lower long-term returns for your investments.

Our Market Timing Procedures are applied consistently to all Contractowners. An exception for any Contractowner will be made only in the event we are required to do so by a court of law. In addition, certain funds available as investment options in your contract may also be available as investment options for owners of other, older life insurance policies issued by us. Some of these older life insurance policies do not provide a contractual basis for us to restrict or refuse transfers which are suspected to be market timing activity. In addition, because other insurance companies and/or retirement plans may invest in the funds, we cannot guarantee that the funds will not suffer harm from frequent, large, or short-term transfer activity among Subaccounts or the Indexed Accounts of variable contracts issued by other insurance companies or among investment options available to retirement plan participants.

In our sole discretion, we may revise our Market Timing Procedures at any time without prior notice as necessary to better detect and deter frequent, large, or short-term transfer activity to comply with state or federal regulatory requirements, and/or to impose additional or alternate restrictions on market timers (such as dollar or percentage limits on transfers). If we modify our Market Timing Procedures, they will be applied uniformly to all Contractowners or as applicable to all Contractowners investing in underlying funds.

30

Some of the funds have reserved the right to temporarily or permanently refuse payments or transfer requests from us if, in the judgment of the fund’s investment adviser, the fund would be unable to invest effectively in accordance with its investment objective or policies, or would otherwise potentially be adversely affected. To the extent permitted by applicable law, we reserve the right to defer or reject a transfer request at any time that we are unable to purchase or redeem shares of any of the funds available through the VAA, including any refusal or restriction on purchases or redemptions of the fund shares as a result of the funds' own policies and procedures on market timing activities. If a fund refuses to accept a transfer request we have already processed, we will reverse the transaction within 1 or 2 business days. We will notify you in writing if we have reversed, restricted or refused any of your transfer requests. Some funds also may impose redemption fees on short-term trading (i.e., redemptions of mutual fund shares within a certain number of business days after purchase). We reserve the right to administer and collect any such redemption fees on behalf of the funds. You should read the prospectuses of the funds for more details on their redemption fees and their ability to refuse or restrict purchases or redemptions of their shares.

Transfers After the Annuity Commencement Date

You may transfer all or a portion of your investment in one Subaccount to another Subaccount, as permitted under your contract. Those transfers will be limited to three times per Contract Year. You may also transfer from a variable Annuity Payout to a fixed Annuity Payout. You may not transfer from a fixed Annuity Payout to a variable Annuity Payout. Once elected, the fixed Annuity Payout is irrevocable. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation.

Ownership

The Contractowner on the date of issue will be the person or entity designated in the contract specifications. The Contractowner of a nonqualified contract may name a joint owner.

As Contractowner, you have all rights under the contract. According to Indiana law, the assets of the VAA are held for the exclusive benefit of all Contractowners and their designated Beneficiaries; and the assets of the VAA are not chargeable with liabilities arising from any other business that we may conduct. We reserve the right to approve all ownership and Annuitant changes. Nonqualified contracts may not be sold, discounted, or pledged as collateral for a loan or for any other purpose. Qualified contracts are not transferable unless allowed under applicable law. Nonqualified contracts may not be collaterally assigned. Assignments may have an adverse impact on your Death Benefits and may be prohibited under the terms of a particular feature. We assume no responsibility for the validity or effect of any assignment. Consult your tax advisor about the tax consequences of an assignment.

Joint Ownership

If a contract has joint owners, the joint owners shall be treated as having equal undivided interests in the contract. Either owner, independently of the other, may exercise any ownership rights in this contract. Not more than two owners (an owner and joint owner) may be named and contingent owners are not permitted.

Annuitant

The following rules apply prior to the Annuity Commencement Date. You may name only one Annuitant (unless you are a tax-exempt entity, then you can name two joint Annuitants). You (if the Contractowner is a natural person) have the right to change the Annuitant at any time by notifying us in writing of the change. However, we reserve the right to approve all Annuitant changes. This may not be allowed if certain riders are in effect. The new Annuitant must be under age 86 as of the effective date of the change. A contingent Annuitant may be named or changed by notifying us in writing. Contingent Annuitants are not allowed on contracts owned by non-natural owners. On or after the Annuity Commencement Date, the Annuitant or joint Annuitants may not be changed and contingent Annuitant designations are no longer applicable.

Surrenders and Withdrawals

Before the Annuity Commencement Date, we will allow the surrender of the contract or a withdrawal of the Contract Value upon your written request on an approved Lincoln distribution request form (available from the Home Office), fax, or other electronic means approved by Lincoln. Withdrawal requests may be made by telephone, subject to certain restrictions. All surrenders and withdrawals may be made in accordance with the rules discussed below. Surrender or withdrawal rights after the Annuity Commencement Date are not available.

The amount available upon surrender/withdrawal is the Contract Value less any applicable charges, fees, and taxes at the end of the Valuation Period during which the written request for surrender/withdrawal is received in Good Order at the Home Office. If we receive a surrender or withdrawal request in Good Order at our Home Office before the close of the NYSE (normally 4:00 p.m., New York time), we will process the request from the VAA using the Accumulation Unit value computed on that Valuation Date. If we receive a surrender or withdrawal request in Good Order at our Home Office after market close, we will process the request using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. There may be circumstances under which the NYSE may close early (prior to 4:00 p.m., New York time). In such instances, surrender or withdrawal requests received after such early market

31

close will be processed using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. The minimum amount which can be withdrawn is $300. Unless a request for withdrawal specifies otherwise, withdrawals will be made in the following order:

1.	proportionately from all Subaccounts within the VAA, until exhausted; then
2.	the transfer account; then
3.	proportionately from all Indexed Accounts.

Unless prohibited, surrender/withdrawal payments will be mailed within seven days after we receive a valid written request at the Home Office. The payment may be postponed as permitted by the 1940 Act.

When withdrawals are made from the Indexed Accounts, an amount equal to the Interim Value of the Segment is available for surrender or withdrawal. In addition, the Indexed Crediting Base for each individual Indexed Segment is reduced proportionately by the amount that the withdrawal reduced the Interim Value. A proportional reduction could be larger than the dollar amount of the withdrawal. Reduction to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Segment Maturity Value at the end of the Indexed Term. You cannot withdraw an amount equal to the Indexed Crediting Base. The following examples show how the Index Crediting Base is impacted by a withdrawal, and assumes that you have invested in an Indexed Account and no Subaccounts.

Example 1:

1/1/2017 Allocation to Indexed Segment = $80,000
1/1/2017 Indexed Crediting Base = $80,000
6/1/2017 Indexed Crediting Base = $80,000; Interim Value = $100,000; Withdrawal = $80,000 (including any applicable surrender charge)
Withdrawal/Interim Value = $80,000 ÷ $100,000 = 80%
Removed Amount from the Indexed Crediting Base = $64,000 (80% of $80,000)
Indexed Crediting Base after withdrawal = $80,000 - $64,000 = $16,000
Interim Value after withdrawal ($100,000 - $80,000) = $20,000
Interim Value calculation going forward and Segment Maturity Value will be based on the $16,000 Indexed Crediting Base

Example 2:

Indexed Crediting Base = $16,000; Interim Value = $15,000; Withdrawal = $15,000 (including any applicable surrender charge)
Withdrawal/Interim Value = $15,000 ÷ $15,000 = 100%
Removed Amount from the Indexed Crediting Base = $16,000 (100% of $16,000)
Indexed Crediting Base after withdrawal = $0
Interim Value after withdrawal = $0 ($15,000 - $15,000)

Note: The $15,000 Interim Value is the maximum that could be withdrawn because this value reflects the index gain or loss during the Indexed Term. The Indexed Crediting Base is not available for withdrawal or transfer.

There may be surrender charges associated with surrender of a contract or withdrawal of Contract Value. You may specify whether these charges are deducted from the amount you request to be withdrawn or from the remaining Contract Value. If the charges are deducted from the remaining Contract Value, the amount of the total withdrawal will increase according to the impact of the applicable surrender charge percentage; consequently, the dollar amount of the surrender charge associated with the withdrawal will also increase. In other words, the dollar amount deducted to cover the surrender charge is also subject to a surrender charge. See Charges and Other Deductions.

The tax consequences of a surrender/withdrawal are discussed later in this prospectus. See Federal Tax Matters – Taxation of Withdrawals and Surrenders.

Additional Services

These additional services may be available to you under your contract: automatic withdrawal service (AWS) and portfolio rebalancing. Currently, there is no charge for these services. However, we reserve the right to impose one after appropriate notice to Contractowners. In order to take advantage of one of these services, you will need to complete the appropriate election form that is available from our Home Office. These services will stop once we are notified of a pending death claim. For further detailed information on these services, please see Additional Services in the SAI.

Automatic Withdrawal Service. The automatic withdrawal service (AWS) provides for an automatic periodic withdrawal of your Contract Value. Withdrawals under AWS are subject to applicable surrender charges. Withdrawals from Indexed Accounts will be at Interim Value. See Charges and Other Deductions – Surrender Charge and Indexed Accounts – Interim Value. Withdrawals under AWS will be noted on your quarterly statement. Confirmation statements for each individual withdrawal will not be issued. AWS is not available when i4LIFE^® Indexed Advantage is in effect.

32

Portfolio Rebalancing. Portfolio rebalancing is an option that restores to a pre-determined level the percentage of Contract Value allocated to each variable account Subaccount. The rebalancing may take place monthly, quarterly, semi-annually or annually. Rebalancing events will be noted on your quarterly statement. Confirmation statements for each individual rebalancing event will not be issued. Portfolio rebalancing is not available for the portion of Contract Value held in the Indexed Accounts.

We reserve the right to discontinue any or all of these administrative services at any time.

Death Benefit

The chart below provides a brief overview of how the Death Benefit proceeds will be distributed if death occurs prior to the Annuity Commencement Date. Refer to your contract for the specific provisions applicable upon death.

upon death of:	and...	and...	Death Benefit proceeds pass to:
Contractowner	There is a surviving joint owner	The Annuitant is living or deceased	Joint owner
Contractowner	There is no surviving joint owner	The Annuitant is living or deceased	Designated Beneficiary
Contractowner	There is no surviving joint owner and the Beneficiary predeceases the Contractowner	The Annuitant is living or deceased	Contractowner's estate
Annuitant	The Contractowner is living	There is no contingent Annuitant	The youngest Contractowner becomes the contingent Annuitant and the contract continues. The Contractowner may waive* this continuation and receive the Death Benefit proceeds.
Annuitant	The Contractowner is living	The contingent Annuitant is living	Contingent Annuitant becomes the Annuitant and the contract continues
Annuitant**	The Contractowner is a trust or other non-natural person	No contingent Annuitant allowed with non-natural Contractowner	Designated Beneficiary

* Notification from the Contractowner to receive the Death Benefit proceeds must be received within 75 days of the death of the Annuitant.

** Death of Annuitant is treated like death of the Contractowner.

If the Contractowner (or a joint owner) or Annuitant dies prior to the Annuity Commencement Date, a Death Benefit may be payable. This Death Benefit terminates on the Annuity Commencement Date.

You should consider the following provisions carefully when designating the Beneficiary, Annuitant, any contingent Annuitant and any joint owner, as well as before changing any of these parties. The identity of these parties under the contract may significantly affect the amount and timing of the Death Benefit or other amount paid upon a Contractowner's or Annuitant's death.

You may designate a Beneficiary during your lifetime and change the Beneficiary by filing a written request with our Home Office. Each change of Beneficiary revokes any previous designation. We reserve the right to request that you send us the contract for endorsement of a change of Beneficiary.

Upon the death of the Contractowner, a Death Benefit will be paid to the Beneficiary. Upon the death of a joint owner, the Death Benefit will be paid to the surviving joint owner. If the Contractowner is a corporation or other non-individual (non-natural person), the death of the Annuitant will be treated as death of the Contractowner.

If an Annuitant who is not the Contractowner or joint owner dies, then the contingent Annuitant, if named, becomes the Annuitant and no Death Benefit is payable on the death of the Annuitant. If no contingent Annuitant is named, the Contractowner (or younger of joint owners) becomes the Annuitant. Alternatively, a Death Benefit may be paid to the Contractowner (and joint owner, if applicable, in equal shares). Notification of the election of this Death Benefit must be received by us within 75 days of the death of the Annuitant. The contract terminates when any Death Benefit is paid due to the death of the Annuitant.

Only the Contract Value as of the Valuation Date we approve the payment of the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

Guarantee of Principal Death Benefit. The Guarantee of Principal Death Benefit is included as part of the base contract. The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of:

• the Contract Value as of the Valuation Date we approve the payment of the claim; or

33

• the sum of all Purchase Payments decreased by all withdrawals in the same proportion that withdrawals reduce the Contract Value.

Note: The Contract Value for Indexed Segments is the Interim Value unless the claim is processed on a Segment End Date. In a declining market, withdrawals deducted in the same proportion that withdrawals reduce the Contract Value may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more that the dollar amount of the withdrawal from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals and premium taxes, if any.

The Guarantee of Principal Death Benefit may not be terminated unless you surrender the contract. In addition, the rider will terminate:

1.	on the Annuity Commencement Date;
2.	upon payment of a Death Benefit under the Guarantee of Principal Death Benefit (unless the contract is continued by the surviving spouse); or
3.	at any time all Contractowners or Annuitants are changed.

Account Value Death Benefit. The Account Value Death Benefit provides a Death Benefit equal to the Contract Value on the Valuation Date the death claim is approved by us for payment. The Account Value Death Benefit is not available for election at contract issue. Once you have the Account Value Death Benefit, this Death Benefit cannot be changed. The Account Value Death Benefit will become effective only at the time all Contractowners and Annuitants are changed.

General Death Benefit Information

Your Death Benefit terminates on and after the Annuity Commencement Date. i4LIFE^® Indexed Advantage, which is an Annuity Payout option, only provides Death Benefit options during the Access Period. There are no Death Benefits during the Lifetime Income Period. Please see the i4LIFE^® Indexed Advantage – i4LIFE^® Indexed Advantage Death Benefit section of this prospectus for more information.

If there are joint owners, upon the death of the first Contractowner, we will pay a Death Benefit to the surviving joint owner. The surviving joint owner will be treated as the primary, designated Beneficiary. Any other Beneficiary designation on record at the time of death will be treated as a contingent Beneficiary. If the surviving joint owner is the spouse of the deceased joint owner, he/she may continue the contract as sole Contractowner. Upon the death of the spouse who continued the contract, we will pay the Account Value Death Benefit to the designated Beneficiary(s) unless the Guarantee of Principal Death Benefit is in effect.

If the Beneficiary is the spouse of the Contractowner, then the spouse may elect to continue the contract as the new Contractowner. In this situation, a portion of the Death Benefit may be credited to the contract. Any portion of the Death Benefit that would have been payable (if the contract had not been continued) that exceeds the current Contract Value on the Valuation Date we approve the claim will be added to the Contract Value and placed in the variable Subaccounts according to the allocations on the contract. If no variable Subaccounts are selected, the proceeds will be placed in the LVIP PIMCO Low Duration Bond Fund Subaccount. If the contract is continued in this way, the Guarantee of Principal Death Benefit rider and charge will continue. The rider charge rate that was in effect immediately prior to the death will continue to apply.

Same-sex spouses should carefully consider whether to purchase annuity products that provide benefits based upon status as a spouse, and whether to exercise any spousal rights under the contract. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

The value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of a claim submitted in Good Order or one year from the date of the death for nonqualified contracts and December 31^st of the year following death for IRAs. To be in Good Order, we require all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Unless otherwise provided in the Beneficiary designation, one of the following procedures will take place on the death of a Beneficiary:

• if any Beneficiary dies before the Contractowner, that Beneficiary’s interest will go to any other Beneficiaries named, according to their respective interests; and/or

• if no Beneficiary survives the Contractowner, the proceeds will be paid to the Contractowner’s estate.

34

If the Beneficiary is a minor, court documents appointing the guardian/custodian may be required.

The Beneficiary may choose the method of payment of the Death Benefit unless the Contractowner has already selected a settlement option. The Death Benefit payable to the Beneficiary or joint owner must be distributed within five years of the Contractowner’s date of death unless the Beneficiary begins receiving within one year of the Contractowner’s death the distribution in the form of a life annuity or an annuity for a designated period not extending beyond the Beneficiary’s life expectancy.

Note: Indexed Accounts cannot be divided into separate contracts when there are multiple beneficiaries. If more than one beneficiary chooses a death benefit option other than a lump sum, the existing Indexed Account(s) will need to be surrendered at the Interim Value to be allocated to multiple beneficiaries. New Indexed Accounts can be selected on the new contracts if desired with the currently available features.

Upon the death of the Annuitant, Federal tax law requires that an annuity election be made no later than 60 days after we have approved the death claim for payment.

The recipient of a Death Benefit may elect to receive payment either in the form of a lump sum settlement or an Annuity Payout. If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Abandoned Property. Every state has unclaimed property laws which generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from the date a benefit is due and payable. For example, if the payment of a Death Benefit has been triggered, but, if after a thorough search, we are still unable to locate the Beneficiary of the Death Benefit, or the Beneficiary does not come forward to claim the Death Benefit in a timely manner, the Death Benefit will be “escheated”. This means that the Death Benefit will be paid to the abandoned property division or unclaimed property office of the state in which the Beneficiary or the Contractowner last resided, as shown on our books and records, or to our state of domicile. This escheatment is revocable and 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 such escheatment, it is important that you update your Beneficiary designations, including addresses, if and as they change. You may update your Beneficiary designations by submitting a Beneficiary change form to our Home Office.

i4LIFE^® Indexed Advantage

i4LIFE^® Indexed Advantage is an optional Annuity Payout rider you may purchase for an additional charge, and is separate and distinct from other Annuity Payout options offered under your contract and described later in this prospectus. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information on how the charge is calculated.

i4LIFE^® Indexed Advantage provides Periodic Income Payments for life subject to certain conditions. These payments are made during two time periods: an Access Period and a Lifetime Income Period, which are discussed in further detail below. i4LIFE^® Indexed Advantage is different from other Annuity Payout options provided by Lincoln because with i4LIFE^® Indexed Advantage, you have the ability to make additional withdrawals or surrender the contract during the Access Period.

When you elect i4LIFE^® Indexed Advantage, you must choose the Annuitant and Secondary Life (if applicable). The Annuitant and Secondary Life may not be changed after i4LIFE^® Indexed Advantage is elected. For qualified contracts, the Secondary Life must be the spouse. See i4LIFE^® Indexed Advantage Death Benefit regarding the impact of a change to the Annuitant prior to the i4LIFE^® Indexed Advantage election.

Only Indexed Accounts with 1-Year Indexed Terms are available. If you elect i4LIFE^® Indexed Advantage while you are currently allocated to an Indexed Account with an Indexed Term greater than one year, the funds allocated to the Indexed Account(s) will be transferred to the LVIP PIMCO Low Duration Bond Fund at Interim Value unless you provide instructions otherwise. Additionally, once i4LIFE^® Indexed Advantage is in effect, any automatic withdrawal service will terminate.

Additional Purchase Payments may be made during the Access Period for an IRA annuity contract. Additional Purchase Payments will not be accepted at any time for a nonqualified annuity contract.

Availability. i4LIFE^® Indexed Advantage is available for contracts with a Contract Value of at least $50,000 and may be elected at the time of contract application or on any subsequent Indexed Anniversary Date by sending a written request to our Home Office. i4LIFE^® Indexed Advantage is not available if another Annuity Payout option is in effect. If you have not established an Indexed Anniversary Date, your i4LIFE^® Indexed Advantage Rider Date can be any Valuation Date.

i4LIFE^® Indexed Advantage is available on nonqualified annuities, IRAs and Roth IRAs (check with your registered representative regarding availability with SEP market). i4LIFE^® Indexed Advantage for IRA contracts is only available if the Annuitant and Secondary Life are age 59½ or older at the time the option is elected. Additional limitations on issue ages and features may be necessary to comply with federal tax law for required minimum distributions.

35

Access Period. The Access Period is a defined period of time during which we pay Periodic Income Payments and provide a Death Benefit. During this period, you may surrender the contract and make withdrawals from your Account Value (defined below). The Lifetime Income Period begins immediately at the end of the Access Period, the remaining Account Value is used to make Periodic Income Payments for the rest of your life (or the Secondary Life if applicable). During the Lifetime Income Period, you will no longer be able to make withdrawals or surrenders or receive a Death Benefit. If your Account Value is reduced to zero because of withdrawals or market loss, your Access Period ends.

The minimum and maximum Access Periods are established at the time you elect i4LIFE^® Indexed Advantage. The current Access Period requirements are outlined in the following chart:

Minimum Access Period	Maximum Access Period
The greater of 20 years or the difference between your nearest age and age 90, based on the youngest covered life if joint life is elected	The length of time between your age and age 115 for nonqualified contracts (based on the youngest covered life if joint life is elected); age 100 for qualified contracts.

You may also choose any period of time between the minimum Access Period and maximum Access Period.

Generally, shorter Access Periods will produce a higher initial Periodic Income Payment than longer Access Periods, but you will have a shorter period of time within which to access your Account Value. A longer Access Period will generally produce a lower initial Periodic Income Payment but will provide you with a longer period of time within which to access your Account Value. At any time during the Access Period, you may extend the length of the Access Period subject to Home Office approval and the Access Period rules in effect at that time. Additional restrictions may apply if you are under age 59½ when you request a change to the Access Period. Currently, if you extend the Access Period, it must be extended at least 5 years. If you change the Access Period, subsequent Periodic Income Payments will be adjusted accordingly, and the Account Value remaining at the end of the new Access Period will be applied to continue Periodic Income Payments for your life. Currently, changes to the Access Period can only be made on Rider Date anniversaries.

Additional limitations on issue ages and features may be necessary to comply with the IRC provisions for required minimum distributions. We may reduce or terminate the Access Period for IRA i4LIFE^® Indexed Advantage contracts in order to keep the Periodic Income Payments in compliance with federal tax law for required minimum distributions.

Account Value. The initial Account Value is the Contract Value on the i4LIFE^® Indexed Advantage Rider Date, less any applicable premium taxes. During the Access Period, the Account Value on a Valuation Date will equal the total value of all of the Contractowner's Indexed Account(s), variable subaccount(s), and Periodic Income Payment Account, and will be reduced by Periodic Income Payments made, rider fees, as well as any withdrawals taken. You will have access to your Account Value during the Access Period. After the Access Period ends, the remaining Account Value will be applied to continue Periodic Income Payments for your life (and/or the Secondary Life, if applicable) and the Account Value will be reduced to zero.

Periodic Income Payments during the Access Period.i4LIFE^® Indexed Advantage provides for Periodic Income Payments for as long as an Annuitant (or Secondary Life, if applicable) is living.

Periodic Income Payments must begin within one year of the date you elect i4LIFE^® Indexed Advantage. Once they begin, they will continue until the death of the Annuitant or Secondary Life, if applicable, unless i4LIFE^® Indexed Advantage is terminated or the contract is surrendered. If you do not choose a Periodic Income Payment frequency, the default frequency is monthly.

Periodic Income Payments are not subject to any applicable surrender charges. For information regarding income tax consequences of Periodic Income Payments, see Federal Tax Matters.

The initial, annual Periodic Income Payment amount is calculated as of the date the rider is elected (Rider Date). This is the same date the Access Period begins. The amount of the initial Periodic Income Payment is determined on the Rider Date by dividing the Account Value, less applicable premium taxes by 1,000 and multiplying the result by an annuity factor. This amount is then transferred to the Periodic Income Payment Account to be paid out based on the payment frequency you selected. The annuity factor is based upon:

• the age and sex of the Annuitant and Secondary Life, if applicable;

• the length of the Access Period selected;

• the 3% Assumed Interest Rate (AIR); and

• the Individual Annuity Mortality table specified in your contract.

The annuity factor used to determine the Periodic Income Payments reflects the fact that, during the Access Period, you have the ability to withdraw the entire Account Value and that a Death Benefit of the entire Account Value will be paid to your Beneficiary upon your death. These benefits during the Access Period result in a slightly lower Periodic Income Payment, during both the Access Period and

36

the Lifetime Income Period, than would be payable if this access was not permitted and no lump-sum Death Benefit was payable. The annuity factor also reflects the requirement that there be sufficient Account Value at the end of the Access Period to continue your Periodic Income Payments for the remainder of your life (and/or the Secondary Life if applicable), during the Lifetime Income Period, with no further access or Death Benefit.

The Account Value will vary with the actual net investment return, which then determines the subsequent Periodic Income Payments during the Access Period. Each subsequent Periodic Income Payment is determined by dividing the Account Value on the Rider Date anniversary by 1,000 and multiplying this result by an annuity factor revised to reflect the declining length of the Access Period. As a result of this calculation, the actual net returns in the Account Value are measured against the AIR to determine subsequent Periodic Income Payments. If the actual net investment return (annualized) for the contract exceeds the AIR, the Periodic Income Payment will increase at a rate approximately equal to the amount of such excess. Conversely, if the actual net investment return for the contract is less than the AIR, the Periodic Income Payment will decrease. For example, if net investment return is 3% higher (annualized) than the AIR, the Periodic Income Payment for the next Rider Year will increase by approximately 3%. Conversely, if actual net investment return is 3% lower than the AIR, the Periodic Income Payment for the next Rider Year will decrease by approximately 3%.

For IRA i4LIFE^® Indexed Advantage contracts, if at any time A is greater than the sum of B and C and no additional withdrawals were made, we will distribute an additional payment, calculated and withdrawn on the Rider Date anniversary, equal to A – (B + C) where,

A = the RMD amount for the calendar year for this contract, as determined by us in accordance with the Internal Revenue Code.

B = the sum of Periodic Income Payment paid in the calendar year immediately prior to the Rider Year anniversary and,

C = the sum of the Periodic Income Payment to be paid from the Rider Year anniversary to the end of the calendar year.

This additional payment will be deducted and distributed within 7 days following the applicable Rider Date anniversary. This amount will be treated as a Periodic Income Payment and not a Withdrawal for Death Benefit calculations.

Withdrawals made during the Access Period will also reduce the Account Value that is available for Periodic Income Payments. Subsequent Periodic Income Payments will be recalculated on the next Rider Date anniversary using the reduced Account Value.

For a joint life option, if either the Annuitant or Secondary Life dies during the Access Period, Periodic Income Payments will be recalculated using a revised annuity factor based on the single surviving life, if doing so provides a higher Periodic Income Payment. On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, the annuity factor will be revised for a non-life contingent Periodic Income Payment and Periodic Income Payments will continue until the Account Value is fully paid out and the Access Period ends. For qualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, i4LIFE^® Indexed Advantage will terminate.

Periodic Income Payments during the Lifetime Income Period. The Lifetime Income Period begins at the end of the Access Period if either the Annuitant or Secondary Life is living. Your earlier election regarding the Periodic Income Payment frequency does not change. The initial Periodic Income Payment during the Lifetime Income Period is determined by dividing the Account Value for each Indexed Account and Subaccount on the last Valuation Date of the Access Period by 1,000 and multiplying the result by an annuity factor revised to reflect that the Access Period has ended. The result for each variable Subaccount is converted to annuity units.

Subsequent Periodic Income Payments are calculated on the Rider Date anniversary and are equal to the sum of each Periodic Income Payment as calculated for each individual allocation. Subsequent Periodic Income Payments for the variable Subaccounts are determined by multiplying the number of Annuity Units per Subaccount by the Annuity Unit value. To determine subsequent Periodic Income Payments for the Indexed Segment(s), the prior Periodic Income Payment for each Segment is multiplied by the performance of the Segment less the rider charge divided by the AIR. Subsequent Periodic Income Payments are adjusted for any reallocations between accounts and Subaccounts.

Your Periodic Income Payments will vary based on the value of your Annuity Units and the performance of your Indexed Segments(s). Your payment(s) will not be affected by market performance during that year. You may also discontinue variable and index-linked payouts and select a fixed level payment.

Periodic Income Payments will continue for as long as the Annuitant or Secondary Life, if applicable, is living, and will vary with Account Value performance.

Periodic Income Payment Account. The Periodic Income Payment Account is designated to hold an amount equal to the annual Periodic Income Payments during the Access Period only.

On the Rider Date and each Rider Date anniversary thereafter, we will transfer Account Value equal to the annual amount of the Periodic Income Payment valued as of that date to the Periodic Income Payment Account. Amounts transferred to the Periodic Income Payment Account will no longer participate in the variable Subaccounts or Indexed Segment(s). The Periodic Income Payment Account is a non-interest bearing account. The Account Value will be transferred proportionately from the variable Subaccounts, and

37

the Indexed Segment(s) in which you are allocated. Transfers of Account Value to the Periodic Income Payment Account may reduce the value in the Subaccounts to zero. Periodic Income Payments will first be deducted from the Periodic Income Payment Account. Only after the Periodic Income Payment Account has been exhausted will any amounts be deducted proportionally from the Variable Subaccounts and lastly proportionally from the Indexed Segment(s).

The Periodic Income Payment Account is not available for allocations or transfers; unless there are any remaining amounts in the Periodic Income Payment Account on the Rider Anniversary after the Periodic Income Payment has been made for the prior Rider Year.

i4LIFE^® Indexed Advantage Death Benefit

The Death Benefit option in effect under the contract will continue to be in effect after the i4LIFE^® Indexed Advantage Rider Date and during the Access Period only and will be adjusted as follows:

Any withdrawal or Periodic Income Payment from the Account Value during the Access Period will result in a death benefit reduction.

If the Account Value Death Benefit is in effect, your Death Benefit will be equal to the Account Value as of the Valuation Date we approve the payment of the claim.

If the Guarantee of Principal Death Benefit is in effect, your Death Benefit will be equal to the greater of:

• the Account Value as of the Valuation Date we approve the payment of the claim; or

• the sum of all Purchase Payments, less the sum of the Periodic Income Payments and other withdrawals where:

• Periodic Income Payments and any additional Required Minimum Distribution payments reduce the Death Benefit by the dollar amount of the payment; and

• All other withdrawals, if any, reduce the Death Benefit in the same proportion that withdrawals reduce the Contract Value or Account Value.

References to Purchase Payments and withdrawals include Purchase Payments and withdrawals made prior to the election of i4LIFE^® Indexed Advantage Rider Date.

In a declining market, withdrawals which are deducted in the same proportion that withdrawals reduce the Contract Value or Account Value, may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more than the dollar amount withdrawn from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals (surrender charges for example) and premium taxes, if any.

The following example demonstrates the impact of a proportionate withdrawal on your Death Benefit:

Guarantee of Principal Death Benefit	$200,000
i4LIFE® Indexed Advantage Periodic Income Payment	$25,000
Additional withdrawal	$15,000 ($15,000/$150,000 = 10% withdrawal)
Account Value at the time of withdrawal	$150,000

Death Benefit value after i4LIFE^® Indexed Advantage Periodic Income Payment = $200,000 - $25,000 = $175,000
Reduction in Death Benefit value for withdrawal = $175,000 x 10% = $17,500
Death Benefit value after withdrawal = $175,000 - $17,500 = $157,500

The Periodic Income Payment reduces the Death Benefit by $25,000 and the withdrawal causes a 10% reduction in the Death Benefit, the same percentage that the withdrawal reduced the Account Value.

Only the Contract Value as of the Valuation Date we approve the payment the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

General Death Benefit Provisions. This Death Benefit option is only available during the Access Period and will terminate when the Account Value equals zero, because the Access Period terminates.

On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, upon the death of the Contractowner, joint owner or Annuitant, the Contractowner (or Beneficiary) may elect to terminate the contract and receive full payment of the Death Benefit or may elect to continue the contract and receive Periodic Income Payments. Upon the death of the Secondary Life, who is not also an owner, only the surrender value is paid.

If you are the owner of an IRA annuity contract, and there is no Secondary Life, and you die during the Access Period, the i4LIFE^® Indexed Advantage will terminate. A spouse Beneficiary may start a new i4LIFE^® Indexed Advantage program.

38

If a death occurs during the Access Period, the value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Upon notification to us of the death, Periodic Income Payments may be suspended until the death claim is approved. Upon approval, a lump sum payment for the value of any suspended payments will be made as of the date the death claim is approved, and Periodic Income Payments will continue, if applicable.

If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Transfers. During the Access Period and subject to the provisions of Transfers On Or Before The Annuity Commencement Date, the following transfers are permitted at any time:

(a) transfers between the variable Subaccounts or

(b) transfers from the Indexed Accounts to the variable Subaccounts. Transfers between the Indexed Accounts and from the variable Subaccounts to the Indexed Accounts are only permitted on a Rider Date anniversary.

After the Access Period and subject to the provisions of Transfers After the Annuity Commencement Date, transfers between the variable Subaccounts are permitted at any time. The following transfers are only permitted on the Rider Date anniversary:

(a) transfers from the variable Subaccounts to the Indexed Accounts;

(b) transfers between the Indexed Accounts; and

(c) transfers from the variable Subaccounts and/or Indexed Accounts to a fixed level payment.

Transfers from the Indexed Account(s) to the Subaccounts or from the fixed level payment to Indexed Account(s) or Subaccounts are not permitted.

Withdrawals. You may request a withdrawal at any time prior to the end of the Access Period. We reduce the Account Value by the amount of the withdrawal, which will impact all subsequent Periodic Income Payments. Withdrawals cannot be taken from the Periodic Income Payment Account. Withdrawals will be taken proportionately from the Subaccounts first and then proportionately from the Indexed Accounts. Any Withdrawal that reduces the Subaccounts and Indexed Accounts to zero will be treated as a withdrawal of the entire Account Value. Any remaining Account Value in the Periodic Income Payment Account will be paid out in a lump sum with the withdrawal, and the contract and rider will terminate. Withdrawals may have tax consequences. See Federal Tax Matters. Withdrawals are subject to any applicable surrender charges except when amounts may be withdrawn free of surrender charges. See Charges and Other Deductions.

Surrender. At any time prior to the end of the Access Period, you may surrender the contract by withdrawing the surrender value. If the contract is surrendered, the contract terminates and no further Periodic Income Payments will be made. Withdrawals are subject to any applicable surrender charges except when amounts may be withdrawn free of surrender charges. See Charges and Other Deductions.

Termination. For IRA contracts, you may terminate i4LIFE^® Indexed Advantage prior to the end of the Access Period by notifying us in writing. The termination will be effective on the next Rider Date anniversary after we receive the notice. Upon termination, the i4LIFE^® Indexed Advantage charge will end. Your Contract Value upon termination will be equal to the Account Value on the Valuation Date we terminate i4LIFE^® Indexed Advantage.

For nonqualified contracts, you may not terminate i4LIFE^® Indexed Advantage once you have elected it without terminating the entire contract..

Annuity Payouts

When you apply for a contract, you may select any Annuity Commencement Date permitted by law, which is usually on or before the Annuitant's 99^th birthday. Your broker-dealer may recommend that you annuitize at an earlier age.

The contract provides optional forms of payouts of annuities (annuity options), each of which is payable on a variable basis, a fixed basis or a combination of both as you specify. The Indexed Accounts are not available as Annuity Payout options. Any amounts in the

39

Indexed Segments must be transferred out of the Indexed Segments at Interim Value prior to the Annuity Commencement Date. The contract provides that all or part of the Contract Value may be used to purchase an Annuity Payout option.

You may elect Annuity Payouts in monthly, quarterly, semiannual or annual installments. If the payouts from any Subaccount would be or become less than $50, we have the right to reduce their frequency until the payouts are at least $50 each. Following are explanations of the annuity options available.

Annuity Options

The annuity options outlined below do not apply to Contractowners who have elected i4LIFE^® Indexed Advantage.

Life Annuity. This option offers a periodic payout during the lifetime of the Annuitant and ends with the last payout before the death of the Annuitant. This option offers the highest periodic payout since there is no guarantee of a minimum number of payouts or provision for a Death Benefit for Beneficiaries. However, there is the risk under this option that the recipient would receive no payouts if the Annuitant dies before the date set for the first payout; only one payout if death occurs before the second scheduled payout, and so on.

Life Annuity with Payouts Guaranteed for Designated Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and then continues throughout the lifetime of the Annuitant. The designated period is selected by the Contractowner.

Joint Life Annuity. This option offers a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. However, under a joint life annuity, if both Annuitants die before the date set for the first payout, no payouts will be made. Only one payment would be made if both deaths occur before the second scheduled payout, and so on.

Joint Life Annuity with Guaranteed Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and continues during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. The designated period is selected by the Contractowner.

Joint Life and Two Thirds to Survivor Annuity. This option provides a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. When one of the joint Annuitants dies, the survivor receives two thirds of the periodic payout made when both were alive.

Joint Life and Two-Thirds Survivor Annuity with Guaranteed Period. This option provides a periodic payout during the joint lifetime of the Annuitant and a joint Annuitant. When one of the joint Annuitants dies, the survivor receives two-thirds of the periodic payout made when both were alive. This option further provides that should one or both of the Annuitants die during the elected guaranteed period, usually 10 or 20 years, full benefit payment will continue for the rest of the guaranteed period.

Life Annuity with Cash Refund. Fixed annuity benefit payments that will be made for the lifetime of the Annuitant with the guarantee that upon death, should (a) the total dollar amount applied to purchase this option be greater than (b) the fixed annuity benefit payment multiplied by the number of annuity benefit payments paid prior to death, then a refund payment equal to the dollar amount of (a) minus (b) will be made.

Under the annuity options listed above, you may not make withdrawals. Other options, with or without withdrawal features, may be made available by us. You may pre-select an Annuity Payout option as a method of paying the Death Benefit to a Beneficiary. If you do, the Beneficiary cannot change this payout option. You may change or revoke in writing to our Home Office, any such selection, unless such selection was made irrevocable. If you have not already chosen an Annuity Payout option, the Beneficiary may choose any Annuity Payout option. At death, options are only available to the extent they are consistent with the requirements of the contract as well as Sections 72(s) and 401(a)(9) of the tax code, if applicable.

General Information

Any previously selected Death Benefit in effect before the Annuity Commencement Date will no longer be available on and after the Annuity Commencement Date. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation. If we have not heard from you by 30 days prior to the maturity date of the contract, we will transfer the Interim Value for each Indexed Segment to the LVIP PIMCO Low Duration Bond Fund. You may change the Annuity Commencement Date, change the annuity option or change the allocation of the investment among Subaccounts up to 30 days before the scheduled Annuity Commencement Date, upon written notice to the Home Office. You must give us at least 30 days’ notice before the date on which you want payouts to begin. We may require proof of age, sex, or survival of any payee upon whose age, sex, or survival payments depend.

Unless you select another option, the contract automatically provides for a life annuity with Annuity Payouts guaranteed for 10 years (on a fixed, variable or combination of fixed and variable basis, in proportion to the account allocations at the time of annuitization) except when a joint life payout is required by law. Under any option providing for guaranteed period payouts, the number of payouts

40

which remain unpaid at the date of the Annuitant’s death (or surviving Annuitant’s death in case of joint life Annuity) will be paid to you or your Beneficiary as payouts become due after we are in receipt of:

• proof, satisfactory to us, of the death;

• written authorization for payment; and

• all claim forms, fully completed.

Variable Annuity Payouts

Variable Annuity Payouts will be determined using:

• the Contract Value on the Annuity Commencement Date, less any applicable premium taxes;

• the annuity tables contained in the contract;

• the annuity option selected; and

• the investment performance of the fund(s) selected.

To determine the amount of payouts, we make this calculation:

1.	Determine the dollar amount of the first periodic payout; then
2.	Credit the contract with a fixed number of Annuity Units equal to the first periodic payout divided by the Annuity Unit value; and
3.	Calculate the value of the Annuity Units each period thereafter.

Annuity Payouts assume an investment return of 3%, 4%, 5% or 6% per year, as applied to the applicable mortality table. Some of these assumed interest rates may not be available in your state; therefore, please check with your registered representative. You may choose your assumed interest rate at the time you elect a variable Annuity Payout on the administrative form provided by us. The higher the assumed interest rate you choose, the higher your initial annuity payment will be. The amount of each payout after the initial payout will depend upon how the underlying fund(s) perform, relative to the assumed rate. If the actual net investment rate (annualized) exceeds the assumed rate, the payment will increase at a rate proportional to the amount of such excess. Conversely, if the actual rate is less than the assumed rate, annuity payments will decrease. The higher the assumed interest rate, the less likely future annuity payments are to increase, or the payments will increase more slowly than if a lower assumed rate was used. There is a more complete explanation of this calculation in the SAI.

Small Contract Surrenders

We may surrender your contract, in accordance with the laws of your state if:

• your Contract Value drops below certain state specified minimum amounts ($1,000 or less) for any reason, including if your Contract Value decreases due to the performance of the Subaccounts you selected;

• no Purchase Payments have been received for two (2) full, consecutive Contract Years; and

• the annuity benefit at the Annuity Commencement Date would be less than $20.00 per month (these requirements may differ in some states).

At least 60 days before we surrender your contract, we will send you a letter at your last address we have on file, to inform you that your contract will be surrendered. You will have the opportunity to make additional Purchase Payments to bring your Contract Value above the minimum level to avoid surrender. If we surrender your contract, we will not assess any surrender charge.

Delay of Payments

Contract proceeds from the VAA will be paid within seven days, except:

• when the NYSE is closed (other than weekends and holidays);

• times when market trading is restricted or the SEC declares an emergency, and we cannot value units or the funds cannot redeem shares; or

• when the SEC so orders to protect Contractowners.

If, pursuant to SEC rules, an underlying money market fund suspends payment of redemption proceeds in connection with a liquidation of the fund, we will delay payment of any transfer, partial withdrawal, surrender, loan, or Death Benefit from the money market sub-account until the fund is liquidated.

Due to federal laws designed to counter terrorism and prevent money laundering by criminals, we may be required to reject a Purchase Payment and/or deny payment of a request for transfers, withdrawals, surrenders, or Death Benefits, until instructions are received from the appropriate regulator. We also may be required to provide additional information about a Contractowner's account to government regulators.

41

Reinvestment Privilege

You may elect to make a reinvestment purchase with any part of the proceeds of a surrender/withdrawal, and we will recredit that portion of the surrender/withdrawal charges attributable to the amount returned.

This election must be made by your written authorization to us on an approved Lincoln reinvestment form and received in our Home Office within 30 days of the date of the surrender/withdrawal, and the repurchase must be of a contract covered by this prospectus. In the case of a qualified retirement plan, a representation must be made that the proceeds being used to make the purchase have retained their tax-favored status under an arrangement for which the contracts offered by this prospectus are designed. The number of Accumulation Units which will be credited when the proceeds are reinvested will be based on the value of the Accumulation Unit(s) on the next Valuation Date. This computation will occur following receipt of the proceeds and request for reinvestment at the Home Office. You may utilize the reinvestment privilege only once. For tax reporting purposes, we will treat a surrender/withdrawal and a subsequent reinvestment purchase as separate transactions (and a Form 1099 may be issued, if applicable). Any taxable distribution that is reinvested may still be reported as taxable. You should consult a tax advisor before you request a surrender/withdrawal or subsequent reinvestment purchase. Any portion of your Contract Value that was previously allocated to an Indexed Account will be placed in the LVIP PIMCO Low Duration Bond Fund. Indexed Accounts cannot be invested until the next Indexed Anniversary Date.

Amendment of Contract

We reserve the right to amend the contract to meet the requirements of the 1940 Act or other applicable federal or state laws or regulations. You will be notified in writing of any changes, modifications or waivers. Any changes are subject to prior approval of your state’s insurance department (if required).

Distribution of the Contracts

Lincoln Financial Distributors, Inc. (“LFD”) serves as Principal Underwriter of this contract. LFD is affiliated with Lincoln Life and is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934 and is a member of FINRA. The Principal Underwriter has entered into selling agreements with broker-dealers that are unaffiliated with us (“Selling Firms”). While the Principal Underwriter has the legal authority to make payments to broker-dealers which have entered into selling agreements, we will make such payments on behalf of the Principal Underwriter in compliance with appropriate regulations. We also pay on behalf of LFD certain of its operating expenses related to the distribution of this and other of our contracts. The Principal Underwriter may also offer “non-cash compensation”, as defined under FINRA’s rules, which includes among other things, merchandise, gifts, marketing support, sponsorships, seminars, entertainment and travel expenses. You may ask your registered representative how he/she will personally be compensated, in whole or in part, for the sale of the contract to you or for any alternative proposal that may have been presented to you. You may wish to take such compensation payments into account when considering and evaluating any recommendation made to you in connection with the purchase of a contract. The following paragraphs describe how payments are made by us and the Principal Underwriter to various parties.

Compensation Paid to Unaffiliated Selling Firms. The Principal Underwriter pays commissions to all Selling Firms. The maximum commission the Principal Underwriter pays to Selling Firms is 4.00% of Purchase Payments. Some Selling Firms may elect to receive a lower commission when a Purchase Payment is made along with an earlier quarterly payment based on Contract Value for so long as the contract’s Selling Firm remains in effect. Upon annuitization, the maximum commission the Principal Underwriter pays to Selling Firms is 4.00% of annuitized value and/or ongoing annual compensation of up to 1.00% of annuity value or statutory reserves. LFD also acts as wholesaler of the contracts and performs certain marketing and other functions in support of the distribution and servicing of the contracts.

LFD may pay certain Selling Firms or their affiliates additional amounts for, among other things: (1) “preferred product” treatment of the contracts in their marketing programs, which may include marketing services and increased access to registered representatives; (2) sales promotions relating to the contracts; (3) costs associated with sales conferences and educational seminars for their registered representatives; (4) other sales expenses incurred by them; and (5) inclusion in the financial products the Selling Firm offers.

Lincoln Life may provide loans to broker-dealers or their affiliates to help finance marketing and distribution of the contracts, and those loans may be forgiven if aggregate sales goals are met. In addition, we may provide staffing or other administrative support and services to broker-dealers who distribute the contracts. LFD, as wholesaler, may make bonus payments to certain Selling Firms based on aggregate sales of our variable insurance contracts (including the contracts) or persistency standards.

These additional types of compensation are not offered to all Selling Firms. The terms of any particular agreement governing compensation may vary among Selling Firms and the amounts may be significant. The prospect of receiving, or the receipt of, additional compensation may provide Selling Firms and/or their registered representatives with an incentive to favor sales of the contracts over other variable annuity contracts (or other investments) with respect to which a Selling Firm 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 contracts. Additional information relating to compensation paid in 2017 is contained in the SAI.

42

Compensation Paid to Other Parties. Depending on the particular selling arrangements, there may be others whom LFD compensates for the distribution activities. For example, LFD may compensate certain “wholesalers”, who control access to certain selling offices, for access to those offices or for referrals, and that compensation may be separate from the compensation paid for sales of the contracts. LFD may compensate marketing organizations, associations, brokers or consultants which provide marketing assistance and other services to broker-dealers who distribute the contracts, and which may be affiliated with those broker-dealers. Commissions and other incentives or payments described above are not charged directly to Contractowners or the VAA. All compensation is paid from our resources, which include fees and charges imposed on your contract.

We pay an education and support fee to First Trust Portfolios L.P. (First Trust) for their educational and sales support in connection with the Capital Strength Net Fee Index^SM. This fee is an annual fee of 0.15% of the average daily value of the amount invested in the Capital Strength Indexed Accounts. First Trust will pay Lincoln an annual rate of 0.05% of the average daily value of the amount invested in the Capital Strength Indexed Accounts to compensate Lincoln for the expenses it incurs in assisting First Trust as it provides this education and support. These payments are not charged directly to Contractowners, but are paid from our resources.

Contractowner Questions

The obligations to purchasers under the contracts are those of Lincoln Life. This prospectus provides a general description of the material features of the contract. Contracts, endorsements and riders may vary as required by state law. Questions about your contract should be directed to us at 1-877-737-6872.

Federal Tax Matters

Introduction

The Federal income tax treatment of the contract is complex and sometimes uncertain. The Federal income tax rules may vary with your particular circumstances. This discussion does not include all the Federal income tax rules that may affect you and your contract. This discussion also does not address other Federal tax consequences (including consequences of sales to foreign individuals or entities), or state or local tax consequences, associated with the contract. As a result, you should always consult a tax advisor about the application of tax rules found in the Internal Revenue Code (“Code”), Treasury Regulations and applicable IRS guidance to your individual situation.

Nonqualified Annuities

This part of the discussion describes some of the Federal income tax rules applicable to nonqualified annuities. A nonqualified annuity is a contract not issued in connection with a qualified retirement plan, such as an IRA or a section 403(b) plan, receiving special tax treatment under the Code. We may not offer nonqualified annuities for all of our annuity products.

Tax Deferral On Earnings

Under the Code, you are generally not subject to tax on any increase in your Contract Value until you receive a contract distribution. However, for this general rule to apply, certain requirements must be satisfied:

• An individual must own the contract (or the Code must treat the contract as owned by an individual).

• The investments of the VAA must be “adequately diversified” in accordance with Treasury regulations.

• Your right to choose particular investments for a contract must be limited.

• The Annuity Commencement Date must not occur near the end of the Annuitant’s life expectancy.

Contracts Not Owned By An Individual

If a contract is owned by an entity (rather than an individual) the Code generally does not treat it as an annuity contract for Federal income tax purposes. This means that the entity owning the contract pays tax currently on the excess of the Contract Value over the investment in the contract. Examples of contracts where the owner pays current tax on the contract’s earnings are contracts issued to a corporation or a trust. Some exceptions to the rule are:

• Contracts in which the named owner is a trust or other entity that holds the contract as an agent for an individual; however, this exception does not apply in the case of any employer that owns a contract to provide deferred compensation for its employees;

• Immediate annuity contracts, purchased with a single premium, when the annuity starting date is no later than a year from purchase and substantially equal periodic payments are made, not less frequently than annually, during the Annuity Payout period;

• Contracts acquired by an estate of a decedent;

• Certain qualified contracts;

• Contracts purchased by employers upon the termination of certain qualified plans; and

• Certain contracts used in connection with structured settlement agreements.

43

Investments In The VAA Must Be Diversified

For a contract to be treated as an annuity for Federal income tax purposes, the investments of the VAA must be “adequately diversified.” Treasury regulations define standards for determining whether the investments of the VAA are adequately diversified. If the VAA fails to comply with these diversification standards, you could be required to pay tax currently on the excess of the Contract Value over the investment in the contract. Although we do not control the investments of the underlying investment options, we expect that the underlying investment options will comply with the Treasury regulations so that the VAA will be considered “adequately diversified.”

Restrictions

The Code limits your right to choose particular investments for the contract. Because the IRS has issued little guidance specifying those limits, the limits are uncertain and your right to allocate Contract Values among the Subaccounts may exceed those limits. If so, you would be treated as the owner of the assets of the VAA and thus subject to current taxation on the income and gains, if applicable, from those assets. We do not know what limits may be set by the IRS in any guidance that it may issue and whether any such limits will apply to existing contracts. We reserve the right to modify the contract without your consent in an attempt to prevent you from being considered as the owner of the assets of the VAA for purposes of the Code.

Loss Of Interest Deduction

After June 8, 1997, if a contract is issued to a taxpayer that is not an individual, or if a contract is held for the benefit of an entity, the entity may lose a portion of its deduction for otherwise deductible interest expenses. However, this rule does not apply to a contract owned by an entity engaged in a trade or business that covers the life of one individual who is either (i) a 20% Owner of the entity, or (ii) an officer, director, or employee of the trade or business, at the time first covered by the contract. This rule also does not apply to a contract owned by an entity engaged in a trade or business that covers the joint lives of the 20% Owner or the entity and the Owner’s spouse at the time first covered by the contract.

Age At Which Annuity Payouts Begin

The Code does not expressly identify a particular age by which Annuity Payouts must begin. However, those rules do require that an annuity contract provide for amortization, through Annuity Payouts, of the contract’s Purchase Payments and earnings. As long as annuity payments begin or are scheduled to begin on a date on which the Annuitant’s remaining life expectancy is enough to allow for a sufficient Annuity Payout period, the contract should be treated as an annuity. If the annuity contract is not treated as an annuity, you would be currently taxed on the excess of the Contract Value over the investment in the contract.

Tax Treatment Of Payments

We make no guarantees regarding the tax treatment of any contract or of any transaction involving a contract. However, the rest of this discussion assumes that your contract will be treated as an annuity under the Code and that any increase in your Contract Value will not be taxed until there is a distribution from your contract.

Taxation Of Withdrawals And Surrenders

You will pay tax on withdrawals to the extent your Contract Value exceeds your investment in the contract. This income (and all other income from your contract) is considered ordinary income (and does not receive capital gains treatment and is not qualified dividend income). You will pay tax on a surrender to the extent the amount you receive exceeds your investment in the contract. In certain circumstances, your Purchase Payments and investment in the contract are reduced by amounts received from your contract that were not included in income. Surrender and reinstatement of your contract will generally be taxed as a withdrawal.

Taxation Of Annuity Payouts, including Periodic Income Payments

The Code imposes tax on a portion of each Annuity Payout (at ordinary income tax rates) and treats a portion as a nontaxable return of your investment in the contract. We will notify you annually of the taxable amount of your Annuity Payout. Once you have recovered the total amount of the investment in the contract, you will pay tax on the full amount of your Annuity Payouts. If Annuity Payouts end because of the Annuitant’s death and before the total amount in the contract has been distributed, the amount not received will generally be deductible. If withdrawals, other than Periodic Income Payments, are taken from i4LIFE^® Indexed Advantage during the Access Period, they are taxed subject to an exclusion ratio that is determined based on the amount of the payment.

Taxation Of Death Benefits

We may distribute amounts from your contract because of the death of a Contractowner or an Annuitant. The tax treatment of these amounts depends on whether the Contractowner or the Annuitant dies before or after the Annuity Commencement Date.

Death prior to the Annuity Commencement Date:

• If the Beneficiary receives Death Benefits under an Annuity Payout option, they are taxed in the same manner as Annuity Payouts.

44

• If the Beneficiary does not receive Death Benefits under an Annuity Payout option, they are taxed in the same manner as a withdrawal.

Death after the Annuity Commencement Date:

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of a Contractowner who is not the Annuitant, they are excludible from income in the same manner as the Annuity Payout prior to the death of the Contractowner.

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of the Annuitant (whether or not the Annuitant is also the Contractowner), the Death Benefits are excludible from income if they do not exceed the investment in the contract not yet distributed from the contract. All Annuity Payouts in excess of the investment in the contract not previously received are includible in income.

• If Death Benefits are received in a lump sum, the Code imposes tax on the amount of Death Benefits which exceeds the amount of Purchase Payments not previously received.

Additional Taxes Payable On Withdrawals, Surrenders, Or Annuity Payouts

The Code may impose a 10% additional tax on any distribution from your contract which you must include in your gross income. The 10% additional tax does not apply if one of several exceptions exists. These exceptions include withdrawals, surrenders, or Annuity Payouts that:

• you receive on or after you reach 59½,

• you receive because you became disabled (as defined in the Code),

• you receive from an immediate annuity,

• a Beneficiary receives on or after your death, or

• you receive as a series of substantially equal periodic payments based on your life or life expectancy (non-natural owners holding as agent for an individual do not qualify).

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax, which affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual's “unearned income”, or (ii) the dollar amount by which the individual's modified adjusted gross income exceeds the applicable threshold. Unearned income includes the taxable portion of distributions that you take from your annuity contract. If you take a distribution from your contract that may be subject to the tax, we will include a Distribution Code “D” in Box 7 of the Form 1099-R issued to report the distribution. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Special Rules If You Own More Than One Annuity Contract

In certain circumstances, you must combine some or all of the nonqualified annuity contracts you own in order to determine the amount of an Annuity Payout, a surrender, or a withdrawal that you must include in income. For example, if you purchase two or more deferred annuity contracts from the same life insurance company (or its affiliates) during any calendar year, the Code treats all such contracts as one contract. Treating two or more contracts as one contract could affect the amount of a surrender, a withdrawal or an Annuity Payout that you must include in income and the amount that might be subject to the additional tax described previously.

Loans and Assignments

Except for certain qualified contracts, the Code treats any amount received as a loan under your contract, and any assignment or pledge (or agreement to assign or pledge) of any portion of your Contract Value, as a withdrawal of such amount or portion.

Gifting A Contract

If you transfer ownership of your contract to a person other than to your spouse (or to your former spouse incident to divorce), and receive a payment less than your contract’s value, you will pay tax on your Contract Value to the extent it exceeds your investment in the contract not previously received. The new owner’s investment in the contract would then be increased to reflect the amount included in income.

Charges for Additional Benefits

Your contract automatically includes a basic Death Benefit and may include other optional riders. Certain enhancements to the basic Death Benefit may also be available to you. The cost of the basic Death Benefit and any additional benefit are deducted from your contract. It is possible that the tax law may treat all or a portion of the Death Benefit and other optional rider charges, if any, as a contract withdrawal.

45

Special Considerations for Same-Sex Spouses

In 2013, the U.S. Supreme Court held that same-sex spouses who are married under state law are treated as spouses for purposes of federal law. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

Qualified Retirement Plans

We have designed the contracts for use in connection with certain types of retirement plans that receive favorable treatment under the Code. Contracts issued to or in connection with a qualified retirement plan are called “qualified contracts.” We issue contracts for use with various types of qualified retirement plans. The Federal income tax rules applicable to those plans are complex and varied. As a result, this prospectus does not attempt to provide more than general information about the use of the contract with the various types of qualified retirement plans. Persons planning to use the contract in connection with a qualified retirement plan should obtain advice from a competent tax advisor.

Types of Qualified Contracts and Terms of Contracts

Qualified retirement plans may include the following:

• Individual Retirement Accounts and Annuities (“Traditional IRAs”)

• Roth IRAs

• Traditional IRA that is part of a Simplified Employee Pension Plan (“SEP”)

• SIMPLE 401(k) plans (Savings Incentive Matched Plan for Employees)

• 401(a) / (k) plans (qualified corporate employee pension and profit-sharing plans)

• 403(a) plans (qualified annuity plans)

• 403(b) plans (public school system and tax-exempt organization annuity plans)

• H.R. 10 or Keogh Plans (self-employed individual plans)

• 457(b) plans (deferred compensation plans for state and local governments and tax-exempt organizations)

Our individual variable annuity products are not available for use with any of the foregoing qualified retirement plan accounts, with the exception of Traditional IRA, SEP IRA, and Roth IRA arrangements. We will amend contracts to be used with a qualified retirement plan as generally necessary to conform to the Code’s requirements for the type of plan. However, the rights of a person to any qualified retirement plan benefits may be subject to the plan’s terms and conditions, regardless of the contract’s terms and conditions. In addition, we are not bound by the terms and conditions of qualified retirement plans to the extent such terms and conditions contradict the contract, unless we consent.

Tax Treatment of Qualified Contracts

The Federal income tax rules applicable to qualified retirement plans and qualified contracts vary with the type of plan and contract. For example:

• Federal tax rules limit the amount of Purchase Payments or contributions that can be made, and the tax deduction or exclusion that may be allowed for the contributions. These limits vary depending on the type of qualified retirement plan and the participant’s specific circumstances (e.g., the participant’s compensation).

• Minimum annual distributions are required under some qualified retirement plans once you reach age 70½ or retire, if later as described below.

• Loans are allowed under certain types of qualified retirement plans, but Federal income tax rules prohibit loans under other types of qualified retirement plans. For example, Federal income tax rules permit loans under some section 403(b) plans, but prohibit loans under Traditional and Roth IRAs. If allowed, loans are subject to a variety of limitations, including restrictions as to the loan amount, the loan’s duration, the rate of interest, and the manner of repayment. Your contract or plan may not permit loans.

Please note that qualified retirement plans such as 403(b) plans, 401(k) plans and IRAs generally defer taxation of contributions and earnings until distribution. As such, an annuity does not provide any additional tax deferral benefit beyond the qualified retirement plan itself.

Tax Treatment of Payments

The Federal income tax rules generally include distributions from a qualified contract in the participant’s income as ordinary income. These taxable distributions will include contributions that were deductible or excludible from income. Thus, under many qualified contracts, the total amount received is included in income since a deduction or exclusion from income was taken for contributions to the contract. There are exceptions. For example, you do not include amounts received from a Roth IRA in income if certain conditions are satisfied.

46

Required Minimum Distributions

Under most qualified plans, you must begin receiving payments from the contract in certain minimum amounts by April 1 of the year following the year you attain age 70½ or retire, if later. You are required to take distributions from your traditional IRAs by April 1 of the year following the year you reach age 70½. If you own a Roth IRA, you are not required to receive minimum distributions from your Roth IRA during your life.

Failure to comply with the minimum distribution rules applicable to certain qualified plans, such as Traditional IRAs, will result in the imposition of an excise tax. This excise tax equals 50% of the amount by which a required minimum distribution exceeds the actual distribution from the qualified plan.

Treasury regulations applicable to required minimum distributions include a rule that may impact the distribution method you have chosen and the amount of your distributions. Under these regulations, the presence of an enhanced Death Benefit, or other benefit which could provide additional value to your contract, may require you to take additional distributions. An enhanced Death Benefit is any Death Benefit that has the potential to pay more than the Contract Value or a return of investment in the contract. Annuity contracts inside Custodial or Trusteed IRAs will also be subject to these regulations. Please contact your tax advisor regarding any tax ramifications.

Additional Tax on Early Distributions from Qualified Retirement Plans

The Code may impose a 10% additional tax on an early distribution from a qualified contract that must be included in income. The Code does not impose the additional tax if one of several exceptions applies. The exceptions vary depending on the type of qualified contract you purchase. For example, in the case of an IRA, the 10% additional tax will not apply to any of the following withdrawals, surrenders, or Annuity Payouts:

• Distribution received on or after the Annuitant reaches 59½,

• Distribution received on or after the Annuitant’s death or because of the Annuitant’s disability (as defined in the Code),

• Distribution received as a series of substantially equal periodic payments based on the Annuitant’s life (or life expectancy), or

• Distribution received as reimbursement for certain amounts paid for medical care.

These exceptions, as well as certain others not described here, generally apply to taxable distributions from other qualified retirement plans. However, the specific requirements of the exception may vary.

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual’s “unearned income”, or (ii) the dollar amount by which the individual’s modified adjusted gross income exceeds the applicable threshold. Distributions that you take from your contract are not included in the calculation of unearned income because your contract is a qualified plan contract. However, the amount of any such distribution is included in determining whether you exceed the modified adjusted gross income threshold. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Transfers and Direct Rollovers

As a result of Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), you may be able to move funds between different types of qualified plans, such as 403(b) and 457(b) governmental plans, by means of a rollover or transfer. You may be able to rollover or transfer amounts between qualified plans and traditional IRAs. These rules do not apply to Roth IRAs and 457(b) non-governmental tax-exempt plans. There are special rules that apply to rollovers, direct rollovers and transfers (including rollovers or transfers of after-tax amounts). If the applicable rules are not followed, you may incur adverse Federal income tax consequences, including paying taxes which you might not otherwise have had to pay. Before we send a rollover distribution, we will provide a notice explaining tax withholding requirements (see Federal Income Tax Withholding). We are not required to send you such notice for your IRA. You should always consult your tax advisor before you move or attempt to move any funds.

The IRS issued Announcement 2014-32 confirming its intent to apply the one-rollover-per-year limitation of 408(d)(3)(B) on an aggregate basis to all IRAs that an individual owns. This means that an individual cannot make a tax-free IRA-to-IRA rollover if he or she has made such a rollover involving any of the individual’s IRAs in the current tax year. If an intended rollover does not qualify for tax-free rollover treatment, contributions to your IRA may constitute excess contributions that may exceed contribution limits. This one-rollover-per-year limitation does not apply to direct trustee-to-trustee transfers.

Direct Conversions and Recharacterizations

The Pension Protection Act of 2006 (PPA) permits direct conversions from certain qualified, retirement, 403(b) or 457(b) plans to Roth IRAs (effective for distributions after 2007). You are also permitted to recharacterize your traditional IRA contribution as a Roth IRA contribution, and to recharacterize your Roth IRA contribution as a traditional IRA contribution. The deadline for the recharacterization is the due date (including extensions) for your individual income tax return for the year in which the contribution

47

was made. Upon recharacterization, you are treated as having made the contribution originally to the second IRA account. The recharacterization does not count toward the one-rollover-per-year limitation described above.

Effective for tax years beginning after December 31, 2017, pursuant to the Tax Cuts and Jobs Act (Pub. L. No. 115-97), recharacterizations are no longer allowed in the case of a conversion from a non-Roth account or annuity to a Roth IRA. This limitation applies to conversions made from pre-tax accounts under an IRA, qualified retirement plan, 403(b) plan, or 457(b) plan. Roth IRA conversions made in 2017 may be recharacterized as a contribution to a traditional IRA if the recharacterization is completed by October 15, 2018.

There are special rules that apply to conversions and recharacterizations, and if they are not followed, you may incur adverse Federal income tax consequences. You should consult your tax advisor before completing a conversion or recharacterization.

Death Benefit and IRAs

Pursuant to Treasury regulations, IRAs may not invest in life insurance contracts. We do not believe that these regulations prohibit the Death Benefit from being provided under the contract when we issue the contract as a Traditional or Roth IRA. However, the law is unclear and it is possible that the presence of the Death Benefit under a contract issued as a Traditional or Roth IRA could result in increased taxes to you. Certain Death Benefit options may not be available for all of our products.

Federal Income Tax Withholding

We will withhold and remit to the IRS a part of the taxable portion of each distribution made under a contract unless you notify us in writing prior to the distribution that tax is not to be withheld. In certain circumstances, Federal income tax rules may require us to withhold tax. At the time a withdrawal, surrender, or Annuity Payout is requested, we will give you an explanation of the withholding requirements.

Certain payments from your contract may be considered eligible rollover distributions (even if such payments are not being rolled over). Such distributions may be subject to special tax withholding requirements. The Federal income tax withholding rules require that we withhold 20% of the eligible rollover distribution from the payment amount, unless you elect to have the amount directly transferred to certain qualified plans or contracts. The IRS requires that tax be withheld, even if you have requested otherwise. Such tax withholding requirements are generally applicable to 401(a), 403(a) or (b), HR 10, and 457(b) governmental plans and contracts used in connection with these types of plans.

Our Tax Status

Under the Code, we are not required to pay tax on investment income and realized capital gains of the VAA. We do not expect that we will incur any Federal income tax liability on the income and gains earned by the VAA. However, the Company does expect, to the extent permitted under the Code, to claim the benefit of the foreign tax credit as the owner of the assets of the VAA. Therefore, we do not impose a charge for Federal income taxes. If there are any changes in the Code that require us to pay tax on some or all of the income and gains earned by the VAA, we may impose a charge against the VAA to pay the taxes.

Changes in the Law

The above discussion is based on the Code, related regulations, and interpretations existing on the date of this prospectus. However, Congress, the IRS, and the courts may modify these authorities, sometimes retroactively.

Additional Information

Voting Rights

As required by law, we will vote the fund shares held in the VAA at meetings of the shareholders of the funds. The voting will be done according to the instructions of Contractowners who have interests in any Subaccounts which invest in classes of the funds. If the 1940 Act or any regulation under it should be amended or if present interpretations should change, and if as a result we determine that we are permitted to vote the fund shares in our own right, we may elect to do so.

The number of votes which you have the right to cast will be determined by applying your percentage interest in a Subaccount to the total number of votes attributable to the Subaccount. In determining the number of votes, fractional shares will be recognized.

Each underlying fund is subject to the laws of the state in which it is organized concerning, among other things, the matters which are subject to a shareholder vote, the number of shares which must be present in person or by proxy at a meeting of shareholders (a “quorum”), and the percentage of such shares present in person or by proxy which must vote in favor of matters presented. Because shares of the underlying fund held in the VAA are owned by us, and because under the 1940 Act we will vote all such shares in the same proportion as the voting instructions which we receive, it is important that each Contractowner provide their voting instructions to us. For funds un-affiliated with Lincoln, even though Contractowners may choose not to provide voting instruction, the shares of a fund to which such Contractowners would have been entitled to provide voting instruction will be voted by us in the same proportion

48

as the voting instruction which we actually receive. For funds affiliated with Lincoln, shares of a fund to which such Contractowners would have been entitled to provide voting instruction will, once we receive a sufficient number of instructions we deem appropriate to ensure a fair representation of Contractowners eligible to vote, be voted by us in the same proportion as the voting instruction which we actually receive. As a result, the instruction of a small number of Contractowners could determine the outcome of matters subject to shareholder vote. All shares voted by us will be counted when the underlying fund determines whether any requirement for a minimum number of shares be present at such a meeting to satisfy a quorum requirement has been met. Voting instructions to abstain on any item to be voted on will be applied proportionately to reduce the number of votes eligible to be cast.

Whenever a shareholders meeting is called, we will provide or make available to each person having a voting interest in a Subaccount proxy voting material, reports and other materials relating to the funds. Since the funds engage in shared funding, other persons or entities besides Lincoln Life may vote fund shares. See Investments of the Variable Annuity Account – Fund Shares.

There are no voting rights associated with the Indexed Accounts.

Return Privilege

Within the free-look period after you receive the contract, you may cancel it for any reason by delivering or mailing it postage prepaid, to The Lincoln National Life Insurance Company at PO Box 2348, Fort Wayne, IN 46801-2348. A contract canceled under this provision will be void. Except as explained in the following paragraph, we will return the Contract Value as of the Valuation Date on which we receive the cancellation request, which includes the Interim Value for the Indexed Accounts, and any premium taxes which had been deducted. No applicable surrender charges will apply. A purchaser who participates in the VAA is subject to the risk of a market loss on the Contract Value during the free-look period.

For contracts written in those states whose laws require that we assume this market risk during the free-look period, a contract may be canceled, subject to the conditions explained before, except that we will return the greater of the Purchase Payment(s) or Contract Value as of the Valuation Date we receive the cancellation request, plus any premium taxes that had been deducted. IRA purchasers will also receive the greater of Purchase Payments or Contract Value as of the Valuation Date on which we receive the cancellation request.

If you cancel this contract within the free-look period, we reserve the right not to accept another application for this contract for a period of six months.

State Regulation

As a life insurance company organized and operated under Indiana law, we are subject to provisions governing life insurers and to regulation by the Indiana Commissioner of Insurance. Our books and accounts are subject to review and examination by the Indiana Department of Insurance at all times. A full examination of our operations is conducted by that Department at least every five years.

Records and Reports

As presently required by the 1940 Act and applicable regulations, we are responsible for maintaining all records and accounts relating to the VAA. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. We will mail to you, at your last known address of record at the Home Office, at least semi-annually after the first Contract Year, reports containing information required by that Act or any other applicable law or regulation.

A written (or electronic, if elected) confirmation of each transaction will be provided to you on the next Valuation Date, except for the following transactions, which are mailed quarterly:

• deduction of any account fee or rider charges;

• any rebalancing event under the portfolio rebalancing service;

• any transfer or withdrawal under AWS; and

• Periodic Income Payments from i4LIFE^® Indexed Advantage.

Electronic Delivery

You may elect to receive your prospectus, prospectus supplements, quarterly statements, and annual and semiannual reports electronically over the Internet, if you have an e-mail account and access to an Internet browser. Once you select eDelivery, via the Internet Service Center, all documents available in electronic format will no longer be sent to you in hard copy. You will receive an e-mail notification when the documents become available online. It is your responsibility to provide us with your current e-mail address. You can resume paper mailings at any time without cost, by updating your profile at the Internet Service Center, or contacting us. To learn more about this service, please log on to www.LincolnFinancial.com, select service centers and continue on through the Internet Service Center.

49

Information Incorporated by Reference

Under the Securities Act of 1933, Lincoln Life has filed with the SEC a registration statement on both Form S-3 and Form N-4 (the “Registration Statement”) relating to the Contracts offered by this prospectus. This prospectus is part of the Registration Statement: it does not contain all of the information set forth in the Registration Statement. As described below, and elsewhere in this prospectus, certain documents are or will be incorporated by reference into (i.e. made part of) this prospectus. Any statement contained in a document incorporated by reference into this prospectus in the future will be considered to supplement, change, or replace the existing information set forth in the prospectus, as applicable.

Lincoln Life files reports and other information with the SEC, as required under the Securities Exchange Act of 1934 (“the Exchange Act”). Lincoln Life’s annual report of Form 10-K for the period ended December 31, 2017 is incorporated by reference into this prospectus. Lincoln Life’s annual reports contain information about Lincoln Life, including its consolidated audited financial statements for Lincoln Life’s latest fiscal year. Lincoln Life files its Exchange Act documents and reports (including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K) electronically with the SEC under File No. 000-55871. In addition, all documents subsequently filed by Lincoln Life pursuant to sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering are also incorporated by reference into this prospectus. We are not incorporating by reference, in any case, any documents or information deemed to have been furnished and not filed in accordance with SEC rules.

Independent Registered Public Accounting Firm

The consolidated financial statements of The Lincoln National Life Insurance Company appearing in LNL’s Annual Report (Form 10-K) for the year ended December 31, 2017 (including schedules appearing therein), have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such financial statements are, and audited financial statements to be included in subsequently filed documents will be, incorporated herein in reliance upon the reports of Ernst & Young LLP pertaining to such financial statements (to the extent covered by consents filed with the Securities and Exchange Commission) given on the authority of such firm as experts in accounting and auditing.

Legal Proceedings

In the ordinary course of its business and otherwise, the Company and its subsidiaries or its separate accounts and Principal Underwriter may become or are involved in various pending or threatened legal proceedings, including purported class actions, arising from the conduct of its business. In some instances, the proceedings include claims for unspecified or substantial punitive damages and similar types of relief in addition to amounts for alleged contractual liability or requests for equitable relief.

After consultation with legal counsel and a review of available facts, it is management’s opinion that the proceedings, after consideration of any reserves and rights to indemnification, ultimately will be resolved without materially affecting the consolidated financial position of the Company and its subsidiaries, or the financial position of its separate accounts or Principal Underwriter. However, given the large and indeterminate amounts sought in certain of these proceedings and the inherent difficulty in predicting the outcome of such legal proceedings, it is reasonably possible that an adverse outcome in certain matters could be material to the Company's operating results for any particular reporting period. Please refer to the Statement of Additional Information for possible additional information regarding legal proceedings.

50

(This page intentionally left blank)

51

Contents of the Statement of Additional Information (SAI)
for Lincoln Life Variable Annuity Account N

Item

Special Terms

Services

Principal Underwriter

Purchase of Securities Being Offered

Annuity Payouts

Determination of Accumulation and Annuity Unit Value

Capital Markets

Advertising & Ratings

About the Indices

Unclaimed Property

Additional Services

Other Information

Financial Statements

For a free copy of the SAI complete the form below:

Statement of Additional Information Request Card
Lincoln Level Advantage^SMB-Class

Lincoln Life Variable Annuity Account N

Please send me a free copy of the current Statement of Additional Information for Lincoln Life Variable Annuity Account N Lincoln Level Advantage^SMB-Class.

(Please Print)

Name: 

Address: 

City 

State 

Zip 

Mail to The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348.

52

Appendix A – Interim Value Calculation

Interim Value for Indexed Segment(s) with no Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata portion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1+D)^-E where:

C = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by Us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by ((1 + G) X H) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed in the Indexed Term divided by total days in the Indexed Term.

Interim Value for Indexed Segment(s) with Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata proportion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1 + D)^-E where:

C = the initial Indexed Crediting Base of the Indexed Segment that has been proportionately adjusted for any transfers, withdrawals, Death Benefit payouts, or surrenders that have occurred during the Indexed Segment prior to the Valuation Date of the calculation;

D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by (1 + (G x H)) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed since the prior Indexed Anniversary Date divided by 365.

Each component of the calculation is further explained as follows:

1.	The fair value of the Indexed Crediting Base of an Indexed Segment with no Annual Locks or an Indexed Segment with Annual Locks is meant to represent the market value of the investment instruments supporting the Indexed Segment. It is the present value of the Indexed Crediting Base of the Indexed Segment discounted at a rate that reflects movements in the interest rate market. The Reference Rate will apply on a uniform basis for a class of Contractowners in the same Indexed Segment and will be administered in a uniform and non-discriminatory manner.
	The maximum Reference Rate is the average U.S. Treasury Constant Maturity yield plus the LMVA Composite OAS Index rate. The U.S. Treasury Constant Maturity yield is the rate for the maturity using a set duration. The duration is set to represent the duration of the investment instruments supporting the Indexed Segment and may not match the actual length of the Indexed Segment. The average is measured using yields on the 1st, 8th, 15th, and 22nd day of the calendar month preceding the calendar month for which the Reference Rate applies.
	If the U.S. Treasury Constant Maturity yield is not published for a particular day, then we will use the yield on the next day it is published. If the U.S. Treasury Constant Maturity yield is no longer published, or is discontinued, then we may substitute another suitable method for determining this component of the Reference Rate. If a U.S. Treasury Constant Maturity yield is not published for a time to maturity that matches the selected duration, then the yield will be interpolated between the yield for maturities that are published.
	The LMVA Composite OAS Index rate will be as of the last business day of the month for which the Reference Rate applies.

A-1

	If the LMVA Composite OAS Index rate is no longer available, or is discontinued, we will substitute another suitable index or indexes for determining this component of the Reference Rate.
	The Reference Rate may be reduced by a rate reduction factor, which increases the value of (1) above. This rate reduction factor will vary with each Indexed Account option and will be declared at the same time a Performance Cap is declared. Currently, the rate reduction factor does not apply to 1-year Indexed Accounts. This rate reduction factor is available upon request by calling us.
2.	Fair Value of Replicating Portfolio of Options - We utilize a fair market value methodology to value the replicating portfolio of options that support this product.

For each Segment, we solely designate and value options, each of which is tied to the performance of the Index associated with the Segment in which you are invested. We use derivatives to provide an estimate of the gain or loss on the Indexed Crediting Base that could have occurred at the end of the Indexed Term. This estimate also reflects the impact of the Performance Cap and Protection Level at the end of the Indexed Term as well as the estimated cost of exiting the replicating options prior to the End Date of a Segment (and the time to Index Anniversaries for Annual Lock Segments). The valuation of the options is based on standard methods for valuing derivatives and based on inputs from third party vendors. The methodology used to value these options is determined solely by us and may vary, higher or lower, from other estimated valuations or the actual selling price of identical derivatives. Any variance between our estimated fair value price and other estimated or actual prices may be different from Segment type to Segment type and may also change from day to day.

The three options valued for each Indexed Account type are as follows:

A. At-the money call option: This represents the market value of the potential to receive an amount equal to the percentage growth in the Index during the Indexed Term.

B. Out-of-the-money call option: This represents the market value of the potential for gain in excess of the Performance Cap rate.

C. Out-of-the-money put option: This represents the market value of the potential to receive an amount equal to the excess loss beyond the Protection Level.

NOTE: This put option will always reduce the Interim Value even if the Index has increased during the Indexed Term.

The valuation of the options is based on standard models for valuing options for both the non-Annual Lock and Annual Lock Segments. For non-Annual Lock Segments, the replicating portfolio of options is equal to: A minus B minus C. For each Annual Lock Segment, we designate and value a replicating (derivative) structure which is tied to the compounded performance for each year of the Annual Lock Segment. The market standard model is adjusted by us to account for additional market risks relevant to the Annual Lock Segment. The key inputs, including but not limited to the following, are also incorporated into the models:

(1) Implied Volatility of the Index—This input varies with (i) how much time remains until the Segment End Date, which is determined by using an expiration date for the designated option that corresponds to that time remaining and (ii) the relationship between the strike price of that option and the level of the Index at the time of the calculation (including the potential for resets each Annual Lock Period).

This relationship is referred to as the “moneyness” of the option described above, and is calculated as the ratio of current price to the strike price. Direct market data for these inputs for any given early withdrawal is generally not available. This is because options on the Index that actually trade in the market have specific maturity dates and moneyness values that are unlikely to precisely match the Segment End Date (or remaining Annual Lock Periods) and moneyness of the designated option that we use in our calculations. Accordingly, we interpolate between the implied volatility quotes that are based on the actual maturities and moneyness values.

(2) Interest Rate — We use key derivative interest rates obtained from information provided by independent third-parties which are recognized financial reporting vendors. Interest rates are obtained for maturities adjacent to the actual time remaining in the Segment at the time of the early withdrawal. We use linear interpolation to derive the exact remaining duration rate needed as the input.

(3) Index Dividend Yield — On a daily basis, we use the projected annual dividend yield across the entire Index obtained from information provided by independent third-party financial institutions. This value is a widely used assumption and is readily available from recognized financial reporting vendors.

In addition, when we calculate the Interim Value, we obtain market values of derivatives each business day from outside vendors. If we are delayed in receiving these values, and cannot calculate a new Interim Value, we will use the prior business day’s Interim Value.

3. The pro rata portion of the Performance Cap equal to the days in the Indexed Term until the withdrawal is applied to the Indexed Crediting Base to place an upper limit on the performance credited during the Indexed Term.

A-2

SAI 2

Lincoln Level Advantage^SM B-Class
Lincoln Life Variable Annuity Account N  (Registrant)

The Lincoln National Life Insurance Company   (Depositor)

Statement of Additional Information (SAI)

This SAI should be read in conjunction with the Lincoln Level Advantage^SM B-Class prospectus of Lincoln Life Variable Annuity Account N dated May 18, 2018. You may obtain a copy of the Lincoln Level Advantage^SM B-Class prospectus on request and without charge. Please write Lincoln Life Customer Service, The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46802, or call 1-877-737-6872.

Table of Contents

Item	Page
Special Terms	B-2
Services	B-2
Principal Underwriter	B-2
Purchase of Securities Being Offered	B-2
Annuity Payouts	B-2
Determination of Accumulation and Annuity Unit Value	B-3
Capital Markets	B-3

Item	Page
Advertising & Ratings	B-4
About the S&P 500 Index	B-4
Unclaimed Property	B-4
Additional Services	B-5
Other Information	B-5
Financial Statements	B-5

 

 

This SAI is not a prospectus.
The date of this SAI is May 18, 2018.

Special Terms

The special terms used in this SAI are the ones defined in the prospectus.

Services

Independent Registered Public Accounting Firm

Ernst & Young LLP, independent registered public accounting firm, One Commerce Square, 2005 Market Street, Suite 700, Philadelphia, Pennsylvania, 19103, has audited a) the financial statements of the Lincoln Life Variable Annuity Account N comprised of the subaccounts described in the related appendix to the opinion, as of December 31, 2017, and the related statement of operations and the statements of changes in net assets for the periods indicated in the appendix to the opinion; and b) the consolidated financial statements of The Lincoln National Life Insurance Company as of December 31, 2017 and 2016 and for each of the three years in the period ended December 31, 2017, as set forth in their reports, which are included in this SAI and Registration Statement. The aforementioned financial statements are included herein in reliance on Ernst & Young LLP’s reports, given on their authority as experts in accounting and auditing.

Keeper of Records

All accounts, books, records and other documents which are required to be maintained for the VAA are maintained by us or by third parties responsible to Lincoln Life. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. No separate charge against the assets of the VAA is made by us for this service.

Principal Underwriter

Lincoln Financial Distributors, Inc. (“LFD”), an affiliate of Lincoln Life, serves as principal underwriter (the “Principal Underwriter”) for the contracts, as described in the prospectus. The Principal Underwriter offers the contracts to the public on a continuous basis and anticipates continuing to offer the contracts, but reserves the right to discontinue the offering. The Principal Underwriter offers the contracts through sales representatives, who are associated with Lincoln Financial Advisors Corporation and/or Lincoln Financial Securities Corporation (collectively, “LFN”), our affiliates. The Principal Underwriter also may enter into selling agreements with other broker-dealers (“Selling Firms”) for the sale of the contracts. Sales representatives of Selling Firms are appointed as our insurance agents. LFD, acting as Principal Underwriter, paid $561,689,144, $433,441,077 and $485,694,075 to LFN and Selling Firms in 2015, 2016 and 2017 respectively, as sales compensation with respect to all the contracts offered under the VAA. The Principal Underwriter retained no underwriting commissions for the sale of the contracts.

Purchase of Securities Being Offered

The variable annuity contracts are offered to the public through licensed insurance agents who specialize in selling our products; through independent insurance brokers; and through certain securities brokers/dealers selected by us whose personnel are legally authorized to sell annuity products. There are no special purchase plans for any class of prospective buyers. However, under certain limited circumstances described in the prospectus under the section Charges and Other Deductions, any applicable account fee and/or surrender charge may be reduced or waived.

Both before and after the Annuity Commencement Date, there are exchange privileges between Subaccounts, and from the VAA to the general account (if available) subject to restrictions set out in the prospectus. See The Contracts, in the prospectus. No exchanges are permitted between the VAA and other separate accounts.

The offering of the contracts is continuous.

Annuity Payouts

Variable Annuity Payouts

Variable Annuity Payouts will be determined on the basis of:

• the dollar value of the contract on the Annuity Commencement Date less any applicable premium tax;

• the annuity tables contained in the contract;

• the type of annuity option selected; and

B-2

• the investment results of the fund(s) selected.

In order to determine the amount of variable Annuity Payouts, we make the following calculation:

• first, we determine the dollar amount of the first payout;

• second, we credit the contract with a fixed number of Annuity Units based on the amount of the first payout; and

• third, we calculate the value of the Annuity Units each period thereafter.

These steps are explained below.

The dollar amount of the first periodic variable Annuity Payout is determined by applying the total value of the Accumulation Units credited under the contract valued as of the Annuity Commencement Date (less any premium taxes) to the annuity tables contained in the contract. The first variable Annuity Payout will be paid 14 days after the Annuity Commencement Date. This day of the month will become the day on which all future Annuity Payouts will be paid. Amounts shown in the tables are based on the 1983 Table “a” Individual Annuity Mortality Tables, modified, with an assumed investment return at the rate of 3%, 4%, 5% or 6% per annum, depending on the terms of your contract. The first Annuity Payout is determined by multiplying the benefit per $1,000 of value shown in the contract tables by the number of thousands of dollars of value accumulated under the contract. These annuity tables vary according to the form of annuity selected and the age of the Annuitant at the Annuity Commencement Date. The assumed interest rate is the measuring point for subsequent Annuity Payouts. If the actual net investment rate (annualized) exceeds the assumed interest rate, the payout will increase at a rate equal to the amount of such excess.

Conversely, if the actual rate is less than the assumed interest rate, Annuity Payouts will decrease. If the assumed rate of interest were to be increased, Annuity Payouts would start at a higher level but would decrease more rapidly or increase more slowly.

We may use sex-distinct annuity tables in contracts that are not associated with employer sponsored plans and where not prohibited by law.

At an Annuity Commencement Date, the contract is credited with Annuity Units for each Subaccount on which variable Annuity Payouts are based. The number of Annuity Units to be credited is determined by dividing the amount of the first periodic payout by the value of an Annuity Unit in each Subaccount selected. Although the number of Annuity Units is fixed by this process, the value of such units will vary with the value of the underlying fund. The amount of the second and subsequent periodic payouts is determined by multiplying the Contractowner’s fixed number of Annuity Units in each Subaccount by the appropriate Annuity Unit value for the Valuation Date ending 14 days prior to the date that payout is due.

The value of each Subaccount’s Annuity Unit will be set initially at $1.00. The Annuity Unit value for each Subaccount at the end of any Valuation Date is determined by multiplying the Subaccount Annuity Unit value for the immediately preceding Valuation Date by the product of:

• The net investment factor of the Subaccount for the Valuation Period for which the Annuity Unit value is being determined, and

• A factor to neutralize the assumed investment return in the annuity table.

The value of the Annuity Units is determined as of a Valuation Date 14 days prior to the payment date in order to permit calculation of amounts of Annuity Payouts and mailing of checks in advance of their due dates. Such checks will normally be issued and mailed at least three days before the due date.

Determination of Accumulation and Annuity Unit Value

A description of the days on which Accumulation and Annuity Units will be valued is given in the prospectus. The New York Stock Exchange's (NYSE) most recent announcement (which is subject to change) states that it will be closed on weekends and on these holidays: New Year's Day, Martin Luther King Day, President's Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. If any of these holidays occurs on a weekend day, the Exchange may also be closed on the business day occurring just before or just after the holiday. It may also be closed on other days.

Since the portfolios of some of the funds and series will consist of securities primarily listed on foreign exchanges or otherwise traded outside the United States, those securities may be traded (and the net asset value of those funds and series and of the variable account could therefore be significantly affected) on days when the investor has no access to those funds and series.

Capital Markets

In any particular year, our capital may increase or decrease depending on a variety of factors — the amount of our statutory income or losses (which is sensitive to equity market and credit market conditions), the amount of additional capital we must hold to support business growth, changes in reserving requirements, our inability to secure capital market solutions to provide reserve relief, such as issuing letters of credit to support captive reinsurance structures, changes in equity market levels, the value of certain fixed-income and equity securities in our investment portfolio and changes in interest rates.

B-3

Advertising & Ratings

We may include in certain advertisements, endorsements in the form of a list of organizations, individuals or other parties which recommend Lincoln Life or the policies. Furthermore, we may occasionally include in advertisements comparisons of currently taxable and tax deferred investment programs, based on selected tax brackets, or discussions of alternative investment vehicles and general economic conditions.

Our financial strength is ranked and rated by nationally recognized independent rating agencies. The ratings do not imply approval of the product and do not refer to the performance of the product, or any separate account, including the underlying investment options. Ratings are not recommendations to buy our products. Each of the rating agencies reviews its ratings periodically. Accordingly, all ratings are subject to revision or withdrawal at any time by the rating agencies, and therefore, no assurance can be given that these ratings will be maintained. The current outlook for the insurance subsidiaries is stable for Moody’s, A.M. Best and Standard & Poor’s, and positive for Fitch. Our financial strength ratings, which are intended to measure our ability to meet contract holder obligations, are an important factor affecting public confidence in most of our products and, as a result, our competitiveness. A downgrade of our financial strength rating could affect our competitive position in the insurance industry by making it more difficult for us to market our products as potential customers may select companies with higher financial strength ratings and by leading to increased withdrawals by current customers seeking companies with higher financial strength ratings. For more information on ratings, including outlooks, see www.LincolnFinancial.com/investor.

About the S&P 500 Index

The S&P 500 Index (hereinafter “Index”) is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”), and has been licensed for use by Lincoln Variable Insurance Products Trust and its affiliates (hereinafter “Licensee”). Standard & Poor’s^® and S&P^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”) and Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The fund(s) are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or any of their respective affiliates (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices do not make any representation or warranty, express or implied, to the owners of the funds or any member of the public regarding the advisability of investing in securities generally or in the funds particularly or the ability of the Index to track general market performance. S&P Dow Jones Indices only relationship to Licensee with respect to the Index is the licensing of the Index and certain trademarks, service marks and/or trade names of S&P Dow Jones Indices and/or its licensors. The Index is determined, composed and calculated by S&P Dow Jones Indices without regard to Licensee or the funds. S&P Dow Jones Indices have no obligation to take the needs of Licensee or the owners of the funds into consideration in determining, composing or calculating the Index. S&P Dow Jones Indices are not responsible for and have not participated in the determination of the prices, and amount of the funds or the timing of the issuance or sale of the funds or in the determination or calculation of the equation by which the funds are to be converted into cash, surrendered or redeemed, as the case may be. S&P Dow Jones Indices have no obligation or liability in connection with the administration, marketing or trading of the funds. There is no assurance that investment products based on the Index will accurately track index performance or provide positive investment returns. S&P Dow Jones Indices LLC is not an investment advisor. Inclusion of a security within an index is not a recommendation by S&P Dow Jones Indices to buy, sell, or hold such security, nor is it considered to be investment advice.

S&P DOW JONES INDICES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA RELATED THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS THEREIN. S&P DOW JONES INDICES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR WITH RESPECT TO ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P DOW JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN S&P DOW JONES INDICES AND LICENSEE, OTHER THAN THE LICENSORS OF S&P DOW JONES INDICES.

Unclaimed Property

We have entered into a Global Resolution Agreement with a third party auditor representing multiple states and jurisdictions. Under the terms of the Global Resolution Agreement, the third party auditor has compared expanded matching criteria to the Social Security Master Death File (“SSMDF”) to identify deceased insureds and policy or contract holders where a valid claim has not been made. We

B-4

have also entered into a Regulatory Settlement Agreement with multiple states and jurisdictions. The Regulatory Settlement Agreement applies prospectively and requires us to adopt and implement additional procedures comparing our records to the SSMDF to identify unclaimed death benefits and prescribes procedures for identifying and locating beneficiaries once deaths are identified. Other jurisdictions that are not signatories to the Regulatory Settlement Agreement are conducting examinations and audits of our compliance with unclaimed property laws. Any escheatable property identified as a result of the audits and inquiries could result in additional payments of previously unclaimed death benefits or the payment of abandoned funds to U.S. jurisdictions.

Additional Services

Automatic Withdrawal Service (AWS)—AWS provides an automatic, periodic withdrawal of Contract Value to you. AWS may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. You may elect to participate in AWS at the time of application or at any time before the Annuity Commencement Date by sending a written request to us. The minimum Contract Value required to establish AWS is $10,000. You may cancel or make changes to your AWS program at any time by sending a written request to us. If telephone authorization has been elected, certain changes may be made by telephone. Notwithstanding the requirements of the program, any withdrawal must be permitted under Section 401(a)(9) of the IRC for qualified plans or permitted under Section 72 of the IRC for nonqualified contracts. To the extent that withdrawals under AWS do not qualify for an exemption from the contingent deferred sales charge, we will assess any applicable surrender charges on those withdrawals. See Surrender Charge.

Portfolio Rebalancing — Portfolio rebalancing is an option, which, if elected by the Contractowner, restores to a pre-determined level the percentage of the Contract Value (or Account Value under i4LIFE^® Advantage), allocated to each variable Subaccount. This pre-determined level will be the allocation initially selected when the contract was purchased, unless subsequently changed. The portfolio rebalancing allocation may be changed at any time by submitting a written request to us. If portfolio rebalancing is elected, all Purchase Payments allocated to the variable Subaccounts must be subject to portfolio rebalancing. Portfolio rebalancing may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. The Contractowner may terminate the portfolio rebalancing program or re-enroll at any time by sending a written request to us. If telephone authorization has been elected, the Contractowner may make these elections by phone. The portfolio rebalancing program is not available following the Annuity Commencement Date.

Please note that all of the services discussed in this section will stop once we are notified of a pending death claim.

Other Information

Due to differences in redemption rates, tax treatment or other considerations, the interests of policyholders under the variable life accounts could conflict with those of Contractowners under the VAA. In those cases, where assets from variable life and variable annuity separate accounts are invested in the same fund(s) (i.e., where mixed funding occurs), the Boards of Directors of the fund involved will monitor for any material conflicts and determine what action, if any, should be taken. If it becomes necessary for any separate account to replace shares of any fund with another investment, that fund may have to liquidate securities on a disadvantageous basis. Refer to the prospectus for each fund for more information about mixed funding.

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life appear on the following pages.

B-5

Prospectus 3

Lincoln Level Advantage^SM B-Share Individual Variable and Index-Linked Annuity Contracts
Lincoln Life Variable Annuity Account N  

May 18, 2018

Home Office:
The Lincoln National Life Insurance Company
1300 South Clinton Street
Fort Wayne, IN 46802
www.LincolnFinancial.com
1-877-737-6872

This prospectus describes an individual flexible premium variable and index-linked deferred annuity contract issued by The Lincoln National Life Insurance Company (Lincoln Life or Company).

This contract can be purchased as either a nonqualified annuity or qualified retirement annuity under Section 408 (IRAs) or 408A (Roth IRAs) of the tax code. Generally, you do not pay federal income tax on the contract's growth until it is paid out. You receive tax deferral for an IRA whether or not the funds are invested in an annuity contract. Further, if your contract is a Roth IRA, you generally will not pay income tax on a distribution, provided certain conditions are met. Therefore, there should be reasons other than tax deferral for purchasing a qualified annuity contract. We offer other types of annuity contracts that may offer different investment options, features, and optional benefits. You should carefully consider whether or not this contract is the best product for you.

The contract is designed to accumulate Contract Value and to provide retirement income over a certain period of time or for life subject to certain conditions. The benefits offered under this contract may be a variable or index-linked amount or both. This contract also offers a Death Benefit payable upon the death of the Contractowner or Annuitant. This prospectus is used by both new purchasers and current Contractowners.

This prospectus describes all material rights and obligations of annuity purchasers under the contract.

The state in which your contract is issued will govern whether or not certain features, riders, restrictions, limitations, charges and fees will apply to your contract. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

The minimum initial Purchase Payment for the contract is $25,000. Additional Purchase Payments may be made to the contract, subject to certain restrictions, and must be at least $100 per payment ($25 if transmitted electronically), and at least $300 annually. We reserve the right to limit, restrict, or suspend Purchase Payments made to the contract upon advance written notice. Purchase Payments and Contract Value may be allocated to the Indexed Accounts only on the initial Start Date or Indexed Anniversary Date and must be at least $2,000.

You choose whether to invest in variable investment options, in one or more index-linked accounts, or both.

You invest in the index-linked portion of the contract by choosing one or more of the available Indexed Accounts. Indexed Accounts are established for either 1- or 6-year terms, and the return on these accounts at the end of the term is based in part on the performance of a specified index. The gain for each Indexed Segment is limited by a specified Performance Cap, and your Contract Value will not be impacted by any loss up to the applicable Protection Level if you hold for the length of the term. The returns on the 6-year Indexed Accounts are calculated either with an Annual Lock or without an Annual Lock. An Interim Value for each Indexed Segment is calculated each Valuation Date prior to the last day of the term.

The Indexed Accounts of the contract are supported by the assets of a non-registered, non-insulated separate account of the Company which has been established to support the Company’s obligations with respect to the Indexed Accounts. The Indexed Accounts are not invested in any underlying fund. We do not guarantee how any of the Indexed Accounts will perform. There is a risk of loss of your investment because you agree to absorb all losses in excess of the level of protection you selected.

Index-linked annuity contracts are complex insurance and investment vehicles. Investors should speak with a financial professional about the contract’s features, benefits, risks, and fees, and whether the contract is appropriate for the investor based upon his or her financial situation and objectives.

The available Indexed Accounts are listed below:

1

1-Year Indexed Accounts

S&P 500^{® (1)}, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^{® (2)}, 10% Protection

Capital Strength Net Fee Index^{SM (3)}, 10% Protection

MSCI EAFE⁽⁴⁾, 10% Protection

6-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 20% Protection

S&P 500^®, 30% Protection

Russell 2000^®, 10% Protection

Russell 2000^®, 20% Protection

Russell 2000^®, 30% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM , 10% Protection

Annual Lock MSCI EAFE, 10% Protection

We calculate an Interim Value in the event you take a withdrawal in the middle of a term. The Interim Value calculation is not based on the value of the Index. This means that you could have a negative performance, even if the Index Value has increased. We do not guarantee that an Indexed Account option will always be available. Amounts paid to you from the Indexed Accounts are subject to our credit worthiness and claims paying ability.

Refer to the Risk Factors section beginning on page 12 of this prospectus for more information.

All Purchase Payments allocated to underlying funds will be placed in Lincoln Life Variable Annuity Account N (Variable Annuity Account [VAA]). The VAA is a segregated investment account of Lincoln Life. You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the contract’s variable options (“Subaccounts”), which, in turn, invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, it goes down. How much it goes up or down depends on the performance of the Subaccounts you select. We do not guarantee how any of the Subaccounts or their funds will perform. Also, neither the U.S. Government nor any federal agency insures or guarantees your investment in the contract. The contracts are not bank deposits and are not endorsed by any bank or government agency.

The available Subaccounts are listed below:

AIM Variable Insurance Funds (Invesco Variable Insurance Funds)

Invesco V.I. Equally-Weighted S&P 500 Fund⁵

American Funds Insurance Series^®

American Funds Asset Allocation Fund

American Funds Growth Fund

BlackRock Variable Series Funds, Inc.

BlackRock Global Allocation V.I. Fund

Fidelity^® Variable Insurance Products

Fidelity^® VIP Mid Cap Portfolio

First Trust Variable Insurance Trust

First Trust/Dow Jones Dividend & Income Allocation Portfolio⁶

Franklin Templeton Variable Insurance Products Trust

Franklin Rising Dividends VIP Fund

JPMorgan Insurance Trust

JPMorgan Insurance Trust Core Bond Portfolio

Lincoln Variable Insurance Products Trust

LVIP Government Money Market Fund

LVIP MFS Value Fund

LVIP PIMCO Low Duration Bond Fund

LVIP SSGA International Index Fund

LVIP SSGA S&P 500 Index Fund⁴

LVIP SSGA Small-Cap Index Fund

 

 

This prospectus gives you information about the contract that you should know before you decide to buy a contract and make Purchase Payments. The risk of loss can become greater in the case of an early withdrawal due to any surrender charges and the Interim Value of such withdrawals. You should also review the prospectuses for the funds and keep all prospectuses for future reference.

Neither the SEC nor any state securities commission has approved this contract or determined that this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

2

More information about the contract is in the current Statement of Additional Information (SAI), dated the same date as this prospectus. The SAI is incorporated by reference into this prospectus and is legally part of this prospectus. The SAI is part of the registration statement filed on Form N-4. For a free copy of the SAI, write: The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. The SAI and other information about Lincoln Life and the VAA are also available on the SEC's website (http://www.sec.gov). There is a table of contents for the SAI on the last page of this prospectus.

¹ The S&P 500 Price Return Index is a product of S&P Dow Jones Indices LLC (“SPDJI”), and has been licensed for use by The Lincoln National Life Insurance Company. Standard & Poor’s^®, S&P^®, and S&P 500^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s product is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 Index.

² The Russell 2000 Price Return Index (the “Index”) is a trademark of Frank Russell Company (“Russell”) and has been licensed for use by The Lincoln National Life Insurance Company. The Lincoln National Life Insurance Company’s products are not in any way sponsored, endorsed, sold or promoted by Russell or the London Stock Exchange Group companies (“LSEG”) (together the “Licensor Parties”), and none of the Licensor Parties make any claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to (i) the results to be obtained from the use of the Index (upon which The Lincoln National Life Insurance Company’s product is based), (ii) the figure at which the Index is said to stand at any particular time on any particular day or otherwise, or (iii) the suitability of the Index for the purpose to which it is being put in connection with The Lincoln National Life Insurance Company product. None of the Licensor Parties have provided or will provide any financial or investment advice or recommendation in relation to the Index to The Lincoln National Life Insurance Company or to its clients. The Index is calculated by Russell or its agent. None of the Licensor Parties shall be (a) liable (whether in negligence or otherwise) to any person for any error in the Index or (b) under any obligation to advise any person of any error therein.

³ Capital Strength Net Fee Index^SM. The Product(s) is not sponsored, endorsed, sold or promoted by NASDAQ, Inc. or its affiliates (NASDAQ, with its affiliates, are referred to as the “Corporations”). The Corporations have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to, the Product(s). The Corporations make no representation or warranty, express or implied to the owners of the Product(s) or any member of the public regarding the advisability of investing in securities generally or in the Product(s) particularly, or the ability of the Capital Strength Net Fee Index to track general stock market performance. The Corporations' only relationship to Lincoln Financial Group (“Licensee”) is in the licensing of the Nasdaq^® and certain trade names of the Corporations and the use of the Capital Strength Net Fee Index which is determined, composed and calculated by NASDAQ without regard to Licensee or the Product(s). NASDAQ has no obligation to take the needs of the Licensee or the owners of the Product(s) into consideration in determining, composing or calculating the Capital Strength Net Fee Index. The Corporations are not responsible for and have not participated in the determination of the timing of, prices at, or quantities of the Product(s) to be issued or in the determination or calculation of the equation by which the Product(s) is to be converted into cash. The Corporations have no liability in connection with the administration, marketing or trading of the Product(s).

THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED CALCULATION OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE PRODUCT(S), OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE CAPITAL STRENGTH NET FEE INDEX OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE CAPITAL STRENGTH NET FEE INDEX^® OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES

⁴ MSCI Price Return EAFE. The securities referred to herein are not sponsored, endorsed or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities, or any index on which such securities are based. The Prospectus contains a more detailed description of the limited relationship MSCI has with Lincoln Financial Group and any related funds.

⁵ Standard & Poor’s^®,” “S&P^®,” “Standard & Poor’s Equal Weight Index,” “S&P EWI,” “S&P 500^®,” “Standard & Poor’s 500” and “500” are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by the Invesco V.I. Equally-Weighted S&P 500 Fund. The fund is not sponsored, endorsed, sold or promoted by S&P, and S&P makes no representation regarding the advisability of investing in the fund.

⁶ Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The trademark has been licensed to S&P Dow Jones Indices LLC and has been sublicensed for use for certain purposes by First Trust Advisors L.P. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of purchasing the product.

3

Table of Contents

Item	Page
Special Terms	5
Summary of Common Questions	7
Expense Tables	10
Risk Factors	12
Condensed Financial Information	14
The Lincoln National Life Insurance Company	15
Investments of the Indexed Accounts	16
Variable Annuity Account (VAA)	21
Investments of the Variable Annuity Account	21
Charges and Other Deductions	24
The Contracts	26
Contracts Offered in this Prospectus	26
Purchase Payments	27
Transfers On or Before the Annuity Commencement Date	29
Surrenders and Withdrawals	32
Death Benefit	33
i4LIFE® Indexed Advantage	35
Annuity Payouts	40
Distribution of the Contracts	42
Federal Tax Matters	44
Additional Information	49
Voting Rights	49
Return Privilege	49
State Regulation	50
Records and Reports	50
Contents of the Statement of Additional Information (SAI) for Lincoln Life Variable Annuity Account N	53
Appendix A – Interim Value Calculation	A-1

4

Special Terms

In this prospectus, the following terms have the indicated meanings:

Access Period—Under i4LIFE^® Indexed Advantage, a defined period of time during which we make Periodic Income Payments to you while you still have access to your Account Value. This means that you may make withdrawals, surrender the contract, and have a Death Benefit.

Account or Variable Annuity Account (VAA)—The segregated investment account, Account N, into which we set aside and invest the assets for the Subaccounts offered in this prospectus.

Account Value—Under i4LIFE^®Indexed Advantage, the Account Value on a Valuation Date equals the total value of all the Contractowner’s Accumulation Units plus the Contractowner’s value in the Indexed Segments and the Periodic Income Payment Account, if any.

Accumulation Unit—A measure used to calculate the assets in the Subaccounts before the Annuity Commencement Date and to calculate the variable side of the i4LIFE^® Indexed Advantage Account Value during the Access Period.

Annuitant—The person upon whose life the annuity benefit payments are based, and upon whose death a Death Benefit may be paid.

Annuity Commencement Date—The Valuation Date when funds are withdrawn or converted into Annuity Units or fixed dollar payout for payment of retirement income benefits under the Annuity Payout option you select (other than i4LIFE^® Indexed Advantage).

Annuity Payout—A regularly scheduled payment (under any of the available annuity options) that occurs after the Annuity Commencement Date (or the i4LIFE^® Indexed Advantage effective date if applicable). Payments may be variable or index-linked under i4LIFE^® Indexed Advantage or variable and fixed under other options.

Annuity Unit—A measure used to calculate the amount of Annuity Payouts for the variable side of the contract after the Annuity Commencement Date.

Beneficiary—The person you choose to receive any Death Benefit paid if you die before the Annuity Commencement Date.

Contractowner (you, your, owner)—The person who can exercise the rights within the contract (decides on investment allocations, transfers, payout option, designates the Beneficiary, etc.). Usually, but not always, the Contractowner is the Annuitant.

Contract Value (may be referred to as Account Value in marketing materials)—At any given time before the Annuity Commencement Date, the total value of any allocations in the Subaccounts, the Indexed Segments, and the transfer account, if any.

Contract Year—Each 12-month period starting with the effective date of the contract and starting with each contract anniversary after that.

Death Benefit—Before the Annuity Commencement Date, the amount payable to your designated Beneficiary if the Contractowner dies. As an alternative, the Contractowner may receive a Death Benefit on the death of the Annuitant prior to the Annuity Commencement Date.

End Date—The last day of the Indexed Term.

Good Order—The actual receipt at our Home Office of the requested transaction in writing or by other means we accept, along with all information and supporting legal documentation necessary to effect the transaction. The forms we provide will identify the necessary documentation. We may, in our sole discretion, determine whether any particular transaction request is in Good Order, and we reserve the right to change or waive any Good Order requirements at any time.

Index Value—The published closing value of an index on a Valuation Date. If an Index Value is not published for a particular day, we will use the closing Index Value on the next Valuation Date it is published.

Indexed Account—An investment option that provides a return based, in part, on the performance of an index.

Indexed Anniversary Date—The same calendar day, each calendar year, as the day you first invested in an Indexed Segment.

Indexed Crediting Base—An amount used in the calculation of the performance return and the Interim Value for an Indexed Segment.

Indexed Segment—The specific Indexed Account option(s) selected by a Contractowner for allocations of Purchase Payments or transfer of Contract Value.

Indexed Term—The period of time during which Contract Value is invested in a particular Indexed Segment.

Interim Value—Your Contract Value for an Indexed Segment during an Indexed Term. The Interim Value is a calculated value and is used in the event that a withdrawal, Death Benefit payment, transfer, annuitization, or surrender occurs at any time other than the Start Date or End Date of an Indexed Term.

Lifetime Income Period—Under i4LIFE^® Indexed Advantage, the period of time following the Access Period during which we make Periodic Income Payments to you for the rest of your life (and Secondary Life, if applicable). During the Lifetime Income Period, you will no longer have access to your Account Value or receive a Death Benefit.

Lincoln Life (we, us, our, Company)—The Lincoln National Life Insurance Company.

Performance Cap or Cap—The highest Performance Rate that can be credited to an Indexed Segment over a specified period of time. A different Cap may be declared for each Indexed Segment and for each Death Benefit type.

Performance Rate—A rate of return for an Indexed Segment based on the performance of an Index over a period of time, adjusted for the Protection Level and subject to the Performance Cap.

Periodic Income Payments—The amounts paid under i4LIFE^® Indexed Advantage.

Periodic Income Payment Account—The account from which the Periodic Income Payments will be paid under i4LIFE^® Indexed Advantage.

Protection Level—The portion of any negative index performance of an Indexed Account that the Company will absorb.

 

 

5

Purchase Payments—Amounts paid into the contract.

Rider Year—Under i4LIFE^® Indexed Advantage, the 12-month period starting with the effective date of the rider and starting with each anniversary of the rider effective date after that.

Secondary Life—Under i4LIFE^® Indexed Advantage, the person designated by the Contractowner upon whose life the annuity payments will also be contingent.

Segment Maturity Value—The value of an Indexed Segment on the End Date after adjustment for the Performance Rate.

Selling Group Individuals—A Contractowner who meets one of the following criteria at the time of the contract purchase and who purchases the contract without the assistance of a registered representative under contract with us:

• Employees and registered representatives of any member of the selling group (broker-dealers who have selling agreements with us for the products described in this prospectus) and their spouses and minor children.

• Officers, directors, trustees or bona-fide full-time employees and their spouses and minor children of Lincoln Financial Group or any of the investment advisers of the funds currently being offered, or their affiliated or managed companies.

Start Date—The Valuation Date on which the Indexed Segment begins.

Subaccount—Each portion of the VAA that reflects investments in Accumulation and Annuity Units of a class of a particular fund available under the contracts. There is a separate Subaccount which corresponds to each class of a fund.

Valuation Date—Each day the New York Stock Exchange (NYSE) is open for trading.

Valuation Period—The period starting at the close of trading (normally 4:00 p.m. New York time) on each day that the NYSE is open for trading (Valuation Date) and ending at the close of such trading on the next Valuation Date.

6

Summary of Common Questions

What kind of contract am I buying? It is an individual variable and/or index-linked deferred annuity contract between you and Lincoln Life. This contract and certain riders, benefits, service features and enhancements may not be available in all states, and the charges may vary in certain states. All material state variations are discussed in this prospectus, however, non-material variations may not be discussed. You should refer to your contract regarding state-specific features. Please check with your registered representative regarding availability.

What is the Variable Annuity Account (VAA)? It is a separate account we established under Indiana insurance law, and registered with the SEC as a unit investment trust. VAA assets are allocated to one or more Subaccounts, according to your investment choices. VAA assets are not chargeable with liabilities arising out of any other business which we may conduct. See Variable Annuity Account.

What are Indexed Accounts? The Indexed Accounts provide a return, in part, based on the performance of an index you select. The return may be positive or negative and is called the Performance Rate. The Performance Rate includes a Performance Cap, which is the maximum percentage amount you can earn during the Indexed Term and a Protection Level, which is the percentage of any negative index performance we will absorb. You may allocate all or a portion of your Purchase Payments into one or more Indexed Segments of Indexed Accounts. Each Indexed Segment has its own Indexed Term, Contract Value and Performance Cap. An Indexed Account is defined by the index tracked, the length of the term, and the Protection Level it provides, and whether or not the calculation includes an Annual Lock.

The Performance Cap and Protection Level will not change during an Indexed Term. At the end of the Index Term, new Indexed Segments will be available which may have different Performance Caps and different Protection Levels. We will notify you in advance of your Indexed Anniversary Date. If we do not hear from you by the end of the Indexed Term, we will transfer your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for the new Indexed Segment will apply. Subsequent transfers from the new Indexed Segment will be at Interim Value. If the same type Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund.

What is the Index-Linked Separate Account? Assets supporting the Indexed Accounts are held in a non-insulated separate account established under Indiana insurance law. These assets are not insulated from the creditors of Lincoln Life. Therefore, the benefits provided under the Indexed Accounts are subject to the claims paying ability of Lincoln Life.

What is the Interim Value? We calculate the Interim Value of your Indexed Segments each Valuation Date. This calculation is based on a formula and may not correspond to the current performance of the Index you selected. This formula includes the value of derivatives at the time of the calculation of the Interim Value. The derivatives replicate what the performance credited would be based on the performance of the Index to the end of the Indexed Segment. Your Contract Value for Indexed Segments during the Indexed Term will equal the Interim Value. This means that the Contract Value in the Segments available for withdrawals, surrenders, transfers, annuitizations, and Death Benefit payments during an Indexed Term will be at the Interim Value. This Interim Value formula may result in a loss even if the Index Value at the time of the withdrawal is higher than the Index Value at the beginning of the Indexed Term.

Can the available Indexed Accounts and indices change over the life of the contract? We reserve the right to add or withdraw Indexed Accounts at any time. If you are invested in an Indexed Segment, it will not be withdrawn from your contract until the end of the Indexed Term. There is no guarantee that an Indexed Account with a Protection Level will be available or that a particular Index will be available in the future. If an Index is discontinued or substantially changed during a Segment Term, we reserve the right to select an alternative Index and we will notify you of such change. This may impact the calculation of your Segment Maturity Value and your future Interim Value.

What are my investment choices? You may allocate your Purchase Payments to the VAA or to one or more Indexed Segments. Based upon your instruction, Purchase Payments into the VAA will be applied to one or more of the Subaccounts, which, in turn, invest in a corresponding underlying fund. Each fund holds a portfolio of securities consistent with its investment policy. See Investments of the Variable Annuity Account – Description of the Funds. Purchase Payments into the Indexed Segments will be held in a non-insulated separate account and payments are subject to the financial strength of the Company. Indexed Accounts with Indexed Terms of 1 or 6 years are currently available. The currently offered Indices are S&P 500^® Price Return Index, Russell 2000^® Price Return Index, MSCI EAFE Price Return Index and Capital Strength Net Fee Index^SM. See Indexed Accounts.

Who invests my money? Several different investment advisers manage the investment options for the Subaccounts. See Investments of the Variable Annuity Account – Description of the Funds. Assets allocated to the Indexed Segments are invested by the investment advisers of the Company’s general account.

How does the contract work? If we approve your application, we will send you a contract. When you make Purchase Payments during the accumulation phase, you buy Accumulation Units with amounts allocated to the variable side of the contract. Amounts allocated to the Indexed Accounts are valued each day, as described in the Interim Value section. If you decide to receive an Annuity Payout, your Accumulation Units are converted to Annuity Units. Your Annuity Payouts will be based on the number of Annuity Units you receive

7

and the value of each Annuity Unit on payout days. Indexed Accounts are not available for Annuity Payouts (except i4LIFE^® Indexed Advantage). A fixed Annuity Payout is also available. See The Contracts.

What charges do I pay under the contract? We apply a Product Charge to the daily net asset value in the Subaccounts for the Death Benefit you select. The Product Charge consists of a mortality and expense risk charge and an administrative charge. There is also a charge for any riders applicable to your contract. See Charges and Other Deductions.

If you withdraw Purchase Payments, you may pay a surrender charge of a certain percentage of the surrendered or withdrawn Purchase Payment, depending upon how long those payments have been invested in the contract. For purposes of calculating surrender charges, we assume that all withdrawals prior to the sixth anniversary come first from Purchase Payments. We may waive surrender charges in certain situations. See Charges and Other Deductions – Surrender Charge.

We will deduct any applicable premium tax from Purchase Payments or Contract Value, unless the governmental entity dictates otherwise, at the time the tax is incurred or at another time we choose.

See Expense Tables and Charges and Other Deductions for information regarding additional fees and expenses that may be incurred.

The funds’ investment management fees, expenses and expense limitations, if applicable, are more fully described in the prospectuses for the funds.

Charges may also be imposed during the Annuity Payout period. See Annuity Payouts.

For information about the compensation we pay for sales of contracts, see The Contracts – Distribution of the Contracts.

Am I limited in the amount of Purchase Payments I can make into the contract? Your Purchase Payments are flexible but subject to the following limitations. Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. Upon providing advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract, including those made into any or all of the Indexed Accounts.

How will my Annuity Payouts be calculated? If you decide to annuitize, you may select an annuity option and start receiving Annuity Payouts from your contract as a fixed option or variable option or a combination of both. See Annuity Payouts - Annuity Options. Any portion of Contract Value invested in the Indexed Accounts must be transferred to the VAA prior to the annuitization, or must be used to purchase a fixed annuity. Remember that participants in the VAA benefit from any gain, and take a risk of any loss, in the value of the securities in the funds' portfolios, which would decrease the amount applied to any payout option and the related payments.

What happens if I die before I annuitize? The Death Benefit may be paid upon the death of either the Contractowner or the Annuitant. Upon the death of the Contractowner, your Beneficiary will receive Death Benefit proceeds. Your Beneficiary has options as to how the Death Benefit is paid. In the alternative, upon the death of the Annuitant the Contractowner may choose to receive a Death Benefit. See The Contracts – Death Benefit.

What are the Death Benefit options available under my Contract? The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of your current Contract Value (including the Interim Value of the Indexed Accounts) or the sum of all Purchase Payments (reduced by withdrawals) as of the date the death claim is approved for payment. The Account Value Death Benefit is also available, which provides a Death Benefit equal to the Contract Value (including the Interim Value) on the date we approve the death claim for payment. See The Contracts – Death Benefits for a complete description of these Death Benefit options. Refer to the i4LIFE^® Indexed Advantage Death Benefits for specific Death Benefit features when i4LIFE^® Indexed Advantage is elected.

What happens if I die on or after the Annuity Commencement Date? Once you reach the Annuity Commencement Date, any applicable Death Benefit will terminate.

May I transfer Contract Value between variable options and between the Subaccounts and Indexed Accounts? Yes, subject to certain restrictions. Generally, transfers made before the Annuity Commencement Date are restricted to no more than 12 per Contract Year. There is no charge for a transfer. Transfers into new Indexed Segments can only be made on the Indexed Anniversary Date. Transfers out of the Indexed Segments will be made at Interim Value unless your transfer occurs on the End Date. No transfers can be made into existing Indexed Segments. The minimum amount that can be transferred to an Indexed Account is $2,000. See The Contracts – Transfers on or Before the Annuity Commencement Date and Transfers After the Annuity Commencement Date.

What is i4LIFE^® Indexed Advantage?i4LIFE^® Indexed Advantage is an Annuity Payout option, available for purchase at an additional charge, that provides periodic lifetime income payments. During the Access Period, you have access to your Account Value, which means you have a Death Benefit and may surrender the contract or make withdrawals.

May I surrender the contract or make a withdrawal? Yes, subject to contract requirements and to the restrictions of any qualified retirement plan for which the contract was purchased. If you surrender the contract or make a withdrawal, certain surrender charges may apply. Withdrawals or surrenders from the Indexed Accounts will be at Interim Value unless the surrender or withdrawal occurs on the End Date. A portion of surrender or withdrawal proceeds may be taxable. In addition, if you decide to take a distribution before

8

age 59½, a 10% Internal Revenue Service (IRS) additional tax may apply. A surrender or a withdrawal also may be subject to 20% withholding. See The Contracts – Surrenders and Withdrawals, Charges and Other Deductions and Federal Tax Matters.

Can I cancel this contract? Yes. You can cancel the contract within ten days (in some states longer) of the date you first receive the contract. You need to return the contract, postage prepaid, to our Home Office. In most states you assume the risk of any market drop on Purchase Payments you allocate to the variable side of the contract and the Interim Value of the Indexed Segments. See Return Privilege.

9

Expense Tables

The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the contract.

The first table describes the fees and expenses that you will pay at the time that you surrender or make a withdrawal from the contract. State premium taxes may also be deducted. The premium tax rates range from zero to 5%.

CONTRACTOWNER TRANSACTION EXPENSES

Accumulation Phase:
Surrender charge (as a percentage of Purchase Payments surrendered/withdrawn):1	7.00%

¹ The surrender charge percentage is reduced over a 6-year period at the following rates: 7%, 7%, 6%, 5%, 4%, 3%. We may reduce or waive this charge in certain situations. See Charges and Other Deductions – Surrender Charge.

The following tables describe the fees and expenses that you will pay periodically during the time that you own the contract, not including fund fees and expenses.

• Table A reflects the subaccount expenses for the VAA.

• Table B reflects the i4LIFE^® Indexed Advantage Rider Charge.

TABLE A

Subaccount Expenses for the VAA

VAA Separate Account Annual Expenses (as a percentage of average daily net assets in the Subaccounts):1
Guaranteed Maximum and Current Product Charges:
Guarantee of Principal Death Benefit
Mortality and Expense Risk Charge	1.20%
Administrative Charge	0.10%
Total Separate Account Expenses	1.30%
Account Value Death Benefit
Mortality and Expense Risk Charge	1.00%
Administrative Charge	0.10%
Total Separate Account Expenses	1.10%

¹ The Product Charge is 1.10% after the Annuity Commencement Date.

TABLE B

i4LIFE^® Indexed Advantage

i4LIFE® Indexed Advantage rider charge:1
Guaranteed Maximum and Current Annual Charge	0.40%

¹ The i4LIFE^® Indexed Advantage charge will be deducted from your Account Value on each rider anniversary. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information. During the Lifetime Income Period, the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The next item shows the minimum and maximum total annual operating expenses charged by the funds that you may pay
periodically during the time that you own the contract. The expenses are for the year ended December 31, 2017, adjusted to reflect anticipated changes in fees and expenses, or, for new portfolios, are based on estimates for the current fiscal year. More detail concerning each fund's fees and expenses is contained in the prospectus for each fund.

10

	Minimum	Maximum
Total Annual Fund Operating Expenses (expenses that are deducted from fund assets, including management fees, distribution and/or service (12b-1) fees, and other expenses)	0.49%	1.23%
Total Annual Fund Operating Expenses (after contractual waivers/reimbursements*)	0.49%	1.20%

*Some of the funds have entered into contractual waiver or reimbursement arrangements that may reduce fund management and other fees and/or expenses during the period of the arrangement. These arrangements vary in length, but no arrangement will terminate before April 30, 2019. There can be no assurance that fund expense waivers or reimbursements will be extended beyond their current terms as outlined in each fund prospectus, and they may not cover certain expenses such as extraordinary expenses. Certain of these arrangements may provide that amounts previously waived or reimbursed may be recovered in future years. See each fund prospectus for complete information regarding annual operating expenses and any waivers or reimbursements in effect for a particular fund.

The following table shows the expenses charged by each fund for the year ended December 31, 2017:
(as a percentage of each fund’s average net assets):

	Management Fees (before any waivers/ reimburse- ments)	+	12b-1 Fees (before any waivers/ reimburse- ments)	+	Other Expenses (before any waivers/ reimburse- ments)	+	Acquired Fund Fees and Expenses	=	Total Expenses (before any waivers/ reimburse- ments)	Total Contractual waivers/ reimburse- ments (if any)	Total Expenses (after Contractual waivers/ reimburse- ments)
American Funds Asset Allocation Fund - Class 4	0.27%		0.25%		0.27%		0.00%		0.79%	0.00%	0.79%
American Funds Growth Fund - Class 4	0.33%		0.25%		0.27%		0.00%		0.85%	0.00%	0.85%
BlackRock Global Allocation V.I. Fund - Class III	0.63%		0.25%		0.25%		0.01%		1.14%	-0.13%	1.01%
Fidelity® VIP Mid Cap Portfolio - Service Class 2	0.54%		0.25%		0.09%		0.00%		0.88%	0.00%	0.88%
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I	0.60%		0.25%		0.38%		0.00%		1.23%	-0.03%	1.20%
Franklin Rising Dividends VIP Fund - Class 4	0.60%		0.35%		0.02%		0.00%		0.97%	0.00%	0.97%
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares	0.12%		0.25%		0.20%		0.00%		0.57%	0.00%	0.57%
JPMorgan Insurance Trust Core Bond Portfolio - Class 2	0.40%		0.25%		0.22%		0.00%		0.87%	-0.02%	0.85%
LVIP Government Money Market Fund - Service Class	0.38%		0.25%		0.11%		0.00%		0.74%	0.00%	0.74%
LVIP MFS Value Fund - Service Class	0.61%		0.25%		0.07%		0.00%		0.93%	0.00%	0.93%
LVIP PIMCO Low Duration Bond Fund - Service Class	0.50%		0.25%		0.25%		0.00%		1.00%	-0.04%	0.96%
LVIP SSGA International Index Fund - Service Class	0.40%		0.25%		0.11%		0.00%		0.76%	-0.12%	0.64%
LVIP SSGA S&P 500 Index Fund - Service Class	0.17%		0.25%		0.07%		0.00%		0.49%	0.00%	0.49%
LVIP SSGA Small-Cap Index Fund - Service Class	0.32%		0.25%		0.08%		0.00%		0.65%	0.00%	0.65%

Certain underlying funds have reserved the right to impose fees when fund shares are redeemed within a specified period of time of purchase (“redemption fees”) which are not reflected in the table above. As of the date of this prospectus, none have done so. See The Contracts - Market Timing for a discussion of redemption fees.

For information concerning compensation paid for the sale of the contracts, see Distribution of the Contracts.

EXAMPLES

The following Example is intended to help you compare the cost of investing in the contract with the cost of investing in other variable annuity contracts. These costs include Contractowner transaction expenses, contract fees, separate account annual expenses, and fund fees and expenses. The Example has been calculated using the fees and expenses of the funds prior to the application of any contractual waivers and/or reimbursements, and assumes that no money was invested in the Indexed Accounts.

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the i4LIFE^® Indexed Advantage with the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

11

1 year	3 years	5 years	10 years
$996	$1,507	$1,943	$3,252

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$296	$907	$1,543	$3,252

The Example assumes that you invest $10,000 in the Subaccounts for the time periods indicated. The Example also assumes that your investment has a 5% return each year, the maximum fees and expenses of any of the funds, and that the Guarantee of Principal Death Benefit is in effect. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

1) If you surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$956	$1,387	$1,745	$2,865

2) If you annuitize or do not surrender your contract at the end of the applicable time period:

1 year	3 years	5 years	10 years
$256	$787	$1,345	$2,865

For more information, see Charges and Other Deductions in this prospectus, and the prospectus for the funds. Premium taxes may also apply, although they do not appear in the examples. Different fees and expenses not reflected in the examples may be imposed during a period in which Annuity Payouts are made. See Annuity Payouts. These examples should not be considered a representation of past or future expenses. Actual expenses may be more or less than those shown.

Risk Factors

This section describes potential risks associated with your contract.

General Risks

1.	We reserve the right, within the law, to make certain changes to the structure and operation of the VAA or Indexed Accounts at our discretion and without your consent. We reserve the right to limit Purchase Payments into the contract. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. We may add to or delete Indexed Accounts currently available. We do not guarantee that an Indexed Account option will always be available.
2.	You may incur a surrender charge upon the surrender or withdrawal of Contract Value. See Charges and Other Deductions – Surrender Charge.
3.	Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s can experience outages or slowdowns for a variety of reasons and may not always be available. These outages or slowdowns may delay or prevent our processing your surrender, withdrawal, or transfer request.

Risks of Investing in the Indexed Accounts

1.	There is a risk of loss of your investment in the Indexed Segments since the performance tracks a market index. You are responsible for all losses in excess of the Protection Level you choose. The Protection Level exists for the full term of the Indexed Segment including Segments with Annual Locks. When you move into a new Indexed Segment after the end of an Indexed Term the performance will be calculated for the new Segment, which may have a new Protection Level, which could also result in a loss. There is also a risk of loss upon an early withdrawal. For Annual Lock accounts, since the gain or loss is established each year, losses can accumulate so that you could actually lose more than the percentage amount in excess of the Protection Level percent. For example, if you chose a 10% Protection Level, you could lose more than 90% of your principal in an Annual Lock account.
2.	Gains in your Indexed Segments are limited by any applicable Performance Cap, which means that your return could be lower than if you had invested directly in a fund based on the applicable Index. The Performance Cap exists for the full term of the Indexed Segment. The Performance Cap rate is lower for contracts with the Guarantee of Principal Death Benefit. Generally, Indexed Segments with greater Protection Levels have lower Performance Caps. Performance Caps for new Segments will be declared 5 business days in advance of the beginning of a Segment.
3.	To determine the Interim Value, we apply a formula which does not reflect the actual performance of the applicable Index, but

12

	rather a determination of the value of hypothetical underlying investments at the time of the Interim Value calculation. This amount could be less than if you had held the Indexed Segment for the full Indexed Term. It also means that you could have a negative performance, even if the value of the Index has increased during the calculation period. All withdrawals from the Indexed Segment, including Death Benefits paid during the Indexed Term, will be based on the Interim Value.
4.	If you withdraw Contract Value allocated to an Indexed Account, the withdrawal will cause an immediate reduction to your Indexed Crediting Base in a proportion equal to the reduction in your Interim Value. A proportional reduction could be larger than the dollar amount of your withdrawal. Reductions to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Indexed Segment Maturity Value at the end of the Indexed Term. Once your Indexed Crediting Base is reduced due to a withdrawal during any Indexed Term, you cannot increase it during the remainder of the Indexed Term.
5.	For Indexed Accounts without an Annual Lock, the indexed performance credited to your Indexed Segment is determined on the last day of the Indexed Term. It is not affected by the price of the Index on any date in between the effective date of the Indexed Account and the End Date of the Indexed Term. Annual Lock accounts are not affected by Index prices between the Annual Lock anniversaries.
6.	We may change the Index on a particular Indexed Account if the Index is discontinued or if we feel the Index is no longer appropriate. This change may occur in the middle of an Indexed Segment and this change may impact how your Indexed Segment performance and Interim Value are calculated.
7.	The available Indexed Accounts with applicable Performance Caps and Protection Levels will vary over time. Before investing in a new Indexed Segment, you should determine exactly what Indexed Accounts, Protection Levels and Performance Caps are available to you. There is no guarantee that an Indexed Account will be available in the future. You should make sure the Segment(s) you select is appropriate for your investment goals.
8.	The risks associated with the currently available Indices are as follows:

• Equity markets are subject to the risk that the value of the securities may fall due to general market and economic conditions. Market volatility may exist with these indices, which means that the value of the indices can change dramatically over a short period of time in either direction. Additional risks for specific indices are as follows:

• Russell^® 2000 Price Return Index: Compared to mid-and large-capitalization companies, small-capitalization companies may be less stable and more susceptible to adverse developments, and their securities may be more volatile and less liquid.

• MSCI EAFE Price Return Index: International investing involves special risks not found in domestic investing, including political and social differences and currency fluctuations due to economic decisions. Emerging markets can be riskier than investing in well established foreign markets. The risks associated with investing on a worldwide basis include differences in the regulation of financial data and reporting, currency exchange differences, as well as economic and political systems differences.

• Capital Strength Net Fee Index^SM: This index has fewer stocks than broad based indices; therefore, the risk is spread between fewer equity securities. This index may not track other large cap indices.

9.	If we do not receive investment instructions from you by the end of an Indexed Term, we will invest your Segment Maturity Value in a new Indexed Segment with the same term, Index and Protection Level if available. The Performance Cap in effect at the time for new Indexed Segments will apply. If the same type of Indexed Segment is not available, your Segment Maturity Value will be moved to the LVIP PIMCO Low Duration Bond Fund. If your Contract Value has been invested in a new Segment and you wish to withdraw your investment, the Contract Value for that Segment will equal the Interim Value.
10.	You will not have voting rights or rights to receive cash dividends or other rights that shareholders who invest in mutual funds based on these Indices would have.
11.	Your receipt of funds invested in the Indexed Segments is based on the claims paying ability of Lincoln Life. You have no ownership rights in the underlying securities. The assets backing the Indexed Accounts are not segregated from other business of Lincoln Life.
12.	The only available annuitization option for the Indexed Accounts is i4LIFE® Indexed Advantage, which has an additional charge.

Risks of Investing in the Subaccounts

1.	You take all the investment risk on the Contract Value and the retirement income for amounts placed into one or more of the Subaccounts, which invest in corresponding underlying funds. If the Subaccounts you select make money, your Contract Value goes up; if they lose money, your Contract Value goes down. How much it goes up or down depends on the performance of the Subaccounts you select.
2.	The dollar amount of the charge for certain optional Death Benefits may increase as your Contract Value increases.
3.	Your receipt of a Death Benefit over and above the amounts invested in the VAA is based on the claims paying ability and credit worthiness of Lincoln Life.

13

4. Certain classes of funds are subject to risk factors as outlined below:

a. Certain funds offered as part of this contract have similar investment objectives and policies to other portfolios managed by the adviser. The investment results of the funds, however, may be higher or lower than the other portfolios that are managed by the adviser or sub-adviser. There can be no assurance, and no representation is made, that the investment results of any of the funds will be comparable to the investment results of any other portfolio managed by the adviser or sub-adviser, if applicable.

b. Certain funds invest their assets in other funds. As a result, you will pay fees and expenses at both fund levels. This will reduce your investment return. These arrangements are referred to as funds of funds or master-feeder funds, which may have higher expenses than funds that invest directly in debt or equity securities. An advisor affiliated with us manages some of the available funds of funds. Our affiliates may promote the benefits of such funds to Contractowners and/or suggest that Contractowners consider whether allocating some or all of their Contract Value to such portfolios is consistent with their desired investment objectives. In doing so, we may be subject to conflicts of interest insofar as we may derive greater revenues from the affiliated fund of funds than certain other funds available to you under your contract.

5.	Some of the underlying funds have reserved the right to temporarily or permanently refuse payments or transfer requests received from us, especially in cases of suspected market timing. To the extent permitted by applicable law, we, in turn, reserve the right to defer or reject your transfer request at any time we are unable to redeem shares of an underlying fund.
6.	Annuity Payouts will fluctuate with the performance of the Subaccounts.

Cyber Security

We rely heavily on interconnected computer systems and digital data to conduct our annuity products business. Because our business is highly dependent upon the effective operation of our computer systems and those of our business partners, our business is vulnerable to disruptions from utility outages, and susceptible to operational and information security risks resulting from information systems failure (e.g., hardware and software malfunctions), and cyber-attacks. These risks include, among other things, the theft, misuse, corruption and destruction of data maintained online or digitally, interference with or denial of service, attacks on websites and other operational disruption and unauthorized release of confidential customer information. Such systems failures and cyber-attacks affecting us, any third-party administrator, the underlying funds, intermediaries and other affiliated or third-party service providers may adversely affect us and your Contract Value. For instance, systems failures and cyber-attacks may interfere with our processing of contract transactions, including the processing of orders from our website or with the underlying funds, impact our ability to calculate Accumulation Unit value, cause the release and possible destruction of confidential customer or business information, impede order processing, subject us and/or our service providers and intermediaries to regulatory fines and financial losses and/or cause reputational damage. Cyber security risks may also impact the issuers of securities in which the underlying funds invest, which may cause the funds underlying your contract to lose value. There can be no assurance that we or the underlying funds or our service providers will avoid losses affecting your contract due to cyber-attacks or information security breaches in the future.

Condensed Financial Information

Since no sales of this product occurred before the date of this prospectus, financial information for the Subaccounts is not included in this prospectus or in the SAI.

Investment Results for the VAA

At times, the VAA may compare its investment results to various unmanaged indices or other variable annuities in reports to shareholders, sales literature and advertisements. The results will be calculated on a total return basis for various periods, with or without surrender charges. Results calculated without surrender charges will be higher. Total returns include the reinvestment of all distributions, which are reflected in changes in unit value. The money market Subaccount's yield is based upon investment performance over a 7-day period, which is then annualized.

There can be no assurance that a money market fund will be able to maintain a stable net asset value of $1.00 per share. During periods of low interest rates, the yield of a money market fund may become extremely low and possibly negative. In addition, if the yield of a Subaccount investing in a money market fund becomes negative, due in part to Contract fees and expenses, your Contract Value may decline. An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The sponsor of a money market fund has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time. If, under SEC rules, a money market fund suspends payments of redemption proceeds, we will delay payment of any transfer, withdrawal, or benefit from a Subaccount investing in the money market fund until the fund resumes payment. If, under SEC rules, a money market fund institutes a liquidity fee, we may assess the fee against your Contract Value if a payment is made to you from a Subaccount investing in the money market fund.

14

The annual performance of the Subaccounts are based on past performance and do not indicate or represent future performance.

Investment Results for the Indexed Accounts

It is possible that you will not earn any gain on investments in the Indexed Segments. Investments in the Indexed Segments are not guaranteed unless you have elected the 100% Protection Level and hold the investment until the end of the Indexed Term. There is a risk of substantial loss of your principal. You agree to absorb all losses that exceed the Protection Level percentage you select.

The Lincoln National Life Insurance Company

The Lincoln National Life Insurance Company (Lincoln Life or Company), organized in 1905, is an Indiana-domiciled insurance company, engaged primarily in the direct issuance of life insurance contracts and annuities. Lincoln Life is wholly owned by Lincoln National Corporation (LNC), a publicly held insurance and financial services holding company incorporated in Indiana. Lincoln Life is obligated to pay all amounts promised to Contractowners under the contracts.

The portion of your Contract Value invested in the Indexed Segments is part of our general account. Therefore, any amounts that we may pay under the contract in excess of the value in the Subaccounts are subject to our financial strength, claims-paying ability, credit worthiness, and our long-term ability to make such payments.

We issue other types of insurance policies and financial products as well. In addition to any amounts we are obligated to pay in excess of Subaccounts under the contracts, we also pay our obligations under these products from our assets in the general account. Moreover, unlike assets held in the VAA, the assets of the general account are subject to the general liabilities of the Company and, therefore, to the Company’s general creditors. In the event of an insolvency or receivership, payments we make from our general account to satisfy claims under the contract would generally receive the same priority as our other Contractowner obligations.

The general account is not segregated or insulated from the claims of the insurance company’s creditors. Investors look to the financial strength of the insurance companies for these insurance guarantees. Therefore, guarantees provided by the insurance company as to benefits promised in the prospectus are subject to the claims paying ability of the insurance company and are subject to the risk that the insurance company may not be able to cover or may default on its obligations under those guarantees.

Our Financial Condition.  Among the laws and regulations applicable to us as an insurance company are those which regulate the investments we can make with assets held in our general account. In general, those laws and regulations determine the amount and type of investments which we can make with general account assets.

In addition, state insurance regulations require that insurance companies calculate and establish on their financial statements, a specified amount of reserves in order to meet the contractual obligations to pay the claims of our Contractowners. In order to meet our claims-paying obligations, we regularly monitor our reserves to ensure we hold sufficient amounts to cover actual or expected contract and claims payments. However, it is important to note that there is no guarantee that we will always be able to meet our claims paying obligations, and that there are risks to purchasing any insurance product.

State insurance regulators also require insurance companies to maintain a minimum amount of capital in excess of liabilities, which acts as a cushion in the event that the insurer suffers a financial impairment, based on the inherent risks in the insurer’s operations. These risks include those associated with losses that we may incur as the result of defaults on the payment of interest or principal on assets held in our general account, which include bonds, mortgages, general real estate investments, and stocks, as well as the loss in value of these investments resulting from a loss in their market value.

How to Obtain More Information.  We encourage both existing and prospective Contractowners to read and understand our financial statements. We prepare our financial statements on both a statutory basis and according to Generally Accepted Accounting Principles (GAAP). Our audited GAAP financial statements, as well as the financial statements of the VAA, are located in the SAI. If you would like a free copy of the SAI, please write to us at: PO Box 2348, Fort Wayne, IN 46801-2348, or call 1-877-737-6872. In addition, the SAI is available on the SEC’s website at http://www.sec.gov. You may obtain our audited statutory financial statements and any unaudited statutory financial statements that may be available by visiting our website at www.LincolnFinancial.com.

You also will find on our website information on ratings assigned to us by one or more independent rating organizations. These ratings are opinions of an operating insurance company’s financial capacity to meet the obligations of its insurance and annuity contracts based on its financial strength and/or claims-paying ability. Additional information about rating agencies is included in the SAI.

Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE:LNC) and its affiliates. Through its affiliates, Lincoln Financial Group offers annuities, life, group life and disability insurance, 401(k) and 403(b) plans, and comprehensive financial planning and advisory services.

15

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life are located in the SAI. The SAI is part of the registration statement filed on Form N-4. If you would like a free copy of the SAI, complete and mail the request on the last page of this prospectus, or call 1-877-737-6872.

Investments of the Indexed Accounts

This contract offers several Indexed Accounts which provide a rate of return based in part on the performance of an index you select. This is the Performance Rate, and it may be positive or negative. An Indexed Account is defined by the index tracked, the length of the term, the Protection Level it provides, and whether or not the performance crediting method includes an Annual Lock.

You may allocate all or a portion of your Purchase Payments into one or more Indexed Accounts. The minimum allocation to an Indexed Account is $2,000; there is no maximum allocation limit. A new Indexed Segment is established upon an allocation to an Indexed Account. Each Indexed Segment has its own Start Date, Crediting Base, Performance Cap, Performance Rate, Contract Value, and End Date.

At this time, the available Indexed Accounts are:

1-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 100% Protection

Russell 2000^®, 10% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Indexed Accounts

S&P 500^®, 10% Protection

S&P 500^®, 20% Protection

S&P 500^®, 30% Protection

Russell 2000^®, 10% Protection

Russell 2000^®, 20% Protection

Russell 2000^®, 30% Protection

Capital Strength Net Fee Index^SM, 10% Protection

MSCI EAFE, 10% Protection

6-Year Annual Lock Indexed Accounts

Annual Lock S&P 500^®, 10% Protection

Annual Lock Russell 2000^®, 10% Protection

Annual Lock Capital Strength Net Fee Index^SM , 10% Protection

Annual Lock MSCI EAFE, 10% Protection

Indices. Each Indexed Account references an index that determines the performance of its associated Indexed Segments. These indices are not funds and are not available for direct investment. We currently offer Indexed Accounts based on the performance of the following securities indices:

S&P 500^® Price Return Index (SPX). The S&P 500^® Index is comprised of 500 stocks considered representative of the overall market. An index is unmanaged and not available for direct investments.

Russell^® 2000 Price Return Index (RTY). The Russell 2000^® Index measures the performance of the 2,000 smallest companies in the Russell 3000^® Index. It is considered representative of small capitalization stocks. The prices of small company stocks generally are more volatile than those of large company stocks. An index is unmanaged and not available for direct investments.

MSCI EAFE Price Return Index (MXEA). The MSCI EAFE Index measures the equity market performance of 22 developed market country indices located in Europe, Australasia and the Far East. An index is unmanaged and not available for direct investments.

Capital Strength Net Fee Index^SM(NQCAPSTNF). The Index is comprised of 50 securities selected based on cash on hand, debt ratios and volatility. The Capital Strength Price Return Index^SM will be reduced by 0.65% to result in the Capital Strength Net Fee Index^SM. An index is unmanaged and not available for direct investment.

The indices used are price indices and do not reflect dividends paid on the underlying stocks. If an Index is discontinued or substantially changes (for example if an index sponsor announces that it will make a material change in the formula for or the method of calculating the Index or in any other way materially modifies the Index), we reserve the right to select an alternative Index and we will notify the Contractowner of such changes. In selecting an alternative Index we will attempt to approximate the performance of the

16

original Index in a commercially reasonable manner in light of relevant market circumstances at the time. Any substitution of an Index is subject to approval by the state insurance authorities where the contract and rider were issued, if required by law. A change to the Index in the middle of a Segment may impact the calculation of the Performance Rate for the Segments. When we notify you of a change to the Index, we will also state how the change will impact your Performance Rate. If you do not choose to remain in the Segment, you can transfer your Interim Value to a variable Subaccount. Investments in new Segments are available on an Indexed Anniversary Date.

Indexed Term. The Indexed Term is the specified period of time of a particular Indexed Account. Indexed Terms of 1 or 6 years are available. An Indexed Segment begins on the day your money is allocated to an Indexed Segment, called the Start Date. The yearly anniversary of the Start Date of the initial Indexed Segment is the Indexed Anniversary Date of your contract. This is the Indexed Anniversary Date for the life of your contract.

You may choose to allocate your Purchase Payments to different Indexed Accounts, but all Indexed Segments must begin on the Indexed Anniversary Date. All future Indexed Terms must begin on the same Indexed Anniversary Date. This means that after the initial Indexed Segment is created, you can only allocate future Purchase Payments or make transfers of Contract Value to Indexed Accounts one time a year. For example, you may start a 6-Year Segment, and two years later, you can start a 1-Year Indexed Segment, as long as the 1-Year Indexed Segment begins on the Indexed Anniversary Date for your contract. If you have more than one 6-Year Term Indexed Segment in effect at any time, these Indexed Segments must have the same Start Date and End Date.

Lincoln reserves the right to make additional Indexed Account options available or to withdraw currently available Indexed Account options in the future.

Indexed Contract Value. For each Indexed Segment the daily value is determined as follows:

a. On the Start Date of the Indexed Segment, the value of the Indexed Segment equals the initial Indexed Crediting Base. The initial Indexed Crediting Base is the amount of Purchase Payment or Contract Value allocated to the Indexed Segment.

b. On each Valuation Date during the Indexed Term, the value of the Indexed Segment equals the Interim Value.

c. On the last date of the Indexed Term, called the End Date, the value of the Indexed Segment equals the Indexed Segment Maturity Value.

Crediting Methods. Any performance earned is credited to or amounts for any loss are deducted from an Indexed Segment only upon the End Date of an Indexed Term. If the End Date is not a Valuation Date, then the amount will be credited or deducted on the next Business Day. Performance is calculated differently depending on whether or not the Indexed Account contains Annual Locks. An Indexed Account with Annual Locks is a multi-year account in which the performance is calculated on each Indexed Anniversary Date, but the performance is not credited to or deducted from the Indexed Segment until the End Date.

Indexed Segments Without Annual Locks. For an Indexed Segment without Annual Locks, the Performance Rate is the percentage change in the Index Value from the Start Date to the End Date, adjusted by the Protection Level and subject to the Performance Cap. The Performance Rate can be positive, negative or zero. The percentage change in the Index Value is calculated by subtracting the Index Value on the Start Date from the Index Value on the End Date. The difference is divided by the Index Value on the Start Date. The daily Index Value is posted on the index’s website. If an Index Value is not published for a particular day, we will use the Index Value at the close of the next Valuation Date the index is published.

If the percentage change of the Index Value from the Start Date to the End Date is positive and equal to or greater than the Performance Cap, then the Performance Rate equals the Performance Cap. If the percentage change is positive and less than the Performance Cap, the Performance Rate equals the percentage change of the Index Value. If the percentage change is negative but is absorbed by the Protection Level percentage, the Performance Rate equals zero. If the percentage change is negative, and is greater than the Protection Level percentage, the Performance Rate is equal to the percentage change in excess of the Protection Level. The Performance Rate for Indexed Segments with a 100% Protection Level is zero if the percentage change is negative.

The amount credited to or deducted from the Indexed Segment is equal to the Performance Rate times the Indexed Crediting Base on the End Date. This will be used to determine the Segment Maturity Value as set forth below. The Indexed Crediting Base is the amount you allocated to the Indexed Segment, less any transfers and withdrawals during the Index Term deducted proportionately by the amount that the transfer or withdrawal reduced the Interim Value (described later in the Interim Value section). Withdrawals include any applicable surrender charge, premium tax or rider charge deductions. If the Performance Rate is positive, the value of your Indexed Segment will increase. If the Performance Rate is negative (after calculation including the Protection Level), the value of your Indexed Segment is reduced. If the Performance Rate is zero, the value of your Indexed Segment will not change. The Segment Maturity Value on the End Date is equal to the sum of A plus (A times B) where:

A = the Indexed Crediting Base on the End Date and

B = the Performance Rate.

For Example:

17

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year with a 10% Performance Cap
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base = $100,000

Indexed Start Date	Index Value	Index % Change	Account Performance Rate (adjusted for Cap)	Segment Maturity Value
1/8/2019	1,679	+7%	+7%	$107,000
1/8/2020	1,880	+12%	+10%	$117,700

This example assumes that a new 1-Year Indexed Segment was selected in 2019 to show the impact of the Performance Cap.In this example, the Performance Cap did not change for the new Segment. (The numbers were rounded for ease of understanding.)

The Indexed Crediting Base is used only to calculate the performance of Indexed Accounts on the End Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit.

Indexed Segment with Annual Locks. For an Indexed Segment with Annual Locks, the Performance Rate will be calculated in the same manner as above, except it will be calculated on each Index Anniversary Date. However, the performance will NOT be credited to or deducted from the Indexed Segment until the End Date of the Indexed Term (at the end of the 6^th year). The amount of the performance credited or deducted from the Indexed Segment on the End Date equals the sum of each Indexed Anniversary’s performance as adjusted for any withdrawals, transfers, or annuitization. On the first Indexed Anniversary Date, the performance equals the Percentage Rate times the Indexed Crediting Base. This performance amount is added to or deducted from the Indexed Crediting Base. This adjusted Indexed Crediting Base becomes the Indexed Crediting Base for the next one-year period. On each Indexed Anniversary Date thereafter, the return for the year is credited to or deducted from the Index Crediting Base and the adjusted Indexed Crediting Base carries over for the next one-year period. As a result, a loss you incur in one year will reduce the amount invested for the next year. In a continuing down market, you could lose in excess of the percentage remaining after the Protection Level. For example, if the Protection Level is 10%, in a continuing down market, you could lose more than 90% of your investment. On the other hand, a gain you incur in one year will increase the Indexed Crediting Base for the next year, upon which future gains (if any) will be calculated. The Segment Maturity Value will equal the value of the Crediting Base on the End Date (after the adjustment for performance on the last Indexed Anniversary Date).

The Indexed Crediting Base is used only to calculate the performance of Indexed Segments on the Indexed Anniversary Date and to calculate the Interim Value. This amount is not available for surrender, withdrawal, transfer, annuitization or as a Death Benefit. In addition to the Indexed Crediting Base adjustment for performance, withdrawals and transfers reduce the Indexed Crediting Base in the same proportion that withdrawals and transfers reduce the Interim Value.

The following example demonstrates the impact of the Performance Cap and Protection Level on an Indexed Account with a 6-Year Annual Lock and assumes no withdrawals have been made.

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 6-Year with Annual Locks with a 10% Performance Cap and 10% Protection Level
Index Value at Beginning of Term = 1,569
Allocation to Indexed Segment = $100,000
Indexed Crediting Base at Beginning of Term = $100,000

Indexed Segment Anniversary	Index Value	Index % Change	Account Performance Rate (adjusted for Cap or Protection Level)	Indexed Segment Performance Amount	Adjusted Indexed Crediting Base/ Anniversary Value
1/8/2019	1,679	+7%	+7%	$7,000	$107,000
1/8/2020	1,880	+12%	+10%	$10,700	$117,700
1/8/2021	1,636	-13%	-3%	-$3,531	$114,169
1/8/2022	1,554	-5%	-0%	0	$114,169
1/8/2023	1,632	+5%	+5%	+$5,708	$119,877
1/8/2024	1,909	+10%	+10%	+$11,988	$131,865

18

Note: The Segment Maturity Value is $131,865. The $31,865 (the sum of the values on each Index Anniversary) is not credited to your Contract Value until the end of the 6-year Indexed Term. Until that time, the Interim Value calculations apply. The anniversary amounts are not available to you and are used only for calculation purposes as the Indexed Crediting Base for the next year.

Reallocation. You will be notified thirty days prior to each Indexed Anniversary Date regarding the timing of investing in new Indexed Segments. The available Indexed Accounts and applicable Performance Caps will be provided 5 business days in advance of the Indexed Anniversary Date on LFG.com/leveladvantage or by calling 1-877-737-6872. If your existing Indexed Segment is at the end of the Indexed Term, you may reallocate the value of the Indexed Segment Maturity Value to any available Indexed Account or variable subaccount as long as the reallocation request is received at least two business days prior to the end of the Indexed Term. We will hold reallocation instructions for up to 25 calendar days prior to the Indexed Anniversary Date. The reallocation will take place on the Indexed Anniversary Date. If we do not receive a reallocation notice from you, all Indexed Segments that are ending will invest into a new Indexed Segment with the same term, index, and Protection Level as the Indexed Segment in which they were previously invested and with the currently applicable Performance Cap. If the same type of Indexed Segment is no longer available, the funds will be moved to LVIP PIMCO Low Duration Bond Fund, and will not be eligible for allocation into an Indexed Account until the next Indexed Anniversary Date.

Performance Cap. The Performance Cap is the maximum Performance Rate that can be credited to the Indexed Segment for an Indexed Term for which it is declared. If an Indexed Account with Annual Lock is selected, the Performance Cap is the maximum percentage that can be credited each year during the Indexed Term. The Performance Cap may vary depending on the Death Benefit option, the index, and the Protection Level you select. Typically, Indexed Segments with greater Protection Levels have lower Performance Caps. The Performance Cap will not change during the Indexed Term.

The initial Performance Cap applies to the initial Indexed Term. Indexed Segments with a Guarantee of Principal Death Benefit will have lower Performance Caps than Indexed Segments with the Account Value Death Benefit. The Company will declare, at its discretion, a Performance Cap for each subsequent Indexed Term. If no Performance Cap is declared for an Indexed Term, there is no maximum Performance Rate for that Indexed Term.

Subsequent Performance Caps may be higher or lower than the initial Performance Cap. Subsequent Performance Caps may differ from the Performance Cap used for new contracts or for other contracts issued at different times. The Company will determine new Performance Caps on a basis that does not discriminate unfairly within any class of contracts.

Protection Levels. The Protection Level is the portion of any negative index performance that will not impact your Contract Value during the Indexed Term if you hold until the End Date of the Segment. Your Contract Value will not be impacted up to the amount of the Protection Level you elect, and, after that, you will be impacted for the remaining portion of the loss. This loss will reduce the amount of your investment (principal) in the Indexed Segments. This contract offers Indexed Accounts with Protection Levels that protect you against losses of 10% to 100%. If you choose an Indexed Account with a 10% Protection Level, your Contract Value will not be impacted by the first 10% of negative Performance if you stay invested until the End Date of the Segment. Any remaining negative percentage will be absorbed by you. If you choose an Indexed Account with a 100% Protection Level, you will not lose any of your principal allocated to the Indexed Account if you stayed invested until the End Date of the Segment. If an Indexed Account with Annual Locks is selected, the Protection Level is the percentage of the index loss that will not impact your Crediting Base each year during the Indexed Term.

For example:

Indexed Term Segment Start Date = 1/8/2018
Indexed Account = 1-Year S&P 500 with a 10% Protection Level
Index Value at beginning of term = 1,569
Indexed Crediting Base = $100,000
Indexed Term Segment End Date = 1/8/2019
Index Value at End Date = 1,333
Index Value percentage change = -15% ((1,333 – 1,569) / 1569)
Indexed Segment Maturity Value = $95,000 ($100,000 - $5,000)

Because your Contract Value is not impacted by the first 10% of the loss, you only experience a 5% loss (-15% Index Value percentage change + 10% Protection Level = 5% loss) or $100,000 * 5.00% = $5,000.

The following year assuming you chose a new 1-Year Segment with a 10% Protection Level:

Indexed Term Segment End Date = 1/8/2020
Index Value at end of term = 1,298
Index Value percentage change = -3%
Indexed Segment Maturity Value = $95,000

Because your Contract Value is not impacted by the first 10% of the loss, you experience no loss of Contract Value for this Segment because the Index Value percentage change was less than the 10% Protection Level.

19

Interim Value. The Interim Value is a daily value we calculate to provide you with a value of your Indexed Segment after the Start Date and before the End Date of an Indexed Term. The Contract Value for an Indexed Segment is equal to the Interim Value on each Valuation Date except the End Date. The Interim Value is used to calculate amounts available for withdrawal, surrender, transfer (including any applicable surrender charge, premium tax or rider charge deductions), annuitization or payment of a death claim for each day during an Indexed Term. The Interim Value also is used to determine how much the Index Crediting Base will be reduced after a transfer or withdrawal. See Surrenders and Withdrawals. Once you reach the End Date of the Indexed Term, there is no Interim Value, and the actual performance will be credited to or deducted from your Indexed Segment based on the Performance Rate (with a Cap or Protection Level) as described above. The Interim Value calculation will vary depending on the Indexed Account selected.

The Interim Value calculation is designed to represent the fair value of the Indexed Segment on each Business Day, taking into account the potential gain or loss of the applicable Index at the end of the Indexed Term, including the impacts of the Cap and Protection Level. The calculation is also designed to reflect the change in fair value due to economic factors, including, but not limited to, the impact of market rates, volatility, and correlation (if applicable) of the investment instruments supporting the contract. The Interim Value is based on this calculation and not the actual value of any underlying investments or the current value of any index.

The specifics of the Interim Value calculation are in Appendix A of this prospectus. In simplified terms, the calculation is the lesser of A or B:

A = the present value of the Indexed Crediting Base (or, for Annual Lock Indexed Accounts, the initial Crediting Base, as adjusted for transactions) plus the current fair value of a replicating package of derivatives that replicates the Segment Maturity Value (if it was held to the End Date) based on the Index Performance and taking into account the Protection Level and Performance Cap.

B = the Indexed Crediting Base times (1 + the pro rata portion of the Performance Cap) (which is calculated differently for the 6 year Annual Lock method).

The following examples demonstrate how the Interim Value is calculated in different scenarios for Indexed Segments without an Annual Lock.    

	1 Year	6 Year	6 Year
Indexed Term length	12 months	72 months	72 months
Months since Indexed Term Start Date	9	69	15
Indexed Crediting Base	$1,000	$1,000	$1,000
Protection Level	10%	10%	10%
Performance Cap	7.25%	82%	82%
Months to End Date	3	3	57

Change in Index Value is -30%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$(198)	$(197)	$(165)
3. Sum of 1 + 2	$796	$800	$771
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$796	$800	$771

Change in Index Value is -10%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$(20)	$(20)	$(5)
3. Sum of 1 + 2	$973	$977	$932
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$973	$977	$932

20

Change in Index Value is 20%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$68	$203	$231
3. Sum of 1 + 2	$1,061	$1,200	$1,167
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$1,054	$1,200	$1,167

Change in Index Value is 40%	1 Year	6 Year	6 Year
1. Fair Value of Hypothetical Fixed Instrument	$993	$997	$937
2. Fair Value of Hypothetical Derivatives	$71	$401	$353
3. Sum of 1 + 2	$1,064	$1,398	$1,289
4. Pro-rated Cap	$1,054	$1,786	$1,171
Account Interim Value = Minimum of 3 and 4	$1,054	$1,398	$1,171

Refer to the Surrender and Withdrawal section for information about the Interim Value and how surrenders or withdrawals are calculated.

Variable Annuity Account (VAA)

On November 3, 1997, the VAA was established as an insurance company separate account under Indiana law. It is registered with the SEC as a unit investment trust under the provisions of the Investment Company Act of 1940 (1940 Act). The VAA is a segregated investment account, meaning that its assets may not be charged with liabilities resulting from any other business that we may conduct. Income, gains and losses, whether realized or not, from assets allocated to the VAA are, in accordance with the applicable annuity contracts, credited to or charged against the VAA. They are credited or charged without regard to any other income, gains or losses of Lincoln Life. We are the issuer of the contracts and the obligations set forth in the contract, other than those of the Contractowner, are ours. The VAA satisfies the definition of a separate account under the federal securities laws. We do not guarantee the investment performance of the VAA. Any investment gain or loss depends on the investment performance of the funds. You assume the full investment risk for all amounts allocated to the VAA.

The VAA is used to support other annuity contracts offered by us in addition to the contracts described in this prospectus. The other annuity contracts supported by the VAA generally invest in the same funds as the contracts described in this prospectus. These other annuity contracts may have different charges that could affect the performance of their Subaccounts, and they offer different benefits.

Investments of the Variable Annuity Account

You decide the Subaccount(s) to which you allocate Purchase Payments. There is a separate Subaccount which corresponds to each class of each fund. You may change your allocation without penalty or charges. Shares of the funds will be sold at net asset value with no initial sales charge to the VAA in order to fund the contracts. The funds are required to redeem fund shares at net asset value upon our request.

Investment Advisers

As compensation for its services to the funds, each investment adviser for each fund receives a fee from the funds which is accrued daily and paid monthly. This fee is based on the net assets of each fund, as defined in the prospectuses for the funds.

Certain Payments We Receive with Regard to the Funds

We (and/or our affiliates) incur expenses in promoting, marketing, and administering the contracts and the underlying funds. With respect to a fund, including affiliated funds, the adviser and/or distributor, or an affiliate thereof, may make payments to us (or an affiliate) for certain services we provide on behalf of the funds. Such services include, but are not limited to, recordkeeping; aggregating and processing purchase and redemption orders; providing Contractowners with statements showing their interests within the funds; processing dividend payments; providing subaccounting services; and forwarding shareholder communications, such as proxies, shareholder reports, tax notices, and printing and delivering prospectuses and updates to Contractowners. It is anticipated that

21

such payments will be based on a percentage of assets of the particular fund attributable to the contracts along with certain other variable contracts issued or administered by us (or an affiliate). These percentages are negotiated and vary with each fund. Some advisers and/or distributors may pay us significantly more than other advisors and/or distributors and the amount we receive may be substantial. These percentages currently range up to 0.43%, and as of the date of this prospectus, we were receiving payments from most fund families. We (or our affiliates) may profit from these payments. These payments may be derived, in whole or in part, from the investment advisory fee deducted from fund assets. Contractowners, through their indirect investment in the funds, bear the costs of these investment advisory fees (see the funds' prospectuses for more information). Additionally, a fund's adviser and/or distributor or its affiliates may provide us with certain services that assist us in the distribution of the contracts and may pay us and/or certain affiliates amounts for marketing programs and sales support, as well as amounts to participate in training and sales meetings.

In addition to the payments described above, all of the funds offered as part of this contract make payments to us under their distribution plans (12b-1 plans) for the marketing and distribution of fund shares. The payment rates range up to 0.35% based on the amount of assets invested in those funds. Payments made out of the assets of the fund will reduce the amount of assets that otherwise would be available for investment, and will reduce the fund's investment return. The dollar amount of future asset-based fees is not predictable because these fees are a percentage of the fund's average net assets, which can fluctuate over time. If, however, the value of the fund goes up, then so would the payment to us (or our affiliates). Conversely, if the value of the funds goes down, payments to us or our affiliates would decrease.

Description of the Funds

Each of the Subaccounts of the VAA is invested solely in shares of one of the funds available under the contract. Each fund may be subject to certain investment policies and restrictions which may not be changed without a majority vote of shareholders of that fund.

We select the funds offered through the contract based on several factors, including, without limitation, asset class coverage, the strength of the manager's reputation and tenure, brand recognition, performance, the capability and qualification of each sponsoring investment firm, and whether the fund is affiliated with us. Another factor we consider during the initial selection process is whether the fund or an affiliate of the fund will make payments to us or our affiliates. We review each fund periodically after it is selected. We reserve the right to remove a fund or restrict allocation of additional Purchase Payments to a fund if we determine the fund no longer meets one or more of the factors and/or if the fund has not attracted significant Contractowner assets. Finally, when we develop a variable annuity product in cooperation with a fund family or distributor (e.g., a “private label” product), we generally will include funds based on recommendations made by the fund family or distributor, whose selection criteria may differ from our selection criteria.

Following are brief summaries of the fund descriptions. More detailed information may be obtained from the current prospectus for each fund. You should read each fund prospectus carefully before investing. Prospectuses for each fund are available by contacting us. In addition, if you receive a summary prospectus for a fund, you may obtain a full statutory prospectus by referring to the contact information for the fund company on the cover page of the summary prospectus. Please be advised that there is no assurance that any of the funds will achieve their stated objectives.

AIM Variable Insurance Funds (Invesco Variable Insurance Funds), advised by Invesco Advisers, Inc.

• Invesco V.I. Equally-Weighted S&P 500 Fund (Series II Shares): To seek to achieve a high level of total return on its assets through a combination of capital appreciation and current income.

American Funds Insurance Series^®, advised by Capital Research and Management Company

• American Funds Asset Allocation Fund (Class 4): High total return (including income and capital gains) consistent with preservation of capital over the long term.

• American Funds Growth Fund (Class 4): Growth of capital.

BlackRock Variable Series Funds, Inc., advised by BlackRock Advisors, LLC

• BlackRock Global Allocation V.I. Fund (Class III): High total investment return.

Fidelity^® Variable Insurance Products, advised by Fidelity Management and Research Company

• Fidelity^® VIP Mid Cap Portfolio (Service Class 2): Long-term growth of capital.

First Trust Variable Insurance Trust, advised by First Trust Advisors L.P.

• First Trust/Dow Jones Dividend & Income Allocation Portfolio (Class I): To provide total return by allocating among dividend-paying stocks and investment grade bonds.

Franklin Templeton Variable Insurance Products Trust, advised by Franklin Advisers, Inc. for the Franklin Income VIP Fund

• Franklin Rising Dividends VIP Fund (Class 4): Long-term capital appreciation; preservation of capital is also an important consideration.

22

JPMorgan Insurance Trust, advised by J.P. Morgan Investment Management Inc.

• JPMorgan Insurance Trust Core Bond Portfolio (Class 2): To maximize total return by investing primarily in a diversified portfolio of intermediate and long-term debt securities.

Lincoln Variable Insurance Products Trust, advised by Lincoln Investment Advisors Corporation

• LVIP Government Money Market Fund (Service Class): Current income while (i) maintaining a stable value of your shares (providing stability of net asset value) and (ii) preserving the value of your initial investment (preservation of capital).

• LVIP MFS Value Fund (Service Class): Capital appreciation.

• LVIP PIMCO Low Duration Bond Fund (Service Class): To seek a high level of current income consistent with preservation of capital.

• LVIP SSGA International Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of a broad market index of non-U.S. foreign securities.

• LVIP SSGA S&P 500 Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the total rate of return of common stocks publicly traded in the United States, as represented by the S&P 500 Index.

• LVIP SSGA Small-Cap Index Fund (Service Class): To approximate as closely as practicable, before fees and expenses, the performance of the Russell 2000^® Index, which emphasizes stocks of small U.S. companies.

Fund Shares

We will purchase shares of the funds at net asset value and direct them to the appropriate Subaccounts of the VAA. We will redeem sufficient shares of the appropriate funds to pay Annuity Payouts, Death Benefits, surrender/withdrawal proceeds or for other purposes described in the contract. If you want to transfer all or part of your investment from one Subaccount to another, we may redeem shares held in the first Subaccount and purchase shares of the other. Redeemed shares are retired, but they may be reissued later.

Shares of the funds are not sold directly to the general public. They are sold to us, and may be sold to other insurance companies, for investment of the assets of the Subaccounts established by those insurance companies to fund variable annuity and variable life insurance contracts.

When a fund sells any of its shares both to variable annuity and to variable life insurance separate accounts, it is said to engage in mixed funding. When a fund sells any of its shares to separate accounts of unaffiliated life insurance companies, it is said to engage in shared funding.

The funds currently engage in mixed and shared funding. Therefore, due to differences in redemption rates or tax treatment, or other considerations, the interest of various Contractowners participating in a fund could conflict. Each of the fund’s Board of Directors will monitor for the existence of any material conflicts, and determine what action, if any, should be taken. The funds do not foresee any disadvantage to Contractowners arising out of mixed or shared funding. If such a conflict were to occur, one of the separate accounts might withdraw its investment in a fund. This might force a fund to sell portfolio securities at disadvantageous prices. See the prospectuses for the funds.

Reinvestment of Dividends and Capital Gain Distributions

All dividends and capital gain distributions of the funds are automatically reinvested in shares of the distributing funds at their net asset value on the date of distribution. Dividends are not paid out to Contractowners as additional units, but are reflected as changes in unit values.

Addition, Deletion or Substitution of Investments

We reserve the right, within the law, to make certain changes to the structure and operation of the VAA at our discretion and without your consent. We may add, delete, or substitute funds for all Contractowners or only for certain classes of Contractowners. New or substitute funds may have different fees and expenses, and may only be offered to certain classes of Contractowners.

Substitutions may be made with respect to existing investments or the investment of future Purchase Payments, or both. We may close Subaccounts to allocations of Purchase Payments or Contract Value, or both, at any time in our sole discretion. The funds, which sell their shares to the Subaccounts pursuant to participation agreements, also may terminate these agreements and discontinue offering their shares to the Subaccounts.

We may also:

• remove, combine, or add Subaccounts and make the new Subaccounts available to you at our discretion;

• transfer assets supporting the contracts from one Subaccount to another or from the VAA to another separate account;

• combine the VAA with other separate accounts and/or create new separate accounts;

• deregister the VAA under the 1940 Act; and

23

• operate the VAA as a management investment company under the 1940 Act or as any other form permitted by law.

We may modify the provisions of the contracts to reflect changes to the Subaccounts and the VAA and to comply with applicable law. We will not make any changes without any necessary approval by the SEC. We will also provide you written notice.

Charges and Other Deductions

We will deduct the charges described below to cover our costs and expenses, services provided and risks assumed under the contracts. We incur certain costs and expenses for the distribution and administration of the contracts and for providing the benefits payable thereunder.

Our administrative services include:

• processing applications for and issuing contracts;

• processing purchases and redemptions of fund shares and from Indexed Accounts as required (including portfolio rebalancing, and automatic withdrawal services if available – See Additional Services and the SAI for more information on these programs);

• maintaining records;

• administering Annuity Payouts;

• furnishing accounting and valuation services (including the calculation and monitoring of daily Subaccount values, Indexed Contract Values and Interim Values);

• reconciling and depositing cash receipts;

• providing contract confirmations;

• providing toll-free inquiry services; and

• furnishing telephone and other electronic surrenders, withdrawals and fund transfer services.

The risks we assume include:

• the risk that Annuitants upon which Annuity Payouts are based live longer than we assumed when we calculated our guaranteed rates (these rates are incorporated in the contract and cannot be changed);

• the risk that more Contractowners than expected will qualify for waivers of the surrender charge;

• the risk that our costs in providing the services will exceed our revenues from contract charges (which we cannot change);

• the risks related to absorbing losses equal to the Protection Levels in Indexed Accounts; and

• the risk that Death Benefits paid will exceed the actual Contract Value.

The amount of a charge may not necessarily correspond to the costs associated with providing the services or benefits indicated by the description of the charge. For example, the surrender charge collected (if applicable) may not fully cover all of the sales and distribution expenses actually incurred by us. Any remaining expenses will be paid from our general account which may consist, among other things, of proceeds derived from mortality and expense risk charges deducted from the account. We may profit from one or more of the fees and charges deducted under the contract and from amounts earned on the Indexed Accounts. We may use these profits for any corporate purpose, including financing the distribution of the contracts.

Deductions from the VAA

For the base contract, we apply to the average daily net asset value of the Subaccounts a Product Charge which is equal to an annual rate of:

Guarantee of Principal Death Benefit	1.30%
Account Value Death Benefit	1.10%

*0.10% of the Product Charge is attributable to an administrative charge, and the remaining amount is attributable to a mortality and expense risk charge.

Surrender Charge

A surrender charge applies (except as described below) to surrenders and withdrawals of Purchase Payments that have been invested for the periods indicated below. The surrender charge is calculated separately for each Purchase Payment. The contract anniversary is the annually occurring date beginning with the effective date of the contract. For example, if the effective date of your contract is January 1^st, your contract anniversary would be on January 1^st of each subsequent year.

24

	0	1	2	3	4	5	6
Surrender charge as a percentage of the surrendered or withdrawn Purchase Payments	7%	7%	6%	5%	4%	3%	0%

A surrender charge does not apply to:

• A surrender or withdrawal of a Purchase Payment beyond the sixth anniversary since the Purchase Payment was invested;

• Withdrawals of Contract Value during a Contract Year to the extent that the total Contract Value withdrawn during the current Contract Year does not exceed the free amount. The free amount is equal to the greater of 10% of the current Contract Value or 10% of the total Purchase Payments (this does not apply upon surrender of the contract);

• Purchase Payments used in the calculation of the initial benefit payment to be made under an Annuity Payout option (other than the i4LIFE^® Indexed Advantage option);

• A surrender or withdrawal of any Purchase Payments, as a result of permanent and total disability of the Contractowner as defined in Section 22(e)(3) of the tax code, if the disability occurred after the effective date of the contract and before the 65^th birthday of the Contractowner. For contracts issued in the state of New Jersey, a different definition of permanent and total disability applies;

• A surviving spouse, at the time he or she assumes ownership of the contract as a result of the death of the original owner (however, the surrender charge schedule of the original contract will continue to apply to the spouse's contract);

• A surrender or withdrawal of any Purchase Payments, as a result of the admittance of the Contractowner to an accredited nursing home or equivalent health care facility, where the admittance into the facility occurs after the effective date of the contract and the owner has been confined for at least 90 consecutive days;

• A surrender or withdrawal of any Purchase Payments as a result of the diagnosis of a terminal illness of the Contractowner. Diagnosis of a terminal illness must be after the effective date of the contract and results in a life expectancy of less than one year as determined by a qualified professional medical practitioner;

• A surrender of the contract as a result of the death of the Contractowner or Annuitant;

• Purchase Payments when used in the calculation of the initial Account Value under i4LIFE^® Indexed Advantage;

• Periodic Income Payments made under i4LIFE^® Indexed Advantage or periodic payments made under any Annuity Payout option made available by us; or

• A surrender of the contract or a withdrawal of a Contract Value from contracts issued to Selling Group Individuals.

For purposes of calculating the surrender charge on withdrawals, we assume that:

1.	The free amount will be withdrawn from Purchase Payments on a first in-first out (“FIFO”) basis.
2.	Prior to the sixth anniversary of the contract, any amount withdrawn above the free amount during a Contract Year will be withdrawn in the following order:

• from Purchase Payments (on a FIFO basis) until exhausted; then

• from earnings until exhausted.

3. On or after the sixth anniversary of the contract, any amount withdrawn above the free amount during a Contract Year will be withdrawn in the following order:

• from Purchase Payments (on a FIFO basis) to which a surrender charge no longer applies until exhausted; then

• from earnings until exhausted; then

• from Purchase Payments (on a FIFO basis) to which a surrender charge still applies until exhausted.

We apply the surrender charge as a percentage of Purchase Payments, which means that you would pay the same surrender charge at the time of surrender regardless of whether your Contract Value has increased or decreased. The surrender charge is calculated separately for each Purchase Payment. The surrender charges associated with surrender or withdrawal are paid to us to compensate us for the loss we experience on contract distribution costs when Contractowners surrender or withdraw before distribution costs have been recovered.

There are charges associated with surrender of a contract or withdrawal of Contract Value. You may specify whether these charges are deducted from the amount you request to be withdrawn or from the remaining Contract Value. If the charges are deducted from the remaining Contract Value, the amount of the total withdrawal will increase according to the impact of the applicable surrender charge percentage; consequently, the dollar amount of the surrender charge associated with the withdrawal will also increase. In other words, the dollar amount deducted to cover the surrender charge is also subject to a surrender charge.

If the Contractowner is a corporation or other non-individual (non-natural person), the Annuitant or joint Annuitant will be considered the Contractowner or joint owner for purposes of determining when a surrender charge does not apply.

25

Rider Charge

i4LIFE^® Indexed Advantage Charge. While this rider is in effect, there is a charge for i4LIFE^® Indexed Advantage. The current annual rider charge rate is 0.40%. This charge is in addition to the applicable Death Benefit charge assessed against the Subaccounts. This charge is based on your Account Value at the beginning of the Rider Year less the Periodic Income Payment(s) for that year. The charge will be deducted from the Account Value in a lump sum at the end of each Rider Anniversary beginning with the first Rider Year anniversary. This deduction will be made proportionately from Subaccount(s) and the Indexed Segment(s), and then from the Periodic Income Payment Account, if the value of the Subaccounts and the Indexed Segments has reached zero. During the Lifetime Income Period, the charge will reduce the Periodic Income Payment for each Indexed Segment, and the mortality and expense risk and administrative charge for the variable payments will be 1.50%.

The rider charge will be discontinued upon termination of the rider. A portion of the rider charge, based on the number of days the rider was in effect that Rider Year, will be deducted upon termination of the rider (except for death) or surrender of the contract.

Deductions for Premium Taxes

Any premium tax or other tax levied by any governmental entity as a result of the existence of the contracts or the VAA will be deducted from the Contract Value, unless the governmental entity dictates otherwise, when incurred, or at another time of our choosing.

The applicable premium tax rates that states and other governmental entities impose on the purchase of an annuity are subject to change by legislation, by administrative interpretation or by judicial action. These premium tax rates generally depend upon the law of your state of residence. The tax rates range from zero to 5%.

Other Charges and Deductions

The mortality and expense risk and administrative charge of 1.10% of the value in the VAA will be assessed on all variable Annuity Payouts, except for i4LIFE^® Indexed Advantage, which has a different charge, including options that may be offered that do not have a life contingency and therefore no mortality risk. This charge covers the expense risk and administrative services listed previously in this prospectus. The expense risk is the risk that our costs in providing the services will exceed our revenues from contract charges.

There are additional deductions from and expenses paid out of the assets of the underlying funds that are more fully described in the prospectuses for the funds. Among these deductions and expenses are 12b-1 fees which reimburse us or an affiliate for certain expenses incurred in connection with certain administrative and distribution support services provided to the funds.

Additional Information

The charges described previously may be reduced or eliminated for any particular contract. However, these reductions may be available only to the extent that we anticipate lower distribution and/or administrative expenses, or that we perform fewer sales or administrative services than those originally contemplated in establishing the level of those charges, or when required by law. Lower distribution and administrative expenses may be the result of economies associated with:

• the use of mass enrollment procedures,

• the performance of administrative or sales functions by the employer,

• the use by an employer of automated techniques in submitting deposits or information related to deposits on behalf of its employees,

• the issue of a new Lincolncontract with the proceeds from the surrender of an existing Lincoln variable annuity contract, if available in your state, or

• any other circumstances which reduce distribution or administrative expenses.

The exact amount of charges and fees applicable to a particular contract will be stated in that contract.

The maximum commission paid to broker-dealers selling this contract is 6% of Purchase Payments. See Distribution of the Contracts for further information.

The Contracts

Contracts Offered in this Prospectus

This contract offers you Indexed Accounts, Subaccounts, the optional Guarantee of Principal Death Benefit, and various Annuity Payout options.

26

Purchase of Contracts

If you wish to purchase a contract, you must apply for it through a registered representative authorized by us. The completed application is sent to us and we decide whether to accept or reject it. If the application is accepted, a contract is prepared and executed by our legally authorized officers. The contract is then sent to you either directly or through your registered representative. See Distribution of the Contracts. The purchase of multiple contracts with identical Contractowners, Annuitants and Beneficiaries will be allowed only upon Home Office approval.

When a completed application and all other information necessary for processing a purchase order is received in Good Order at our Home Office, an initial Purchase Payment will be priced no later than two business days after we receive the order. If you submit your application and/or initial Purchase Payment to your registered representative, we will not begin processing your purchase order until we receive the application and initial Purchase Payment from your registered representative’s broker-dealer. While attempting to finish an incomplete application, we may hold the initial Purchase Payment for no more than five business days unless we receive your consent to our retaining the payment until the application is completed. If the incomplete application cannot be completed within those five days and we have not received your consent, you will be informed of the reasons, and the Purchase Payment will be returned immediately. Once the application is complete, we will allocate your initial Purchase Payment within two business days.

The Guarantee of Principal Death Benefit is available for both qualified and nonqualified contracts, and can only be elected at the time the contract is purchased.

Who Can Invest

To apply for a contract, you must be of legal age in a state where the contracts may be lawfully sold and also be eligible to participate in any of the qualified or nonqualified plans for which the contracts are designed. At the time of issue, the Contractowner, joint owner and Annuitant must be under age 86. The oldest of the Contractowner, joint owner, and Annuitant must be under age 76 to elect the Guarantee of Principal Death Benefit. Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account in an effort to help the government fight the funding of terrorism and money laundering activities. When you open an account, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license, photo i.d. or other identifying documents.

In accordance with anti-money laundering laws and federal economic sanction policy, the Company may be required in a given instance to reject a Purchase Payment and/or freeze a Contractowner’s account. This means we could refuse to honor requests for transfers, withdrawals, surrenders or Death Benefits. Once frozen, monies would be moved from the VAA and Indexed Account to an interest-bearing account maintained solely for the Contractowner, and held in that account until instructions are received from the appropriate regulator.

Do not purchase this contract if you plan to use it, or any of its riders, for speculation, arbitrage, viatical arrangement, or other similar investment scheme. The contract may not be resold, traded on any stock exchange, or sold on any secondary market.

If you are purchasing the contract through a tax-favored arrangement, including traditional IRAs and Roth IRAs, you should consider carefully the costs and benefits of the contract (including annuity income benefits) before purchasing the contract, since the tax-favored arrangement itself provides tax-deferred growth.

Replacement of Existing Insurance

Careful consideration should be given prior to surrendering or withdrawing money from an existing insurance contract to purchase a contract described in this prospectus. Surrender charges may be imposed on your existing contract and/or a new surrender charge period may be imposed with the purchase of, or transfer into, this contract. The benefits offered under this contract may be less favorable or more favorable than the benefits offered under your current contract. It also may have different charges. You should also consult with your registered representative and/or your tax advisor prior to making an exchange. Cash surrenders from an existing contract may be subject to tax and tax penalties.

Purchase Payments

You may make Purchase Payments to the contract at any time, prior to the Annuity Commencement Date, subject to certain conditions. You are not required to make any additional Purchase Payments after the initial Purchase Payment. The minimum initial Purchase Payment is $25,000. The minimum for Selling Group Individuals is $1,500. Please check with your registered representative about making additional Purchase Payments since the requirements of your state may vary. The minimum payment to the contract at any one time must be at least $100 ($25 if transmitted electronically). If a Purchase Payment is submitted that does not meet the minimum amount, we will contact you to ask whether additional money will be sent, or whether we should return the Purchase Payment to you.

Purchase Payments totaling $2 million or more are subject to Home Office approval. This amount takes into consideration the total Purchase Payments for all existing Lincoln Level Advantage^SM contracts for the same Contractowner, joint owner, and/or Annuitant. If you stop making Purchase Payments, the contract will remain in force, however, we may terminate the contract as allowed by your

27

state's non-forfeiture law for individual deferred annuities. Purchase Payments may be made or, if stopped, resumed at any time until the Annuity Commencement Date, the surrender of the contract, or the death of the Contractowner, whichever comes first.

In addition to the specific Purchase Payment restrictions and limitations immediately above, upon advance written notice, we reserve the right to further limit, restrict, or suspend Purchase Payments made to the contract.

These restrictions and limitations will limit your ability to increase your Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments to the contract. You should carefully consider these limitations and restrictions, and any other limitations and restrictions of the contract, and how they may impact your long-term investment plans, especially if you intend to increase Contract Value (or Account Value under i4LIFE^® Indexed Advantage) by making additional Purchase Payments over a long period of time.

Valuation Date

Accumulation and Annuity Units and Indexed Segments will be valued once daily at the close of trading (normally, 4:00 p.m., New York time) on each day the New York Stock Exchange is open (Valuation Date). On any date other than a Valuation Date, the Accumulation Unit value and the Annuity Unit value and value of the Indexed Segment will not change.

Allocation of Purchase Payments

Purchase Payments will be allocated, according to your instructions, among one or more of the investment options available under your contract. Allocation made to the variable side of the contract are placed into the VAA’s Subaccounts. You may also allocate Purchase Payments to the available Indexed Accounts.

Allocations to the Subaccounts. The minimum amount that can be put into any one Subaccount is $20. Purchase Payments received from you or your broker-dealer in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time), will be processed using the Accumulation Unit value computed on that Valuation Date. Purchase Payments received in Good Order after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. Purchase Payments submitted to your registered representative will generally not be processed until they are received from your representative’s broker-dealer. Purchase Payments submitted to us by your broker-dealer through the Depository Trust and Clearing Corporation (DTCC) or, pursuant to terms agreeable to us, uses a proprietary order placement system to submit your Purchase Payment to us, and your Purchase Payment was placed with your broker-dealer prior to market close, then we will use the Accumulation Unit value computed on that Valuation Date when processing your Purchase Payment. Purchase Payments placed with your broker-dealer after market close will be processed using the Accumulation Unit value computed on the next Valuation Date. There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances, Purchase Payments received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date.

The number of Accumulation Units determined in this way is not impacted by any subsequent change in the value of an Accumulation Unit. However, the dollar value of an Accumulation Unit will vary depending not only upon how well the underlying fund’s investments perform, but also upon the expenses of the VAA and the underlying funds.

Allocations to the Indexed Accounts. The minimum amount that may be allocated into an Indexed Account is $2,000. An initial Purchase Payment that is received in Good Order at our Home Office prior to the close of the New York Stock Exchange (normally 4:00 p.m., New York time) will be allocated to the Indexed Accounts according to your instructions. The date this initial allocation occurs is the first date of the Indexed Term and the Indexed Anniversary Date. Allocations cannot be made on February 29^th. After the Indexed Anniversary Date is established, that is the only date each year that allocations can be invested in the Indexed Accounts. If additional Purchase Payments for the Indexed Accounts are received prior to the Indexed Anniversary Date, these Purchase Payments must be accompanied with instructions to invest in a variable Subaccount until the Purchase Payment can be allocated to the Indexed Account. We will hold allocation instructions for the Indexed Accounts for up to 25 calendar days prior to the Indexed Anniversary Date.

A rate hold is available for Purchase Payments received within thirty days from the date your application is received at our Home Office. The rate hold will provide the Performance Cap and the Protection Level for your elected Indexed Account that were in effect on the date your application was received at the Home Office for any Purchase Payments allocated to the Indexed Accounts during this 30-day period. If you elect the rate hold, all Purchase Payments will be held in a non-interest bearing transfer account for 30 days (or the next Valuation Day), and then will be allocated to the Indexed Account(s) selected. Purchase Payments received after day 30 will be allocated to the variable Subaccounts you selected. If no variable Subaccounts were selected, these Purchase Payments will be allocated to the LVIP PIMCO Low Duration Bond Fund. You can allocate to Indexed Accounts on the next Indexed Anniversary Date.

Valuation of Accumulation Units

Purchase Payments allocated to the VAA are converted into Accumulation Units. This is done by dividing the amount allocated by the value of an Accumulation Unit for the Valuation Period during which the Purchase Payments are allocated to the VAA. The Accumulation Unit value for each Subaccount was or will be established at the inception of the Subaccount. It may increase or decrease from

28

Valuation Period to Valuation Period. Accumulation Unit values are affected by investment performance of the funds, fund expenses, and the contract charges. The Accumulation Unit value for a Subaccount for a later Valuation Period is determined as follows:

1.	The total value of the fund shares held in the Subaccount is calculated by multiplying the number of fund shares owned by the Subaccount at the beginning of the Valuation Period by the net asset value per share of the fund at the end of the Valuation Period, and adding any dividend or other distribution of the fund if an ex-dividend date occurs during the Valuation Period; minus
2.	The liabilities of the Subaccount at the end of the Valuation Period; these liabilities include daily charges imposed on the Subaccount, and may include a charge or credit with respect to any taxes paid or reserved for by us that we determine result from the operations of the VAA; and
3.	The result is divided by the number of Subaccount units outstanding at the beginning of the Valuation Period.

The daily charges imposed on a Subaccount for any Valuation Period are equal to the daily Product Charge multiplied by the number of calendar days in the Valuation Period. Contracts with different features have different daily charges, and therefore, will have different corresponding Accumulation Unit values on any given day. In certain circumstances (for example, when separate account assets are less than $1,000), and when permitted by law, it may be prudent for us to use a different standard industry method for this calculation, called the Net Investment Factor method. We will achieve substantially the same result using either method.

Transfers On or Before the Annuity Commencement Date

After the first 30 days from the effective date of your contract, you may transfer all or a portion of your investment from one Subaccount to another. A transfer among Subaccounts involves the surrender of Accumulation Units in one Subaccount and the purchase of Accumulation Units in the other Subaccount. A transfer will be done using the respective Accumulation Unit values determined at the end of the Valuation Date on which the transfer request is received.

Transfers (among the Subaccounts and as permitted between the Subaccounts and Indexed Accounts) are limited to 12 per Contract Year unless otherwise authorized by us. This limit does not apply to transfers made under the automatic transfer programs of portfolio rebalancing programs elected on forms available from us. See Additional Services and the SAI for more information on these programs. These transfer rights and restrictions also apply during the i4LIFE^® Indexed Advantage Access Period (the time period during which you may make withdrawals from the i4LIFE^® Indexed Advantage Account Value). See i4LIFE^® Indexed Advantage.

Transfers into a new Indexed Account are only available on the Indexed Anniversary Date. Transfers are not allowed into an existing Indexed Segment. Transfers from Indexed Segments prior to the end of the Indexed Term will be valued at the Interim Value. In addition, the Indexed Crediting Base is reduced proportionately by the amount that the transfer reduced the Interim Value. You cannot transfer an amount greater than your Interim Value.

The minimum amount which may be transferred between Subaccounts is $300 (or the entire amount in the Subaccount, if less than $300). If the transfer from a Subaccount would leave you with less than $300 in the Subaccount, we may transfer the total balance of the Subaccount.

A transfer request may be made to our Home Office in writing, or by fax or other electronic means. A transfer request may also be made by telephone provided the appropriate authorization is on file with us. Our address, telephone number, and Internet address are on the first page of this prospectus. Requests for transfers will be processed on the Valuation Date that they are received when they are received in Good Order at our Home Office before the close of the New York Stock Exchange (normally 4:00 p.m., New York time). If we receive a transfer request in Good Order after market close, we will process the request using the Accumulation Unit value computed on the next Valuation Date.

There may be circumstances under which the New York Stock Exchange may close early (prior to 4:00 p.m., New York time). In such instances transfers received after such early market close will be processed using the Accumulation Unit value computed on the next Valuation Date. We will hold a transfer request to move Contract Value from the Subaccounts to the Indexed Accounts for up to 25 days prior to the Indexed Anniversary Date. During this time, your assets will remain in the Subaccounts previously selected by you.

We may defer or reject a transfer request that is subject to a restriction imposed by an underlying fund.

Transfers may be delayed as permitted by the 1940 Act. See Delay of Payments.

Telephone and Electronic Transactions

A surrender, withdrawal, or transfer request may be made to our Home Office using a fax or other electronic means. In addition, withdrawal and transfer requests may be made by telephone, subject to certain restrictions. In order to prevent unauthorized or fraudulent transfers, we may require certain identifying information before we will act upon instructions. We may also assign the Contractowner a Personal Identification Number (PIN) to serve as identification. We will not be liable for following instructions we reasonably believe are genuine. Telephone and other electronic requests will be recorded and written confirmation of all transactions will be mailed to the Contractowner on the next Valuation Date.

29

Please note that the telephone and/or electronic devices may not always be available. Any telephone, fax machine or other electronic device, whether it is yours, your service provider’s, or your agent’s, 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 limit these problems, we cannot promise complete reliability under all circumstances. If you are experiencing problems, you should make your request by writing to our Home Office.

Market Timing

Frequent, large, or short-term transfers among Subaccounts, such as those associated with “market timing” transactions, can affect the funds and their investment returns. Such transfers may dilute the value of the fund shares, interfere with the efficient management of the fund's portfolio, and increase brokerage and administrative costs of the funds. As an effort to protect our Contractowners and the funds from potentially harmful trading activity, we utilize certain market timing policies and procedures (the “Market Timing Procedures”). Our Market Timing Procedures are designed to detect and prevent such transfer activity among the Subaccounts and the Indexed Accounts that may affect other Contractowners or fund shareholders.

In addition, the funds may have adopted their own policies and procedures with respect to frequent purchases and redemptions of their respective shares. The prospectuses for the funds describe any such policies and procedures, which may be more or less restrictive than the frequent trading policies and procedures of other funds and the Market Timing Procedures we have adopted to discourage frequent transfers among Subaccounts. While we reserve the right to enforce these policies and procedures, Contractowners and other persons with interests under the contracts should be aware that we may not have the contractual authority or the operational capacity to apply the frequent trading policies and procedures of the funds. However, under SEC rules, we are required to: (1) enter into a written agreement with each fund or its principal underwriter that obligates us to provide to the fund promptly upon request certain information about the trading activity of individual Contractowners, and (2) execute instructions from the fund to restrict or prohibit further purchases or transfers by specific Contractowners who violate the excessive trading policies established by the fund.

You should be aware that the purchase and redemption orders received by the funds generally are “omnibus” orders from intermediaries such as retirement plans or separate accounts funding variable insurance contracts. The omnibus orders reflect the aggregation and netting of multiple orders from individual retirement plan participants and/or individual owners of variable insurance contracts. The omnibus nature of these orders may limit the funds’ ability to apply their respective disruptive trading policies and procedures. We cannot guarantee that the funds (and thus our Contractowners) will not be harmed by transfer activity relating to the retirement plans and/or other insurance companies that may invest in the funds. In addition, if a fund believes that an omnibus order we submit may reflect one or more transfer requests from Contractowners engaged in disruptive trading activity, the fund may reject the entire omnibus order.

Our Market Timing Procedures detect potential “market timers” by examining the number of transfers made by Contractowners within given periods of time. In addition, managers of the funds might contact us if they believe or suspect that there is market timing. If requested by a fund company, we may vary our Market Timing Procedures from Subaccount to Subaccount to comply with specific fund policies and procedures.

We may increase our monitoring of Contractowners who we have previously identified as market timers. When applying the parameters used to detect market timers, we will consider multiple contracts owned by the same Contractowner if that Contractowner has been identified as a market timer. For each Contractowner, we will investigate the transfer patterns that meet the parameters being used to detect potential market timers. We will also investigate any patterns of trading behavior identified by the funds that may not have been captured by our Market Timing Procedures.

Once a Contractowner has been identified as a market timer under our Market Timing Procedures, we will notify the Contractowner in writing that future transfers (among the Subaccounts and/or the Indexed Account) will be temporarily permitted to be made only by original signature sent to us by U.S. mail, first-class delivery for the remainder of the Contract Year (or calendar year if the contract is an individual contract that was sold in connection with an employer sponsored plan). Overnight delivery or electronic instructions (which may include telephone, facsimile, or Internet instructions) submitted during this period will not be accepted. If overnight delivery or electronic instructions are inadvertently accepted from a Contractowner that has been identified as a market timer, upon discovery, we will reverse the transaction within 1 or 2 business days. We will impose this “original signature” restriction on that Contractowner even if we cannot identify, in the particular circumstances, any harmful effect from that Contractowner's particular transfers.

Contractowners seeking to engage in frequent, large, or short-term transfer activity may deploy a variety of strategies to avoid detection. Our ability to detect such transfer activity may be limited by operational systems and technological limitations. The identification of Contractowners determined to be engaged in such transfer activity that may adversely affect other Contractowners or fund shareholders involves judgments that are inherently subjective. We cannot guarantee that our Market Timing Procedures will detect every potential market timer. If we are unable to detect market timers, you may experience dilution in the value of your fund shares and increased brokerage and administrative costs in the funds. This may result in lower long-term returns for your investments.

30

Our Market Timing Procedures are applied consistently to all Contractowners. An exception for any Contractowner will be made only in the event we are required to do so by a court of law. In addition, certain funds available as investment options in your contract may also be available as investment options for owners of other, older life insurance policies issued by us. Some of these older life insurance policies do not provide a contractual basis for us to restrict or refuse transfers which are suspected to be market timing activity. In addition, because other insurance companies and/or retirement plans may invest in the funds, we cannot guarantee that the funds will not suffer harm from frequent, large, or short-term transfer activity among Subaccounts or the Indexed Accounts of variable contracts issued by other insurance companies or among investment options available to retirement plan participants.

In our sole discretion, we may revise our Market Timing Procedures at any time without prior notice as necessary to better detect and deter frequent, large, or short-term transfer activity to comply with state or federal regulatory requirements, and/or to impose additional or alternate restrictions on market timers (such as dollar or percentage limits on transfers). If we modify our Market Timing Procedures, they will be applied uniformly to all Contractowners or as applicable to all Contractowners investing in underlying funds.

Some of the funds have reserved the right to temporarily or permanently refuse payments or transfer requests from us if, in the judgment of the fund’s investment adviser, the fund would be unable to invest effectively in accordance with its investment objective or policies, or would otherwise potentially be adversely affected. To the extent permitted by applicable law, we reserve the right to defer or reject a transfer request at any time that we are unable to purchase or redeem shares of any of the funds available through the VAA, including any refusal or restriction on purchases or redemptions of the fund shares as a result of the funds' own policies and procedures on market timing activities. If a fund refuses to accept a transfer request we have already processed, we will reverse the transaction within 1 or 2 business days. We will notify you in writing if we have reversed, restricted or refused any of your transfer requests. Some funds also may impose redemption fees on short-term trading (i.e., redemptions of mutual fund shares within a certain number of business days after purchase). We reserve the right to administer and collect any such redemption fees on behalf of the funds. You should read the prospectuses of the funds for more details on their redemption fees and their ability to refuse or restrict purchases or redemptions of their shares.

Transfers After the Annuity Commencement Date

You may transfer all or a portion of your investment in one Subaccount to another Subaccount, as permitted under your contract. Those transfers will be limited to three times per Contract Year. You may also transfer from a variable Annuity Payout to a fixed Annuity Payout. You may not transfer from a fixed Annuity Payout to a variable Annuity Payout. Once elected, the fixed Annuity Payout is irrevocable. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation.

Ownership

The Contractowner on the date of issue will be the person or entity designated in the contract specifications. The Contractowner of a nonqualified contract may name a joint owner.

As Contractowner, you have all rights under the contract. According to Indiana law, the assets of the VAA are held for the exclusive benefit of all Contractowners and their designated Beneficiaries; and the assets of the VAA are not chargeable with liabilities arising from any other business that we may conduct. We reserve the right to approve all ownership and Annuitant changes. Nonqualified contracts may not be sold, discounted, or pledged as collateral for a loan or for any other purpose. Qualified contracts are not transferable unless allowed under applicable law. Nonqualified contracts may not be collaterally assigned. Assignments may have an adverse impact on your Death Benefits and may be prohibited under the terms of a particular feature. We assume no responsibility for the validity or effect of any assignment. Consult your tax advisor about the tax consequences of an assignment.

Joint Ownership

If a contract has joint owners, the joint owners shall be treated as having equal undivided interests in the contract. Either owner, independently of the other, may exercise any ownership rights in this contract. Not more than two owners (an owner and joint owner) may be named and contingent owners are not permitted.

Annuitant

The following rules apply prior to the Annuity Commencement Date. You may name only one Annuitant (unless you are a tax-exempt entity, then you can name two joint Annuitants). You (if the Contractowner is a natural person) have the right to change the Annuitant at any time by notifying us in writing of the change. However, we reserve the right to approve all Annuitant changes. This may not be allowed if certain riders are in effect. The new Annuitant must be under age 86 as of the effective date of the change. A contingent Annuitant may be named or changed by notifying us in writing. Contingent Annuitants are not allowed on contracts owned by non-natural owners. On or after the Annuity Commencement Date, the Annuitant or joint Annuitants may not be changed and contingent Annuitant designations are no longer applicable.

31

Surrenders and Withdrawals

Before the Annuity Commencement Date, we will allow the surrender of the contract or a withdrawal of the Contract Value upon your written request on an approved Lincoln distribution request form (available from the Home Office), fax, or other electronic means approved by Lincoln. Withdrawal requests may be made by telephone, subject to certain restrictions. All surrenders and withdrawals may be made in accordance with the rules discussed below. Surrender or withdrawal rights after the Annuity Commencement Date are not available.

The amount available upon surrender/withdrawal is the Contract Value less any applicable charges, fees, and taxes at the end of the Valuation Period during which the written request for surrender/withdrawal is received in Good Order at the Home Office. If we receive a surrender or withdrawal request in Good Order at our Home Office before the close of the NYSE (normally 4:00 p.m., New York time), we will process the request from the VAA using the Accumulation Unit value computed on that Valuation Date. If we receive a surrender or withdrawal request in Good Order at our Home Office after market close, we will process the request using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. There may be circumstances under which the NYSE may close early (prior to 4:00 p.m., New York time). In such instances, surrender or withdrawal requests received after such early market close will be processed using the Accumulation Unit value and the Interim Value computed on the next Valuation Date. The minimum amount which can be withdrawn is $300. Unless a request for withdrawal specifies otherwise, withdrawals will be made in the following order:

1.	proportionately from all Subaccounts within the VAA, until exhausted; then
2.	the transfer account; then
3.	proportionately from all Indexed Accounts.

Unless prohibited, surrender/withdrawal payments will be mailed within seven days after we receive a valid written request at the Home Office. The payment may be postponed as permitted by the 1940 Act.

When withdrawals are made from the Indexed Accounts, an amount equal to the Interim Value of the Segment is available for surrender or withdrawal. In addition, the Indexed Crediting Base for each individual Indexed Segment is reduced proportionately by the amount that the withdrawal reduced the Interim Value. A proportional reduction could be larger than the dollar amount of the withdrawal. Reduction to your Indexed Crediting Base will negatively impact your Interim Value for the remainder of the Indexed Term and will result in a lower Segment Maturity Value at the end of the Indexed Term. You cannot withdraw an amount equal to the Indexed Crediting Base. The following examples show how the Index Crediting Base is impacted by a withdrawal, and assumes that you have invested in an Indexed Account and no Subaccounts.

Example 1:

1/1/2017 Allocation to Indexed Segment = $80,000
1/1/2017 Indexed Crediting Base = $80,000
6/1/2017 Indexed Crediting Base = $80,000; Interim Value = $100,000; Withdrawal = $80,000 (including any applicable surrender charge)
Withdrawal/Interim Value = $80,000 ÷ $100,000 = 80%
Removed Amount from the Indexed Crediting Base = $64,000 (80% of $80,000)
Indexed Crediting Base after withdrawal = $80,000 - $64,000 = $16,000
Interim Value after withdrawal ($100,000 - $80,000) = $20,000
Interim Value calculation going forward and Segment Maturity Value will be based on the $16,000 Indexed Crediting Base

Example 2:

Indexed Crediting Base = $16,000; Interim Value = $15,000; Withdrawal = $15,000 (including any applicable surrender charge)
Withdrawal/Interim Value = $15,000 ÷ $15,000 = 100%
Removed Amount from the Indexed Crediting Base = $16,000 (100% of $16,000)
Indexed Crediting Base after withdrawal = $0
Interim Value after withdrawal = $0 ($15,000 - $15,000)

Note: The $15,000 Interim Value is the maximum that could be withdrawn because this value reflects the index gain or loss during the Indexed Term. The Indexed Crediting Base is not available for withdrawal or transfer.

There may be surrender charges associated with surrender of a contract or withdrawal of Contract Value. You may specify whether these charges are deducted from the amount you request to be withdrawn or from the remaining Contract Value. If the charges are deducted from the remaining Contract Value, the amount of the total withdrawal will increase according to the impact of the applicable surrender charge percentage; consequently, the dollar amount of the surrender charge associated with the withdrawal will also increase. In other words, the dollar amount deducted to cover the surrender charge is also subject to a surrender charge. See Charges and Other Deductions.

32

The tax consequences of a surrender/withdrawal are discussed later in this prospectus. See Federal Tax Matters – Taxation of Withdrawals and Surrenders.

Additional Services

These additional services may be available to you under your contract: automatic withdrawal service (AWS) and portfolio rebalancing. Currently, there is no charge for these services. However, we reserve the right to impose one after appropriate notice to Contractowners. In order to take advantage of one of these services, you will need to complete the appropriate election form that is available from our Home Office. These services will stop once we are notified of a pending death claim. For further detailed information on these services, please see Additional Services in the SAI.

Automatic Withdrawal Service. The automatic withdrawal service (AWS) provides for an automatic periodic withdrawal of your Contract Value. Withdrawals under AWS are subject to applicable surrender charges. Withdrawals from Indexed Accounts will be at Interim Value. See Charges and Other Deductions – Surrender Charge and Indexed Accounts – Interim Value. Withdrawals under AWS will be noted on your quarterly statement. Confirmation statements for each individual withdrawal will not be issued. AWS is not available when i4LIFE^® Indexed Advantage is in effect.

Portfolio Rebalancing. Portfolio rebalancing is an option that restores to a pre-determined level the percentage of Contract Value allocated to each variable account Subaccount. The rebalancing may take place monthly, quarterly, semi-annually or annually. Rebalancing events will be noted on your quarterly statement. Confirmation statements for each individual rebalancing event will not be issued. Portfolio rebalancing is not available for the portion of Contract Value held in the Indexed Accounts.

We reserve the right to discontinue any or all of these administrative services at any time.

Death Benefit

The chart below provides a brief overview of how the Death Benefit proceeds will be distributed if death occurs prior to the Annuity Commencement Date. Refer to your contract for the specific provisions applicable upon death.

upon death of:	and...	and...	Death Benefit proceeds pass to:
Contractowner	There is a surviving joint owner	The Annuitant is living or deceased	Joint owner
Contractowner	There is no surviving joint owner	The Annuitant is living or deceased	Designated Beneficiary
Contractowner	There is no surviving joint owner and the Beneficiary predeceases the Contractowner	The Annuitant is living or deceased	Contractowner's estate
Annuitant	The Contractowner is living	There is no contingent Annuitant	The youngest Contractowner becomes the contingent Annuitant and the contract continues. The Contractowner may waive* this continuation and receive the Death Benefit proceeds.
Annuitant	The Contractowner is living	The contingent Annuitant is living	Contingent Annuitant becomes the Annuitant and the contract continues
Annuitant**	The Contractowner is a trust or other non-natural person	No contingent Annuitant allowed with non-natural Contractowner	Designated Beneficiary

* Notification from the Contractowner to receive the Death Benefit proceeds must be received within 75 days of the death of the Annuitant.

** Death of Annuitant is treated like death of the Contractowner.

If the Contractowner (or a joint owner) or Annuitant dies prior to the Annuity Commencement Date, a Death Benefit may be payable. This Death Benefit terminates on the Annuity Commencement Date.

You should consider the following provisions carefully when designating the Beneficiary, Annuitant, any contingent Annuitant and any joint owner, as well as before changing any of these parties. The identity of these parties under the contract may significantly affect the amount and timing of the Death Benefit or other amount paid upon a Contractowner's or Annuitant's death.

You may designate a Beneficiary during your lifetime and change the Beneficiary by filing a written request with our Home Office. Each change of Beneficiary revokes any previous designation. We reserve the right to request that you send us the contract for endorsement of a change of Beneficiary.

33

Upon the death of the Contractowner, a Death Benefit will be paid to the Beneficiary. Upon the death of a joint owner, the Death Benefit will be paid to the surviving joint owner. If the Contractowner is a corporation or other non-individual (non-natural person), the death of the Annuitant will be treated as death of the Contractowner.

If an Annuitant who is not the Contractowner or joint owner dies, then the contingent Annuitant, if named, becomes the Annuitant and no Death Benefit is payable on the death of the Annuitant. If no contingent Annuitant is named, the Contractowner (or younger of joint owners) becomes the Annuitant. Alternatively, a Death Benefit may be paid to the Contractowner (and joint owner, if applicable, in equal shares). Notification of the election of this Death Benefit must be received by us within 75 days of the death of the Annuitant. The contract terminates when any Death Benefit is paid due to the death of the Annuitant.

Only the Contract Value as of the Valuation Date we approve the payment of the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

Account Value Death Benefit. The Account Value Death Benefit provides a Death Benefit equal to the Contract Value on the Valuation Date the Death Benefit is approved by us for payment. No additional Death Benefit is provided. (Your contract may refer to this benefit as the Contract Value Death Benefit.)

Guarantee of Principal Death Benefit. The Guarantee of Principal Death Benefit provides a Death Benefit equal to the greater of:

• the Contract Value as of the Valuation Date we approve the payment of the claim; or

• the sum of all Purchase Payments decreased by all withdrawals in the same proportion that withdrawals reduce the Contract Value.

Note: The Contract Value for Indexed Segments is the Interim Value unless the claim is processed on a Segment End Date. In a declining market, withdrawals deducted in the same proportion that withdrawals reduce the Contract Value may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more that the dollar amount of the withdrawal from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals and premium taxes, if any.

The Guarantee of Principal Death Benefit may not be terminated unless you surrender the contract. In addition, the rider will terminate:

1.	on the Annuity Commencement Date;
2.	upon payment of a Death Benefit under the Guarantee of Principal Death Benefit (unless the contract is continued by the surviving spouse); or
3.	at any time all Contractowners or Annuitants are changed.

General Death Benefit Information

Your Death Benefit terminates on and after the Annuity Commencement Date. i4LIFE^® Indexed Advantage, which is an Annuity Payout option, only provides Death Benefit options during the Access Period. There are no Death Benefits during the Lifetime Income Period. Please see the i4LIFE^® Indexed Advantage – i4LIFE^® Indexed Advantage Death Benefit section of this prospectus for more information.

If there are joint owners, upon the death of the first Contractowner, we will pay a Death Benefit to the surviving joint owner. The surviving joint owner will be treated as the primary, designated Beneficiary. Any other Beneficiary designation on record at the time of death will be treated as a contingent Beneficiary. If the surviving joint owner is the spouse of the deceased joint owner, he/she may continue the contract as sole Contractowner. Upon the death of the spouse who continued the contract, we will pay the Account Value Death Benefit to the designated Beneficiary(s) unless the Guarantee of Principal Death Benefit is in effect.

If the Beneficiary is the spouse of the Contractowner, then the spouse may elect to continue the contract as the new Contractowner. In this situation, a portion of the Death Benefit may be credited to the contract. Any portion of the Death Benefit that would have been payable (if the contract had not been continued) that exceeds the current Contract Value on the Valuation Date we approve the claim will be added to the Contract Value and placed in the variable Subaccounts according to the allocations on the contract. If no variable Subaccounts are selected, the proceeds will be placed in the LVIP PIMCO Low Duration Bond Fund Subaccount. If the contract is continued in this way, the Guarantee of Principal Death Benefit rider and charge will continue. The rider charge rate that was in effect immediately prior to the death will continue to apply.

Same-sex spouses should carefully consider whether to purchase annuity products that provide benefits based upon status as a spouse, and whether to exercise any spousal rights under the contract. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

34

The value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of a claim submitted in Good Order or one year from the date of the death for nonqualified contracts and December 31^st of the year following death for IRAs. To be in Good Order, we require all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Unless otherwise provided in the Beneficiary designation, one of the following procedures will take place on the death of a Beneficiary:

• if any Beneficiary dies before the Contractowner, that Beneficiary’s interest will go to any other Beneficiaries named, according to their respective interests; and/or

• if no Beneficiary survives the Contractowner, the proceeds will be paid to the Contractowner’s estate.

If the Beneficiary is a minor, court documents appointing the guardian/custodian may be required.

The Beneficiary may choose the method of payment of the Death Benefit unless the Contractowner has already selected a settlement option. The Death Benefit payable to the Beneficiary or joint owner must be distributed within five years of the Contractowner’s date of death unless the Beneficiary begins receiving within one year of the Contractowner’s death the distribution in the form of a life annuity or an annuity for a designated period not extending beyond the Beneficiary’s life expectancy.

Note: Indexed Accounts cannot be divided into separate contracts when there are multiple beneficiaries. If more than one beneficiary chooses a death benefit option other than a lump sum, the existing Indexed Account(s) will need to be surrendered at the Interim Value to be allocated to multiple beneficiaries. New Indexed Accounts can be selected on the new contracts if desired with the currently available features.

Upon the death of the Annuitant, Federal tax law requires that an annuity election be made no later than 60 days after we have approved the death claim for payment.

The recipient of a Death Benefit may elect to receive payment either in the form of a lump sum settlement or an Annuity Payout. If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Abandoned Property. Every state has unclaimed property laws which generally declare annuity contracts to be abandoned after a period of inactivity of three to five years from the date a benefit is due and payable. For example, if the payment of a Death Benefit has been triggered, but, if after a thorough search, we are still unable to locate the Beneficiary of the Death Benefit, or the Beneficiary does not come forward to claim the Death Benefit in a timely manner, the Death Benefit will be “escheated”. This means that the Death Benefit will be paid to the abandoned property division or unclaimed property office of the state in which the Beneficiary or the Contractowner last resided, as shown on our books and records, or to our state of domicile. This escheatment is revocable and 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 such escheatment, it is important that you update your Beneficiary designations, including addresses, if and as they change. You may update your Beneficiary designations by submitting a Beneficiary change form to our Home Office.

i4LIFE^® Indexed Advantage

i4LIFE^® Indexed Advantage is an optional Annuity Payout rider you may purchase for an additional charge, and is separate and distinct from other Annuity Payout options offered under your contract and described later in this prospectus. See Charges and Other Deductions – i4LIFE^® Indexed Advantage Charge for more information on how the charge is calculated.

i4LIFE^® Indexed Advantage provides Periodic Income Payments for life subject to certain conditions. These payments are made during two time periods: an Access Period and a Lifetime Income Period, which are discussed in further detail below. i4LIFE^® Indexed Advantage is different from other Annuity Payout options provided by Lincoln because with i4LIFE^® Indexed Advantage, you have the ability to make additional withdrawals or surrender the contract during the Access Period.

When you elect i4LIFE^® Indexed Advantage, you must choose the Annuitant and Secondary Life (if applicable). The Annuitant and Secondary Life may not be changed after i4LIFE^® Indexed Advantage is elected. For qualified contracts, the Secondary Life must be the spouse. See i4LIFE^® Indexed Advantage Death Benefit regarding the impact of a change to the Annuitant prior to the i4LIFE^® Indexed Advantage election.

35

Only Indexed Accounts with 1-Year Indexed Terms are available. If you elect i4LIFE^® Indexed Advantage while you are currently allocated to an Indexed Account with an Indexed Term greater than one year, the funds allocated to the Indexed Account(s) will be transferred to the LVIP PIMCO Low Duration Bond Fund at Interim Value unless you provide instructions otherwise. Additionally, once i4LIFE^® Indexed Advantage is in effect, any automatic withdrawal service will terminate.

Additional Purchase Payments may be made during the Access Period for an IRA annuity contract. Additional Purchase Payments will not be accepted at any time for a nonqualified annuity contract.

Availability. i4LIFE^® Indexed Advantage is available for contracts with a Contract Value of at least $50,000 and may be elected at the time of contract application or on any subsequent Indexed Anniversary Date by sending a written request to our Home Office. i4LIFE^® Indexed Advantage is not available if another Annuity Payout option is in effect. If you have not established an Indexed Anniversary Date, your i4LIFE^® Indexed Advantage Rider Date can be any Valuation Date.

i4LIFE^® Indexed Advantage is available on nonqualified annuities, IRAs and Roth IRAs (check with your registered representative regarding availability with SEP market). i4LIFE^® Indexed Advantage for IRA contracts is only available if the Annuitant and Secondary Life are age 59½ or older at the time the option is elected. Additional limitations on issue ages and features may be necessary to comply with federal tax law for required minimum distributions.

Access Period. The Access Period is a defined period of time during which we pay Periodic Income Payments and provide a Death Benefit. During this period, you may surrender the contract and make withdrawals from your Account Value (defined below). The Lifetime Income Period begins immediately at the end of the Access Period, the remaining Account Value is used to make Periodic Income Payments for the rest of your life (or the Secondary Life if applicable). During the Lifetime Income Period, you will no longer be able to make withdrawals or surrenders or receive a Death Benefit. If your Account Value is reduced to zero because of withdrawals or market loss, your Access Period ends.

The minimum and maximum Access Periods are established at the time you elect i4LIFE^® Indexed Advantage. The current Access Period requirements are outlined in the following chart:

Minimum Access Period	Maximum Access Period
The greater of 20 years or the difference between your nearest age and age 90, based on the youngest covered life if joint life is elected	The length of time between your age and age 115 for nonqualified contracts (based on the youngest covered life if joint life is elected); age 100 for qualified contracts.

You may also choose any period of time between the minimum Access Period and maximum Access Period.

Generally, shorter Access Periods will produce a higher initial Periodic Income Payment than longer Access Periods, but you will have a shorter period of time within which to access your Account Value. A longer Access Period will generally produce a lower initial Periodic Income Payment but will provide you with a longer period of time within which to access your Account Value. At any time during the Access Period, you may extend the length of the Access Period subject to Home Office approval and the Access Period rules in effect at that time. Additional restrictions may apply if you are under age 59½ when you request a change to the Access Period. Currently, if you extend the Access Period, it must be extended at least 5 years. If you change the Access Period, subsequent Periodic Income Payments will be adjusted accordingly, and the Account Value remaining at the end of the new Access Period will be applied to continue Periodic Income Payments for your life. Currently, changes to the Access Period can only be made on Rider Date anniversaries.

Additional limitations on issue ages and features may be necessary to comply with the IRC provisions for required minimum distributions. We may reduce or terminate the Access Period for IRA i4LIFE^® Indexed Advantage contracts in order to keep the Periodic Income Payments in compliance with federal tax law for required minimum distributions.

Account Value. The initial Account Value is the Contract Value on the i4LIFE^® Indexed Advantage Rider Date, less any applicable premium taxes. During the Access Period, the Account Value on a Valuation Date will equal the total value of all of the Contractowner's Indexed Account(s), variable subaccount(s), and Periodic Income Payment Account, and will be reduced by Periodic Income Payments made, rider fees, as well as any withdrawals taken. You will have access to your Account Value during the Access Period. After the Access Period ends, the remaining Account Value will be applied to continue Periodic Income Payments for your life (and/or the Secondary Life, if applicable) and the Account Value will be reduced to zero.

Periodic Income Payments during the Access Period.i4LIFE^® Indexed Advantage provides for Periodic Income Payments for as long as an Annuitant (or Secondary Life, if applicable) is living.

36

Periodic Income Payments must begin within one year of the date you elect i4LIFE^® Indexed Advantage. Once they begin, they will continue until the death of the Annuitant or Secondary Life, if applicable, unless i4LIFE^® Indexed Advantage is terminated or the contract is surrendered. If you do not choose a Periodic Income Payment frequency, the default frequency is monthly.

Periodic Income Payments are not subject to any applicable surrender charges. For information regarding income tax consequences of Periodic Income Payments, see Federal Tax Matters.

The initial, annual Periodic Income Payment amount is calculated as of the date the rider is elected (Rider Date). This is the same date the Access Period begins. The amount of the initial Periodic Income Payment is determined on the Rider Date by dividing the Account Value, less applicable premium taxes by 1,000 and multiplying the result by an annuity factor. This amount is then transferred to the Periodic Income Payment Account to be paid out based on the payment frequency you selected. The annuity factor is based upon:

• the age and sex of the Annuitant and Secondary Life, if applicable;

• the length of the Access Period selected;

• the 3% Assumed Interest Rate (AIR); and

• the Individual Annuity Mortality table specified in your contract.

The annuity factor used to determine the Periodic Income Payments reflects the fact that, during the Access Period, you have the ability to withdraw the entire Account Value and that a Death Benefit of the entire Account Value will be paid to your Beneficiary upon your death. These benefits during the Access Period result in a slightly lower Periodic Income Payment, during both the Access Period and the Lifetime Income Period, than would be payable if this access was not permitted and no lump-sum Death Benefit was payable. The annuity factor also reflects the requirement that there be sufficient Account Value at the end of the Access Period to continue your Periodic Income Payments for the remainder of your life (and/or the Secondary Life if applicable), during the Lifetime Income Period, with no further access or Death Benefit.

The Account Value will vary with the actual net investment return, which then determines the subsequent Periodic Income Payments during the Access Period. Each subsequent Periodic Income Payment is determined by dividing the Account Value on the Rider Date anniversary by 1,000 and multiplying this result by an annuity factor revised to reflect the declining length of the Access Period. As a result of this calculation, the actual net returns in the Account Value are measured against the AIR to determine subsequent Periodic Income Payments. If the actual net investment return (annualized) for the contract exceeds the AIR, the Periodic Income Payment will increase at a rate approximately equal to the amount of such excess. Conversely, if the actual net investment return for the contract is less than the AIR, the Periodic Income Payment will decrease. For example, if net investment return is 3% higher (annualized) than the AIR, the Periodic Income Payment for the next Rider Year will increase by approximately 3%. Conversely, if actual net investment return is 3% lower than the AIR, the Periodic Income Payment for the next Rider Year will decrease by approximately 3%.

For IRA i4LIFE^® Indexed Advantage contracts, if at any time A is greater than the sum of B and C and no additional withdrawals were made, we will distribute an additional payment, calculated and withdrawn on the Rider Date anniversary, equal to A – (B + C) where,

A = the RMD amount for the calendar year for this contract, as determined by us in accordance with the Internal Revenue Code.

B = the sum of Periodic Income Payment paid in the calendar year immediately prior to the Rider Year anniversary and,

C = the sum of the Periodic Income Payment to be paid from the Rider Year anniversary to the end of the calendar year.

This additional payment will be deducted and distributed within 7 days following the applicable Rider Date anniversary. This amount will be treated as a Periodic Income Payment and not a Withdrawal for Death Benefit calculations.

Withdrawals made during the Access Period will also reduce the Account Value that is available for Periodic Income Payments. Subsequent Periodic Income Payments will be recalculated on the next Rider Date anniversary using the reduced Account Value.

For a joint life option, if either the Annuitant or Secondary Life dies during the Access Period, Periodic Income Payments will be recalculated using a revised annuity factor based on the single surviving life, if doing so provides a higher Periodic Income Payment. On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, the annuity factor will be revised for a non-life contingent Periodic Income Payment and Periodic Income Payments will continue until the Account Value is fully paid out and the Access Period ends. For qualified contracts, if the Annuitant and Secondary Life, if applicable, both die during the Access Period, i4LIFE^® Indexed Advantage will terminate.

Periodic Income Payments during the Lifetime Income Period. The Lifetime Income Period begins at the end of the Access Period if either the Annuitant or Secondary Life is living. Your earlier election regarding the Periodic Income Payment frequency does not change. The initial Periodic Income Payment during the Lifetime Income Period is determined by dividing the Account Value for each Indexed Account and Subaccount on the last Valuation Date of the Access Period by 1,000 and multiplying the result by an annuity factor revised to reflect that the Access Period has ended. The result for each variable Subaccount is converted to annuity units.

37

Subsequent Periodic Income Payments are calculated on the Rider Date anniversary and are equal to the sum of each Periodic Income Payment as calculated for each individual allocation. Subsequent Periodic Income Payments for the variable Subaccounts are determined by multiplying the number of Annuity Units per Subaccount by the Annuity Unit value. To determine subsequent Periodic Income Payments for the Indexed Segment(s), the prior Periodic Income Payment for each Segment is multiplied by the performance of the Segment less the rider charge divided by the AIR. Subsequent Periodic Income Payments are adjusted for any reallocations between accounts and Subaccounts.

Your Periodic Income Payments will vary based on the value of your Annuity Units and the performance of your Indexed Segments(s). Your payment(s) will not be affected by market performance during that year. You may also discontinue variable and index-linked payouts and select a fixed level payment.

Periodic Income Payments will continue for as long as the Annuitant or Secondary Life, if applicable, is living, and will vary with Account Value performance.

Periodic Income Payment Account. The Periodic Income Payment Account is designated to hold an amount equal to the annual Periodic Income Payments during the Access Period only.

On the Rider Date and each Rider Date anniversary thereafter, we will transfer Account Value equal to the annual amount of the Periodic Income Payment valued as of that date to the Periodic Income Payment Account. Amounts transferred to the Periodic Income Payment Account will no longer participate in the variable Subaccounts or Indexed Segment(s). The Periodic Income Payment Account is a non-interest bearing account. The Account Value will be transferred proportionately from the variable Subaccounts, and the Indexed Segment(s) in which you are allocated. Transfers of Account Value to the Periodic Income Payment Account may reduce the value in the Subaccounts to zero. Periodic Income Payments will first be deducted from the Periodic Income Payment Account. Only after the Periodic Income Payment Account has been exhausted will any amounts be deducted proportionally from the Variable Subaccounts and lastly proportionally from the Indexed Segment(s).

The Periodic Income Payment Account is not available for allocations or transfers; unless there are any remaining amounts in the Periodic Income Payment Account on the Rider Anniversary after the Periodic Income Payment has been made for the prior Rider Year.

i4LIFE^® Indexed Advantage Death Benefit

The Death Benefit option in effect under the contract will continue to be in effect after the i4LIFE^® Indexed Advantage Rider Date and during the Access Period only and will be adjusted as follows:

Any withdrawal or Periodic Income Payment from the Account Value during the Access Period will result in a death benefit reduction.

If the Account Value Death Benefit is in effect, your Death Benefit will be equal to the Account Value as of the Valuation Date we approve the payment of the claim.

If the Guarantee of Principal Death Benefit is in effect, your Death Benefit will be equal to the greater of:

• the Account Value as of the Valuation Date we approve the payment of the claim; or

• the sum of all Purchase Payments, less the sum of the Periodic Income Payments and other withdrawals where:

• Periodic Income Payments and any additional Required Minimum Distribution payments reduce the Death Benefit by the dollar amount of the payment; and

• All other withdrawals, if any, reduce the Death Benefit in the same proportion that withdrawals reduce the Contract Value or Account Value.

References to Purchase Payments and withdrawals include Purchase Payments and withdrawals made prior to the election of i4LIFE^® Indexed Advantage Rider Date.

In a declining market, withdrawals which are deducted in the same proportion that withdrawals reduce the Contract Value or Account Value, may have a magnified effect on the reduction of the Death Benefit payable. This is because the reduction in the benefit may be more than the dollar amount withdrawn from the Contract Value. All references to withdrawals include deductions for any applicable charges associated with those withdrawals (surrender charges for example) and premium taxes, if any.

The following example demonstrates the impact of a proportionate withdrawal on your Death Benefit:

Guarantee of Principal Death Benefit	$200,000
i4LIFE® Indexed Advantage Periodic Income Payment	$25,000
Additional withdrawal	$15,000 ($15,000/$150,000 = 10% withdrawal)
Account Value at the time of withdrawal	$150,000

38

Death Benefit value after i4LIFE^® Indexed Advantage Periodic Income Payment = $200,000 - $25,000 = $175,000
Reduction in Death Benefit value for withdrawal = $175,000 x 10% = $17,500
Death Benefit value after withdrawal = $175,000 - $17,500 = $157,500

The Periodic Income Payment reduces the Death Benefit by $25,000 and the withdrawal causes a 10% reduction in the Death Benefit, the same percentage that the withdrawal reduced the Account Value.

Only the Contract Value as of the Valuation Date we approve the payment the death claim is available as a Death Benefit if a Contractowner, joint owner or Annuitant was added or changed subsequent to the effective date of this contract unless the change occurred because of the death of a prior Contractowner, joint owner or Annuitant. If your Contract Value equals zero, no Death Benefit will be paid.

General Death Benefit Provisions. This Death Benefit option is only available during the Access Period and will terminate when the Account Value equals zero, because the Access Period terminates.

On a joint life option, the Secondary Life spouse must be either the primary Beneficiary or joint owner in order to receive the remaining payments after the first spouse’s death.

For nonqualified contracts, upon the death of the Contractowner, joint owner or Annuitant, the Contractowner (or Beneficiary) may elect to terminate the contract and receive full payment of the Death Benefit or may elect to continue the contract and receive Periodic Income Payments. Upon the death of the Secondary Life, who is not also an owner, only the surrender value is paid.

If you are the owner of an IRA annuity contract, and there is no Secondary Life, and you die during the Access Period, the i4LIFE^® Indexed Advantage will terminate. A spouse Beneficiary may start a new i4LIFE^® Indexed Advantage program.

If a death occurs during the Access Period, the value of the Death Benefit will be determined as of the Valuation Date we approve the payment of the claim. Approval of payment will occur upon our receipt of all the following:

1.	proof (e.g. an original certified death certificate), or any other proof of death satisfactory to us; and
2.	written authorization for payment; and
3.	all required claim forms, fully completed (including selection of a settlement option).

Notwithstanding any provision of this contract to the contrary, the payment of Death Benefits provided under this contract must be made in compliance with Code Section 72(s) or 401(a)(9) as applicable, as amended from time to time. Death Benefits may be taxable. See Federal Tax Matters.

Upon notification to us of the death, Periodic Income Payments may be suspended until the death claim is approved. Upon approval, a lump sum payment for the value of any suspended payments will be made as of the date the death claim is approved, and Periodic Income Payments will continue, if applicable.

If a lump sum settlement is elected, the proceeds will be mailed within seven days of approval by us of the claim subject to the laws, regulations and tax code governing payment of Death Benefits. This payment may be postponed as permitted by the Investment Company Act of 1940.

Transfers. During the Access Period and subject to the provisions of Transfers On Or Before The Annuity Commencement Date, the following transfers are permitted at any time:

(a) transfers between the variable Subaccounts or

(b) transfers from the Indexed Accounts to the variable Subaccounts. Transfers between the Indexed Accounts and from the variable Subaccounts to the Indexed Accounts are only permitted on a Rider Date anniversary.

After the Access Period and subject to the provisions of Transfers After the Annuity Commencement Date, transfers between the variable Subaccounts are permitted at any time. The following transfers are only permitted on the Rider Date anniversary:

(a) transfers from the variable Subaccounts to the Indexed Accounts;

(b) transfers between the Indexed Accounts; and

(c) transfers from the variable Subaccounts and/or Indexed Accounts to a fixed level payment.

Transfers from the Indexed Account(s) to the Subaccounts or from the fixed level payment to Indexed Account(s) or Subaccounts are not permitted.

Withdrawals. You may request a withdrawal at any time prior to the end of the Access Period. We reduce the Account Value by the amount of the withdrawal, which will impact all subsequent Periodic Income Payments. Withdrawals cannot be taken from the Periodic Income Payment Account. Withdrawals will be taken proportionately from the Subaccounts first and then proportionately from the Indexed Accounts. Any Withdrawal that reduces the Subaccounts and Indexed Accounts to zero will be treated as a withdrawal of the entire Account Value. Any remaining Account Value in the Periodic Income Payment Account will be paid out in a lump sum with

39

the withdrawal, and the contract and rider will terminate. Withdrawals may have tax consequences. See Federal Tax Matters. Withdrawals are subject to any applicable surrender charges except when amounts may be withdrawn free of surrender charges. See Charges and Other Deductions.

Surrender. At any time prior to the end of the Access Period, you may surrender the contract by withdrawing the surrender value. If the contract is surrendered, the contract terminates and no further Periodic Income Payments will be made. Withdrawals are subject to any applicable surrender charges except when amounts may be withdrawn free of surrender charges. See Charges and Other Deductions.

Termination. For IRA contracts, you may terminate i4LIFE^® Indexed Advantage prior to the end of the Access Period by notifying us in writing. The termination will be effective on the next Rider Date anniversary after we receive the notice. Upon termination, the i4LIFE^® Indexed Advantage charge will end. Your Contract Value upon termination will be equal to the Account Value on the Valuation Date we terminate i4LIFE^® Indexed Advantage.

For nonqualified contracts, you may not terminate i4LIFE^® Indexed Advantage once you have elected it without terminating the entire contract..

Annuity Payouts

When you apply for a contract, you may select any Annuity Commencement Date permitted by law, which is usually on or before the Annuitant's 99^th birthday. Your broker-dealer may recommend that you annuitize at an earlier age.

The contract provides optional forms of payouts of annuities (annuity options), each of which is payable on a variable basis, a fixed basis or a combination of both as you specify. The Indexed Accounts are not available as Annuity Payout options. Any amounts in the Indexed Segments must be transferred out of the Indexed Segments at Interim Value prior to the Annuity Commencement Date. The contract provides that all or part of the Contract Value may be used to purchase an Annuity Payout option.

You may elect Annuity Payouts in monthly, quarterly, semiannual or annual installments. If the payouts from any Subaccount would be or become less than $50, we have the right to reduce their frequency until the payouts are at least $50 each. Following are explanations of the annuity options available.

Annuity Options

The annuity options outlined below do not apply to Contractowners who have elected i4LIFE^® Indexed Advantage.

Life Annuity. This option offers a periodic payout during the lifetime of the Annuitant and ends with the last payout before the death of the Annuitant. This option offers the highest periodic payout since there is no guarantee of a minimum number of payouts or provision for a Death Benefit for Beneficiaries. However, there is the risk under this option that the recipient would receive no payouts if the Annuitant dies before the date set for the first payout; only one payout if death occurs before the second scheduled payout, and so on.

Life Annuity with Payouts Guaranteed for Designated Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and then continues throughout the lifetime of the Annuitant. The designated period is selected by the Contractowner.

Joint Life Annuity. This option offers a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. However, under a joint life annuity, if both Annuitants die before the date set for the first payout, no payouts will be made. Only one payment would be made if both deaths occur before the second scheduled payout, and so on.

Joint Life Annuity with Guaranteed Period. This option guarantees periodic payouts during a designated period, usually 10 or 20 years, and continues during the joint lifetime of the Annuitant and a designated joint Annuitant. The payouts continue during the lifetime of the survivor. The designated period is selected by the Contractowner.

Joint Life and Two Thirds to Survivor Annuity. This option provides a periodic payout during the joint lifetime of the Annuitant and a designated joint Annuitant. When one of the joint Annuitants dies, the survivor receives two thirds of the periodic payout made when both were alive.

Joint Life and Two-Thirds Survivor Annuity with Guaranteed Period. This option provides a periodic payout during the joint lifetime of the Annuitant and a joint Annuitant. When one of the joint Annuitants dies, the survivor receives two-thirds of the periodic payout made when both were alive. This option further provides that should one or both of the Annuitants die during the elected guaranteed period, usually 10 or 20 years, full benefit payment will continue for the rest of the guaranteed period.

Life Annuity with Cash Refund. Fixed annuity benefit payments that will be made for the lifetime of the Annuitant with the guarantee that upon death, should (a) the total dollar amount applied to purchase this option be greater than (b) the fixed annuity benefit payment multiplied by the number of annuity benefit payments paid prior to death, then a refund payment equal to the dollar amount of (a) minus (b) will be made.

40

Under the annuity options listed above, you may not make withdrawals. Other options, with or without withdrawal features, may be made available by us. You may pre-select an Annuity Payout option as a method of paying the Death Benefit to a Beneficiary. If you do, the Beneficiary cannot change this payout option. You may change or revoke in writing to our Home Office, any such selection, unless such selection was made irrevocable. If you have not already chosen an Annuity Payout option, the Beneficiary may choose any Annuity Payout option. At death, options are only available to the extent they are consistent with the requirements of the contract as well as Sections 72(s) and 401(a)(9) of the tax code, if applicable.

General Information

Any previously selected Death Benefit in effect before the Annuity Commencement Date will no longer be available on and after the Annuity Commencement Date. Any portion of your Contract Value invested in the Indexed Accounts must be transferred to the Subaccounts or to a fixed Annuity Payout prior to the Annuity Commencement Date. Amounts transferred will be subject to an Interim Value calculation. If we have not heard from you by 30 days prior to the maturity date of the contract, we will transfer the Interim Value for each Indexed Segment to the LVIP PIMCO Low Duration Bond Fund. You may change the Annuity Commencement Date, change the annuity option or change the allocation of the investment among Subaccounts up to 30 days before the scheduled Annuity Commencement Date, upon written notice to the Home Office. You must give us at least 30 days’ notice before the date on which you want payouts to begin. We may require proof of age, sex, or survival of any payee upon whose age, sex, or survival payments depend.

Unless you select another option, the contract automatically provides for a life annuity with Annuity Payouts guaranteed for 10 years (on a fixed, variable or combination of fixed and variable basis, in proportion to the account allocations at the time of annuitization) except when a joint life payout is required by law. Under any option providing for guaranteed period payouts, the number of payouts which remain unpaid at the date of the Annuitant’s death (or surviving Annuitant’s death in case of joint life Annuity) will be paid to you or your Beneficiary as payouts become due after we are in receipt of:

• proof, satisfactory to us, of the death;

• written authorization for payment; and

• all claim forms, fully completed.

Variable Annuity Payouts

Variable Annuity Payouts will be determined using:

• the Contract Value on the Annuity Commencement Date, less any applicable premium taxes;

• the annuity tables contained in the contract;

• the annuity option selected; and

• the investment performance of the fund(s) selected.

To determine the amount of payouts, we make this calculation:

1.	Determine the dollar amount of the first periodic payout; then
2.	Credit the contract with a fixed number of Annuity Units equal to the first periodic payout divided by the Annuity Unit value; and
3.	Calculate the value of the Annuity Units each period thereafter.

Annuity Payouts assume an investment return of 3%, 4%, 5% or 6% per year, as applied to the applicable mortality table. Some of these assumed interest rates may not be available in your state; therefore, please check with your registered representative. You may choose your assumed interest rate at the time you elect a variable Annuity Payout on the administrative form provided by us. The higher the assumed interest rate you choose, the higher your initial annuity payment will be. The amount of each payout after the initial payout will depend upon how the underlying fund(s) perform, relative to the assumed rate. If the actual net investment rate (annualized) exceeds the assumed rate, the payment will increase at a rate proportional to the amount of such excess. Conversely, if the actual rate is less than the assumed rate, annuity payments will decrease. The higher the assumed interest rate, the less likely future annuity payments are to increase, or the payments will increase more slowly than if a lower assumed rate was used. There is a more complete explanation of this calculation in the SAI.

Small Contract Surrenders

We may surrender your contract, in accordance with the laws of your state if:

• your Contract Value drops below certain state specified minimum amounts ($1,000 or less) for any reason, including if your Contract Value decreases due to the performance of the Subaccounts you selected;

• no Purchase Payments have been received for two (2) full, consecutive Contract Years; and

• the annuity benefit at the Annuity Commencement Date would be less than $20.00 per month (these requirements may differ in some states).

41

At least 60 days before we surrender your contract, we will send you a letter at your last address we have on file, to inform you that your contract will be surrendered. You will have the opportunity to make additional Purchase Payments to bring your Contract Value above the minimum level to avoid surrender. If we surrender your contract, we will not assess any surrender charge.

Delay of Payments

Contract proceeds from the VAA will be paid within seven days, except:

• when the NYSE is closed (other than weekends and holidays);

• times when market trading is restricted or the SEC declares an emergency, and we cannot value units or the funds cannot redeem shares; or

• when the SEC so orders to protect Contractowners.

If, pursuant to SEC rules, an underlying money market fund suspends payment of redemption proceeds in connection with a liquidation of the fund, we will delay payment of any transfer, partial withdrawal, surrender, loan, or Death Benefit from the money market sub-account until the fund is liquidated.

Due to federal laws designed to counter terrorism and prevent money laundering by criminals, we may be required to reject a Purchase Payment and/or deny payment of a request for transfers, withdrawals, surrenders, or Death Benefits, until instructions are received from the appropriate regulator. We also may be required to provide additional information about a Contractowner's account to government regulators.

Reinvestment Privilege

You may elect to make a reinvestment purchase with any part of the proceeds of a surrender/withdrawal, and we will recredit that portion of the surrender/withdrawal charges attributable to the amount returned.

This election must be made by your written authorization to us on an approved Lincoln reinvestment form and received in our Home Office within 30 days of the date of the surrender/withdrawal, and the repurchase must be of a contract covered by this prospectus. In the case of a qualified retirement plan, a representation must be made that the proceeds being used to make the purchase have retained their tax-favored status under an arrangement for which the contracts offered by this prospectus are designed. The number of Accumulation Units which will be credited when the proceeds are reinvested will be based on the value of the Accumulation Unit(s) on the next Valuation Date. This computation will occur following receipt of the proceeds and request for reinvestment at the Home Office. You may utilize the reinvestment privilege only once. For tax reporting purposes, we will treat a surrender/withdrawal and a subsequent reinvestment purchase as separate transactions (and a Form 1099 may be issued, if applicable). Any taxable distribution that is reinvested may still be reported as taxable. You should consult a tax advisor before you request a surrender/withdrawal or subsequent reinvestment purchase. Any portion of your Contract Value that was previously allocated to an Indexed Account will be placed in the LVIP PIMCO Low Duration Bond Fund. Indexed Accounts cannot be invested until the next Indexed Anniversary Date.

Amendment of Contract

We reserve the right to amend the contract to meet the requirements of the 1940 Act or other applicable federal or state laws or regulations. You will be notified in writing of any changes, modifications or waivers. Any changes are subject to prior approval of your state’s insurance department (if required).

Distribution of the Contracts

Lincoln Financial Distributors, Inc. (“LFD”) serves as Principal Underwriter of this contract. LFD is affiliated with Lincoln Life and is registered as a broker-dealer with the SEC under the Securities Exchange Act of 1934 and is a member of FINRA. The Principal Underwriter has entered into selling agreements with Lincoln Financial Advisors Corporation and/or Lincoln Financial Securities Corporation (collectively “LFN”), also affiliates of ours. The Principal Underwriter has also entered into selling agreements with broker-dealers that are unaffiliated with us (“Selling Firms”). While the Principal Underwriter has the legal authority to make payments to broker-dealers which have entered into selling agreements, we will make such payments on behalf of the Principal Underwriter in compliance with appropriate regulations. We also pay on behalf of LFD certain of its operating expenses related to the distribution of this and other of our contracts. The Principal Underwriter may also offer “non-cash compensation”, as defined under FINRA’s rules, which includes among other things, merchandise, gifts, marketing support, sponsorships, seminars, entertainment and travel expenses. You may ask your registered representative how he/she will personally be compensated, in whole or in part, for the sale of the contract to you or for any alternative proposal that may have been presented to you. You may wish to take such compensation payments into account when considering and evaluating any recommendation made to you in connection with the purchase of a contract. The following paragraphs describe how payments are made by us and the Principal Underwriter to various parties.

42

Compensation Paid to LFN. The maximum commission the Principal Underwriter pays to LFN is 4.50% of Purchase Payments. LFN may elect to receive a lower commission when a Purchase Payment is made along with an earlier quarterly payment based on Contract Value for so long as the contract remains in effect. Upon annuitization, the maximum commission the Principal Underwriter pays to LFN is 4.50% of annuitized value and/or ongoing annual compensation of up to 1.00% of annuity value or statutory reserves.

Lincoln Life also pays for the operating and other expenses of LFN, including the following sales expenses: registered representative training allowances; compensation and bonuses for LFN's management team; advertising expenses; and all other expenses of distributing the contracts. LFN pays its registered representatives a portion of the commissions received for their sales of contracts. LFN registered representatives and their managers are also eligible for various cash benefits, such as bonuses, insurance benefits and financing arrangements. In addition, LFN registered representatives who meet certain productivity, persistency and length of service standards and/or their managers may be eligible for additional compensation. Sales of the contracts may help LFN registered representatives and/or their managers qualify for such benefits. LFN registered representatives and their managers may receive other payments from us for services that do not directly involve the sale of the contracts, including payments made for the recruitment and training of personnel, production of promotional literature and similar services.

Compensation Paid to Unaffiliated Selling Firms. The Principal Underwriter pays commissions to all Selling Firms. The maximum commission the Principal Underwriter pays to Selling Firms, other than LFN, is 6.00% of Purchase Payments. Some Selling Firms may elect to receive a lower commission when a Purchase Payment is made along with an earlier quarterly payment based on Contract Value for so long as the contract’s Selling Firm remains in effect. Upon annuitization, the maximum commission the Principal Underwriter pays to Selling Firms is 6.00% of annuitized value and/or ongoing annual compensation of up to 1.00% of annuity value or statutory reserves. LFD also acts as wholesaler of the contracts and performs certain marketing and other functions in support of the distribution and servicing of the contracts.

LFD may pay certain Selling Firms or their affiliates additional amounts for, among other things: (1) “preferred product” treatment of the contracts in their marketing programs, which may include marketing services and increased access to registered representatives; (2) sales promotions relating to the contracts; (3) costs associated with sales conferences and educational seminars for their registered representatives; (4) other sales expenses incurred by them; and (5) inclusion in the financial products the Selling Firm offers.

Lincoln Life may provide loans to broker-dealers or their affiliates to help finance marketing and distribution of the contracts, and those loans may be forgiven if aggregate sales goals are met. In addition, we may provide staffing or other administrative support and services to broker-dealers who distribute the contracts. LFD, as wholesaler, may make bonus payments to certain Selling Firms based on aggregate sales of our variable insurance contracts (including the contracts) or persistency standards.

These additional types of compensation are not offered to all Selling Firms. The terms of any particular agreement governing compensation may vary among Selling Firms and the amounts may be significant. The prospect of receiving, or the receipt of, additional compensation may provide Selling Firms and/or their registered representatives with an incentive to favor sales of the contracts over other variable annuity contracts (or other investments) with respect to which a Selling Firm 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 contracts. Additional information relating to compensation paid in 2017 is contained in the SAI.

Compensation Paid to Other Parties. Depending on the particular selling arrangements, there may be others whom LFD compensates for the distribution activities. For example, LFD may compensate certain “wholesalers”, who control access to certain selling offices, for access to those offices or for referrals, and that compensation may be separate from the compensation paid for sales of the contracts. LFD may compensate marketing organizations, associations, brokers or consultants which provide marketing assistance and other services to broker-dealers who distribute the contracts, and which may be affiliated with those broker-dealers. Commissions and other incentives or payments described above are not charged directly to Contractowners or the VAA. All compensation is paid from our resources, which include fees and charges imposed on your contract.

We pay an education and support fee to First Trust Portfolios L.P. (First Trust) for their educational and sales support in connection with the Capital Strength Net Fee Index^SM. This fee is an annual fee of 0.15% of the average daily value of the amount invested in the Capital Strength Indexed Accounts. First Trust will pay Lincoln an annual rate of 0.05% of the average daily value of the amount invested in the Capital Strength Indexed Accounts to compensate Lincoln for the expenses it incurs in assisting First Trust as it provides this education and support. These payments are not charged directly to Contractowners, but are paid from our resources.

Contractowner Questions

The obligations to purchasers under the contracts are those of Lincoln Life. This prospectus provides a general description of the material features of the contract. Contracts, endorsements and riders may vary as required by state law. Questions about your contract should be directed to us at 1-877-737-6872.

43

Federal Tax Matters

Introduction

The Federal income tax treatment of the contract is complex and sometimes uncertain. The Federal income tax rules may vary with your particular circumstances. This discussion does not include all the Federal income tax rules that may affect you and your contract. This discussion also does not address other Federal tax consequences (including consequences of sales to foreign individuals or entities), or state or local tax consequences, associated with the contract. As a result, you should always consult a tax advisor about the application of tax rules found in the Internal Revenue Code (“Code”), Treasury Regulations and applicable IRS guidance to your individual situation.

Nonqualified Annuities

This part of the discussion describes some of the Federal income tax rules applicable to nonqualified annuities. A nonqualified annuity is a contract not issued in connection with a qualified retirement plan, such as an IRA or a section 403(b) plan, receiving special tax treatment under the Code. We may not offer nonqualified annuities for all of our annuity products.

Tax Deferral On Earnings

Under the Code, you are generally not subject to tax on any increase in your Contract Value until you receive a contract distribution. However, for this general rule to apply, certain requirements must be satisfied:

• An individual must own the contract (or the Code must treat the contract as owned by an individual).

• The investments of the VAA must be “adequately diversified” in accordance with Treasury regulations.

• Your right to choose particular investments for a contract must be limited.

• The Annuity Commencement Date must not occur near the end of the Annuitant’s life expectancy.

Contracts Not Owned By An Individual

If a contract is owned by an entity (rather than an individual) the Code generally does not treat it as an annuity contract for Federal income tax purposes. This means that the entity owning the contract pays tax currently on the excess of the Contract Value over the investment in the contract. Examples of contracts where the owner pays current tax on the contract’s earnings are contracts issued to a corporation or a trust. Some exceptions to the rule are:

• Contracts in which the named owner is a trust or other entity that holds the contract as an agent for an individual; however, this exception does not apply in the case of any employer that owns a contract to provide deferred compensation for its employees;

• Immediate annuity contracts, purchased with a single premium, when the annuity starting date is no later than a year from purchase and substantially equal periodic payments are made, not less frequently than annually, during the Annuity Payout period;

• Contracts acquired by an estate of a decedent;

• Certain qualified contracts;

• Contracts purchased by employers upon the termination of certain qualified plans; and

• Certain contracts used in connection with structured settlement agreements.

Investments In The VAA Must Be Diversified

For a contract to be treated as an annuity for Federal income tax purposes, the investments of the VAA must be “adequately diversified.” Treasury regulations define standards for determining whether the investments of the VAA are adequately diversified. If the VAA fails to comply with these diversification standards, you could be required to pay tax currently on the excess of the Contract Value over the investment in the contract. Although we do not control the investments of the underlying investment options, we expect that the underlying investment options will comply with the Treasury regulations so that the VAA will be considered “adequately diversified.”

Restrictions

The Code limits your right to choose particular investments for the contract. Because the IRS has issued little guidance specifying those limits, the limits are uncertain and your right to allocate Contract Values among the Subaccounts may exceed those limits. If so, you would be treated as the owner of the assets of the VAA and thus subject to current taxation on the income and gains, if applicable, from those assets. We do not know what limits may be set by the IRS in any guidance that it may issue and whether any such limits will apply to existing contracts. We reserve the right to modify the contract without your consent in an attempt to prevent you from being considered as the owner of the assets of the VAA for purposes of the Code.

Loss Of Interest Deduction

After June 8, 1997, if a contract is issued to a taxpayer that is not an individual, or if a contract is held for the benefit of an entity, the entity may lose a portion of its deduction for otherwise deductible interest expenses. However, this rule does not apply to a contract

44

owned by an entity engaged in a trade or business that covers the life of one individual who is either (i) a 20% Owner of the entity, or (ii) an officer, director, or employee of the trade or business, at the time first covered by the contract. This rule also does not apply to a contract owned by an entity engaged in a trade or business that covers the joint lives of the 20% Owner or the entity and the Owner’s spouse at the time first covered by the contract.

Age At Which Annuity Payouts Begin

The Code does not expressly identify a particular age by which Annuity Payouts must begin. However, those rules do require that an annuity contract provide for amortization, through Annuity Payouts, of the contract’s Purchase Payments and earnings. As long as annuity payments begin or are scheduled to begin on a date on which the Annuitant’s remaining life expectancy is enough to allow for a sufficient Annuity Payout period, the contract should be treated as an annuity. If the annuity contract is not treated as an annuity, you would be currently taxed on the excess of the Contract Value over the investment in the contract.

Tax Treatment Of Payments

We make no guarantees regarding the tax treatment of any contract or of any transaction involving a contract. However, the rest of this discussion assumes that your contract will be treated as an annuity under the Code and that any increase in your Contract Value will not be taxed until there is a distribution from your contract.

Taxation Of Withdrawals And Surrenders

You will pay tax on withdrawals to the extent your Contract Value exceeds your investment in the contract. This income (and all other income from your contract) is considered ordinary income (and does not receive capital gains treatment and is not qualified dividend income). You will pay tax on a surrender to the extent the amount you receive exceeds your investment in the contract. In certain circumstances, your Purchase Payments and investment in the contract are reduced by amounts received from your contract that were not included in income. Surrender and reinstatement of your contract will generally be taxed as a withdrawal.

Taxation Of Annuity Payouts, including Periodic Income Payments

The Code imposes tax on a portion of each Annuity Payout (at ordinary income tax rates) and treats a portion as a nontaxable return of your investment in the contract. We will notify you annually of the taxable amount of your Annuity Payout. Once you have recovered the total amount of the investment in the contract, you will pay tax on the full amount of your Annuity Payouts. If Annuity Payouts end because of the Annuitant’s death and before the total amount in the contract has been distributed, the amount not received will generally be deductible. If withdrawals, other than Periodic Income Payments, are taken from i4LIFE^® Indexed Advantage during the Access Period, they are taxed subject to an exclusion ratio that is determined based on the amount of the payment.

Taxation Of Death Benefits

We may distribute amounts from your contract because of the death of a Contractowner or an Annuitant. The tax treatment of these amounts depends on whether the Contractowner or the Annuitant dies before or after the Annuity Commencement Date.

Death prior to the Annuity Commencement Date:

• If the Beneficiary receives Death Benefits under an Annuity Payout option, they are taxed in the same manner as Annuity Payouts.

• If the Beneficiary does not receive Death Benefits under an Annuity Payout option, they are taxed in the same manner as a withdrawal.

Death after the Annuity Commencement Date:

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of a Contractowner who is not the Annuitant, they are excludible from income in the same manner as the Annuity Payout prior to the death of the Contractowner.

• If Death Benefits are received in accordance with the existing Annuity Payout option following the death of the Annuitant (whether or not the Annuitant is also the Contractowner), the Death Benefits are excludible from income if they do not exceed the investment in the contract not yet distributed from the contract. All Annuity Payouts in excess of the investment in the contract not previously received are includible in income.

• If Death Benefits are received in a lump sum, the Code imposes tax on the amount of Death Benefits which exceeds the amount of Purchase Payments not previously received.

Additional Taxes Payable On Withdrawals, Surrenders, Or Annuity Payouts

The Code may impose a 10% additional tax on any distribution from your contract which you must include in your gross income. The 10% additional tax does not apply if one of several exceptions exists. These exceptions include withdrawals, surrenders, or Annuity Payouts that:

• you receive on or after you reach 59½,

• you receive because you became disabled (as defined in the Code),

• you receive from an immediate annuity,

45

• a Beneficiary receives on or after your death, or

• you receive as a series of substantially equal periodic payments based on your life or life expectancy (non-natural owners holding as agent for an individual do not qualify).

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax, which affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual's “unearned income”, or (ii) the dollar amount by which the individual's modified adjusted gross income exceeds the applicable threshold. Unearned income includes the taxable portion of distributions that you take from your annuity contract. If you take a distribution from your contract that may be subject to the tax, we will include a Distribution Code “D” in Box 7 of the Form 1099-R issued to report the distribution. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Special Rules If You Own More Than One Annuity Contract

In certain circumstances, you must combine some or all of the nonqualified annuity contracts you own in order to determine the amount of an Annuity Payout, a surrender, or a withdrawal that you must include in income. For example, if you purchase two or more deferred annuity contracts from the same life insurance company (or its affiliates) during any calendar year, the Code treats all such contracts as one contract. Treating two or more contracts as one contract could affect the amount of a surrender, a withdrawal or an Annuity Payout that you must include in income and the amount that might be subject to the additional tax described previously.

Loans and Assignments

Except for certain qualified contracts, the Code treats any amount received as a loan under your contract, and any assignment or pledge (or agreement to assign or pledge) of any portion of your Contract Value, as a withdrawal of such amount or portion.

Gifting A Contract

If you transfer ownership of your contract to a person other than to your spouse (or to your former spouse incident to divorce), and receive a payment less than your contract’s value, you will pay tax on your Contract Value to the extent it exceeds your investment in the contract not previously received. The new owner’s investment in the contract would then be increased to reflect the amount included in income.

Charges for Additional Benefits

Your contract automatically includes a basic Death Benefit and may include other optional riders. Certain enhancements to the basic Death Benefit may also be available to you. The cost of the basic Death Benefit and any additional benefit are deducted from your contract. It is possible that the tax law may treat all or a portion of the Death Benefit and other optional rider charges, if any, as a contract withdrawal.

Special Considerations for Same-Sex Spouses

In 2013, the U.S. Supreme Court held that same-sex spouses who are married under state law are treated as spouses for purposes of federal law. You are strongly encouraged to consult a tax advisor before electing spousal rights under the contract.

Qualified Retirement Plans

We have designed the contracts for use in connection with certain types of retirement plans that receive favorable treatment under the Code. Contracts issued to or in connection with a qualified retirement plan are called “qualified contracts.” We issue contracts for use with various types of qualified retirement plans. The Federal income tax rules applicable to those plans are complex and varied. As a result, this prospectus does not attempt to provide more than general information about the use of the contract with the various types of qualified retirement plans. Persons planning to use the contract in connection with a qualified retirement plan should obtain advice from a competent tax advisor.

Types of Qualified Contracts and Terms of Contracts

Qualified retirement plans may include the following:

• Individual Retirement Accounts and Annuities (“Traditional IRAs”)

• Roth IRAs

• Traditional IRA that is part of a Simplified Employee Pension Plan (“SEP”)

• SIMPLE 401(k) plans (Savings Incentive Matched Plan for Employees)

• 401(a) / (k) plans (qualified corporate employee pension and profit-sharing plans)

• 403(a) plans (qualified annuity plans)

• 403(b) plans (public school system and tax-exempt organization annuity plans)

46

• H.R. 10 or Keogh Plans (self-employed individual plans)

• 457(b) plans (deferred compensation plans for state and local governments and tax-exempt organizations)

Our individual variable annuity products are not available for use with any of the foregoing qualified retirement plan accounts, with the exception of Traditional IRA, SEP IRA, and Roth IRA arrangements. We will amend contracts to be used with a qualified retirement plan as generally necessary to conform to the Code’s requirements for the type of plan. However, the rights of a person to any qualified retirement plan benefits may be subject to the plan’s terms and conditions, regardless of the contract’s terms and conditions. In addition, we are not bound by the terms and conditions of qualified retirement plans to the extent such terms and conditions contradict the contract, unless we consent.

Tax Treatment of Qualified Contracts

The Federal income tax rules applicable to qualified retirement plans and qualified contracts vary with the type of plan and contract. For example:

• Federal tax rules limit the amount of Purchase Payments or contributions that can be made, and the tax deduction or exclusion that may be allowed for the contributions. These limits vary depending on the type of qualified retirement plan and the participant’s specific circumstances (e.g., the participant’s compensation).

• Minimum annual distributions are required under some qualified retirement plans once you reach age 70½ or retire, if later as described below.

• Loans are allowed under certain types of qualified retirement plans, but Federal income tax rules prohibit loans under other types of qualified retirement plans. For example, Federal income tax rules permit loans under some section 403(b) plans, but prohibit loans under Traditional and Roth IRAs. If allowed, loans are subject to a variety of limitations, including restrictions as to the loan amount, the loan’s duration, the rate of interest, and the manner of repayment. Your contract or plan may not permit loans.

Please note that qualified retirement plans such as 403(b) plans, 401(k) plans and IRAs generally defer taxation of contributions and earnings until distribution. As such, an annuity does not provide any additional tax deferral benefit beyond the qualified retirement plan itself.

Tax Treatment of Payments

The Federal income tax rules generally include distributions from a qualified contract in the participant’s income as ordinary income. These taxable distributions will include contributions that were deductible or excludible from income. Thus, under many qualified contracts, the total amount received is included in income since a deduction or exclusion from income was taken for contributions to the contract. There are exceptions. For example, you do not include amounts received from a Roth IRA in income if certain conditions are satisfied.

Required Minimum Distributions

Under most qualified plans, you must begin receiving payments from the contract in certain minimum amounts by April 1 of the year following the year you attain age 70½ or retire, if later. You are required to take distributions from your traditional IRAs by April 1 of the year following the year you reach age 70½. If you own a Roth IRA, you are not required to receive minimum distributions from your Roth IRA during your life.

Failure to comply with the minimum distribution rules applicable to certain qualified plans, such as Traditional IRAs, will result in the imposition of an excise tax. This excise tax equals 50% of the amount by which a required minimum distribution exceeds the actual distribution from the qualified plan.

Treasury regulations applicable to required minimum distributions include a rule that may impact the distribution method you have chosen and the amount of your distributions. Under these regulations, the presence of an enhanced Death Benefit, or other benefit which could provide additional value to your contract, may require you to take additional distributions. An enhanced Death Benefit is any Death Benefit that has the potential to pay more than the Contract Value or a return of investment in the contract. Annuity contracts inside Custodial or Trusteed IRAs will also be subject to these regulations. Please contact your tax advisor regarding any tax ramifications.

Additional Tax on Early Distributions from Qualified Retirement Plans

The Code may impose a 10% additional tax on an early distribution from a qualified contract that must be included in income. The Code does not impose the additional tax if one of several exceptions applies. The exceptions vary depending on the type of qualified contract you purchase. For example, in the case of an IRA, the 10% additional tax will not apply to any of the following withdrawals, surrenders, or Annuity Payouts:

• Distribution received on or after the Annuitant reaches 59½,

• Distribution received on or after the Annuitant’s death or because of the Annuitant’s disability (as defined in the Code),

• Distribution received as a series of substantially equal periodic payments based on the Annuitant’s life (or life expectancy), or

• Distribution received as reimbursement for certain amounts paid for medical care.

47

These exceptions, as well as certain others not described here, generally apply to taxable distributions from other qualified retirement plans. However, the specific requirements of the exception may vary.

Unearned Income Medicare Contribution

Congress enacted the “Unearned Income Medicare Contribution” as a part of the Health Care and Education Reconciliation Act of 2010. This tax affects individuals whose modified adjusted gross income exceeds certain thresholds, is a 3.8% tax on the lesser of (i) the individual’s “unearned income”, or (ii) the dollar amount by which the individual’s modified adjusted gross income exceeds the applicable threshold. Distributions that you take from your contract are not included in the calculation of unearned income because your contract is a qualified plan contract. However, the amount of any such distribution is included in determining whether you exceed the modified adjusted gross income threshold. Please consult your tax advisor to determine whether your annuity distributions are subject to this tax.

Transfers and Direct Rollovers

As a result of Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), you may be able to move funds between different types of qualified plans, such as 403(b) and 457(b) governmental plans, by means of a rollover or transfer. You may be able to rollover or transfer amounts between qualified plans and traditional IRAs. These rules do not apply to Roth IRAs and 457(b) non-governmental tax-exempt plans. There are special rules that apply to rollovers, direct rollovers and transfers (including rollovers or transfers of after-tax amounts). If the applicable rules are not followed, you may incur adverse Federal income tax consequences, including paying taxes which you might not otherwise have had to pay. Before we send a rollover distribution, we will provide a notice explaining tax withholding requirements (see Federal Income Tax Withholding). We are not required to send you such notice for your IRA. You should always consult your tax advisor before you move or attempt to move any funds.

The IRS issued Announcement 2014-32 confirming its intent to apply the one-rollover-per-year limitation of 408(d)(3)(B) on an aggregate basis to all IRAs that an individual owns. This means that an individual cannot make a tax-free IRA-to-IRA rollover if he or she has made such a rollover involving any of the individual’s IRAs in the current tax year. If an intended rollover does not qualify for tax-free rollover treatment, contributions to your IRA may constitute excess contributions that may exceed contribution limits. This one-rollover-per-year limitation does not apply to direct trustee-to-trustee transfers.

Direct Conversions and Recharacterizations

The Pension Protection Act of 2006 (PPA) permits direct conversions from certain qualified, retirement, 403(b) or 457(b) plans to Roth IRAs (effective for distributions after 2007). You are also permitted to recharacterize your traditional IRA contribution as a Roth IRA contribution, and to recharacterize your Roth IRA contribution as a traditional IRA contribution. The deadline for the recharacterization is the due date (including extensions) for your individual income tax return for the year in which the contribution was made. Upon recharacterization, you are treated as having made the contribution originally to the second IRA account. The recharacterization does not count toward the one-rollover-per-year limitation described above.

Effective for tax years beginning after December 31, 2017, pursuant to the Tax Cuts and Jobs Act (Pub. L. No. 115-97), recharacterizations are no longer allowed in the case of a conversion from a non-Roth account or annuity to a Roth IRA. This limitation applies to conversions made from pre-tax accounts under an IRA, qualified retirement plan, 403(b) plan, or 457(b) plan. Roth IRA conversions made in 2017 may be recharacterized as a contribution to a traditional IRA if the recharacterization is completed by October 15, 2018.

There are special rules that apply to conversions and recharacterizations, and if they are not followed, you may incur adverse Federal income tax consequences. You should consult your tax advisor before completing a conversion or recharacterization.

Death Benefit and IRAs

Pursuant to Treasury regulations, IRAs may not invest in life insurance contracts. We do not believe that these regulations prohibit the Death Benefit from being provided under the contract when we issue the contract as a Traditional or Roth IRA. However, the law is unclear and it is possible that the presence of the Death Benefit under a contract issued as a Traditional or Roth IRA could result in increased taxes to you. Certain Death Benefit options may not be available for all of our products.

Federal Income Tax Withholding

We will withhold and remit to the IRS a part of the taxable portion of each distribution made under a contract unless you notify us in writing prior to the distribution that tax is not to be withheld. In certain circumstances, Federal income tax rules may require us to withhold tax. At the time a withdrawal, surrender, or Annuity Payout is requested, we will give you an explanation of the withholding requirements.

Certain payments from your contract may be considered eligible rollover distributions (even if such payments are not being rolled over). Such distributions may be subject to special tax withholding requirements. The Federal income tax withholding rules require that we withhold 20% of the eligible rollover distribution from the payment amount, unless you elect to have the amount directly transferred to certain qualified plans or contracts. The IRS requires that tax be withheld, even if you have requested otherwise. Such

48

tax withholding requirements are generally applicable to 401(a), 403(a) or (b), HR 10, and 457(b) governmental plans and contracts used in connection with these types of plans.

Our Tax Status

Under the Code, we are not required to pay tax on investment income and realized capital gains of the VAA. We do not expect that we will incur any Federal income tax liability on the income and gains earned by the VAA. However, the Company does expect, to the extent permitted under the Code, to claim the benefit of the foreign tax credit as the owner of the assets of the VAA. Therefore, we do not impose a charge for Federal income taxes. If there are any changes in the Code that require us to pay tax on some or all of the income and gains earned by the VAA, we may impose a charge against the VAA to pay the taxes.

Changes in the Law

The above discussion is based on the Code, related regulations, and interpretations existing on the date of this prospectus. However, Congress, the IRS, and the courts may modify these authorities, sometimes retroactively.

Additional Information

Voting Rights

As required by law, we will vote the fund shares held in the VAA at meetings of the shareholders of the funds. The voting will be done according to the instructions of Contractowners who have interests in any Subaccounts which invest in classes of the funds. If the 1940 Act or any regulation under it should be amended or if present interpretations should change, and if as a result we determine that we are permitted to vote the fund shares in our own right, we may elect to do so.

The number of votes which you have the right to cast will be determined by applying your percentage interest in a Subaccount to the total number of votes attributable to the Subaccount. In determining the number of votes, fractional shares will be recognized.

Each underlying fund is subject to the laws of the state in which it is organized concerning, among other things, the matters which are subject to a shareholder vote, the number of shares which must be present in person or by proxy at a meeting of shareholders (a “quorum”), and the percentage of such shares present in person or by proxy which must vote in favor of matters presented. Because shares of the underlying fund held in the VAA are owned by us, and because under the 1940 Act we will vote all such shares in the same proportion as the voting instructions which we receive, it is important that each Contractowner provide their voting instructions to us. For funds un-affiliated with Lincoln, even though Contractowners may choose not to provide voting instruction, the shares of a fund to which such Contractowners would have been entitled to provide voting instruction will be voted by us in the same proportion as the voting instruction which we actually receive. For funds affiliated with Lincoln, shares of a fund to which such Contractowners would have been entitled to provide voting instruction will, once we receive a sufficient number of instructions we deem appropriate to ensure a fair representation of Contractowners eligible to vote, be voted by us in the same proportion as the voting instruction which we actually receive. As a result, the instruction of a small number of Contractowners could determine the outcome of matters subject to shareholder vote. All shares voted by us will be counted when the underlying fund determines whether any requirement for a minimum number of shares be present at such a meeting to satisfy a quorum requirement has been met. Voting instructions to abstain on any item to be voted on will be applied proportionately to reduce the number of votes eligible to be cast.

Whenever a shareholders meeting is called, we will provide or make available to each person having a voting interest in a Subaccount proxy voting material, reports and other materials relating to the funds. Since the funds engage in shared funding, other persons or entities besides Lincoln Life may vote fund shares. See Investments of the Variable Annuity Account – Fund Shares.

There are no voting rights associated with the Indexed Accounts.

Return Privilege

Within the free-look period after you receive the contract, you may cancel it for any reason by delivering or mailing it postage prepaid, to The Lincoln National Life Insurance Company at PO Box 2348, Fort Wayne, IN 46801-2348. A contract canceled under this provision will be void. Except as explained in the following paragraph, we will return the Contract Value as of the Valuation Date on which we receive the cancellation request, which includes the Interim Value for the Indexed Accounts, and any premium taxes which had been deducted. No applicable surrender charges will apply. A purchaser who participates in the VAA is subject to the risk of a market loss on the Contract Value during the free-look period.

For contracts written in those states whose laws require that we assume this market risk during the free-look period, a contract may be canceled, subject to the conditions explained before, except that we will return the greater of the Purchase Payment(s) or Contract Value as of the Valuation Date we receive the cancellation request, plus any premium taxes that had been deducted. IRA purchasers will also receive the greater of Purchase Payments or Contract Value as of the Valuation Date on which we receive the cancellation request.

49

If you cancel this contract within the free-look period, we reserve the right not to accept another application for this contract for a period of six months.

State Regulation

As a life insurance company organized and operated under Indiana law, we are subject to provisions governing life insurers and to regulation by the Indiana Commissioner of Insurance. Our books and accounts are subject to review and examination by the Indiana Department of Insurance at all times. A full examination of our operations is conducted by that Department at least every five years.

Records and Reports

As presently required by the 1940 Act and applicable regulations, we are responsible for maintaining all records and accounts relating to the VAA. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. We will mail to you, at your last known address of record at the Home Office, at least semi-annually after the first Contract Year, reports containing information required by that Act or any other applicable law or regulation.

A written (or electronic, if elected) confirmation of each transaction will be provided to you on the next Valuation Date, except for the following transactions, which are mailed quarterly:

• deduction of any account fee or rider charges;

• any rebalancing event under the portfolio rebalancing service;

• any transfer or withdrawal under AWS; and

• Periodic Income Payments from i4LIFE^® Indexed Advantage.

Electronic Delivery

You may elect to receive your prospectus, prospectus supplements, quarterly statements, and annual and semiannual reports electronically over the Internet, if you have an e-mail account and access to an Internet browser. Once you select eDelivery, via the Internet Service Center, all documents available in electronic format will no longer be sent to you in hard copy. You will receive an e-mail notification when the documents become available online. It is your responsibility to provide us with your current e-mail address. You can resume paper mailings at any time without cost, by updating your profile at the Internet Service Center, or contacting us. To learn more about this service, please log on to www.LincolnFinancial.com, select service centers and continue on through the Internet Service Center.

Information Incorporated by Reference

Under the Securities Act of 1933, Lincoln Life has filed with the SEC a registration statement on both Form S-3 and Form N-4 (the “Registration Statement”) relating to the Contracts offered by this prospectus. This prospectus is part of the Registration Statement: it does not contain all of the information set forth in the Registration Statement. As described below, and elsewhere in this prospectus, certain documents are or will be incorporated by reference into (i.e. made part of) this prospectus. Any statement contained in a document incorporated by reference into this prospectus in the future will be considered to supplement, change, or replace the existing information set forth in the prospectus, as applicable.

Lincoln Life files reports and other information with the SEC, as required under the Securities Exchange Act of 1934 (“the Exchange Act”). Lincoln Life’s annual report of Form 10-K for the period ended December 31, 2017 is incorporated by reference into this prospectus. Lincoln Life’s annual reports contain information about Lincoln Life, including its consolidated audited financial statements for Lincoln Life’s latest fiscal year. Lincoln Life files its Exchange Act documents and reports (including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K) electronically with the SEC under File No. 000-55871. In addition, all documents subsequently filed by Lincoln Life pursuant to sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering are also incorporated by reference into this prospectus. We are not incorporating by reference, in any case, any documents or information deemed to have been furnished and not filed in accordance with SEC rules.

Independent Registered Public Accounting Firm

The consolidated financial statements of The Lincoln National Life Insurance Company appearing in LNL’s Annual Report (Form 10-K) for the year ended December 31, 2017 (including schedules appearing therein), have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such financial statements are, and audited financial statements to be included in subsequently filed documents will be, incorporated herein in reliance upon the reports of Ernst & Young LLP pertaining to such financial statements (to the extent covered by consents filed with the Securities and Exchange Commission) given on the authority of such firm as experts in accounting and auditing.

50

Legal Proceedings

In the ordinary course of its business and otherwise, the Company and its subsidiaries or its separate accounts and Principal Underwriter may become or are involved in various pending or threatened legal proceedings, including purported class actions, arising from the conduct of its business. In some instances, the proceedings include claims for unspecified or substantial punitive damages and similar types of relief in addition to amounts for alleged contractual liability or requests for equitable relief.

After consultation with legal counsel and a review of available facts, it is management’s opinion that the proceedings, after consideration of any reserves and rights to indemnification, ultimately will be resolved without materially affecting the consolidated financial position of the Company and its subsidiaries, or the financial position of its separate accounts or Principal Underwriter. However, given the large and indeterminate amounts sought in certain of these proceedings and the inherent difficulty in predicting the outcome of such legal proceedings, it is reasonably possible that an adverse outcome in certain matters could be material to the Company's operating results for any particular reporting period. Please refer to the Statement of Additional Information for possible additional information regarding legal proceedings.

51

(This page intentionally left blank)

52

Contents of the Statement of Additional Information (SAI)
for Lincoln Life Variable Annuity Account N

Item

Special Terms

Services

Principal Underwriter

Purchase of Securities Being Offered

Annuity Payouts

Determination of Accumulation and Annuity Unit Value

Capital Markets

Advertising & Ratings

About the Indices

Unclaimed Property

Additional Services

Other Information

Financial Statements

For a free copy of the SAI complete the form below:

Statement of Additional Information Request Card
Lincoln Level Advantage^SMB-Share

Lincoln Life Variable Annuity Account N

Please send me a free copy of the current Statement of Additional Information for Lincoln Life Variable Annuity Account N Lincoln Level Advantage^SMB-Share.

(Please Print)

Name: 

Address: 

City 

State 

Zip 

Mail to The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46801-2348.

53

Appendix A – Interim Value Calculation

Interim Value for Indexed Segment(s) with no Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata portion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1+D)^-E where:

C = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by Us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by ((1 + G) X H) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed in the Indexed Term divided by total days in the Indexed Term.

Interim Value for Indexed Segment(s) with Annual Locks

The Interim Value of an Indexed Segment is equal to the sum of (1) and (2) not to exceed the pro-rata proportion of the Performance Cap as set forth in (3) where:

(1) is the fair value of the Indexed Crediting Base of an Indexed Segment on the Valuation Date the Interim Value is calculated. It is determined for an Indexed Segment as C multiplied by (1 + D)^-E where:

C = the initial Indexed Crediting Base of the Indexed Segment that has been proportionately adjusted for any transfers, withdrawals, Death Benefit payouts, or surrenders that have occurred during the Indexed Segment prior to the Valuation Date of the calculation;

D = the Reference Rate;
E = the total days remaining in the Indexed Term divided by 365.

(2) is the fair value of the replicating portfolio of options, determined solely by us, on any Valuation Date that the Interim Value is calculated for an Indexed Segment.

(3) is F multiplied by (1 + (G x H)) where:

F = the Indexed Crediting Base of the Indexed Segment on the Valuation Date of the calculation;
G = the Performance Cap for the Indexed Segment;
H = the total days elapsed since the prior Indexed Anniversary Date divided by 365.

Each component of the calculation is further explained as follows:

1.	The fair value of the Indexed Crediting Base of an Indexed Segment with no Annual Locks or an Indexed Segment with Annual Locks is meant to represent the market value of the investment instruments supporting the Indexed Segment. It is the present value of the Indexed Crediting Base of the Indexed Segment discounted at a rate that reflects movements in the interest rate market. The Reference Rate will apply on a uniform basis for a class of Contractowners in the same Indexed Segment and will be administered in a uniform and non-discriminatory manner.
	The maximum Reference Rate is the average U.S. Treasury Constant Maturity yield plus the LMVA Composite OAS Index rate. The U.S. Treasury Constant Maturity yield is the rate for the maturity using a set duration. The duration is set to represent the duration of the investment instruments supporting the Indexed Segment and may not match the actual length of the Indexed Segment. The average is measured using yields on the 1st, 8th, 15th, and 22nd day of the calendar month preceding the calendar month for which the Reference Rate applies.
	If the U.S. Treasury Constant Maturity yield is not published for a particular day, then we will use the yield on the next day it is published. If the U.S. Treasury Constant Maturity yield is no longer published, or is discontinued, then we may substitute another suitable method for determining this component of the Reference Rate. If a U.S. Treasury Constant Maturity yield is not published for a time to maturity that matches the selected duration, then the yield will be interpolated between the yield for maturities that are published.
	The LMVA Composite OAS Index rate will be as of the last business day of the month for which the Reference Rate applies.

A-1

	If the LMVA Composite OAS Index rate is no longer available, or is discontinued, we will substitute another suitable index or indexes for determining this component of the Reference Rate.
	The Reference Rate may be reduced by a rate reduction factor, which increases the value of (1) above. This rate reduction factor will vary with each Indexed Account option and will be declared at the same time a Performance Cap is declared. Currently, the rate reduction factor does not apply to 1-year Indexed Accounts. This rate reduction factor is available upon request by calling us.
2.	Fair Value of Replicating Portfolio of Options - We utilize a fair market value methodology to value the replicating portfolio of options that support this product.

For each Segment, we solely designate and value options, each of which is tied to the performance of the Index associated with the Segment in which you are invested. We use derivatives to provide an estimate of the gain or loss on the Indexed Crediting Base that could have occurred at the end of the Indexed Term. This estimate also reflects the impact of the Performance Cap and Protection Level at the end of the Indexed Term as well as the estimated cost of exiting the replicating options prior to the End Date of a Segment (and the time to Index Anniversaries for Annual Lock Segments). The valuation of the options is based on standard methods for valuing derivatives and based on inputs from third party vendors. The methodology used to value these options is determined solely by us and may vary, higher or lower, from other estimated valuations or the actual selling price of identical derivatives. Any variance between our estimated fair value price and other estimated or actual prices may be different from Segment type to Segment type and may also change from day to day.

The three options valued for each Indexed Account type are as follows:

A. At-the money call option: This represents the market value of the potential to receive an amount equal to the percentage growth in the Index during the Indexed Term.

B. Out-of-the-money call option: This represents the market value of the potential for gain in excess of the Performance Cap rate.

C. Out-of-the-money put option: This represents the market value of the potential to receive an amount equal to the excess loss beyond the Protection Level.

NOTE: This put option will always reduce the Interim Value even if the Index has increased during the Indexed Term.

The valuation of the options is based on standard models for valuing options for both the non-Annual Lock and Annual Lock Segments. For non-Annual Lock Segments, the replicating portfolio of options is equal to: A minus B minus C. For each Annual Lock Segment, we designate and value a replicating (derivative) structure which is tied to the compounded performance for each year of the Annual Lock Segment. The market standard model is adjusted by us to account for additional market risks relevant to the Annual Lock Segment. The key inputs, including but not limited to the following, are also incorporated into the models:

(1) Implied Volatility of the Index—This input varies with (i) how much time remains until the Segment End Date, which is determined by using an expiration date for the designated option that corresponds to that time remaining and (ii) the relationship between the strike price of that option and the level of the Index at the time of the calculation (including the potential for resets each Annual Lock Period).

This relationship is referred to as the “moneyness” of the option described above, and is calculated as the ratio of current price to the strike price. Direct market data for these inputs for any given early withdrawal is generally not available. This is because options on the Index that actually trade in the market have specific maturity dates and moneyness values that are unlikely to precisely match the Segment End Date (or remaining Annual Lock Periods) and moneyness of the designated option that we use in our calculations. Accordingly, we interpolate between the implied volatility quotes that are based on the actual maturities and moneyness values.

(2) Interest Rate — We use key derivative interest rates obtained from information provided by independent third-parties which are recognized financial reporting vendors. Interest rates are obtained for maturities adjacent to the actual time remaining in the Segment at the time of the early withdrawal. We use linear interpolation to derive the exact remaining duration rate needed as the input.

(3) Index Dividend Yield — On a daily basis, we use the projected annual dividend yield across the entire Index obtained from information provided by independent third-party financial institutions. This value is a widely used assumption and is readily available from recognized financial reporting vendors.

In addition, when we calculate the Interim Value, we obtain market values of derivatives each business day from outside vendors. If we are delayed in receiving these values, and cannot calculate a new Interim Value, we will use the prior business day’s Interim Value.

3. The pro rata portion of the Performance Cap equal to the days in the Indexed Term until the withdrawal is applied to the Indexed Crediting Base to place an upper limit on the performance credited during the Indexed Term.

A-2

SAI 3

Lincoln Level Advantage^SM B-Share
Lincoln Life Variable Annuity Account N  (Registrant)

The Lincoln National Life Insurance Company   (Depositor)

Statement of Additional Information (SAI)

This SAI should be read in conjunction with the Lincoln Level Advantage^SM B-Share prospectus of Lincoln Life Variable Annuity Account N dated May 18, 2018. You may obtain a copy of the Lincoln Level Advantage^SM B-Share prospectus on request and without charge. Please write Lincoln Life Customer Service, The Lincoln National Life Insurance Company, PO Box 2348, Fort Wayne, IN 46802, or call 1-877-737-6872.

Table of Contents

Item	Page
Special Terms	B-2
Services	B-2
Principal Underwriter	B-2
Purchase of Securities Being Offered	B-2
Annuity Payouts	B-2
Determination of Accumulation and Annuity Unit Value	B-3
Capital Markets	B-3

Item	Page
Advertising & Ratings	B-4
About the S&P 500 Index	B-4
Unclaimed Property	B-4
Additional Services	B-5
Other Information	B-5
Financial Statements	B-5

 

 

This SAI is not a prospectus.
The date of this SAI is May 18, 2018.

Special Terms

The special terms used in this SAI are the ones defined in the prospectus.

Services

Independent Registered Public Accounting Firm

Ernst & Young LLP, independent registered public accounting firm, One Commerce Square, 2005 Market Street, Suite 700, Philadelphia, Pennsylvania, 19103, has audited a) the financial statements of the Lincoln Life Variable Annuity Account N comprised of the subaccounts described in the related appendix to the opinion, as of December 31, 2017, and the related statement of operations and the statements of changes in net assets for the periods indicated in the appendix to the opinion; and b) the consolidated financial statements of The Lincoln National Life Insurance Company as of December 31, 2017 and 2016 and for each of the three years in the period ended December 31, 2017, as set forth in their reports, which are included in this SAI and Registration Statement. The aforementioned financial statements are included herein in reliance on Ernst & Young LLP’s reports, given on their authority as experts in accounting and auditing.

Keeper of Records

All accounts, books, records and other documents which are required to be maintained for the VAA are maintained by us or by third parties responsible to Lincoln Life. We have entered into an agreement with The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, Pennsylvania, 15258, to provide accounting services to the VAA. No separate charge against the assets of the VAA is made by us for this service.

Principal Underwriter

Lincoln Financial Distributors, Inc. (“LFD”), an affiliate of Lincoln Life, serves as principal underwriter (the “Principal Underwriter”) for the contracts, as described in the prospectus. The Principal Underwriter offers the contracts to the public on a continuous basis and anticipates continuing to offer the contracts, but reserves the right to discontinue the offering. The Principal Underwriter offers the contracts through sales representatives, who are associated with Lincoln Financial Advisors Corporation and/or Lincoln Financial Securities Corporation (collectively, “LFN”), our affiliates. The Principal Underwriter also may enter into selling agreements with other broker-dealers (“Selling Firms”) for the sale of the contracts. Sales representatives of Selling Firms are appointed as our insurance agents. LFD, acting as Principal Underwriter, paid $561,689,144, $433,441,077 and $485,694,075 to LFN and Selling Firms in 2015, 2016 and 2017 respectively, as sales compensation with respect to all the contracts offered under the VAA. The Principal Underwriter retained no underwriting commissions for the sale of the contracts.

Purchase of Securities Being Offered

The variable annuity contracts are offered to the public through licensed insurance agents who specialize in selling our products; through independent insurance brokers; and through certain securities brokers/dealers selected by us whose personnel are legally authorized to sell annuity products. There are no special purchase plans for any class of prospective buyers. However, under certain limited circumstances described in the prospectus under the section Charges and Other Deductions, any applicable account fee and/or surrender charge may be reduced or waived.

Both before and after the Annuity Commencement Date, there are exchange privileges between Subaccounts, and from the VAA to the general account (if available) subject to restrictions set out in the prospectus. See The Contracts, in the prospectus. No exchanges are permitted between the VAA and other separate accounts.

The offering of the contracts is continuous.

Annuity Payouts

Variable Annuity Payouts

Variable Annuity Payouts will be determined on the basis of:

• the dollar value of the contract on the Annuity Commencement Date less any applicable premium tax;

• the annuity tables contained in the contract;

• the type of annuity option selected; and

B-2

• the investment results of the fund(s) selected.

In order to determine the amount of variable Annuity Payouts, we make the following calculation:

• first, we determine the dollar amount of the first payout;

• second, we credit the contract with a fixed number of Annuity Units based on the amount of the first payout; and

• third, we calculate the value of the Annuity Units each period thereafter.

These steps are explained below.

The dollar amount of the first periodic variable Annuity Payout is determined by applying the total value of the Accumulation Units credited under the contract valued as of the Annuity Commencement Date (less any premium taxes) to the annuity tables contained in the contract. The first variable Annuity Payout will be paid 14 days after the Annuity Commencement Date. This day of the month will become the day on which all future Annuity Payouts will be paid. Amounts shown in the tables are based on the 1983 Table “a” Individual Annuity Mortality Tables, modified, with an assumed investment return at the rate of 3%, 4%, 5% or 6% per annum, depending on the terms of your contract. The first Annuity Payout is determined by multiplying the benefit per $1,000 of value shown in the contract tables by the number of thousands of dollars of value accumulated under the contract. These annuity tables vary according to the form of annuity selected and the age of the Annuitant at the Annuity Commencement Date. The assumed interest rate is the measuring point for subsequent Annuity Payouts. If the actual net investment rate (annualized) exceeds the assumed interest rate, the payout will increase at a rate equal to the amount of such excess.

Conversely, if the actual rate is less than the assumed interest rate, Annuity Payouts will decrease. If the assumed rate of interest were to be increased, Annuity Payouts would start at a higher level but would decrease more rapidly or increase more slowly.

We may use sex-distinct annuity tables in contracts that are not associated with employer sponsored plans and where not prohibited by law.

At an Annuity Commencement Date, the contract is credited with Annuity Units for each Subaccount on which variable Annuity Payouts are based. The number of Annuity Units to be credited is determined by dividing the amount of the first periodic payout by the value of an Annuity Unit in each Subaccount selected. Although the number of Annuity Units is fixed by this process, the value of such units will vary with the value of the underlying fund. The amount of the second and subsequent periodic payouts is determined by multiplying the Contractowner’s fixed number of Annuity Units in each Subaccount by the appropriate Annuity Unit value for the Valuation Date ending 14 days prior to the date that payout is due.

The value of each Subaccount’s Annuity Unit will be set initially at $1.00. The Annuity Unit value for each Subaccount at the end of any Valuation Date is determined by multiplying the Subaccount Annuity Unit value for the immediately preceding Valuation Date by the product of:

• The net investment factor of the Subaccount for the Valuation Period for which the Annuity Unit value is being determined, and

• A factor to neutralize the assumed investment return in the annuity table.

The value of the Annuity Units is determined as of a Valuation Date 14 days prior to the payment date in order to permit calculation of amounts of Annuity Payouts and mailing of checks in advance of their due dates. Such checks will normally be issued and mailed at least three days before the due date.

Determination of Accumulation and Annuity Unit Value

A description of the days on which Accumulation and Annuity Units will be valued is given in the prospectus. The New York Stock Exchange's (NYSE) most recent announcement (which is subject to change) states that it will be closed on weekends and on these holidays: New Year's Day, Martin Luther King Day, President's Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. If any of these holidays occurs on a weekend day, the Exchange may also be closed on the business day occurring just before or just after the holiday. It may also be closed on other days.

Since the portfolios of some of the funds and series will consist of securities primarily listed on foreign exchanges or otherwise traded outside the United States, those securities may be traded (and the net asset value of those funds and series and of the variable account could therefore be significantly affected) on days when the investor has no access to those funds and series.

Capital Markets

In any particular year, our capital may increase or decrease depending on a variety of factors — the amount of our statutory income or losses (which is sensitive to equity market and credit market conditions), the amount of additional capital we must hold to support business growth, changes in reserving requirements, our inability to secure capital market solutions to provide reserve relief, such as issuing letters of credit to support captive reinsurance structures, changes in equity market levels, the value of certain fixed-income and equity securities in our investment portfolio and changes in interest rates.

B-3

Advertising & Ratings

We may include in certain advertisements, endorsements in the form of a list of organizations, individuals or other parties which recommend Lincoln Life or the policies. Furthermore, we may occasionally include in advertisements comparisons of currently taxable and tax deferred investment programs, based on selected tax brackets, or discussions of alternative investment vehicles and general economic conditions.

Our financial strength is ranked and rated by nationally recognized independent rating agencies. The ratings do not imply approval of the product and do not refer to the performance of the product, or any separate account, including the underlying investment options. Ratings are not recommendations to buy our products. Each of the rating agencies reviews its ratings periodically. Accordingly, all ratings are subject to revision or withdrawal at any time by the rating agencies, and therefore, no assurance can be given that these ratings will be maintained. The current outlook for the insurance subsidiaries is stable for Moody’s, A.M. Best and Standard & Poor’s, and positive for Fitch. Our financial strength ratings, which are intended to measure our ability to meet contract holder obligations, are an important factor affecting public confidence in most of our products and, as a result, our competitiveness. A downgrade of our financial strength rating could affect our competitive position in the insurance industry by making it more difficult for us to market our products as potential customers may select companies with higher financial strength ratings and by leading to increased withdrawals by current customers seeking companies with higher financial strength ratings. For more information on ratings, including outlooks, see www.LincolnFinancial.com/investor.

About the S&P 500 Index

The S&P 500 Index (hereinafter “Index”) is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”), and has been licensed for use by Lincoln Variable Insurance Products Trust and its affiliates (hereinafter “Licensee”). Standard & Poor’s^® and S&P^® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”) and Dow Jones^® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The fund(s) are not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or any of their respective affiliates (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices do not make any representation or warranty, express or implied, to the owners of the funds or any member of the public regarding the advisability of investing in securities generally or in the funds particularly or the ability of the Index to track general market performance. S&P Dow Jones Indices only relationship to Licensee with respect to the Index is the licensing of the Index and certain trademarks, service marks and/or trade names of S&P Dow Jones Indices and/or its licensors. The Index is determined, composed and calculated by S&P Dow Jones Indices without regard to Licensee or the funds. S&P Dow Jones Indices have no obligation to take the needs of Licensee or the owners of the funds into consideration in determining, composing or calculating the Index. S&P Dow Jones Indices are not responsible for and have not participated in the determination of the prices, and amount of the funds or the timing of the issuance or sale of the funds or in the determination or calculation of the equation by which the funds are to be converted into cash, surrendered or redeemed, as the case may be. S&P Dow Jones Indices have no obligation or liability in connection with the administration, marketing or trading of the funds. There is no assurance that investment products based on the Index will accurately track index performance or provide positive investment returns. S&P Dow Jones Indices LLC is not an investment advisor. Inclusion of a security within an index is not a recommendation by S&P Dow Jones Indices to buy, sell, or hold such security, nor is it considered to be investment advice.

S&P DOW JONES INDICES DO NOT GUARANTEE THE ADEQUACY, ACCURACY, TIMELINESS AND/OR THE COMPLETENESS OF THE INDEX OR ANY DATA RELATED THERETO OR ANY COMMUNICATION, INCLUDING BUT NOT LIMITED TO, ORAL OR WRITTEN COMMUNICATION (INCLUDING ELECTRONIC COMMUNICATIONS) WITH RESPECT THERETO. S&P DOW JONES INDICES SHALL NOT BE SUBJECT TO ANY DAMAGES OR LIABILITY FOR ANY ERRORS, OMISSIONS, OR DELAYS THEREIN. S&P DOW JONES INDICES MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE OR AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDEX OR WITH RESPECT TO ANY DATA RELATED THERETO. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT WHATSOEVER SHALL S&P DOW JONES INDICES BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES INCLUDING BUT NOT LIMITED TO, LOSS OF PROFITS, TRADING LOSSES, LOST TIME OR GOODWILL, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, WHETHER IN CONTRACT, TORT, STRICT LIABILITY, OR OTHERWISE. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN S&P DOW JONES INDICES AND LICENSEE, OTHER THAN THE LICENSORS OF S&P DOW JONES INDICES.

Unclaimed Property

We have entered into a Global Resolution Agreement with a third party auditor representing multiple states and jurisdictions. Under the terms of the Global Resolution Agreement, the third party auditor has compared expanded matching criteria to the Social Security Master Death File (“SSMDF”) to identify deceased insureds and policy or contract holders where a valid claim has not been made. We

B-4

have also entered into a Regulatory Settlement Agreement with multiple states and jurisdictions. The Regulatory Settlement Agreement applies prospectively and requires us to adopt and implement additional procedures comparing our records to the SSMDF to identify unclaimed death benefits and prescribes procedures for identifying and locating beneficiaries once deaths are identified. Other jurisdictions that are not signatories to the Regulatory Settlement Agreement are conducting examinations and audits of our compliance with unclaimed property laws. Any escheatable property identified as a result of the audits and inquiries could result in additional payments of previously unclaimed death benefits or the payment of abandoned funds to U.S. jurisdictions.

Additional Services

Automatic Withdrawal Service (AWS)—AWS provides an automatic, periodic withdrawal of Contract Value to you. AWS may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. You may elect to participate in AWS at the time of application or at any time before the Annuity Commencement Date by sending a written request to us. The minimum Contract Value required to establish AWS is $10,000. You may cancel or make changes to your AWS program at any time by sending a written request to us. If telephone authorization has been elected, certain changes may be made by telephone. Notwithstanding the requirements of the program, any withdrawal must be permitted under Section 401(a)(9) of the IRC for qualified plans or permitted under Section 72 of the IRC for nonqualified contracts. To the extent that withdrawals under AWS do not qualify for an exemption from the contingent deferred sales charge, we will assess any applicable surrender charges on those withdrawals. See Surrender Charge.

Portfolio Rebalancing — Portfolio rebalancing is an option, which, if elected by the Contractowner, restores to a pre-determined level the percentage of the Contract Value (or Account Value under i4LIFE^® Advantage), allocated to each variable Subaccount. This pre-determined level will be the allocation initially selected when the contract was purchased, unless subsequently changed. The portfolio rebalancing allocation may be changed at any time by submitting a written request to us. If portfolio rebalancing is elected, all Purchase Payments allocated to the variable Subaccounts must be subject to portfolio rebalancing. Portfolio rebalancing may take place on either a monthly, quarterly, semi-annual or annual basis, as selected by the Contractowner. The Contractowner may terminate the portfolio rebalancing program or re-enroll at any time by sending a written request to us. If telephone authorization has been elected, the Contractowner may make these elections by phone. The portfolio rebalancing program is not available following the Annuity Commencement Date.

Please note that all of the services discussed in this section will stop once we are notified of a pending death claim.

Other Information

Due to differences in redemption rates, tax treatment or other considerations, the interests of policyholders under the variable life accounts could conflict with those of Contractowners under the VAA. In those cases, where assets from variable life and variable annuity separate accounts are invested in the same fund(s) (i.e., where mixed funding occurs), the Boards of Directors of the fund involved will monitor for any material conflicts and determine what action, if any, should be taken. If it becomes necessary for any separate account to replace shares of any fund with another investment, that fund may have to liquidate securities on a disadvantageous basis. Refer to the prospectus for each fund for more information about mixed funding.

Financial Statements

The December 31, 2017 financial statements of the VAA and the December 31, 2017 consolidated financial statements of Lincoln Life appear on the following pages.

B-5

The Lincoln National Life Insurance Company

Consolidated Financial Statements

December 31, 2017 and 2016

Report of Independent Registered Public Accounting Firm

To the Stockholder and the Board of Directors of

The Lincoln National Life Insurance Company

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of The Lincoln National Life Insurance Company (the Company) as of December 31, 2017 and 2016, the related consolidated statements of comprehensive income (loss), stockholder’s equity and cash flows for each of the three years in the period ended December 31, 2017, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017, in conformity with U.S. generally accepted accounting principles.

Adoption of New Accounting Standard

As discussed in Note 1 to the consolidated financial statements, in 2017 the Company changed its method of accounting for goodwill impairment.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting 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. 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 1966.

Philadelphia, Pennsylvania

March 13, 2018

1

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

CONSOLIDATED BALANCE SHEETS

(in millions, except share data)

	As of December 31,
	2017		2016
ASSETS
Investments:
Available-for-sale securities, at fair value:
Fixed maturity securities (amortized cost:  2017 – $85,802; 2016 – $83,290)	$	93,340	$	87,866
Variable interest entities’ fixed maturity securities (amortized cost:  2017 – $0; 2016 – $200)		-		200
Equity securities (cost:  2017 – $247; 2016 – $260)		246		275
Trading securities		1,533		1,624
Mortgage loans on real estate		10,662		9,761
Real estate		11		12
Policy loans		2,379		2,429
Derivative investments		845		900
Other investments		2,006		2,034
Total investments		111,022		105,101
Cash and invested cash		947		2,057
Deferred acquisition costs and value of business acquired		8,408		9,143
Premiums and fees receivable		394		428
Accrued investment income		1,052		1,029
Reinsurance recoverables		6,515		6,810
Reinsurance related embedded derivatives		-		58
Funds withheld reinsurance assets		598		623
Goodwill		1,368		2,273
Other assets		7,349		6,132
Separate account assets		144,219		128,397
Total assets	$	281,872	$	262,051
LIABILITIES AND STOCKHOLDER’S EQUITY
Liabilities
Future contract benefits	$	22,063	$	20,681
Other contract holder funds		79,481		78,106
Short-term debt		10		280
Long-term debt		2,374		2,549
Reinsurance related embedded derivatives		51		-
Funds withheld reinsurance liabilities		4,348		4,827
Deferred gain on business sold through reinsurance		41		67
Payables for collateral on investments		4,354		4,910
Other liabilities		6,486		6,414
Separate account liabilities		144,219		128,397
Total liabilities		263,427		246,231
Contingencies and Commitments (See Note 13)
Stockholder’s Equity
Common stock – 10,000,000 shares authorized, issued and outstanding		10,713		10,696
Retained earnings		4,405		3,342
Accumulated other comprehensive income (loss)		3,327		1,782
Total stockholder’s equity		18,445		15,820
Total liabilities and stockholder’s equity	$	281,872	$	262,051

See accompanying Notes to Consolidated Financial Statements

2

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions)

	For the Years Ended December 31,
	2017			2016			2015
Revenues
Insurance premiums	$	3,018		$	2,579		$	2,825
Fee income		5,369			5,171			4,960
Net investment income		4,760			4,631			4,611
Realized gain (loss):
Total other-than-temporary impairment losses on securities		(18	)		(141	)		(75	)
Portion of loss recognized in other comprehensive income		-			41			25
Net other-than-temporary impairment losses on securities recognized in earnings		(18	)		(100	)		(50	)
Realized gain (loss), excluding other-than-temporary impairment losses on securities		(438	)		(410	)		(172	)
Total realized gain (loss)		(456	)		(510	)		(222	)
Amortization of deferred gain on business sold through reinsurance		18			69			69
Other revenues		439			403			440
Total revenues		13,148			12,343			12,683
Expenses
Interest credited		2,558			2,527			2,472
Benefits		4,818			4,247			4,529
Commissions and other expenses		3,967			4,005			4,109
Interest and debt expense		126			116			105
Strategic digitization expense		43			8			-
Impairment of intangibles		905			-			-
Total expenses		12,417			10,903			11,215
Income (loss) before taxes		731			1,440			1,468
Federal income tax expense (benefit)		(1,287	)		267			295
Net income (loss)		2,018			1,173			1,173
Other comprehensive income (loss), net of tax:
Unrealized investment gains (losses)		1,547			692			(2,090	)
Funded status of employee benefit plans		(2	)		(1	)		2
Total other comprehensive income (loss), net of tax		1,545			691			(2,088	)
Comprehensive income (loss)	$	3,563		$	1,864		$	(915	)

See accompanying Notes to Consolidated Financial Statements

3

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF STOCKHOLDER’S EQUITY

(in millions)

	For the Years Ended December 31,
	2017			2016			2015
Common Stock
Balance as of beginning-of-year	$	10,696		$	10,677		$	10,652
Stock compensation/issued for benefit plans		17			19			25
Balance as of end-of-year		10,713			10,696			10,677
Retained Earnings
Balance as of beginning-of-year		3,342			3,118			3,066
Net income (loss)		2,018			1,173			1,173
Dividends declared		(955	)		(949	)		(1,121	)
Balance as of end-of-year		4,405			3,342			3,118
Accumulated Other Comprehensive Income (Loss)
Balance as of beginning-of-year		1,782			1,091			3,179
Other comprehensive income (loss), net of tax		1,545			691			(2,088	)
Balance as of end-of-year		3,327			1,782			1,091
Total stockholder’s equity as of end-of-year	$	18,445		$	15,820		$	14,886

See accompanying Notes to Consolidated Financial Statements

4

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

	For the Years Ended December 31,
	2017			2016			2015
Cash Flows from Operating Activities
Net income (loss)	$	2,018		$	1,173		$	1,173
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Deferred acquisition costs, value of business acquired, deferred sales inducements
and deferred front-end loads deferrals and interest, net of amortization		(17	)		55			(176	)
Trading securities purchases, sales and maturities, net		120			165			143
Change in premiums and fees receivable		34			(49	)		101
Change in accrued investment income		19			8			(18	)
Change in future contract benefits and other contract holder funds		(2,062	)		(2,036	)		868
Change in reinsurance related assets and liabilities		1,001			542			(1,060	)
Change in federal income tax accruals		(1,502	)		146			170
Realized (gain) loss		456			511			222
Amortization of deferred gain on business sold through reinsurance		(18	)		(69	)		(69	)
Change in cash management agreement		(277	)		(66	)		351
Impairment of intangibles		905			-			-
Other		177			262			45
Net cash provided by (used in) operating activities		854			642			1,750
Cash Flows from Investing Activities
Purchases of available-for-sale securities		(9,887	)		(10,791	)		(8,858	)
Sales of available-for-sale securities		1,773			3,076			1,329
Maturities of available-for-sale securities		5,790			5,290			4,265
Purchases of alternative investments		(357	)		(302	)		(324	)
Sales and repayments of alternative investments		184			238			177
Proceeds from affiliate transfer of alternative investments		66			-			-
Issuance of mortgage loans on real estate		(2,047	)		(2,127	)		(1,944	)
Repayment and maturities of mortgage loans on real estate		1,145			877			816
Issuance and repayment of policy loans, net		49			91			125
Net change in collateral on investments and derivatives		(374	)		435			638
Proceeds from sale of subsidiary/business		-			-			75
Other		(123	)		(99	)		(78	)
Net cash provided by (used in) investing activities		(3,781	)		(3,312	)		(3,779	)
Cash Flows from Financing Activities
Payment of long-term debt, including current maturities		(290	)		(250	)		(4	)
Issuance of long-term debt, net of issuance costs		75			-			-
Issuance (payment) of short-term debt		(270	)		190			88
Proceeds from sales leaseback transaction		62			85			47
Deposits of fixed account values, including the fixed portion of variable		10,775			10,030			10,745
Withdrawals of fixed account values, including the fixed portion of variable		(5,764	)		(5,449	)		(6,062	)
Transfers to and from separate accounts, net		(1,787	)		(1,308	)		(2,474	)
Common stock issued for benefit plans		(29	)		(22	)		(14	)
Dividends paid		(955	)		(949	)		(1,121	)
Net cash provided by (used in) financing activities		1,817			2,327			1,205
Net increase (decrease) in cash and invested cash		(1,110	)		(343	)		(824	)
Cash and invested cash as of beginning-of-year		2,057			2,400			3,224
Cash and invested cash as of end-of-year	$	947		$	2,057		$	2,400

See accompanying Notes to Consolidated Financial Statements

5

THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Nature of Operations, Basis of Presentation and Summary of Significant Accounting Policies

Nature of Operations

The Lincoln National Life Insurance Company (“LNL” or the “Company,” which also may be referred to as “we,” “our” or “us”), a wholly-owned subsidiary of Lincoln National Corporation (“LNC” or the “Parent Company”), is domiciled in the state of Indiana.  We own 100% of the outstanding common stock of one insurance company subsidiary, Lincoln Life & Annuity Company of New York (“LLANY”).  We also own several non-insurance companies, including Lincoln Financial Distributors, our wholesale distributor, and Lincoln Financial Advisors Corporation, part of LNC’s retail distributor, Lincoln Financial Network.  LNL’s principal businesses consist of underwriting annuities, deposit-type contracts and life insurance through multiple distribution channels.  LNL is licensed and sells its products throughout the U.S. and several U.S. territories.  See Note 21 for additional information.

Basis of Presentation

The accompanying consolidated financial statements are prepared in accordance with United States of America generally accepted accounting principles (“GAAP”).  Certain GAAP policies, which significantly affect the determination of financial condition, results of operations and cash flows, are summarized below.

Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of LNL and all other entities in which we have a controlling financial interest and any variable interest entities (“VIEs”) in which we are the primary beneficiary.  We use the equity method of accounting to recognize all of our investments in limited liability partnerships.  All material inter-company accounts and transactions have been eliminated in consolidation. 

Our involvement with VIEs is primarily to invest in assets that allow us to gain exposure to a broadly diversified portfolio of asset classes.  A VIE is an entity that does not have sufficient equity to finance its own activities without additional financial support or where investors lack certain characteristics of a controlling financial interest.  We assess our contractual, ownership or other interests in a VIE to determine if our interest participates in the variability the VIE was designed to absorb and pass onto variable interest holders.  We perform an ongoing qualitative assessment of our variable interests in VIEs to determine whether we have a controlling financial interest and would therefore be considered the primary beneficiary of the VIE.  If we determine we are the primary beneficiary of a VIE, we consolidate the assets and liabilities of the VIE in our consolidated financial statements.

Accounting Estimates and Assumptions

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses for the reporting period.  Those estimates are inherently subject to change and actual results could differ from those estimates.  Included among the material (or potentially material) reported amounts and disclosures that require extensive use of estimates are:  fair value of certain invested assets and derivatives, other-than-temporary impairment (“OTTI”) and asset valuation allowances, deferred acquisition costs (“DAC”),  value of business acquired (“VOBA”), deferred sales inducements (“DSI”), goodwill, future contract benefits, other contract holder funds including deferred front-end loads (“DFEL”), pension plans, stock-based incentive compensation, income taxes and the potential effects of resolving litigated matters.

Business Combinations

We use the acquisition method of accounting for all business combination transactions, and accordingly, recognize the fair values of assets acquired, liabilities assumed and any noncontrolling interests in our consolidated financial statements.  The allocation of fair values may be subject to adjustment after the initial allocation for up to a one-year period as more information becomes available relative to the fair values as of the acquisition date.  The consolidated financial statements include the results of operations of any acquired company since the acquisition date.

6

Fair Value Measurement

Our measurement of fair value is based on assumptions used by market participants in pricing the asset or liability, which may include inherent risk, restrictions on the sale or use of an asset or non-performance risk (“NPR”), which would include our own credit risk.  Our estimate of an exchange price is the price in an orderly transaction between market participants to sell the asset or transfer the liability (“exit price”) in the principal market, or the most advantageous market in the absence of a principal market, for that asset or liability, as opposed to the price that would be paid to acquire the asset or receive a liability (“entry price”).  Pursuant to the Fair Value Measurements and Disclosures Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards CodificationTM (“ASC”),

we categorize our financial instruments carried at fair value into a three-level fair value hierarchy, based on the priority of inputs to the respective valuation technique.  The three-level hierarchy for fair value measurement is defined as follows:

· Level 1 – inputs to the valuation methodology are quoted prices available in active markets for identical investments as of the reporting date, except for large holdings subject to “blockage discounts” that are excluded;

· Level 2 – inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value can be determined through the use of models or other valuation methodologies; and

· Level 3 – inputs to the valuation methodology are unobservable inputs in situations where there is little or no market activity for the asset or liability, and we make estimates and assumptions related to the pricing of the asset or liability, including assumptions regarding risk.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, the level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement.  Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment. 

When a determination is made to classify an asset or liability within Level 3 of the fair value hierarchy, the determination is based upon the significance of the unobservable inputs to the overall fair value measurement.  Because certain securities trade in less liquid or illiquid markets with limited or no pricing information, the determination of fair value for these securities is inherently more difficult.  However, Level 3 fair value investments may include, in addition to the unobservable or Level 3 inputs, observable components, which are components that are actively quoted or can be validated to market-based sources.

Available-For-Sale Securities – Fair Valuation Methodologies and Associated Inputs

Securities classified as available-for-sale (“AFS”) consist of fixed maturity and equity securities and are stated at fair value with unrealized gains and losses included within accumulated other comprehensive income (loss) (“AOCI”), net of associated DAC, VOBA, DSI, future contract benefits, other contract holder funds and deferred income taxes. 

We measure the fair value of our securities classified as AFS based on assumptions used by market participants in pricing the security.  The most appropriate valuation methodology is selected based on the specific characteristics of the fixed maturity or equity security, and we consistently apply the valuation methodology to measure the security’s fair value.  Our fair value measurement is based on a market approach that utilizes prices and other relevant information generated by market transactions involving identical or comparable securities.  Sources of inputs to the market approach primarily include third-party pricing services, independent broker quotations or pricing matrices.  We do not adjust prices received from third parties; however, we do analyze the third-party pricing services’ valuation methodologies and related inputs and perform additional evaluation to determine the appropriate level within the fair value hierarchy.

The observable and unobservable inputs to our valuation methodologies are based on a set of standard inputs that we generally use to evaluate all of our AFS securities.  Observable inputs include benchmark yields, reported trades, broker-dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data.  In addition, market indicators, industry and economic events are monitored, and further market data is acquired if certain triggers are met.  For certain security types, additional inputs may be used, or some of the inputs described above may not be applicable.  For private placement securities, we use pricing matrices that utilize observable pricing inputs of similar public securities and Treasury yields as inputs to the fair value measurement.  Depending on the type of security or the daily market activity, standard inputs may be prioritized differently or may not be available for all AFS securities on any given day.  For broker-quoted only securities, non-binding quotes from market makers or broker-dealers are obtained from sources recognized as market participants.  For securities trading in less liquid or illiquid markets with limited or no pricing information, we use unobservable inputs to measure fair value. 

The following summarizes our fair valuation methodologies and associated inputs, which are particular to the specified security type and are in addition to the defined standard inputs to our valuation methodologies for all of our AFS securities discussed above:

· Corporate bonds and U.S. government bonds – We also use Trade Reporting and Compliance EngineTM reported tables for our corporate bonds and vendor trading platform data for our U.S. government bonds. 

· Mortgage- and asset-backed securities (“ABS”) – We also utilize additional inputs, which include new issues data, monthly payment information and monthly collateral performance, including prepayments, severity, delinquencies, step-down features and over collateralization features for each of our mortgage-backed securities (“MBS”), which include collateralized mortgage obligations and 7

mortgage pass through securities backed by residential mortgages (“RMBS”), commercial mortgage-backed securities (“CMBS”), collateralized loan obligations (“CLOs”) and collateralized debt obligations (“CDOs”).

· State and municipal bonds – We also use additional inputs that include information from the Municipal Securities Rule Making Board, as well as material event notices, new issue data, issuer financial statements and Municipal Market Data benchmark yields for our state and municipal bonds.

· Hybrid and redeemable preferred and equity securities – We also utilize additional inputs of exchange prices (underlying and common stock of the same issuer) for our hybrid and redeemable preferred and equity securities.

In order to validate the pricing information and broker-dealer quotes, we employ, where possible, procedures that include comparisons with similar observable positions, comparisons with subsequent sales and observations of general market movements for those security classes.  We have policies and procedures in place to review the process that is utilized by our third-party pricing service and the output that is provided to us by the pricing service.  On a periodic basis, we test the pricing for a sample of securities to evaluate the inputs and assumptions used by the pricing service, and we perform a comparison of the pricing service output to an alternative pricing source.  We also evaluate prices provided by our primary pricing service to ensure that they are not stale or unreasonable by reviewing the prices for unusual changes from period to period based on certain parameters or for lack of change from one period to the next. 

AFS Securities – Evaluation for Recovery of Amortized Cost

We regularly review our AFS securities for declines in fair value that we determine to be other-than-temporary.  For an equity security, if we do not have the ability and intent to hold the security for a sufficient period of time to allow for a recovery in value, we conclude that an OTTI has occurred and the amortized cost of the equity security is written down to the current fair value, with a corresponding charge to realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).  When assessing our ability and intent to hold the equity security to recovery, we consider, among other things, the severity and duration of the decline in fair value of the equity security as well as the cause of the decline, a fundamental analysis of the liquidity, and business prospects and overall financial condition of the issuer. 

For our fixed maturity AFS securities (also referred to as “debt securities”), we generally consider the following to determine whether our debt securities with unrealized losses are other-than-temporarily impaired:

· The estimated range and average period until recovery;

· The estimated range and average holding period to maturity;

· Remaining payment terms of the security;

· Current delinquencies and nonperforming assets of underlying collateral;

· Expected future default rates;

· Collateral value by vintage, geographic region, industry concentration or property type;

· Subordination levels or other credit enhancements as of the balance sheet date as compared to origination; and

· Contractual and regulatory cash obligations.

For a debt security, if we intend to sell a security, or it is more likely than not we will be required to sell a debt security before recovery of its amortized cost basis and the fair value of the debt security is below amortized cost, we conclude that an OTTI has occurred and the amortized cost is written down to current fair value, with a corresponding charge to realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).  If we do not intend to sell a debt security, or it is not more likely than not we will be required to sell a debt security before recovery of its amortized cost basis but the present value of the cash flows expected to be collected is less than the amortized cost of the debt security (referred to as the credit loss), we conclude that an OTTI has occurred and the amortized cost is written down to the estimated recovery value with a corresponding charge to realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss), as this amount is deemed the credit portion of the OTTI.  The remainder of the decline to fair value is recorded in other comprehensive income (“OCI”) to unrealized OTTI on AFS securities on our Consolidated Statements of Stockholder’s Equity, as this amount is considered a noncredit (i.e., recoverable) impairment.

When assessing our intent to sell a debt security, or if it is more likely than not we will be required to sell a debt security before recovery of its cost basis, we evaluate facts and circumstances such as, but not limited to, decisions to reposition our security portfolio, sales of securities to meet cash flow needs and sales of securities to capitalize on favorable pricing.  Management considers the following as part of the evaluation:

· The current economic environment and market conditions;

· Our business strategy and current business plans;

· The nature and type of security, including expected maturities and exposure to general credit, liquidity, market and interest rate risk;

· Our analysis of data from financial models and other internal and industry sources to evaluate the current effectiveness of our hedging and overall risk management strategies;

· The current and expected timing of contractual maturities of our assets and liabilities, expectations of prepayments on investments and expectations for surrenders and withdrawals of life insurance policies and annuity contracts;

· The capital risk limits approved by management; and

· Our current financial condition and liquidity demands.

8

In order to determine the amount of the credit loss for a debt security, we calculate the recovery value by performing a discounted cash flow analysis based on the current cash flows and future cash flows we expect to recover.  The discount rate is the effective interest rate implicit in the underlying debt security.  The effective interest rate is the original yield, or the coupon if the debt security was previously impaired.  See the discussion below for additional information on the methodology and significant inputs, by security type, that we use to determine the amount of a credit loss.

To determine the recovery period of a debt security, we consider the facts and circumstances surrounding the underlying issuer including, but not limited to, the following:

· Historical and implied volatility of the security;

· Length of time and extent to which the fair value has been less than amortized cost;

· Adverse conditions specifically related to the security or to specific conditions in an industry or geographic area;

· Failure, if any, of the issuer of the security to make scheduled payments; and

· Recoveries or additional declines in fair value subsequent to the balance sheet date. 

In periods subsequent to the recognition of an OTTI, the AFS security is accounted for as if it had been purchased on the measurement date of the OTTI.  Therefore, for the fixed maturity AFS security, the original discount or reduced premium is reflected in net investment income over the contractual term of the investment in a manner that produces a constant effective yield.

To determine recovery value of a corporate bond, CLO or CDO, we perform additional analysis related to the underlying issuer including, but not limited to, the following:

· Fundamentals of the issuer to determine what we would recover if they were to file bankruptcy versus the price at which the market is trading;

· Fundamentals of the industry in which the issuer operates;

· Earnings multiples for the given industry or sector of an industry that the underlying issuer operates within, divided by the outstanding debt to determine an expected recovery value of the security in the case of a liquidation;

· Expected cash flows of the issuer (e.g., whether the issuer has cash flows in excess of what is required to fund its operations);

· Expectations regarding defaults and recovery rates;

· Changes to the rating of the security by a rating agency; and

· Additional market information (e.g., if there has been a replacement of the corporate debt security).

Each quarter we review the cash flows for the MBS to determine whether or not they are sufficient to provide for the recovery of our amortized cost.  We revise our cash flow projections only for those securities that are at most risk for impairment based on current credit enhancement and trends in the underlying collateral performance.  To determine recovery value of a MBS, we perform additional analysis related to the underlying issuer including, but not limited to, the following:

· Discounted cash flow analysis based on the current cash flows and future cash flows we expect to recover;

· Level of creditworthiness of the home equity loans or residential mortgages that back an RMBS or commercial mortgages that back a CMBS;

· Susceptibility to fair value fluctuations for changes in the interest rate environment;

· Susceptibility to reinvestment risks, in cases where market yields are lower than the securities’ book yield earned;

· Susceptibility to reinvestment risks, in cases where market yields are higher than the book yields earned on a security;

· Expectations of sale of such a security where market yields are higher than the book yields earned on a security; and

· Susceptibility to variability of prepayments.

When evaluating MBS and mortgage-related ABS, we consider a number of pool-specific factors as well as market level factors when determining whether or not the impairment on the security is temporary or other-than-temporary.  The most important factor is the performance of the underlying collateral in the security and the trends of that performance in the prior periods.  We use this information about the collateral to forecast the timing and rate of mortgage loan defaults, including making projections for loans that are already delinquent and for those loans that are currently performing but may become delinquent in the future.  Other factors used in this analysis include the credit characteristics of borrowers, geographic distribution of underlying loans and timing of liquidations by state.  Once default rates and timing assumptions are determined, we then make assumptions regarding the severity of a default if it were to occur.  Factors that impact the severity assumption include expectations for future home price appreciation or depreciation, loan size, first lien versus second lien, existence of loan level private mortgage insurance, type of occupancy and geographic distribution of loans.  Once default and severity assumptions are determined for the security in question, cash flows for the underlying collateral are projected including expected defaults and prepayments.  These cash flows on the collateral are then translated to cash flows on our tranche based on the cash flow waterfall of the entire capital security structure.  If this analysis indicates the entire principal on a particular security will not be returned, the security is reviewed for OTTI by comparing the expected cash flows to amortized cost.  To the extent that the security has already been impaired or was purchased at a discount, such that the amortized cost of the security is less than or equal to the present value of cash flows expected to be collected, no impairment is required.  Otherwise, if the amortized cost of the security is greater than the present value of the cash flows expected to be collected, and the security was not purchased at a discount greater than the expected principal loss, then impairment is recognized.

9

We further monitor the cash flows of all of our AFS securities backed by mortgages on an ongoing basis.  We also perform detailed analysis on all of our subprime, Alt-A, non-agency residential MBS and on a significant percentage of our AFS securities backed by pools of commercial mortgages.  The detailed analysis includes revising projected cash flows by updating the cash flows for actual cash received and applying assumptions with respect to expected defaults, foreclosures and recoveries in the future.  These revised projected cash flows are then compared to the amount of credit enhancement (subordination) in the structure to determine whether the amortized cost of the security is recoverable.  If it is not recoverable, we record an impairment of the security. 

Trading Securities

Trading securities consist of fixed maturity and equity securities in designated portfolios, some of which support modified coinsurance (“Modco”) and coinsurance with funds withheld (“CFW”) reinsurance arrangements.  Investment results for the portfolios that support Modco and CFW reinsurance arrangements, including gains and losses from sales, are passed directly to the reinsurers pursuant to contractual terms of the reinsurance arrangements.  Trading securities are carried at fair value, and changes in fair value and changes in the fair value of embedded derivative liabilities associated with the underlying reinsurance arrangements are recorded in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss) as they occur. 

Alternative Investments

Alternative investments, which consist primarily of investments in limited partnerships (“LPs”), are included in other investments on our Consolidated Balance Sheets.  We account for our investments in LPs using the equity method to determine the carrying value.  Recognition of alternative investment income is delayed due to the availability of the related financial statements, which are generally obtained from the partnerships’ general partners.  As a result, our venture capital, real estate and oil and gas portfolios are generally on a three-month delay and our hedge funds are on a one-month delay.  In addition, the impact of audit adjustments related to completion of calendar-year financial statement audits of the investees are typically received during the second quarter of each calendar year.  Accordingly, our investment income from alternative investments for any calendar-year period may not include the complete impact of the change in the underlying net assets for the partnership for that calendar-year period. 

Payables for Collateral on Investments

When we enter into collateralized financing transactions on our investments, a liability is recorded equal to the cash or non-cash collateral received.  This liability is included within payables for collateral on investments on our Consolidated Balance Sheets.  Income and expenses associated with these transactions are recorded as investment income and investment expenses within net investment income on our Consolidated Statements of Comprehensive Income (Loss).  Changes in payables for collateral on investments are reflected within cash flows from investing activities on our Consolidated Statements of Cash Flows.

Mortgage Loans on Real Estate

Mortgage loans on real estate are carried at unpaid principal balances adjusted for amortization of premiums and accretion of discounts and are net of valuation allowances.  Interest income is accrued on the principal balance of the loan based on the loan’s contractual interest rate.  Premiums and discounts are amortized using the effective yield method over the life of the loan.  Interest income and amortization of premiums and discounts are reported in net investment income on our Consolidated Statements of Comprehensive Income (Loss) along with mortgage loan fees, which are recorded as they are incurred.

Our commercial loan portfolio is comprised of long-term loans secured by existing commercial real estate.  As such, it does not exhibit risk characteristics unique to mezzanine, construction, residential, agricultural, land or other types of real estate loans.  We believe all of the loans in our portfolio share three primary risks:  borrower creditworthiness; sustainability of the cash flow of the property; and market risk; therefore, our methods for monitoring and assessing credit risk are consistent for our entire portfolio.  Loans are considered impaired when it is probable that, based upon current information and events, we will be unable to collect all amounts due under the contractual terms of the loan agreement.  When we determine that a loan is impaired, a valuation allowance is established for the excess carrying value of the loan over its estimated value.  The loan’s estimated value is based on:  the present value of expected future cash flows discounted at the loan’s effective interest rate; the loan’s observable market price; or the fair value of the loan’s collateral.  Valuation allowances are maintained at a level we believe is adequate to absorb estimated probable credit losses of each specific loan.  Our periodic evaluation of the adequacy of the allowance for losses is based on our past loan loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay (including the timing of future payments), the estimated value of the underlying collateral, composition of the loan portfolio, current economic conditions and other relevant factors.  Trends in market vacancy and rental rates are incorporated into the analysis that we perform for monitored loans and may contribute to the establishment of (or an increase or decrease in) an allowance for credit losses.  In addition, we review each loan individually in our commercial mortgage loan portfolio on an annual basis to identify emerging risks.  We focus on properties that experienced a reduction in debt-service coverage or that have significant exposure to tenants with deteriorating credit profiles.  Where warranted, we establish or increase loss reserves for a specific loan based upon this analysis.  Our process for determining past due or delinquency status begins when a payment date is missed, at which time the borrower is contacted.  After the grace period expiration that may last up to 10 days, we send a default notice.  The default notice generally provides a short time period to cure the default.  Our policy is to report loans that are 60 or more days past due, which equates to two or more payments missed, as delinquent.  We do not accrue interest on loans 90 days past due, and any interest received on these loans is either applied to the principal or recorded in net investment income on our Consolidated Statements of Comprehensive Income (Loss) when received, depending on the assessment of the collectability of the loan.  We resume accruing interest

10

once a loan complies with all of its original terms or restructured terms.  Mortgage loans deemed uncollectable are charged against the allowance for losses, and subsequent recoveries, if any, are credited to the allowance for losses.  All mortgage loans that are impaired have an established allowance for credit losses.  Changes in valuation allowances are reported in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

We measure and assess the credit quality of our mortgage loans by using loan-to-value and debt-service coverage ratios.  The loan-to-value ratio compares the principal amount of the loan to the fair value at origination of the underlying property collateralizing the loan and is commonly expressed as a percentage.  Loan-to-value ratios greater than 100% indicate that the principal amount is greater than the collateral value.  Therefore, all else being equal, a lower loan-to-value ratio generally indicates a higher quality loan.  The debt-service coverage ratio compares a property’s net operating income to its debt-service payments.  Debt-service coverage ratios of less than 1.0 indicate that property operations do not generate enough income to cover its current debt payments.  Therefore, all else being equal, a higher debt-service coverage ratio generally indicates a higher quality loan. 

Policy Loans

Policy loans represent loans we issue to contract holders that use the cash surrender value of their life insurance policy as collateral.  Policy loans are carried at unpaid principal balances. 

Real Estate

Real estate includes both real estate held for the production of income and real estate held-for-sale.  Real estate held for the production of income is carried at cost less accumulated depreciation.  Depreciation is calculated on a straight-line basis over the estimated useful life of the asset.  We periodically review properties held for the production of income for impairment.  Properties whose carrying values are greater than their projected undiscounted cash flows are written down to estimated fair value, with impairment losses reported in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).  The estimated fair value of real estate is generally computed using the present value of expected future cash flows from the real estate discounted at a rate commensurate with the underlying risks.  Real estate classified as held-for-sale is stated at the lower of depreciated cost or fair value less expected disposition costs at the time classified as held-for-sale.  Real estate is not depreciated while it is classified as held-for-sale.  Also, valuation allowances for losses are established, as appropriate, for real estate held-for-sale and any changes to the valuation allowances are reported in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).  Real estate acquired through foreclosure proceedings is recorded at fair value at the settlement date. 

Derivative Instruments

We hedge certain portions of our exposure to interest rate risk, foreign currency exchange risk, equity market risk and credit risk by entering into derivative transactions.  All of our derivative instruments are recognized as either assets or liabilities on our Consolidated Balance Sheets at estimated fair value.  We categorized derivatives into a three-level hierarchy, based on the priority of the inputs to the respective valuation technique as discussed above in “Fair Value Measurement.”  The accounting for changes in the estimated fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship, and further, on the type of hedging relationship.  For those derivative instruments that are designated and qualify as hedging instruments, we designate the hedging instrument based upon the exposure being hedged: as a cash flow hedge or a fair value hedge.

For derivative instruments that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of AOCI and reclassified into net income in the same period or periods during which the hedged transaction affects net income.  The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of designated future cash flows of the hedged item (hedge ineffectiveness), if any, is recognized in net income during the period of change.  For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument, as well as the offsetting gain or loss on the hedged item attributable to the hedged risk are recognized in net income during the period of change in estimated fair values.  For derivative instruments not designated as hedging instruments, but that are economic hedges, the gain or loss is recognized in net income.

We purchase and issue financial instruments and products that contain embedded derivative instruments.  When it is determined that the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host for measurement purposes.  The embedded derivative is carried at fair value with changes in fair value recognized in net income during the period of change. 

We employ several different methods for determining the fair value of our derivative instruments.  The fair value of our derivative contracts are measured based on current settlement values, which are based on quoted market prices, industry standard models that are commercially available and broker quotes.  These techniques project cash flows of the derivatives using current and implied future market conditions.  We calculate the present value of the cash flows to measure the current fair market value of the derivative. 

Cash and Invested Cash

Cash and invested cash is carried at cost and includes all highly liquid debt instruments purchased with an original maturity of three months or less.

11

DAC, VOBA, DSI and DFEL

Acquisition costs directly related to successful contract acquisitions or renewals of universal life insurance (“UL”), variable universal life insurance (“VUL”), traditional life insurance, annuities and other investment contracts have been deferred (i.e., DAC) to the extent recoverable.  VOBA is an intangible asset that reflects the estimated fair value of in-force contracts in a life insurance company acquisition and represents the portion of the purchase price that is allocated to the value of the right to receive future cash flows from the business in force at the acquisition date.  Bonus credits and excess interest for dollar cost averaging contracts are considered DSI.  Contract sales charges that are collected in the early years of an insurance contract are deferred (i.e., DFEL), and the unamortized balance is reported in other contract holder funds on our Consolidated Balance Sheets. 

Both DAC and VOBA amortization, excluding amounts reported in realized gain (loss), is reported within commissions and other expenses on our Consolidated Statements of Comprehensive Income (Loss).  DSI amortization, excluding amounts reported in realized gain (loss), is reported in interest credited on our Consolidated Statements of Comprehensive Income (Loss).  The amortization of DFEL, excluding amounts reported in realized gain (loss), is reported within fee income on our Consolidated Statements of Comprehensive Income (Loss).  The methodology for determining the amortization of DAC, VOBA, DSI and DFEL varies by product type.  For all insurance contracts, amortization is based on assumptions consistent with those used in the development of the underlying contract adjusted for emerging experience and expected trends. 

Acquisition costs for UL and VUL insurance and investment-type products, which include fixed and variable deferred annuities, are generally amortized over the lives of the policies in relation to the incidence of estimated gross profits (“EGPs”) from surrender charges, investment, mortality net of reinsurance ceded and expense margins and actual realized gain (loss) on investments.  Contract lives for UL and VUL policies are estimated to be 30 to 40 years based on the expected lives of the contracts.  Contract lives for fixed and variable deferred annuities are generally between 15 and 30 years, while some of our fixed multi-year guarantee products have amortization periods equal to the guarantee period.  The front-end load annuity product has an assumed life of 25 years.  Longer lives are assigned to those blocks that have demonstrated favorable lapse experience. 

Acquisition costs for all traditional contracts, including traditional life insurance contracts, such as individual whole life, group business and term life insurance, are amortized over the expected premium-paying period that generally results in amortization less than 30 years.  Acquisition costs are either amortized on a straight-line basis or as a level percent of premium of the related policies depending on the block of business.  There is currently no DAC, VOBA, DSI or DFEL balance or related amortization for fixed and variable payout annuities.

We account for modifications of insurance contracts that result in a substantially unchanged contract as a continuation of the replaced contract.  We account for modifications of insurance contracts that result in a substantially changed contract as an extinguishment of the replaced contract.

The carrying amounts of DAC, VOBA, DSI and DFEL are adjusted for the effects of realized and unrealized gains and losses on securities classified as AFS and certain derivatives and embedded derivatives.  Amortization expense of DAC, VOBA, DSI and DFEL reflects an assumption for an expected level of credit-related investment losses.  When actual credit-related investment losses are realized, we recognize a true-up to our DAC, VOBA, DSI and DFEL amortization within realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss) reflecting the incremental effect of actual versus expected credit-related investment losses.  These actual to expected amortization adjustments can create volatility from period to period in realized gain (loss). 

During the third quarter of each year, we conduct our annual comprehensive review of the assumptions and the projection models used for our estimates of future gross profits underlying the amortization of DAC, VOBA, DSI and DFEL and the calculations of the embedded derivatives and reserves for life insurance and annuity products.  These assumptions include, but are not limited to, capital markets, investment margins, mortality, retention, rider utilization and maintenance expenses (costs associated with maintaining records relating to insurance and individual and group annuity contracts, and with the processing of premium collections, deposits, withdrawals and commissions).  Based on our review, the cumulative balances of DAC, VOBA, DSI and DFEL included on our Consolidated Balance Sheets are adjusted with an offsetting benefit or charge to revenue or amortization expense to reflect such change related to our expectations of future EGPs (“unlocking”).  We may have unlocking in other quarters as we become aware of information that warrants updating assumptions outside of our annual comprehensive review.  We may also identify and implement actuarial modeling refinements that result in increases or decreases to the carrying values of DAC, VOBA, DSI, DFEL, embedded derivatives and reserves for life insurance and annuity products with living benefit and death benefit guarantees. 

DAC, VOBA, DSI and DFEL are reviewed to ensure that the unamortized portion does not exceed the expected recoverable amounts. 

Reinsurance

We enter into reinsurance agreements with other companies in the normal course of business.  Assets and liabilities and premiums and benefits from certain reinsurance contracts that grant statutory surplus relief provided by or to other insurance companies are netted on our Consolidated Balance Sheets and Consolidated Statements of Comprehensive Income (Loss), respectively, because there is a right of offset.  All other reinsurance agreements are reported on a gross basis on our Consolidated Balance Sheets as an asset for amounts recoverable from reinsurers or as a component of other liabilities for amounts, such as premiums, owed to the reinsurers, with the exception of Modco agreements for which the right of offset also exists.  Reinsurance premiums and benefits paid or provided are

12

accounted for on bases consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.  Premiums, benefits and DAC are reported net of insurance ceded. 

Goodwill

We recognize the excess of the purchase price, plus the fair value of any noncontrolling interest in the acquiree, over the fair value of identifiable net assets acquired as goodwill.  Goodwill is not amortized, but is reviewed for impairment annually as of October 1 and more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.  Prior to October 1, 2017, we performed a two-step test in our evaluation of the carrying value of goodwill for each of our reporting units.  In Step 1 of the evaluation, if the fair value estimate of the reporting unit was greater than the carrying value, then the carrying value of the reporting unit was deemed to be recoverable, and Step 2 was not required.  If the fair value estimate was less than the carrying value, we applied Step 2 to determine the implied fair value of goodwill for the reporting unit.  If the implied fair value of the reporting unit’s goodwill was lower than its carrying amount, goodwill was impaired and written down to its fair value.

Effective with our early adoption of new accounting guidance for goodwill impairment during the fourth quarter of 2017, as discussed in Note 2, we perform a quantitative goodwill impairment test where the fair value of the reporting unit is determined and compared to the carrying value of the reporting unit.  If the fair value of the reporting unit is greater than the reporting unit’s carrying value, then the carrying value of the reporting unit is deemed to be recoverable.  If the carrying value of the reporting unit is greater than the reporting unit’s fair value, goodwill is impaired and written down to the reporting unit’s fair value; and a charge is reported in impairment of intangibles on our Consolidated Statements of Comprehensive Income (Loss).  The results of one goodwill impairment test on one reporting unit cannot subsidize the results of another reporting unit.

Other Assets and Other Liabilities

Other assets consist primarily ofDSI, specifically identifiable intangible assets, property and equipment owned by the Company, balances associated with corporate-owned and bank-owned life insurance, certain reinsurance assets, receivables resulting from sales of securities that had not yet settled as of the balance sheet date, debt issuance costs associated with line-of-credit arrangements, assets under capital leases, guaranteed living benefit (“GLB”) reserves embedded derivatives, other prepaid expenses and deferred losses on business sold through reinsurance.  Other liabilities consist primarily of current and deferred taxes, pension and other employee benefit liabilities, derivative instrument liabilities, certain reinsurance payables, payables resulting from purchases of securities that had not yet settled as of the balance sheet date, interest on borrowed funds, obligations under capital leases and other accrued expenses.

Other assets and other liabilities on our Consolidated Balance Sheets include GLB features and remaining guaranteed interestand similar contracts that are carried at fair value, which may be reported in either other assets or other liabilities.  The fair value of these items represents approximate exit price including an estimate for our NPR.  Certain of these featureshave elements of both insurance benefits and embedded derivatives.  Through our hybrid accounting approach, for reserve calculation purposes we assign product cash flows to the embedded derivative or insurance portion of the reserves based on thelife-contingent nature of the benefits.  We classify these GLBreserves embedded derivatives in Level 3 within the hierarchylevels described above in “Fair Value Measurement.”  We report the insurance portion of the reserves in future contract benefits. 

The carrying values of specifically identifiable intangible assets are reviewed at least annually for indicators of impairment in value that are other-than-temporary, including unexpected or adverse changes in the following:  the economic or competitive environments in which the company operates; profitability analyses; cash flow analyses; and the fair value of the relevant business operation.  If there was an indication of impairment, then the discounted cash flow method would be used to measure the impairment, and the carrying value would be adjusted as necessary and reported in impairment of intangibles on our Consolidated Statements of Comprehensive Income (Loss).  Sales force intangibles are attributable to the value of the new business distribution system acquired through business combinations.  These assets are amortized on a straight-line basis over their useful life of 25 years.

Property and equipment owned for company use is carried at cost less allowances for depreciation.  Provisions for depreciation of investment real estate and property and equipment owned for company use are computed principally on the straight-line method over the estimated useful lives of the assets, which include buildings, computer hardware and software and other property and equipment.  Certain assets on our Consolidated Balance Sheets are related to capital leases.  These assets under capital leases are depreciated in a manner consistent with our current depreciation policy for owned assets.  We periodically review the carrying value of our long-lived assets, including property and equipment, for impairment whenever events or circumstances indicate that the carrying amount of such assets may not be fully recoverable.  For long-lived assets to be held and used, impairments are recognized when the carrying amount of a long-lived asset is not recoverable and exceeds its fair value.  The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset.  An impairment loss is measured as the amount by which the carrying amount of a long-lived asset exceeds its fair value.

Long-lived assets to be disposed of by abandonment or in an exchange for a similar productive long-lived asset are classified as held-for-use until they are disposed.  Long-lived assets to be sold are classified as held-for-sale and are no longer depreciated.  Certain criteria have to be met in order for the long-lived asset to be classified as held-for-sale, including that a sale is probable and expected to occur within one year.  Long-lived assets classified as held-for-sale are recorded at the lower of their carrying amount or fair value less cost to sell.

13

We completed reinsurance transactions in 2012 and 2014 whereby we ceded closed blocks of UL contracts with secondary guarantees to Lincoln National Reinsurance Company (Barbados) Limited (“LNBAR”), a wholly-owned subsidiary of LNC.  We are recognizing the losses related to these transactions over a period of 30 years.

Separate Account Assets and Liabilities

We maintain separate account assets, which are reported at fair value.  The related liabilities are reported at an amount equivalent to the separate account assets.  Investment risks associated with market value changes are borne by the contract holders, except to the extent of minimum guarantees made by the Company with respect to certain accounts.

We issue variable annuity contracts through our separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contract holder (traditional variable annuities).  We also issue variable annuity and life contracts through separate accounts that may include various types of guaranteed death benefit (“GDB”), guaranteed withdrawal benefit (“GWB”) and guaranteed income benefit (“GIB”) features.  The GDB features include those where we contractually guarantee to the contract holder either:  return of no less than total deposits made to the contract less any partial withdrawals (“return of net deposits”); total deposits made to the contract less any partial withdrawals plus a minimum return (“minimum return”); or the highest contract value on any contract anniversary date through age 80.  The highest contract value is increased by purchase payments and is decreased by withdrawals subsequent to that anniversary date in the same proportion that withdrawals reduce the contract value.

As discussed in Note 6, certain features of these guarantees are accounted for as embedded derivative reserves, whereas other guarantees are accounted for as benefit reserves.  Other guarantees contain characteristics of both and are accounted for under an approach that calculates the value of the embedded derivative reserve and the benefit reserve based on the specific characteristics of each GLB feature.  We use derivative instruments to hedge our exposure to the risks and earnings volatility that result from the embedded derivatives for living benefits in certain of our variable annuity products.  The change in fair value of these instruments tends to move in the opposite direction of the change in the value of the associated reserves.  The net impact of these changes is reported as a component of realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

The “market consistent scenarios” used in the determination of the fair value of the GLB liability are similar to those used by an investment bank to value derivatives for which the pricing is not transparent and the aftermarket is nonexistent or illiquid.  We use risk-neutral Monte Carlo simulations in our calculation to value the entire block of guarantees, which involve 100 unique scenarios per policy or approximately 49 million scenarios.  The market consistent scenario assumptions, as of each valuation date, are those we view to be appropriate for a hypothetical market participant.  The market consistent inputs include, but are not limited to, assumptions for capital markets (e.g., implied volatilities, correlation among indices, risk-free swap curve, etc.), policyholder behavior (e.g., policy lapse, rider utilization, etc.), mortality, risk margins, maintenance expenses and a margin for profit.  We believe these assumptions are consistent with those that would be used by a market participant; however, as the related markets develop we will continue to reassess our assumptions.  It is possible that different valuation techniques and assumptions could produce a materially different estimate of fair value.

Future Contract Benefits and Other Contract Holder Funds

Future contract benefits represent liability reserves that we have established and carry based on estimates of how much we will need to pay for future benefits and claims.  Other contract holder funds represent liabilities for fixed account values, including the fixed portion of variable, dividends payable, premium deposit funds, undistributed earnings on participating business and other contract holder funds as well the carrying value of DFEL discussed above.

The liabilities for future contract benefits and claim reserves for UL and VUL insurance policies consist of contract account balances that accrue to the benefit of the contract holders, excluding surrender charges.  The liabilities for future insurance contract benefits and claim reserves for traditional life policies are computed using assumptions for investment yields, mortality and withdrawals based principally on generally accepted actuarial methods and assumptions at the time of contract issue.  Investment yield assumptions for traditional direct individual life reserves for all contracts range from 2.25% to 7.75% depending on the time of contract issue.  The investment yield assumptions for immediate and deferred paid-up annuities range from 1.25% to 12.75%.  These investment yield assumptions are intended to represent an estimation of the interest rate experience for the period that these contract benefits are payable.

The liabilities for future claim reserves for variable annuity products containing GDB features are calculated by estimating the present value of total expected benefit payments over the life of the contract from inception divided by the present value of total expected assessments over the life of the contract (“benefit ratio”) multiplied by the cumulative assessments recorded from the contract inception through the balance sheet date less the cumulative GDB payments plus interest on the liability.  The change in the liability for a period is the benefit ratio multiplied by the assessments recorded for the period less GDB claims paid in the period plus interest.  As experience or assumption changes result in a change in expected benefit payments or assessments, the benefit ratio is unlocked, that is, recalculated using the updated expected benefit payments and assessments over the life of the contract since inception.  The revised benefit ratio is then applied to the liability calculation described above, with the resulting change in liability reported in benefits on our Consolidated Statements of Comprehensive Income (Loss).

With respect to our future contract benefits and other contract holder funds, we continually review overall reserve position, reserving techniques and reinsurance arrangements.  As experience develops and new information becomes known, liabilities are adjusted as deemed necessary.  The effects of changes in estimates are included in the operating results for the period in which such changes occur.

14

The business written or assumed by us includes participating life insurance contracts, under which the contract holder is entitled to share in the earnings of such contracts via receipt of dividends.  The dividend scale for participating policies is reviewed annually and may be adjusted to reflect recent experience and future expectations.  As of December 31, 2017 and 2016, participating policies comprised less than 1% of the face amount of business in force, and dividend expenses were $57million, $59 million and $67 million for the years ended December 31, 2017,  2016 and 2015, respectively.

Liabilities for the secondary guarantees on UL-type products are calculated by multiplying the benefit ratio by the cumulative assessments recorded from contract inception through the balance sheet date less the cumulative secondary guarantee benefit payments plus interest.  If experience or assumption changes result in a new benefit ratio, the reserves are adjusted to reflect the changes in a manner similar to the unlocking of DAC, VOBA, DFEL and DSI.  The accounting for secondary guarantee benefits impacts, and is impacted by, EGPs used to calculate amortization of DAC, VOBA, DFEL and DSI.

Certain of our variable annuity contracts reported within future contract benefits contain GLB reserves embedded derivatives, a portion of which may be reported in either other assets or other liabilities, and include guaranteed interest and similar contracts, that are carried at fair value on our Consolidated Balance Sheets, which represents approximate exit price including an estimate for our NPR.  Certain of these features have elements of both insurance benefits and embedded derivatives.  Through our hybrid accounting approach, for reserve calculation purposes we assign product cash flows to the embedded derivative or insurance portion of the reserves based on the life-contingent nature of the benefits.  We classify these GLB reserves embedded derivatives items in Level 3 within the hierarchy levels described above in “Fair Value Measurement.”  We report the insurance portion of the reserves in future contract benefits. 

The fair value of our indexed annuity contracts is based on their approximate surrender values.

Borrowed Funds

LNL’s short-term borrowings are defined as borrowings with contractual or expected maturities of one year or less.  Long-term borrowings have contractual or expected maturities greater than one year.

Deferred Gain on Business Sold Through Reinsurance

Our reinsurance operations were acquired by Swiss Re Life & Health America, Inc. (“Swiss Re”) in December 2001 through a series of indemnity reinsurance transactions.  We recognized the gain related to these transactions over the period over which the majority of the earnings were expected to emerge, and the deferred gain was fully amortized in 2017.

We completed a reinsurance transaction in 2009 whereby we assumed a closed block of term contracts from First Penn-Pacific Life Insurance Company, a wholly-owned subsidiary of LNC.  We are recognizing the gain related to this transaction over a period of 15 years.

We completed reinsurance transactions in 2012 and 2013 whereby we ceded a closed block of UL contracts with secondary guarantees to LNBAR.  We are recognizing the gains related to these transactions over a period of 30 years.

Contingencies and Commitments

Contingencies arising from environmental remediation costs, regulatory judgments, claims, assessments, guarantees, litigation, recourse reserves, fines, penalties and other sources are recorded when deemed probable and reasonably estimable.

Fee Income

Fee income for investment and interest-sensitive life insurance contracts consist of asset-based fees, cost of insurance charges, percent of premium charges, contract administration charges and surrender charges that are assessed against contract holder account balances.  Investment products consist primarily of individual and group variable and fixed deferred annuities.  Interest-sensitive life insurance products include UL insurance, VUL insurance and other interest-sensitive life insurance policies.  These products include life insurance sold to individuals, corporate-owned life insurance and bank-owned life insurance. 

In bifurcating the embedded derivative of our GLB features on our variable annuity products, we attribute to the embedded derivative the portion of total fees collected from the contract holder that relate to the GLB riders (the “attributed fees”), which are not reported within fee income on our Consolidated Statements of Comprehensive Income (Loss).  These attributed fees represent the present value of future claims expected to be paid for the GLB at the inception of the contract plus a margin that a theoretical market participant would include for risk/profit and are reported within realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

The timing of revenue recognition as it relates to fees assessed on investment contracts is determined based on the nature of such fees.  Asset-based fees, cost of insurance and contract administration charges are assessed on a daily or monthly basis and recognized as revenue when assessed and earned.  Percent of premium charges are assessed at the time of premium payment and recognized as revenue when assessed and earned.  Certain amounts assessed that represent compensation for services to be provided in future periods are reported as unearned revenue and recognized in income over the periods benefited.  Surrender charges are recognized upon surrender of a contract by the contract holder in accordance with contractual terms.

15

For investment and interest-sensitive life insurance contracts, the amounts collected from contract holders are considered deposits and are not included in revenue.

Insurance Premiums

Our insurance premiums for traditional life insurance and group insurance products are recognized as revenue when due from the contract holder.  Our traditional life insurance products include those products with fixed and guaranteed premiums and benefits and consist primarily of whole life insurance, limited-payment life insurance, term life insurance and certain annuities with life contingencies.  Our group non-medical insurance products consist primarily of term life, disability and dental.

Net Investment Income

Dividends and interest income, recorded in net investment income, are recognized when earned.  Amortization of premiums and accretion of discounts on investments in debt securities are reflected in net investment income over the contractual terms of the investments in a manner that produces a constant effective yield. 

For CLOs and MBS, included in the trading and AFS fixed maturity securities portfolios, we recognize income using a constant effective yield based on anticipated prepayments and the estimated economic life of the securities.  When actual prepayments differ significantly from originally anticipated prepayments, the retrospective effective yield is recalculated to reflect actual payments to date and a catch up adjustment is recorded in the current period.  In addition, the new effective yield, which reflects anticipated future payments, is used prospectively.  Any adjustments resulting from changes in effective yield are reflected in net investment income on our Consolidated Statements of Comprehensive Income (Loss).

Realized Gain (Loss)

Realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss) includes realized gains and losses from the sale of investments, write-downs for OTTI of investments, certain derivative and embedded derivative gains and losses, gains and losses on the sale of subsidiaries and businesses and net gains and losses on reinsurance embedded derivatives and trading securities.  Realized gains and losses on the sale of investments are determined using the specific identification method.  Realized gain (loss) is recognized in net income, net of associated amortization of DAC, VOBA, DSI and DFEL.  Realized gain (loss) is also net of allocations of investment gains and losses to certain contract holders and certain funds withheld on reinsurance arrangements for which we have a contractual obligation. 

Other Revenues

Other revenues consists primarily of fees attributable to broker-dealer services recorded as earned at the time of sale, changes in the market value of our seed capital investments, proceeds from reinsurance recaptures and communications sales recognized as earned, net of agency and representative commissions. 

Interest Credited

Interest credited includes interest credited to contract holder account balances.  Interest crediting rates associated with funds invested in our general account during 2015 through 2017 ranged from 1% to 10%.

Benefits

Benefits for UL and other interest-sensitive life insurance products include benefit claims incurred during the period in excess of contract account balances.  Benefits also include the change in reserves for life insurance products with secondary guarantee benefits, annuity products with guaranteed death and living benefits and certain annuities with life contingencies.  For traditional life, group health and disability income products, benefits are recognized when incurred in a manner consistent with the related premium recognition policies. 

Strategic Digitization Expense

Strategic digitization expense consists primarily of costs related to our enterprise-wide digitization initiative.

Pension and Other Postretirement Benefit Plans

Pursuant to the accounting rules for our obligations to employees and agents under our various pension and other postretirement benefit plans, we are required to make a number of assumptions to estimate related liabilities and expenses.  The mortality assumption is based on actual and anticipated plan experience, determined using acceptable actuarial methods.  We use assumptions for the weighted-average discount rate and expected return on plan assets to estimate pension expense.  The discount rate assumptions are determined using an analysis of current market information and the projected benefit flows associated with these plans.  The expected long-term rate of return on plan assets is based on historical and projected future rates of return on the funds invested in the plan.  The calculation of our accumulated postretirement benefit obligation also uses an assumption of weighted-average annual rate of increase in the per capita cost of covered benefits, which reflects a health care cost trend rate. 

16

Stock-Based Compensation

In general, we expense the fair value of stock awards included in our incentive compensation plans.  As of the date LNC’s Board of Directors approves stock awards, the fair value of stock options is determined using a Black-Scholes options valuation methodology, and the fair value of other stock awards is based upon the market value of the stock.  The fair value of the awards is expensed over the performance or service period, which generally corresponds to the vesting period, and is recognized as an increase to common stock in stockholder’s equity.  We apply an estimated forfeiture rate to our accrual of compensation cost.We classify certain stock awards as liabilities.  For these awards, the settlement value is classified as a liability on our Consolidated Balance Sheets, and the liability is marked-to-market through net income at the end of each reporting period.  Stock-based compensation expense is reflected in commissions and other expenses on our Consolidated Statements of Comprehensive Income (Loss). 

Interest and Debt Expense

Interest expense on our short-term and long-term debt is recognized as due and any associated premiums, discounts and costs are amortized (accreted) over the term of the related borrowing utilizing the effective interest method.  In addition, gains or losses related to certain derivative instruments associated with debt are recognized in interest and debt expense during the period of the change.

Income Taxes

We file a U.S.  consolidated income tax return with LNC and its eligible subsidiaries.  Ineligible subsidiaries file separate individual corporate tax returns.  Deferred income taxes are recognized, based on enacted rates, when assets and liabilities have different values for financial statement and tax reporting purposes.  A valuation allowance is recorded to the extent required.  Considerable judgment and the use of estimates are required in determining whether a valuation allowance is necessary and, if so, the amount of such valuation allowance.  In evaluating the need for a valuation allowance, we consider many factors, including:  the nature and character of the deferred tax assets and liabilities; taxable income in prior carryback years; future reversals of temporary differences; the length of time carryovers can be utilized; and any tax planning strategies we would employ to avoid a tax benefit from expiring unused. 

Discontinued Operations

The results of operations of a component of the Company that either has been disposed of or is classified as held-for-sale are reported in income (loss) from discontinued operations, net of federal income taxes, if the disposal represents a strategic shift that has, or will have, a major effect on our consolidated financial condition and results of operations. 

17

2.  New Accounting Standards

Adoption of New Accounting Standards

The following table provides a description of our adoption of new Accounting Standards Updates (“ASUs”) issued by the FASB and the impact of the adoption on our financial statements:

Standard	Description	Date of Adoption	Effect on Financial Statements or Other Significant Matters
ASU 2016-09, Improvements to Employee Share-Based Payment Accounting	These amendments require all income tax effects of awards to be recognized in the income statement when the awards vest or are settled rather than through additional paid-in capital in the equity section of the balance sheet.  The amendments also permit an employer to repurchase an employee’s shares at the maximum statutory tax rate in the employee’s applicable jurisdiction for tax withholding purposes without triggering liability accounting.  Finally, the amendments permit entities to make a one-time accounting policy election to account for forfeitures as they occur.  Specific adoption methods depend on the issue being adopted and range from prospective to retrospective adoption.  Early adoption is permitted; however, all amendments must be adopted in the same period.  If an entity early adopts the amendments in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period.	Early adopted as of October 1, 2016	We recognized an income tax benefit of $4 million in federal income tax expense (benefit) in our Consolidated Statements of Comprehensive Income (Loss) for the year ended December 31, 2016.
ASU 2016-05, Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships	The amendments clarify that a change in the counterparty to a derivative instrument identified in a hedging relationship in and of itself does not require dedesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met.  We adopted the guidance in this ASU prospectively.	January 1, 2017	The adoption of this ASU did not have an effect on our consolidated financial condition or results of operations.
ASU 2016-06, Contingent Put and Call Options in Debt Instruments	The amendments clarify the requirements for assessing whether contingent call and put options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts.  Upon adoption of this ASU, entities will be required to assess embedded call and put options solely in accordance with the four-step decision sequence that was developed by the FASB Derivatives Implementation Group.  We adopted this ASU using a modified retrospective basis applied to existing debt instruments.	January 1, 2017	The adoption of this ASU did not have an effect on our consolidated financial condition or results of operations.
ASU 2017-04, Simplifying the Test for Goodwill Impairment	These amendments eliminate the requirement in current GAAP to perform Step 2 of the goodwill impairment test in favor of only applying a quantitative test (referred to in previous guidance as Step 1).  As part of the quantitative test, the fair value of the reporting unit is compared with its carrying value, and an impairment charge is recognized when the carrying value exceeds the reporting unit’s fair value.  An entity still has the option to first perform a qualitative assessment of an individual reporting unit to determine if the quantitative assessment is necessary.  ASU 2017-04 should be adopted prospectively, and early adoption is permitted on impairment testing dates after January 1, 2017.	Early adopted as of our October 1, 2017 goodwill impairment measurement date.  There were no impairment indicators during the first three quarters of 2017.	We recognized a goodwill impairment of $905 million during the fourth quarter of 2017 related to our Life Insurance segment reported in the impairment of intangibles line item on our Consolidated Statements of Comprehensive Income (Loss).  For more information regarding our goodwill impairment, see Note 10.

18

Future Adoption of New Accounting Standards

The following table provides a description of future adoptions of new accounting standards that may have an impact on our financial statements when adopted:

Standard	Description	Projected Date of Adoption	Effect on Financial Statements or Other Significant Matters
ASU 2014-09, Revenue from Contracts with Customers	This standard establishes the core principle of recognizing revenue to depict the transfer of promised goods and services.  The amendments define a five-step process that systematically identifies the various components of the revenue recognition process, culminating with the recognition of revenue upon satisfaction of an entity’s performance obligation.  Although these amendments will supersede nearly all existing revenue recognition guidance under GAAP, ASU 2014-09 will not amend the accounting for insurance and investment contracts recognized in accordance with ASC Topic 944, Financial Services – Insurance, leases, financial instruments and guarantees.  Retrospective, or modified retrospective, application is required.	January 1, 2018	Our revenue within the scope of this standard primarily includes commissions and advisory fees earned by our broker dealer operation.  We will adopt this ASU using the modified retrospective method.  The adoption of ASU 2014-09 will not have a material impact on our consolidated financial condition or results of operations.
ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities	These amendments require, among other things, the fair value measurement of investments in equity securities and certain other ownership interests that do not result in consolidation and are not accounted for under the equity method of accounting.  The change in fair value of the impacted investments in equity securities must be recognized in net income in the period of the change in fair value.  In addition, the amendments include certain enhancements to the presentation and disclosure requirements for financial assets and financial liabilities.  Early adoption of the ASU is generally not permitted, except as defined in the ASU.  The amendments will be adopted in the financial statements through a cumulative-effect adjustment to the beginning balance of retained earnings in the period of adoption.  Financial statement disclosures will be updated prospectively.	January 1, 2018	The current carrying value of our equity securities within the scope of ASU 2016-01 is $110 million. Upon adoption, we will prospectively recognize the change in fair value of these equity securities in current period earnings. The cumulative effective adjustment of adopting ASU 2016-01 will not have a material impact on our consolidated financial condition.
ASU 2016-02, Leases	This standard establishes a new accounting model for leases.  Lessees will recognize most leases on the balance sheet as a right-of-use asset and a related lease liability.  The lease liability is measured as the present value of the lease payments over the lease term with the right-of-use asset measured at the lease liability amount and including adjustments for certain lease incentives and initial direct costs.  Lease expense recognition will continue to differentiate between finance leases and operating leases resulting in a similar pattern of lease expense recognition as under current GAAP.  This ASU permits a modified retrospective adoption approach that includes a number of optional practical expedients that entities may elect upon adoption.  Early adoption is permitted.	January 1, 2019	We continue to gather information to determine our leases that are within the scope of this standard. We do not expect there to be a significant difference in our pattern of lease expense recognition under this ASU.

19

Standard	Description	Projected Date of Adoption	Effect on Financial Statements or Other Significant Matters
ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)	These amendments clarify the implementation guidance on principal versus agent considerations in ASU 2014-09, including how an entity should identify the unit of accounting for the principal versus agent evaluation.  In addition, the amendments clarify how to apply the control principle to certain types of arrangements, such as service transactions, by explaining what a principal controls before the good or service is transferred to the customer.  Transition requirements are consistent with ASU 2014-09.	January 1, 2018	See comments under ASU 2014-09 for more information.
ASU 2016-10, Identifying Performance Obligations and Licensing	These amendments clarify, among other things, the accounting guidance in ASU 2014-09 regarding how an entity will determine whether promised goods or services are separately identifiable, which is an important consideration in determining whether to account for goods or services as a separate performance obligation.   Transition requirements are consistent with ASU 2014-09.	January 1, 2018	See comments under ASU 2014-09 for more information.
ASU 2016-12, Narrow Scope Improvements and Practical Expedients	The standard update amends the revenue recognition guidance in ASU 2014-09 related to transition, collectability, noncash consideration and the presentation of sales and other similar taxes. The amendments clarify that, for a contract to be considered completed at transition, substantially all of the revenue must have been recognized under current GAAP.  The amendments also clarify how an entity should evaluate the collectability threshold and when an entity can recognize nonrefundable consideration received as revenue if an arrangement does not meet the standard’scontract criteria.  Transition requirements are consistent with ASU 2014-09.	January 1, 2018	See comments under ASU 2014-09 for more information.
ASU 2016-13, Measurement of Credit Losses on Financial Instruments	These amendments adopt a new model to measure and recognize credit losses for most financial assets.  The method used to measure estimated credit losses for AFS debt securities will be unchanged from current GAAP; however, the amendments require credit losses to be recognized through an allowance rather than as a reduction to the amortized cost of those debt securities.  The amendments will permit entities to recognize improvements in credit loss estimates on AFS debt securities by reducing the allowance account immediately through earnings.  The amendments will be adopted through a cumulative effect adjustment to the beginning balance of retained earnings as of the first reporting period in which the amendments are effective.  Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods therein.	January 1, 2020	We are currently evaluating the impact of adopting this ASU on our consolidated financial condition and results of operations, with a primary focus on our fixed maturity securities, mortgage loans and reinsurance recoverables.

20

Standard	Description	Projected Date of Adoption	Effect on Financial Statements or Other Significant Matters
ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments	These amendments clarify the classification of eight specific cash flow issues in an entity’s statement of cash flows where it was determined by the FASB that there is diversity in practice.  Early adoption of the amendments is permitted, and retrospective transition is required for each period presented in the statement of cash flows.	January 1, 2018	We will amend classifications in our Consolidated Statements of Cash Flows upon adoption of this ASU.
ASU 2016-16, Intra-Entity Asset Transfers Other Than Inventory	This amendment requires an entity to recognize current and deferred income taxes for an intra-entity asset transfer, other than inventory, when the transfer occurs, thereby eliminating the current GAAP exception that prohibits the recognition of income taxes until the asset has been sold to an outside party.  Early adoption is permitted as of the beginning of the annual reporting period for which financial statements have not been issued.	January 1, 2018	This amendment is not expected to have a material impact on our consolidated financial condition or results of operations.
ASU 2016-18, Restricted Cash	This amendment requires that amounts generally described as restricted cash and restricted cash equivalents should be included within cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows.  Early adoption is permitted using a retrospective transition method applied to each period presented.	January 1, 2018	We will provide these additional disclosures in our Consolidated Statements of Cash Flows upon the adoption date as applicable.
ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers	These amendments clarify 13 issues related to the adoption of ASU 2014-09.  The most significant issue of these amendments for us is the clarification that all contracts within the scope of Topic 944 are excluded from the scope of ASU 2014-09, rather than just insurance contracts as described in ASU 2014-09.  Transition requirements are consistent with ASU 2014-09.	January 1, 2018	See comments under ASU 2014-09 for more information.
ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost	These amendments require that an entity report the service cost component of employee pension and postretirement benefit plans in the same line item as other compensation costs from services rendered by the applicable employees during the period.  The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations.  ASU 2017-07 requires retrospective adoption related to the presentation of net periodic pension cost and postretirement benefit cost.	January 1, 2018	The adoption of this ASU will not have an effect on our consolidated financial condition or results of operations.
ASU 2017-08, Premium Amortization on Purchased Callable Debt Securities	These amendments require an entity to shorten the amortization period for certain callable debt securities held at a premium so that the premium is amortized to the earliest call date.  Early adoption is permitted, and the ASU requires adoption under a modified retrospective basis through a cumulative-effect adjustment to the beginning balance of retained earnings.	January 1, 2019	We are currently evaluating the impact of adopting this ASU on our consolidated financial condition or results of operations.

21

Standard	Description	Projected Date of Adoption	Effect on Financial Statements or Other Significant Matters
ASU 2017-09, Compensation – Stock Compensation: Scope of Modification Accounting	These amendments provide guidance when changes to the terms or conditions of a share-based payment award would require modification accounting.  An entity should account for the effects of a modification unless the following are the same immediately before and after the modification:  (a) the fair value of the award, (b) the vesting conditions of the award and (c) the classification of the award as an equity instrument or a liability instrument.  These amendments are to be applied prospectively to awards modified on or after the effective date.  Early adoption is permitted.	January 1, 2018	The impacts of adopting this standard are prospective.  The adoption of this ASU will not impact our consolidated financial condition or results of operations.
ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities	These amendments change both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results.  These amendments retain the threshold of highly effective for hedging relationships, remove the requirement to bifurcate between the portions of the hedging relationship that are effective and ineffective, record hedge item and hedging instrument results in the same financial statement line item, require quantitative assessment initially for all hedging relationships unless the hedging relationship meets the definition of either the shortcut method or critical terms match method and allow the contractual specified index rate to be designated as the hedged risk in a cash flow hedge of interest rate risk of a variable rate financial instrument.  These amendments also eliminate the benchmark interest rate concept for variable rate instruments.  Early adoption is permitted.	January 1, 2019	We are currently evaluating the impact of adopting this ASU on our consolidated financial condition or results of operations.
ASU 2018-02, Reclassification of Certain Tax Effects From Accumulated Other Comprehensive Income	These amendments allow a reclassification from AOCI to retained earnings for stranded tax effects associated with the change in the federal corporate income tax rate in the Tax Cuts and Jobs Act (the “Tax Act”) of 2017.  An entity that elects to reclassify these amounts must reclassify the stranded tax effects related to the change in the federal corporate income tax rate for all items accounted for in OCI.  Additional disclosures will be required for entities that elect to reclassify stranded tax effects.  The ASU is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years and early adoption is permitted.  An entity that elects to early adopt in an annual or interim period after the period of enactment can choose to apply the ASU retrospective to each period impacted or in the period of adoption.	January 1, 2018	Upon adoption of this ASU, we will reclassify approximately $600 million of stranded tax effects resulting from the new federal income rate from AOCI to retained earnings.

3.  Dispositions

Lincoln Financial Media Company

On July 16, 2015, we closed on the sale of Lincoln Financial Media Company to Entercom Communications Corp.  (“Entercom Parent”) and Entercom Radio, LLC.  We received $75 million in cash, net of transaction expenses, and $28 million face amount of perpetual cumulative convertible preferred stock of Entercom Parent.During 2015, we recognized a loss of $2 million, after-tax, reflected within income (loss) from continuing operations on our Consolidated Statements of Comprehensive Income (Loss) related to finalizing the transaction.

22

4.  Variable Interest Entities

Consolidated VIEs

Credit-Linked Notes

We invested in the Class 1 notes of a credit-linked note (“CLN”) structure, which represented a special purpose trust combining ABS with credit default swaps to produce multi-class structured securities. 

Because the note holders did not have voting rights or similar rights, we determined that the entity issuing the CLN was a VIE, and as a note holder, our interest represented a variable interest.  We had the power to direct the most significant activity affecting the performance of the CLN structure and we had the ability to actively manage the reference portfolios underlying the credit default swaps.  We concluded that we were the primary beneficiary of the VIE associated with the CLN.   

As of March 2017, our $200 million CLN matured ending our exposure to this VIE.  We no longer reflect the assets and liabilities associated with this VIE on our Consolidated Balance Sheets or recognize the results of operations of this VIE on our Consolidated Statements of Comprehensive Income (Loss). 

Asset and liability information (dollars in millions) for the consolidated VIEs included on our Consolidated Balance Sheets was as follows:

		As of December 31, 2017							As of December 31, 2016
		Number							Number
		of		Notional		Carrying			of		Notional		Carrying
	Instruments			Amounts		Value		Instruments			Amounts		Value
Assets
Fixed maturity securities:
Asset-backed credit card loans (1)			N/A	$	-	$	-			N/A	$	-	$	200
Credit default swaps			-		-		-			1		200		-
Total assets			-	$	-	$	-			1	$	200	$	200

⁽¹⁾ Reported in variable interest entities’ fixed maturity securities on our Consolidated Balance Sheets.  

As described more fully in Note 1, we regularly review our investment holdings for OTTI.  Based upon our review of our VIE AFS fixed maturity security for OTTI, there was no impairment prior to maturity in March 2017.

The gains (losses) for the consolidated VIEs (in millions) recorded on our Consolidated Statements of Comprehensive Income (Loss) were as follows:

	For the Years Ended
	December 31,
	2017		2016
Non-Qualifying Hedges
Credit default swaps	$	-	$	4
Contingent forwards		-		-
Total non-qualifying hedges (1)	$	-	$	4

⁽¹⁾ Reported in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

Unconsolidated VIEs

Reinsurance Related Notes

Effective October 1, 2017, our captive reinsurance subsidiary, the Lincoln Reinsurance Company of Vermont VI, restructured the $275 million, long-term surplus note which was originally issued to a non-affiliated VIE in October 2015 in exchange for two corporate bond AFS securities of like principal and duration.  The activities of the VIE are primarily to acquire, hold and issue notes and loans and to pay and collect interest on the notes and loans.  The outstanding principal balance of the long-term surplus note is variable in nature; moving concurrently with any variability in the face amount of the corporate bond AFS securities.  We have concluded that we are not the primary beneficiary of the non-affiliated VIE because we do not have power over the activities that most significantly affect its economic performance.  As of December 31, 2017, the principal balance of the long-term surplus note was zero and we do not currently have any exposure to this VIE. 

23

Structured Securities

Through our investment activities, we make passive investments in structured securities issued by VIEs for which we are not the manager.  These structured securities include our RMBS, CMBS, CLOs and CDOs.  We have not provided financial or other support with respect to these VIEs other than our original investment.  We have determined that we are not the primary beneficiary of these VIEs due to the relative size of our investment in comparison to the principal amount of the structured securities issued by the VIEs and the level of credit subordination that reduces our obligation to absorb losses or right to receive benefits.  Our maximum exposure to loss on these structured securities is limited to the amortized cost for these investments.  We recognize our variable interest in these VIEs at fair value on our Consolidated Balance Sheets.  For information about these structured securities, see Note 5.

Limited Partnerships and Limited Liability Companies

We invest in certain LPs and limited liability companies (“LLCs”), including qualified affordable housing projects, that we have concluded are VIEs.  We do not hold any substantive kick-out or participation rights in the LPs and LLCs, and we do not receive any performance fees or decision maker fees from the LPs and LLCs.  Based on our analysis of the LPs and LLCs, we are not the primary beneficiary of the VIEs as we do not have the power to direct the most significant activities of the LPs and LLCs.

The carrying amounts of our investments in the LPs and LLCs are recognized in other investments on our Consolidated Balance Sheets and were $1.4 billion and $1.3  billion as of December 31, 2017 and 2016, respectively.  Included in these carrying amounts are our investments in qualified affordable housing projects, which were $31  million and $37 million as of December 31, 2017 and 2016, respectively.  We do not have any contingent commitments to provide additional capital funding to these qualified affordable housing projects.  We receive returns from these qualified affordable housing projects in the form of income tax credits and other tax benefits, which are recognized in federal income tax expense (benefit) on our Consolidated Statements of Comprehensive Income (Loss) and were $3 million for the years ended December 31, 2017 and 2016. 

Our exposure to loss is limited to the capital we invest in the LPs and LLCs, and there have been no indicators of impairment that would require us to recognize an impairment loss related to the LPs and LLCs as of December 31, 2017.

5.  Investments

AFS Securities

Pursuant to the Fair Value Measurements and Disclosures Topic of the FASB ASC, we have categorized AFS securities into a three-level hierarchy, 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 or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3), as described in Note 1, which also includes additional disclosures regarding our fair value measurements.

24

The amortized cost, gross unrealized gains, losses and OTTI and fair value of AFS securities (in millions) were as follows:

	As of December 31, 2017
	Amortized		Gross Unrealized							Fair
	Cost		Gains		Losses		OTTI (1)			Value
Fixed maturity securities:
Corporate bonds	$	74,921	$	6,573	$	341	$	(7	)	$	81,160
ABS		882		51		6		(26	)		953
U.S. government bonds		497		37		1		-			533
Foreign government bonds		391		55		-		-			446
RMBS		3,125		148		36		(21	)		3,258
CMBS		589		10		2		(2	)		599
CLOs		803		2		2		(5	)		808
State and municipal bonds		4,033		932		6		-			4,959
Hybrid and redeemable preferred securities		561		85		22		-			624
Total fixed maturity securities		85,802		7,893		416		(61	)		93,340
Equity securities		247		16		17		-			246
Total AFS securities	$	86,049	$	7,909	$	433	$	(61	)	$	93,586

	As of December 31, 2016
	Amortized		Gross Unrealized							Fair
	Cost		Gains		Losses		OTTI (1)			Value
Fixed maturity securities:
Corporate bonds	$	72,706	$	4,583	$	931	$	(5	)	$	76,363
ABS		1,016		39		13		(12	)		1,054
U.S. government bonds		345		34		2		-			377
Foreign government bonds		445		57		1		-			501
RMBS		3,316		141		65		(5	)		3,397
CMBS		341		8		4		(1	)		346
CLOs		742		1		3		(4	)		744
State and municipal bonds		3,811		703		19		-			4,495
Hybrid and redeemable preferred securities		568		68		47		-			589
VIEs’ fixed maturity securities		200		-		-		-			200
Total fixed maturity securities		83,490		5,634		1,085		(27	)		88,066
Equity securities		260		18		3		-			275
Total AFS securities	$	83,750	$	5,652	$	1,088	$	(27	)	$	88,341

⁽¹⁾ Includes unrealized (gains) and losses on impaired securities related to changes in the fair value of such securities subsequent to the impairment measurement date.

The amortized cost and fair value of fixed maturity AFS securities by contractual maturities (in millions) as of December 31, 2017, were as follows:

	Amortized		Fair
	Cost		Value
Due in one year or less	$	3,268	$	3,305
Due after one year through five years		17,472		18,099
Due after five years through ten years		17,059		17,708
Due after ten years		42,604		48,610
Subtotal		80,403		87,722
Structured securities (ABS, MBS, CLOs)		5,399		5,618
Total fixed maturity AFS securities	$	85,802	$	93,340

Actual maturities may differ from contractual maturities because issuers may have the right to call or pre-pay obligations.

25

The fair value and gross unrealized losses, including the portion of OTTI recognized in OCI, of AFS securities (dollars in millions), aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, were as follows:

	As of December 31, 2017
	Less Than or Equal					Greater Than
	to Twelve Months					Twelve Months					Total
				Gross					Gross					Gross
			Unrealized					Unrealized					Unrealized
	Fair		Losses and			Fair		Losses and			Fair		Losses and
	Value			OTTI		Value			OTTI		Value			OTTI
Fixed maturity securities:
Corporate bonds	$	4,726		$	67	$	4,706		$	276	$	9,432		$	343
ABS		56			-		143			15		199			15
U.S. government bonds		156			-		19			1		175			1
RMBS		277			4		599			33		876			37
CMBS		113			-		60			3		173			3
CLOs		281			2		72			-		353			2
State and municipal bonds		33			-		89			5		122			5
Hybrid and redeemable
preferred securities		20			-		124			22		144			22
Total fixed maturity securities		5,662			73		5,812			355		11,474			428
Equity securities		22			14		8			3		30			17
Total AFS securities	$	5,684		$	87	$	5,820		$	358	$	11,504		$	445
Total number of AFS securities in an unrealized loss position															1,095

	As of December 31, 2016
	Less Than or Equal					Greater Than
	to Twelve Months					Twelve Months					Total
				Gross					Gross					Gross
			Unrealized					Unrealized					Unrealized
	Fair		Losses and			Fair		Losses and			Fair		Losses and
	Value			OTTI		Value			OTTI		Value			OTTI
Fixed maturity securities:
Corporate bonds	$	15,099		$	542	$	3,117		$	390	$	18,216		$	932
ABS		201			5		281			23		482			28
U.S. government bonds		18			2		-			-		18			2
Foreign government bonds		29			1		-			-		29			1
RMBS		876			50		374			22		1,250			72
CMBS		187			4		18			2		205			6
CLOs		259			3		25			-		284			3
State and municipal bonds		208			11		47			8		255			19
Hybrid and redeemable
preferred securities		75			3		142			44		217			47
Total fixed maturity securities		16,952			621		4,004			489		20,956			1,110
Equity securities		4			2		44			2		48			4
Total AFS securities	$	16,956		$	623	$	4,048		$	491	$	21,004		$	1,114
Total number of AFS securities in an unrealized loss position															1,692

26

The fair value, gross unrealized losses, the portion of OTTI recognized in OCI (in millions) and number of AFS securities where the fair value had declined and remained below amortized cost by greater than 20% were as follows:

	As of December 31, 2017
								Number
	Fair		Gross Unrealized					of
	Value		Losses		OTTI		Securities (1)
Less than six months	$	156	$	57	$	1			26
Six months or greater, but less than nine months		2		1		-			4
Nine months or greater, but less than twelve months		12		6		-			7
Twelve months or greater		209		77		10			49
Total	$	379	$	141	$	11			86

	As of December 31, 2016
								Number
	Fair		Gross Unrealized					of
	Value		Losses		OTTI		Securities (1)
Less than six months	$	164	$	49	$	2			19
Nine months or greater, but less than twelve months		1		1		-			2
Twelve months or greater		358		166		10			62
Total	$	523	$	216	$	12			83

⁽¹⁾ We may reflect a security in more than one aging category based on various purchase dates. 

We regularly review our investment holdings for OTTI.  Our gross unrealized losses, including the portion of OTTI recognized in OCI, on AFS securities decreased $669 million for the year ended December 31, 2017.  As discussed further below, we believe the unrealized loss position as of December 31, 2017, did not represent OTTI as (i) we did not intend to sell these fixed maturity AFS securities; (ii) it is not more likely than not that we will be required to sell the fixed maturity AFS securities before recovery of their amortized cost basis; (iii) the estimated future cash flows were equal to or greater than the amortized cost basis of the debt securities; and (iv) we had the ability and intent to hold the equity AFS securities for a period of time sufficient for recovery. 

Based upon this evaluation as of December 31, 2017, management believes we have the ability to generate adequate amounts of cash from our normal operations (e.g., insurance premiums and fees and investment income) to meet cash requirements with a prudent margin of safety without requiring the sale of our temporarily-impaired securities. 

As of December 31, 2017, the unrealized losses associated with our corporate bond securities were attributable primarily to widening credit spreads and rising interest rates since purchase.  We performed a detailed analysis of the financial performance of the underlying issuers and determined that we expected to recover the entire amortized cost for each temporarily-impaired security.

As of December 31, 2017, the unrealized losses associated with our MBS and ABS were attributable primarily to widening credit spreads and rising interest rates since purchase.  We assessed for credit impairment using a cash flow model that incorporates key assumptions including default rates, severities and prepayment rates.  We estimated losses for a security by forecasting the underlying loans in each transaction.  The forecasted loan performance was used to project cash flows to the various tranches in the structure, as applicable.  Our forecasted cash flows also considered, as applicable, independent industry analyst reports and forecasts and other independent market data.  Based upon our assessment of the expected credit losses of the security given the performance of the underlying collateral compared to our subordination or other credit enhancement, we expected to recover the entire amortized cost of each temporarily-impaired security.

As of December 31, 2017, the unrealized losses associated with our hybrid and redeemable preferred securities were attributable primarily to wider credit spreads caused by illiquidity in the market and subordination within the capital structure, as well as credit risk of underlying issuers.  For our hybrid and redeemable preferred securities, we evaluated the financial performance of the underlying issuers based upon credit performance and investment ratings and determined that we expected to recover the entire amortized cost of each temporarily-impaired security.

27

Changes in the amount of credit loss of OTTI recognized in net income (loss) where the portion related to other factors was recognized in OCI (in millions) on fixed maturity AFS securities were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	411		$	363		$	360
Increases attributable to:
Credit losses on securities for which an OTTI
was not previously recognized		13			83			19
Credit losses on securities for which an OTTI
was previously recognized		7			16			15
Decreases attributable to:
Securities sold, paid down or matured		(73	)		(51	)		(31	)
Balance as of end-of-year	$	358		$	411		$	363

During 2017,  2016 and 2015, we recorded credit losses on securities for which an OTTI was not previously recognized as we determined the cash flows expected to be collected would not be sufficient to recover the entire amortized cost basis of the debt security.  The credit losses we recorded on securities for which an OTTI was not previously recognized were attributable primarily to one or a combination of the following reasons:

· Failure of the issuer of the security to make scheduled payments;

· Deterioration of creditworthiness of the issuer;

· Deterioration of conditions specifically related to the security;

· Deterioration of fundamentals of the industry in which the issuer operates; and

· Deterioration of the rating of the security by a rating agency.

We recognize the OTTI attributed to the noncredit portion as a separate component in OCI referred to as unrealized OTTI on AFS securities. 

Details of the amount of credit loss of OTTI recognized in net income (loss) for which a portion related to other factors was recognized in OCI (in millions), were as follows:

	As of December 31, 2017
			Net
			Unrealized				OTTI in
	Amortized		Gain/(Loss)		Fair		Credit
	Cost		Position		Value		Losses
Corporate bonds	$	17	$	7	$	24	$	31
ABS		173		26		199		102
RMBS		245		21		266		178
CMBS		13		2		15		39
CLOs		11		5		16		5
State and municipal bonds		-		-		-		3
Total	$	459	$	61	$	520	$	358

	As of December 31, 2016
			Net
			Unrealized				OTTI in
	Amortized		Gain/(Loss)		Fair		Credit
	Cost		Position		Value		Losses
Corporate bonds	$	80	$	5	$	85	$	77
ABS		201		12		213		106
RMBS		310		6		316		183
CMBS		29		1		30		37
CLOs		11		3		14		5
State and municipal bonds		2		-		2		3
Total	$	633	$	27	$	660	$	411

28

Trading Securities

Trading securities at fair value (in millions) consisted of the following:

	As of December 31,
	2017		2016
Fixed maturity securities:
Corporate bonds	$	1,250	$	1,275
ABS		15		19
U.S. government bonds		115		164
Foreign government bonds		23		23
RMBS		85		95
CMBS		2		2
CLOs		3		6
State and municipal bonds		17		17
Hybrid and redeemable preferred securities		23		23
Total trading securities	$	1,533	$	1,624

The portion of the market adjustment for trading gains and losses recognized in realized gain (loss) that relate to trading securities still held as of December 31, 2017,  2016 and 2015,  was $8  million, $(3) million and $(96)  million, respectively.

Mortgage Loans on Real Estate

Mortgage loans on real estate principally involve commercial real estate.  The commercial loans are geographically diversified throughout the U.S. with the largest concentrations in California, which accounted for 21% and 20%, respectively,and Texas, which accounted for 12%and 11%, respectively, of mortgage loans on real estate as of December 31, 2017 and 2016.

The following provides the current and past due composition of our mortgage loans on real estate (in millions):

	As of December 31,
	2017			2016
Current	$	10,662		$	9,762
60 to 90 days past due		-			-
Greater than 90 days past due		3			-
Valuation allowance associated with impaired mortgage loans on real estate		(3	)		(2	)
Unamortized premium (discount)		-			1
Total carrying value	$	10,662		$	9,761

The number of impaired mortgage loans on real estate, each of which had an associated specific valuation allowance, and the carrying value of impaired mortgage loans on real estate (dollars in millions) were as follows:

	As of December 31,
	2017			2016
Number of impaired mortgage loans on real estate	3			2
Principal balance of impaired mortgage loans on real estate	$	11		$	7
Valuation allowance associated with impaired mortgage loans on real estate		(3	)		(2	)
Carrying value of impaired mortgage loans on real estate	$	8		$	5

The changes in the valuation allowance associated with impaired mortgage loans on real estate (in millions) were as follows:

	For the Years Ended December 31,
	2017		2016		2015
Balance as of beginning-of-year	$	2	$	2	$	3
Additions		1		-		-
Charge-offs, net of recoveries		-		-		(1	)
Balance as of end-of-year	$	3	$	2	$	2

29

The average carrying value on the impaired mortgage loans on real estate (in millions) was as follows:

	For the Years Ended December 31,
	2017		2016		2015
Average carrying value for impaired
mortgage loans on real estate	$	6	$	6	$	17
Interest income recognized on impaired
mortgage loans on real estate		-		-		1
Interest income collected on impaired
mortgage loans on real estate		-		-		1

As described in Note 1, we use the loan-to-value and debt-service coverage ratios as credit quality indicators for our mortgage loans on real estate, which were as follows (dollars in millions):

	As of December 31, 2017				As of December 31, 2016
				Debt-				Debt-
				Service				Service
	Carrying		% of	Coverage	Carrying		% of	Coverage
Loan-to-Value Ratio	Value		Total	Ratio	Value		Total	Ratio
Less than 65%	$	9,563	89.7%	2.27	$	8,604	88.1%	2.16
65% to 74%		1,000	9.4%	1.94		1,009	10.3%	1.87
75% to 100%		91	0.8%	0.97		143	1.5%	0.86
Greater than 100%		8	0.1%	0.82		5	0.1%	1.04
Total mortgage loans on real estate	$	10,662	100.0%		$	9,761	100.0%

Alternative Investments 

As of December 31, 2017 and 2016, alternative investments included investments in 221 and 202 different partnerships, respectively, and the portfolios represented approximately 1%of our overall invested assets.

Net Investment Income

The major categories of net investment income (in millions) on our Consolidated Statements of Comprehensive Income (Loss) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Fixed maturity AFS securities	$	4,048		$	4,019		$	3,981
Equity AFS securities		12			11			9
Trading securities		88			94			102
Mortgage loans on real estate		433			413			385
Real estate		1			1			1
Policy loans		134			139			150
Invested cash		11			12			3
Commercial mortgage loan prepayment
and bond make-whole premiums		138			115			98
Alternative investments		165			75			88
Consent fees		6			5			5
Other investments		5			4			6
Investment income		5,041			4,888			4,828
Investment expense		(281	)		(257	)		(217	)
Net investment income	$	4,760		$	4,631		$	4,611

30

Realized Gain (Loss) Related to Certain Investments

The detail of the realized gain (loss) related to certain investments (in millions) was as follows:

	For the Years Ended December 31,
	2017			2016			2015
Fixed maturity AFS securities: (1)
Gross gains	$	17		$	65		$	41
Gross losses		(63	)		(227	)		(94	)
Equity AFS securities:
Gross gains		6			8			3
Gross losses		-			(1	)		-
Gain (loss) on other investments		(10	)		(62	)		(7	)
Associated amortization of DAC, VOBA, DSI and DFEL
and changes in other contract holder funds		(21	)		(24	)		(26	)
Total realized gain (loss) related to certain investments, pre-tax	$	(71	)	$	(241	)	$	(83	)

⁽¹⁾ These amounts are represented net of related fair value hedging activity.  See Note 6 for more information.

Details underlying write-downs taken as a result of OTTI that were recognized in net income (loss) and included in realized gain (loss) on AFS securities above and the portion of OTTI recognized in OCI (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
OTTI Recognized in Net Income (Loss)
Fixed maturity securities:
Corporate bonds	$	(13	)	$	(80	)	$	(42	)
ABS		(2	)		(5	)		(6	)
RMBS		(2	)		(10	)		(7	)
CMBS		(2	)		(1	)		(1	)
State and municipal bonds		(1	)		(3	)		-
Total fixed maturity securities		(20	)		(99	)		(56	)
Equity securities		-			(1	)		-
Gross OTTI recognized in net income (loss)		(20	)		(100	)		(56	)
Associated amortization of DAC, VOBA, DSI and DFEL		2			-			6
Net OTTI recognized in net income (loss), pre-tax	$	(18	)	$	(100	)	$	(50	)
Portion of OTTI Recognized in OCI
Gross OTTI recognized in OCI	$	-		$	53		$	29
Change in DAC, VOBA, DSI and DFEL		-			(12	)		(4	)
Net portion of OTTI recognized in OCI, pre-tax	$	-		$	41		$	25

Determination of Credit Losses on Corporate Bonds and ABS

As of December 31, 2017 and 2016, we reviewed our corporate bond and ABS portfolios for potential shortfall in contractual principal and interest based on numerous subjective and objective inputs.  The factors used to determine the amount of credit loss for each individual security, include, but are not limited to, near term risk, substantial discrepancy between book and market value, sector or company-specific volatility, negative operating trends and trading levels wider than peers. 

Credit ratings express opinions about the credit quality of a security.  Securities rated investment grade, that is those rated BBB- or higher by Standard & Poor’s (“S&P”) Rating Services or Baa3 or higher by Moody’s Investors Service (“Moody’s”), are generally considered by the rating agencies and market participants to be low credit risk.  As of December 31, 2017 and 2016, 96% and 95%, respectively, of the fair value of our corporate bond portfolio was rated investment grade.  As of December 31, 2017 and 2016, the portion of our corporate bond portfolio rated below investment grade had an amortized cost of $3.4 billion and $3.7 billion, respectively, and a fair value of $3.4 billion and $3.6 billion, respectively.  As of December 31, 2017 and 2016, 98% and 96%, respectively, of the fair value of our ABS portfolio was rated investment grade.  As of December 31, 2017 and 2016, the portion of our ABS portfolio rated below investment grade had an amortized cost of $43 million and $87 million, respectively, and a fair value of $41 million and $73 million, respectively.  Based upon the analysis discussed above, we believed as of December 31, 2017 and 2016, that we would recover the amortized cost of each investment grade corporate bond and ABS security.

31

Determination of Credit Losses on MBS

As of December 31, 2017 and 2016, default rates were projected by considering underlying MBS loan performance and collateral type.  Projected default rates on existing delinquencies vary between 10% to 100% depending on loan type and severity of delinquency status.  In addition, we estimate the potential contributions of currently performing loans that may become delinquent in the future based on the change in delinquencies and loan liquidations experienced in the recent history.  Finally, we develop a default rate timing curve by aggregating the defaults for all loans in the pool (delinquent loans, foreclosure and real estate owned and new delinquencies from currently performing loans) and the associated loan-level loss severities. 

We use certain available loan characteristics such as lien status, loan sizes and occupancy to estimate the loss severity of loans.  Second lien loans are assigned 100% severity, if defaulted.  For first lien loans, we assume a minimum of 30% severity with higher severity assumed for investor properties and further adjusted by housing price assumptions.  With the default rate timing curve and loan-level loss severity, we derive the future expected credit losses.

Payables for Collateral on Investments

The carrying value of the payables for collateral on investments (in millions) included on our Consolidated Balance Sheets and the fair value of the related investments or collateral consisted of the following:

	As of December 31, 2017				As of December 31, 2016
	Carrying		Fair		Carrying		Fair
	Value		Value		Value		Value
Collateral payable for derivative investments (1)	$	701	$	701	$	813	$	813
Securities pledged under securities lending agreements (2)		222		213		217		209
Securities pledged under repurchase agreements (3)		531		554		530		555
Investments pledged for Federal Home Loan Bank of
Indianapolis (“FHLBI”) (4)		2,900		4,235		3,350		4,947
Total payables for collateral on investments	$	4,354	$	5,703	$	4,910	$	6,524

⁽¹⁾ We obtain collateral based upon contractual provisions with our counterparties.  These agreements take into consideration the counterparties’ credit rating as compared to ours, the fair value of the derivative investments and specified thresholds that if exceeded result in the receipt of cash that is typically invested in cash and invested cash.  See Note 6 for additional information. 

⁽²⁾ Our pledged securities under securities lending agreements are included in fixed maturity AFS securities on our Consolidated Balance Sheets.  We generally obtain collateral in an amount equal to 102% and 105% of the fair value of the domestic and foreign securities, respectively.  We value collateral daily and obtain additional collateral when deemed appropriate.  The cash received in our securities lending program is typically invested in cash and invested cash or fixed maturity AFS securities.

⁽³⁾ Our pledged securities under repurchase agreements are included in fixed maturity AFS securities on our Consolidated Balance Sheets.  We obtain collateral in an amount equal to 95% of the fair value of the securities, and our agreements with third parties contain contractual provisions to allow for additional collateral to be obtained when necessary.  The cash received in our repurchase program is typically invested in fixed maturity AFS securities.

⁽⁴⁾ Our pledged investments for FHLBI are included in fixed maturity AFS securities and mortgage loans on real estate on our Consolidated Balance Sheets.  The collateral requirements are generally 105% to 115% of the fair value for fixed maturity AFS securities and 155% to 175% of the fair value for mortgage loans on real estate.  The cash received in these transactions is primarily invested in cash and invested cash or fixed maturity AFS securities.

Increase (decrease) in payables for collateral on investments (in millions) consisted of the following:

	For the Years Ended December 31,
	2017			2016			2015
Collateral payable for derivative investments	$	(112	)	$	(481	)	$	(283	)
Securities pledged under securities lending agreements		5			(25	)		38
Securities pledged under repurchase agreements		1			(144	)		69
Investments pledged for FHLBI		(450	)		995			430
Total increase (decrease) in payables for collateral on investments	$	(556	)	$	345		$	254

32

We have elected not to offset our repurchase agreements and securities lending transactions in our financial statements.  The remaining contractual maturities of repurchase agreements and securities lending transactions accounted for as secured borrowings were as follows:

	As of December 31, 2017
	Overnight and Continuous		Up to 30 Days		30 –  90 Days		Greater Than 90 Days		Total
Repurchase Agreements
Corporate bonds	$	-	$	100	$	281	$	150	$	531
Total		-		100		281		150		531
Securities Lending
Corporate bonds		222		-		-		-		222
Total		222		-		-		-		222
Total gross secured borrowings	$	222	$	100	$	281	$	150	$	753

	As of December 31, 2016
	Overnight and Continuous		Up to 30 Days		30 –  90 Days		Greater Than 90 Days		Total
Repurchase Agreements
Corporate bonds	$	-	$	-	$	384	$	146	$	530
Total		-		-		384		146		530
Securities Lending
Corporate bonds		212		-		-		-		212
Foreign government bonds		5		-		-		-		5
Total		217		-		-		-		217
Total gross secured borrowings	$	217	$	-	$	384	$	146	$	747

We accept collateral in the form of securities in connection with repurchase agreements.  In instances where we are permitted to sell or re-pledge the securities received, we report the fair value of the collateral received and a related obligation to return the collateral in the financial statements.  In addition, we receive securities in connection with securities borrowing agreements which we are permitted to sell or re-pledge.  As of December 31, 2017, the fair value of all collateral received that we are permitted to sell or re-pledge was $175  million.  As of December 31, 2017, we have re-pledged $174 million of this collateral to cover initial margin on certain derivative investments.

Investment Commitments

As of December 31, 2017, our investment commitments were $1.3 billion, which included $752 million of LPs, $196 million of private placement securities and $320 million of mortgage loans on real estate.

Concentrations of Financial Instruments

As of December 31, 2017 and 2016, our most significant investments in one issuer were our investments in securities issued by the Federal Home Loan Mortgage Corporation with a fair value of $1.2 billion and $1.5 billion, respectively, or1%of our invested assets portfolio, and our investments in securities issued by the Federal National Mortgage Association with a fair value of $930  million and $1.1 billion, respectively, or 1% of our invested assets portfolio.  These concentrations include both AFS and trading securities.

As of December 31, 2017 and 2016, our most significant investments in one industry were our investments in securities in the consumer non-cyclical industry with a fair value of $14.3 billion and $13.0 billion,respectively, or 13% and 12%, respectively, of our invested assets portfolio, and our investmentsin securities in the utilities industry with a fair value of $13.8 billion and $12.8 billion, respectively, or 12%  of our invested assets portfolio.  These concentrations include both AFS and trading securities.

6.  Derivative Instruments

We maintain an overall risk management strategy that incorporates the use of derivative instruments to minimize significant unplanned fluctuations in earnings that are caused by interest rate risk, foreign currency exchange risk, equity market risk, basis risk and credit risk.  We assess these risks by continually identifying and monitoring changes in our exposures that may adversely affect expected future cash flows and by evaluating hedging opportunities. 

Derivative activities are monitored by various management committees.  The committees are responsible for overseeing the implementation of various hedging strategies that are developed through the analysis of financial simulation models and other internal and industry sources.  The resulting hedging strategies are incorporated into our overall risk management strategies. 

See Note 1 for a detailed discussion of the accounting treatment for derivative instruments.  See Note 20 for additional disclosures related to the fair value of our derivative instruments and Note 4 for derivative instruments related to our consolidated VIEs.

33

Interest Rate Contracts

We use derivative instruments as part of our interest rate risk management strategy.  These instruments are economic hedges unless otherwise noted and include:

Forward-Starting Interest Rate Swaps

We use forward-starting interest rate swaps designated and qualifying as cash flow hedges to hedge our exposure to interest rate fluctuations related to the forecasted purchases of certain assets.

Interest Rate Cap Corridors

We use interest rate cap corridors to provide a level of protection from the effect of rising interest rates for certain life insurance products and annuity contracts.  Interest rate cap corridors involve purchasing an interest rate cap at a specific cap rate and selling an interest rate cap with a higher cap rate.  For each corridor, the amount of quarterly payments, if any, is determined by the rate at which the underlying index rate resets above the original capped rate.  The corridor limits the benefit the purchaser can receive as the related interest rate index rises above the higher capped rate.  There is no additional liability to us other than the purchase price associated with the interest rate cap corridor. 

Interest Rate Futures

We use interest rate futures contracts to hedge the liability exposure on certain options in variable annuity products.  These futures contracts require payment between our counterparty and us on a daily basis for changes in the futures index price.

Interest Rate Swap Agreements

We use interest rate swap agreements to hedge the liability exposure on certain options in variable annuity products.

We also use interest rate swap agreements designated and qualifying as cash flow hedges to hedge the interest rate risk of floating-rate bond coupon payments by replicating a fixed-rate bond. 

Finally, we use interest rate swap agreements designated and qualifying as fair value hedges to hedge against changes in the fair value of certain fixed maturity securities due to interest rate risks. 

Reverse Treasury Locks

We use reverse treasury locks designated and qualifying as cash flow hedges to hedge the interest rate exposure related to the anticipated purchase of fixed-rate securities.  These derivatives are primarily structured to hedge interest rate risk inherent in the assumptions used to price certain liabilities. 

Foreign Currency Contracts

We use derivative instruments as part of our foreign currency risk management strategy.  These instruments are economic hedges unless otherwise noted and include: 

Currency Futures

We use currency futures to hedge foreign exchange risk associated with certain options in variable annuity products.  Currency futures exchange one currency for another at a specified date in the future at a specified exchange rate. 

Foreign Currency Swaps

We use foreign currency swaps designated and qualifying as cash flow hedges, to hedge foreign exchange risk of investments in fixed maturity securities denominated in foreign currencies.  A foreign currency swap is a contractual agreement to exchange one currency for another at specified dates in the future at a specified exchange rate.

34

Equity Market Contracts

We use derivative instruments as part of our equity market risk management strategy that are economic hedges and include: 

Call Options Based on the S&P 500 Index®

Our indexed annuity and IUL contractspermit the holder to elect an interest rate return or an equity market component, where interest credited to the contracts is linked to the performance of the S&P 500 Index® (“S&P 500”).  Contract holders may elect to rebalance index options at renewal dates, either annually or biannually.  As of each renewal date, we have the opportunity to re-price the indexed component by establishing participation rates, caps, spreads and specified rates, subject to contractual guarantees.  We purchase call options that are highly correlated to the portfolio allocation decisions of our contract holders, such that we are economically hedged with respect to equity returns for the current reset period. 

Consumer Price Index Swaps

We use consumer price index swaps to hedge the liability exposure on certain options in fixed annuity products.  Consumer price index swaps are contracts entered into at no cost and whose payoff is the difference between the consumer price index inflation rate and the fixed-rate determined as of inception.

Equity Futures

We use equity futures contracts to hedge the liability exposure on certain options in variable annuity products.  These futures contracts require payment between our counterparty and us on a daily basis for changes in the futures index price.

Put Options

We use put options to hedge the liability exposure on certain options in variable annuity products.  Put options are contracts that require counterparties to pay us at a specified future date the amount, if any, by which a specified equity index is less than the strike rate stated in the agreement, applied to a notional amount. 

Total Return Swaps

We use total return swaps to hedge the liability exposure on certain options in variable annuity products. 

In addition, we use total return swaps to hedge a portion of the liability related to our deferred compensation plans.  We receive the total return on a portfolio of indexes and pay a floating-rate of interest. 

Variance Swaps

We use variance swaps to hedge the liability exposure on certain options in variable annuity products.  Variance swaps are contracts entered into at no cost whose payoff is the difference between the realized variance rate of an underlying index and the fixed variance rate determined as of inception of the contract.

Credit Contracts

We use derivative instruments as part of our credit risk management strategy that are economic hedges and include: 

Credit Default Swaps – Buying Protection

We use credit default swaps to hedge the liability exposure on certain options in variable annuity products. 

We buy credit default swaps to hedge against a drop in bond prices due to credit concerns of certain bond issuers.  A credit default swap allows us to put the bond back to the counterparty at par upon a default event by the bond issuer.  A default event is defined as bankruptcy, failure to pay, obligation acceleration or restructuring. 

Credit Default Swaps – Selling Protection

We use credit default swaps to hedge the liability exposure on certain options in variable annuity products. 

We sell credit default swaps to offer credit protection to contract holders and investors.  The credit default swaps hedge the contract holders and investors against a drop in bond prices due to credit concerns of certain bond issuers.  A credit default swap allows the investor to put the bond back to us at par upon a default event by the bond issuer.  A default event is defined as bankruptcy, failure to pay, obligation acceleration or restructuring. 

35

Embedded Derivatives

We have embedded derivatives that include:

GLB Reserves Embedded Derivatives

We are exposed to risk and income statement volatility caused by changes in the equity markets, interest rates and volatility associated with GLBs offered in our variable annuity products, including products with GWB and GIB features.  These GLB features are reinsured among various reinsurance counterparties on either a Modco or coinsurance basis.  We cede a portion of the GLB features to LNBAR on a funds withheld modified coinsurance basis.  The funds withheld arrangement includes a dynamic hedging strategy designed to mitigate selected risk. Changes in the value of the hedge contracts due to changes in equity markets, interest rates and implied volatilities hedge the changes in embedded derivative GLB reserves assumed by LNBAR caused by those same factors.  The hedge positions are rebalanced based upon changes in these factors as needed.  While we actively manage the hedge positions, these hedge positions may not be totally effective in offsetting changes in the embedded derivative reserve assumed by LNBAR due to, among other things, differences in timing between when a market exposure changes and corresponding changes to the hedge positions, extreme swings in the equity markets and interest rates, market volatility, contract holder behavior, divergence between the performance of the underlying funds and the hedging indices, divergence between the actual and expected performance of the hedge instruments and our ability to purchase hedging instruments at prices consistent with the desired risk and return trade-off.  However, the hedging results do not impact LNL due to a funds withheld agreement with LNBAR, which causes the financial impact of the derivatives, as well as the cash flow activity, to be reflected on LNBAR.

Certain features of these guarantees have elements of both insurance benefits accounted for under the Financial Services – Insurance – Claim Costs and Liabilities for Future Policy Benefits Subtopic of the FASB ASC (“benefit reserves”) and embedded derivatives accounted for under the Derivatives and Hedging and the Fair Value Measurements and Disclosures Topics of the FASB ASC (“embedded derivative reserves”).  We calculate the value of the benefit reserves and the embedded derivative reserves based on the specific characteristics of each GLB feature.

Indexed Annuity and IUL Contracts Embedded Derivatives

Our indexed annuity and IUL contracts permit the holder to elect an interest rate return or an equity market component, where interest credited to the contracts is linked to the performance of the S&P 500.  Contract holders may elect to rebalance index options at renewal dates, either annually or biannually.  As of each renewal date, we have the opportunity to re-price the indexed component by establishing participation rates, caps, spreads and specified rates, subject to contractual guarantees.  We purchase S&P 500 call options that are highly correlated to the portfolio allocation decisions of our contract holders, such that we are economically hedged with respect to equity returns for the current reset period. 

Reinsurance Related Embedded Derivatives

We have certain modified coinsurance arrangements and coinsurance with funds withheld reinsurance arrangements with embedded derivatives related to the withheld assets of the related funds.  These derivatives are considered total return swaps with contractual returns that are attributable to various assets and liabilities associated with these reinsurance arrangements. 

36

We have derivative instruments with off-balance-sheet risks whose notional or contract amounts exceed the related credit exposure.  Outstanding derivative instruments with off-balance-sheet risks (in millions) were as follows:

	As of December 31, 2017						As of December 31, 2016
	Notional		Fair Value				Notional		Fair Value
	Amounts		Asset		Liability		Amounts		Asset		Liability
Qualifying Hedges
Cash flow hedges:
Interest rate contracts (1)	$	1,544	$	45	$	16	$	2,089	$	68	$	77
Foreign currency contracts (1)		1,804		79		79		1,177		153		10
Total cash flow hedges		3,348		124		95		3,266		221		87
Fair value hedges:
Interest rate contracts (1)		563		-		174		637		-		182
Non-Qualifying Hedges
Interest rate contracts (1)		72,937		657		127		70,290		985		701
Foreign currency contracts (1)		22		-		-		14		-		-
Equity market contracts (1)		30,918		562		557		28,142		542		616
Credit contracts (1)		52		-		-		66		-		-
Embedded derivatives:
GLB direct (2) (3)		-		903		-		-		-		371
GLB ceded (2) (3)		-		51		954		-		371		-
Reinsurance related (4)		-		-		51		-		58		-
Indexed annuity and IUL contracts (2) (5)		-		11		1,418		-		-		1,139
Total derivative instruments	$	107,840	$	2,308	$	3,376	$	102,415	$	2,177	$	3,096

⁽¹⁾ Reported in derivative investments and other liabilities on our Consolidated Balance Sheets.

⁽²⁾ Reported in other assets on our Consolidated Balance Sheets.

⁽³⁾ Reported in other liabilities on our Consolidated Balance Sheets.

⁽⁴⁾ Reported in reinsurance related embedded derivatives on our Consolidated Balance Sheets.

⁽⁵⁾ Reported in future contract benefits on our Consolidated Balance Sheets.

Beginning in the first quarter 2017, consistent with changes enacted by the Chicago Mercantile Exchange (“CME”), the Company offset the variation margin payments with the derivative balances that are cleared through CME.

The maturity of the notional amounts of derivative instruments (in millions) was as follows:

	Remaining Life as of December 31, 2017
	Less Than		1 – 5		6 – 10		11 – 30		Over 30
	1 Year		Years		Years		Years		Years		Total
Interest rate contracts (1)	$	7,748	$	20,953	$	31,378	$	14,965	$	-	$	75,044
Foreign currency contracts (2)		22		247		423		1,090		44		1,826
Equity market contracts		18,746		9,520		485		15		2,152		30,918
Credit contracts		-		52		-		-		-		52
Total derivative instruments
with notional amounts	$	26,516	$	30,772	$	32,286	$	16,070	$	2,196	$	107,840

⁽¹⁾ As of December 31, 2017, the latest maturity date for which we were hedging our exposure to the variability in future cash flows for these instruments was February 2047.

⁽²⁾ As of December 31, 2017, the latest maturity date for which we were hedging our exposure to the variability in future cash flows for these instruments was September 2049.

37

The change in our unrealized gain (loss) on derivative instruments in AOCI (in millions) was as follows:

	For the Years Ended December 31,
	2017			2016			2015
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year	$	93		$	157		$	127
Other comprehensive income (loss):
Unrealized holding gains (losses) arising during the period:
Cash flow hedges:
Interest rate contracts		43			(165	)		(202	)
Foreign currency contracts		20			(10	)		17
Change in foreign currency exchange rate adjustment		(137	)		96			48
Change in DAC, VOBA, DSI and DFEL		1			2			3
Income tax benefit (expense)		26			27			46
Less:
Reclassification adjustment for gains (losses) included in net income (loss):
Cash flow hedges:
Interest rate contracts (1)		4			5			(190	)
Interest rate contracts (2)		-			1			-
Foreign currency contracts (1)		18			11			6
Foreign currency contracts (2)		9			7			-
Associated amortization of DAC, VOBA, DSI and DFEL		(2	)		(2	)		2
Income tax benefit (expense)		(10	)		(8	)		64
Balance as of end-of-period	$	27		$	93		$	157

⁽¹⁾ The OCI offset is reported within net investment income on our Consolidated Statements of Comprehensive Income (Loss).

⁽²⁾ The OCI offset is reported within realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

38

The gains (losses) on derivative instruments (in millions) recorded within income (loss) from continuing operations on our Consolidated Statements of Comprehensive Income (Loss) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Qualifying Hedges
Cash flow hedges:
Interest rate contracts (1)	$	4		$	5		$	8
Interest rate contracts (2)		-			1			-
Foreign currency contracts (1)		18			11			6
Foreign currency contracts (2)		9			7			-
Total cash flow hedges		31			24			14
Fair value hedges:
Interest rate contracts (1)		(23	)		(28	)		(30	)
Interest rate contracts (2)		7			16			(198	)
Total fair value hedges		(16	)		(12	)		(228	)
Non-Qualifying Hedges
Interest rate contracts (2)		103			181			304
Foreign currency contracts (2)		-			(14	)		(11	)
Equity market contracts (2)		(1,427	)		(1,253	)		(118	)
Equity market contracts (3)		28			12			1
Credit contracts (2)		1			(5	)		(6	)
Embedded derivatives:
Reinsurance related (2)		(141	)		(57	)		221
Indexed annuity and IUL contracts (2)		(400	)		(120	)		(57	)
Total derivative instruments	$	(1,821	)	$	(1,244	)	$	120

⁽¹⁾ Reported in net investment income on our Consolidated Statements of Comprehensive Income (Loss).

⁽²⁾ Reported in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

⁽³⁾ Reported in commissions and other expenses on our Consolidated Statements of Comprehensive Income (Loss).

Gains (losses) recognized as a component of OCI (in millions) on derivative instruments designated and qualifying as cash flow hedges were as follows:

	For the Years Ended December 31,
	2017		2016		2015
Offset to net investment income	$	22		16		14
Offset to realized gain (loss)		9		8		-

As of December 31, 2017,  $28 million of the deferred net gains (losses) on derivative instruments in AOCI were expected to be reclassified to earnings during the next 12 months.  This reclassification would be due primarily to interest rate variances related to our interest rate swap agreements.

For the years ended December 31, 2017 and 2016, there were no material reclassifications to earnings due to hedged firm commitments no longer deemed probable or due to hedged forecasted transactions that had not occurred by the end of the originally specified time period.

39

Information related to our credit default swaps for which we are the seller (dollars in millions) was as follows:

As of December 31, 2017
					Credit
		Reason	Nature		Rating of	Number			Maximum
		for	of	Underlying		of	Fair		Potential
Credit Contract Type	Maturity	Entering	Recourse	Obligation (1)		Instruments	Value (2)		Payout
Basket credit default swaps	12/20/2022	(3)	(4)		BBB+	1	$	1	$	52
						1	$	1	$	52

As of December 31, 2016
					Credit
		Reason	Nature		Rating of	Number			Maximum
		for	of	Underlying		of	Fair		Potential
Credit Contract Type	Maturity	Entering	Recourse		Obligation (1)	Instruments	Value (2)		Payout
Single name credit default swaps	3/20/2017 (5)	(6)	(4)		BBB+	2		-		40
						2	$	-	$	40

⁽¹⁾ Represents average credit ratings based on the midpoint of the applicable ratings among Moody's, S&P and Fitch Ratings, as scaled to the corresponding S&P ratings.

⁽²⁾ Broker quotes are used to determine the market value of our credit default swaps.

⁽³⁾ Credit default swaps were entered into in order to hedge the liability exposure on certain variable annuity products.

⁽⁴⁾ Sellers do not have the right to demand indemnification or compensation from third parties in case of a loss (payment) on the contract. 

⁽⁵⁾ These credit default swaps were sold to a counterparty of the consolidated VIEs discussed in Note 4.

⁽⁶⁾ Credit default swaps were entered into in order to generate income by providing default protection in return for a quarterly payment.

Details underlying the associated collateral of our credit default swaps for which we are the seller if credit risk-related contingent features were triggered (in millions) were as follows:

		As of			As of
	December 31,			December 31,
		2017			2016
Maximum potential payout		$	52		$	40
Less:  Counterparty thresholds			-			-
Maximum collateral potentially required to post		$	52		$	40

Certain of our credit default swap agreements contain contractual provisions that allow for the netting of collateral with our counterparties related to all of our collateralized financing transactions that we have outstanding.  If these netting agreements were not in place, we would have been required to post collateral if the market value was less than zero.

Credit Risk

We are exposed to credit losses in the event of non-performance by our counterparties on various derivative contracts and reflect assumptions regarding the credit or NPR.  The NPR is based upon assumptions for each counterparty’s credit spread over the estimated weighted average life of the counterparty exposure, less collateral held.  As of December 31, 2017, the NPR adjustment was less than$1 million.  The credit risk associated with such agreements is minimized by entering into agreements with financial institutions with long-standing, superior performance records.  Additionally, we maintain a policy of requiring derivative contracts to be governed by an International Swaps and Derivatives Association (“ISDA”) Master Agreement.  We are required to maintain minimum ratings as a matter of routine practice in negotiating ISDA agreements.  Under some ISDA agreements, we and LLANY have agreed to maintain certain financial strength or claims-paying ratings.  A downgrade below these levels could result in termination of derivative contracts, at which time any amounts payable by us would be dependent on the market value of the underlying derivative contracts.  In certain transactions, we and the counterparty have entered into a credit support annex requiring either party to post collateral when net exposures exceed pre-determined thresholds.  These thresholds vary by counterparty and credit rating.  The amount of such exposure is essentially the net replacement cost or market value less collateral held for such agreements with each counterparty if the net market value is in our favor.  As of December 31, 2017, and December 31, 2016, our exposure was zero and $5 million, respectively. 

40

The amounts recognized (in millions) by S&P credit rating of counterparty, for which we had the right to reclaim cash collateral or were obligated to return cash collateral, were as follows:

	As of December 31, 2017					As of December 31, 2016
	Collateral		Collateral			Collateral		Collateral
	Posted by		Posted by			Posted by		Posted by
S&P	Counter-		LNL			Counter-		LNL
Credit	Party		(Held by			Party		(Held by
Rating of	(Held by		Counter-			(Held by		Counter-
Counterparty	LNL)		Party)			LNL)		Party)
AA-	$	116	$	(1	)	$	53	$	(32	)
A+		178		(453	)		10		(217	)
A		170		(48	)		394		(335	)
A-		237		-			67		-
BBB+		-		(4	)		289		-
	$	701	$	(506	)	$	813	$	(584	)

Balance Sheet Offsetting

Information related to the effects of offsetting on our Consolidated Balance Sheets (in millions) was as follows:

		As of December 31, 2017
					Embedded
	Derivative				Derivative
	Instruments				Instruments			Total
Financial Assets
Gross amount of recognized assets		$	1,082			$	965	$	2,047
Gross amounts offset			(237	)			-		(237	)
Net amount of assets			845				965		1,810
Gross amounts not offset:
Cash collateral			(701	)			-		(701	)
Net amount		$	144			$	965	$	1,109
Financial Liabilities
Gross amount of recognized liabilities		$	1,037			$	2,423	$	3,460
Gross amounts offset			(261	)			-		(261	)
Net amount of liabilities			776				2,423		3,199
Gross amounts not offset:
Cash collateral			(506	)			-		(506	)
Net amount		$	270			$	2,423	$	2,693

41

		As of December 31, 2016
					Embedded
	Derivative				Derivative
	Instruments				Instruments			Total
Financial Assets
Gross amount of recognized assets		$	1,211			$	429	$	1,640
Gross amounts offset			(311	)			-		(311	)
Net amount of assets			900				429		1,329
Gross amounts not offset:
Cash collateral			(813	)			-		(813	)
Net amount		$	87			$	429	$	516
Financial Liabilities
Gross amount of recognized liabilities		$	1,274			$	1,510	$	2,784
Gross amounts offset			(536	)			-		(536	)
Net amount of liabilities			738				1,510		2,248
Gross amounts not offset:
Cash collateral			(584	)			-		(584	)
Net amount		$	154			$	1,510	$	1,664

7.  Federal Income Taxes

The federal income tax expense (benefit) on continuing operations (in millions) was as follows:

	For the Years Ended December 31,
	2017			2016		2015
Current	$	118		$	25	$	71
Deferred		(1,405	)		242		224
Federal income tax expense (benefit)	$	(1,287	)	$	267	$	295

A reconciliation of the effective tax rate differences (in millions) was as follows:

	For the Years Ended December 31,
	2017			2016			2015
Tax rate times pre-tax income	$	256		$	504		$	514
Effect of:
Tax-preferred investment income		(280	)		(196	)		(192	)
Tax credits		(29	)		(28	)		(26	)
Change in uncertain tax positions		(17	)		(11	)		1
Excess tax benefits from share-based
compensation		(8	)		(4	)		-
Goodwill impairment		316			-			-
Deferred tax impact from the Tax Cuts
and Jobs Act		(1,526	)		-			-
Other items		1			2			(2	)
Federal income tax expense (benefit)	$	(1,287	)	$	267		$	295
Effective tax rate		-176%			19%			20%

The effective tax rate is the ratio of tax expense (benefit) over pre-tax income (loss).  The tax-preferred investment income relates primarily to the separate account dividends-received deduction.  The tax benefit associated with the separate account dividends-received deduction was $264  million,  $175 million and $188 million for the years ended December 31, 2017,  2016 and 2015.  Tax benefits for uncertain tax positions for the year ended December 31, 2017, were primarily attributable to the release of reserves for tax contingencies associated with a  prior tax year that closed during 2017. 

As a result of the enactment of the Tax Act on December 22, 2017, we remeasured our existing deferred tax balances at the new 21% marginal corporate income tax rate and recognized $1.5 billion in tax benefit in 2017.  We continue to review and analyze the provisions of the Tax Act, including the actual and potential impact of the reduction in the U.S. federal corporate income tax rate and the impact of specific life insurance provisions on our financial statements.  The impact of the Tax Act may differ from existing amounts due to, among other things, changes in interpretations and assumptions we have made and guidance that may be issued by regulatory authorities.  The

42

Securities and Exchange Commission has issued rules that allow for a one year measurement period after the enactment of the Tax Act to finalize calculations and recording of the related tax impacts.  While we do not anticipate any significant changes to the amounts recorded as of December 31, 2017, any adjustments to amounts recorded as a result of the Tax Act will be made during 2018.We file with a consolidated group; however, we calculate our tax expense (benefit) on a separate company basis.

The federal income tax asset (liability) (in millions) was as follows:

	As of December 31,
	2017			2016
Current	$	206		$	164
Deferred		(2,391	)		(3,062	)
Total federal income tax asset (liability)	$	(2,185	)	$	(2,898	)

Significant components of our deferred tax assets and liabilities (in millions) were as follows:

	As of December 31,
	2017			2016
Deferred Tax Assets
Future contract benefits and other contract holder funds	$	580		$	986
Reinsurance related embedded derivative asset		11			-
Compensation and benefit plans		123			187
Tax credits		76			85
Other		8			19
Total deferred tax assets	$	798		$	1,277
Deferred Tax Liabilities
DAC	$	1,112		$	2,038
VOBA		105			306
Net unrealized gain on AFS securities		1,579			1,596
Net unrealized gain on trading securities		39			65
Intangibles		9			20
Investment activity		118			125
Deferred gain on business sold through reinsurance		35			51
Reinsurance related embedded derivative asset		-			20
Other		192			118
Total deferred tax liabilities	$	3,189		$	4,339
Net deferred tax asset (liability)	$	(2,391	)	$	(3,062	)

As of December 31, 2017,  wehad $73 million of alternative minimum tax credits that are not subject to expiration and $3 million of research and development credits that expire in 2036.  Although realization is not assured, management believes that it is more likely than not that we will realize the benefits of our deferred tax assets, and, accordingly, no valuation allowance has been recorded.

As of December 31, 2017 and2016,  $11 million and $1 million, respectively, of our unrecognized tax benefits presented below, if recognized, would have affected our income tax expense and our effective tax rate.  We are not aware of any events for which it is likely that unrecognized tax benefits will significantly increase or decrease within the next year.  A reconciliation of the unrecognized tax benefits (in millions) was as follows:

	For the Years Ended
	December 31,
	2017		2016
Balance as of beginning-of-year	$	1	$	10
Increases for prior year tax positions		9		-
Increases for current year tax positions		1		1
Decreases for expiring statutes		-		(10	)
Balance as of end-of-year	$	11	$	1

We recognize interest and penalties accrued, if any, related to unrecognized tax benefits as a component of tax expense.  For the years ended December 31, 2017,  2016 and2015, we recognized interest and penalty expense (benefit) related to uncertain tax positions of zero,  $(2) million and $1 million, respectively.  We had accrued interest and penalty expense related to the unrecognized tax benefits of zero as of December 31, 2017 and 2016.

43

We are subject to examination by U.S. federal, state, local and non-U.S. income authorities.  We are currently not under examination by the Internal Revenue Service; however, tax years 2014 and forward remain open.  We are currently under examination by several state and local taxing jurisdictions; however, we do not expect these examinations will materially impact us.

8.  DAC, VOBA, DSI and DFEL

Changes in DAC (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	8,269		$	8,620		$	7,527
Business acquired (sold) through reinsurance		-			-			38
Deferrals		1,345			1,339			1,483
Amortization, net of interest:
Amortization, excluding unlocking, net of interest		(922	)		(879	)		(813	)
Unlocking		61			(276	)		(232	)
Adjustment related to realized (gains) losses		(55	)		(51	)		(44	)
Adjustment related to unrealized (gains) losses		(789	)		(484	)		661
Balance as of end-of-year	$	7,909		$	8,269		$	8,620

Changes in VOBA (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	874		$	873		$	628
Business acquired (sold) through reinsurance		-			-			(22	)
Deferrals		7			3			8
Amortization:
Amortization, excluding unlocking		(105	)		(105	)		(128	)
Unlocking		(48	)		36			(82	)
Accretion of interest (1)		52			52			56
Adjustment related to realized (gains) losses		(1	)		(2	)		(1	)
Adjustment related to unrealized (gains) losses		(280	)		17			414
Balance as of end-of-year	$	499		$	874		$	873

⁽¹⁾ The interest accrual rates utilized to calculate the accretion of interest ranged from 4.2% to 6.9%.

Estimated future amortization of VOBA, net of interest (in millions), as of December 31, 2017, was as follows:

2018	$	49
2019		51
2020		65
2021		65
2022		61

Changes in DSI (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	293		$	301		$	285
Deferrals		29			25			29
Amortization, net of interest:
Amortization, excluding unlocking, net of interest		(30	)		(28	)		(33	)
Unlocking		(4	)		(2	)		2
Adjustment related to realized (gains) losses		(2	)		(2	)		(1	)
Adjustment related to unrealized (gains) losses		1			(1	)		19
Balance as of end-of-year	$	287		$	293		$	301

44

Changes in DFEL (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	1,855		$	1,923		$	1,365
Deferrals		753			628			537
Amortization, net of interest:
Amortization, excluding unlocking, net of interest		(383	)		(345	)		(299	)
Unlocking		(3	)		(63	)		(66	)
Adjustment related to realized (gains) losses		(18	)		(11	)		(8	)
Adjustment related to unrealized (gains) losses		(775	)		(277	)		394
Balance as of end-of-year	$	1,429		$	1,855		$	1,923

9.  Reinsurance

The following summarizes reinsurance amounts (in millions) recorded on our Consolidated Statements of Comprehensive Income (Loss), excluding amounts attributable to the indemnity reinsurance transaction with Swiss Re:

	For the Years Ended December 31,
	2017			2016			2015
Direct insurance premiums and fee income	$	10,103		$	9,373		$	9,354
Reinsurance assumed		101			105			83
Reinsurance ceded		(1,817	)		(1,728	)		(1,652	)
Total insurance premiums and fee income	$	8,387		$	7,750		$	7,785
Direct insurance benefits	$	6,669		$	6,112		$	6,304
Reinsurance recoveries netted against benefits		(1,851	)		(1,865	)		(1,775	)
Total benefits	$	4,818		$	4,247		$	4,529

Weand LLANY cede insurance to other companies.  The portion of our life insurance and annuity risks exceeding our retention limit is reinsured with other insurers.  We seek reinsurance coverage to limit our exposure to mortality losses and to enhance our capital management.  As discussed in Note 24, a portion of this reinsurance activity is with affiliated companies.

As of December 31, 2017, the policy for our reinsurance program was to retain up to$20 million on a single insured life.  As the amount we retain varies by policy, we reinsured approximately 25% of the mortality risk on newly issued life insurance contracts in 2017.  Approximately 35%and 36%of our total individual life in-force amount was reinsured as of December 31, 2017 and 2016, respectively.  Portions of our deferred annuity business have been reinsured on either a coinsurance or a Modco basis with other companies to limit our exposure to interest rate risks.  As of December 31, 2017 and 2016, the reserves associated with these reinsurance arrangements totaled $541 million and $584 million, respectively. 

We focus on obtaining reinsurance from a diverse group of reinsurers, and we monitor concentration as well as financial strength ratings of our reinsurers.  We regularly evaluate the financial condition of our reinsurers and monitor concentrations of credit risk related to reinsurance activities.  Our amounts recoverable from reinsurers represent receivables from and reserves ceded to reinsurers and LNBAR.  The amounts recoverable from reinsurers were $6.5  billionand $6.8 billion as of December 31, 2017 and 2016, respectively.  Our reinsurance operations were acquired by Swiss Re in December 2001 through a series of indemnity reinsurance transactions.  As such, Swiss Re reinsured certain liabilities and obligations under the indemnity reinsurance agreements and thereby represents our largest reinsurance exposure.  As we are not relieved of our liability to the ceding companies for this business, the liabilities and obligations associated with the reinsured policies remain on our Consolidated Balance Sheets with a corresponding reinsurance receivable from Swiss Re, which totaled $1.9 billion and $2.2 billion as of December 31, 2017 and 2016, respectively.  Swiss Re has funded a trust, with a balance of $2.5 billion as of December 31, 2017, to support this business.  In addition to various remedies that we would have in the event of a default by Swiss Re, we continue to hold assets in support of certain of the transferred reserves.  These assets consist of those reported as trading securities and certain mortgage loans.  Our liabilities for funds withheld and embedded derivatives as of December 31, 2017, included $269 million and $46 million, respectively, related to the business sold to Swiss Re.  In addition, the amounts recoverable from LNBAR were $2.1 billion as of December 31, 2017 and 2016.  LNBAR has funded trusts to support the business ceded of which the balance in the trusts changes as a result of ongoing reinsurance activity and totaled $1.9 billion as of December 31, 2017. 

We recorded the gain related to the indemnity reinsurance transactions with Swiss Re as a deferred gain on business sold through reinsurance on our Consolidated Balance Sheets and amortized the gain over the period which the majority of the earnings were expected to emerge, and the deferred gain was fully amortized in 2017.  We amortized $15 million, after-tax, of deferred gain on business sold through reinsurance during 2017 and $48 million during 2016 and 2015, respectively.

45

10.  Goodwill and Specifically Identifiable Intangible Assets

The changes in the carrying amount of goodwill (in millions) by reportable segment were as follows:

		For the Year Ended December 31, 2017
	Gross			Accumulated
	Goodwill			Impairment							Net
	as of			as of							Goodwill
	Beginning-			Beginning-							as of End-
		of-Year			of-Year			Impairment			of-Year
Annuities		$	1,040		$	(600	)	$	-		$	440
Retirement Plan Services			20			-			-			20
Life Insurance			2,186			(647	)		(905	)		634
Group Protection			274			-			-			274
Total goodwill		$	3,520		$	(1,247	)	$	(905	)	$	1,368

		For the Year Ended December 31, 2016
	Gross			Accumulated
	Goodwill			Impairment						Net
	as of			as of						Goodwill
	Beginning-			Beginning-						as of End-
		of-Year			of-Year			Impairment		of-Year
Annuities		$	1,040		$	(600	)	$	-	$	440
Retirement Plan Services			20			-			-		20
Life Insurance			2,186			(647	)		-		1,539
Group Protection			274			-			-		274
Total goodwill		$	3,520		$	(1,247	)	$	-	$	2,273

The fair values of our reporting units (Level 3 fair value estimates) are comprised of the value of in-force (i.e., existing) business and the value of new business.  Specifically, new business is representative of cash flows and profitability associated with policies or contracts we expect to issue in the future, reflecting our forecasts of future sales volume and product mix over a 10-year period.  To determine the values of in-force and new business, we use a discounted cash flows technique that applies a discount rate reflecting the market expected, weighted-average rate of return adjusted for the risk factors associated with operations to the projected future cash flows for each reporting unit.

As of October 1, 2017, the date of our annual quantitative assessment of goodwill, our Annuities, Retirement Plan Services and Group Protection reporting units had fair values that exceeded the carrying value of each reporting unit.  As discussed in Note 2, our early adoption of ASU 2017-04, “Simplifying the Test for Goodwill Impairment,” resulted in impairment of the Life Insurance reporting unit goodwill of $905 million during the fourth quarter of 2017 driven primarily from the impact of the December 22, 2017, enactment of the Tax Act that increased the carrying value of the Life Insurance reporting unit in excess of its fair value.

The gross carrying amounts and accumulated amortization (in millions) for each major specifically identifiable intangible asset class by reportable segment were as follows:

	As of December 31, 2017					As of December 31, 2016
	Gross					Gross
	Carrying		Accumulated			Carrying		Accumulated
	Amount		Amortization			Amount		Amortization
Life Insurance:
Sales force	$	100		$	47	$	100		$	43
Retirement Plan Services:
Mutual fund contract rights (1)		5			-		5			-
Total	$	105		$	47	$	105		$	43

⁽¹⁾ No amortization recorded as the intangible asset has indefinite life. 

46

Future estimated amortization of specifically identifiable intangible assets (in millions) as of December 31, 2017, was as follows:

2018	$	4
2019		4
2020		4
2021		4
2022		4
Thereafter		33

11.  Guaranteed Benefit Features

Information on the GDBfeatures outstanding (dollars in millions) was as follows:

	As of December 31,
	2017 (1)		2016 (1)
Return of Net Deposits
Total account value	$	96,941	$	87,707
Net amount at risk (2)		81		824
Average attained age of contract holders		64 years		63 years
Minimum Return
Total account value	$	108	$	105
Net amount at risk (2)		18		22
Average attained age of contract holders		76 years		75 years
Guaranteed minimum return		5%		5%
Anniversary Contract Value
Total account value	$	26,596	$	24,605
Net amount at risk (2)		417		782
Average attained age of contract holders		70 years		69 years

⁽¹⁾ Our variable contracts with guarantees may offer more than one type of guarantee in each contract; therefore, the amounts listed are not mutually exclusive.

⁽²⁾ Represents the amount of death benefit in excess of the account balance that is subject to market fluctuations.

The determination of GDB liabilities is based on models that involve a range of scenarios and assumptions, including those regarding expected market rates of return and volatility, contract surrender rates and mortality experience.  The following summarizes the balances of and changes in the liabilities for GDBs (in millions), which were recorded in future contract benefits on our Consolidated Balance Sheets:

	For the Years Ended December 31,
	2017			2016			2015
Balance as of beginning-of-year	$	110		$	115		$	89
Changes in reserves		8			34			52
Benefits paid		(18	)		(39	)		(26	)
Balance as of end-of-year	$	100		$	110		$	115

Variable Annuity Contracts

Account balances of variable annuity contracts, including those with guarantees, (in millions) were invested in separate account investment options as follows:

	As of December 31,
	2017		2016
Asset Type
Domestic equity	$	59,647	$	50,337
International equity		20,837		16,714
Fixed income		40,626		37,795
Total	$	121,110	$	104,846
Percent of total variable annuity
separate account values		99%		99%

47

Secondary Guarantee Products

Future contract benefits and other contract holder funds include reserves for our secondary guarantee products sold through our Life Insurance segment.  These UL and VUL products with secondary guarantees represented 32%and 36%of total life insurance in-force reserves as of December 31, 2017 and 2016, respectively.  UL and VUL products with secondary guarantees represented27% of total sales for the year ended December 31, 2017, and 33% for the years ended December 31, 2016 and 2015.

12.  Short-Term and Long-Term Debt

Details underlying short-term and long-term debt (in millions) were as follows:

	As of December 31,
	2017		2016
Short-Term Debt
Short-term debt (1)	$	10	$	280
Long-Term Debt, Excluding Current Portion
Surplus notes due LNC:
LIBOR + 142 bps surplus note, due 2023	$	-	$	240
9.76% surplus note, due 2024		50		50
6.56% surplus note, due 2028		500		500
LIBOR + 111 bps surplus note, due 2028		71		71
LIBOR + 226 bps surplus note, due 2028		573		533
6.03% surplus note, due 2028		750		750
LIBOR + 200 bps surplus note, due 2035		30		30
LIBOR + 155 bps surplus note, due 2037		25		-
4.20% surplus note, due 2037		50		-
LIBOR + 100 bps surplus note, due 2037		325		375
Total surplus notes		2,374		2,549
Total long-term debt	$	2,374	$	2,549

⁽¹⁾ The short-term debt represents short-term notes payable to LNC.

During 2017, we recognized a $5 million loss on the early extinguishment of debt, pre-tax, related to unamortized issuance costs on our Consolidated Statements of Comprehensive Income (Loss).

Future principal payments due on long-term debt (in millions) as of December 31, 2017, were as follows:

2018	$	-
2019		-
2020		-
2021		-
2022		-
Thereafter		2,374
Total	$	2,374

On June 28, 2013, we issued a surplus note of $240 million to LNC.  The note called for us to pay the principal amount of the note on or before June 28, 2023, and interest to be paid quarterly at an annual rate of the London Interbank Offered Rate (“LIBOR”) + 142 bps.  Subject to approval by the Indiana Insurance Commissioner (the “Commissioner”), we had the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest.  On September 27, 2017, we executed the right to repay the surplus note in whole totaling $240 million to LNC using dividends from subsidiaries and other items.

We issued a surplus note of $50 million to LNC in 1994.  The note calls for us to pay the principal amount of the note on or before September 30, 2024, and interest to be paid semiannually at an annual rate of 9.76%.  Subject to approval by the Commissioner, we have the right to repay the note on any March 31 or September 30.

We issued a surplus note of $500 million to LNC in 1998.  The note calls for us to pay the principal amount of the note on or before March 31, 2028, and interest to be paid quarterly at an annual rate of 6.56%.  Subject to approval by the Commissioner, LNC has the right to redeem the note for immediate repayment in total or in part once per year on the anniversary date of the note.  Any payment of interest or repayment of principal may be paid only out of our statutory earnings, only if our statutory capital surplus exceeds our statutory capital as of the date of note issuance of $2.3 billion, and subject to approval by the Commissioner.

48

On October 1, 2013, we issued a surplus note of $71 million to LNC.  The note calls for us to pay the principal amount of the note on or before September 24, 2028, and interest to be paid quarterly at an annual rate of LIBOR + 111 bps.  Subject to approval by the Commissioner, we have the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest.

On December 17, 2013, we issued a variable surplus note to a wholly-owned subsidiary of LNC with an initial outstanding principal amount of $287 million.  The outstanding principal amount as of December 31, 2017, was $573 million.  The note calls for us to pay the principal amount of the note on or before October 1, 2028, and interest to be paid quarterly at an annual rate of LIBOR + 226 bps.

We issued a surplus note of $750 million to LNC in 1998.  The note calls for us to pay the principal amount of the note on or before December 31, 2028, and interest to be paid quarterly at an annual rate of 6.03%.  Subject to approval by the Commissioner, LNC has the right to redeem the note for immediate repayment in total or in part once per year on the anniversary date of the note.  Any payment of interest or repayment of principal may be paid only out of our statutory earnings, only if our statutory capital surplus exceeds our statutory capital surplus as of the date of note issuance of $2.4 billion, and subject to approval by the Commissioner.

On October 1, 2015, we issued a surplus note of $30 million to LNC.  The note calls for us to pay the principal amount of the note on or before September 28, 2035, and interest to be paid quarterly at an annual rate of LIBOR + 200 bps.  Subject to approval by the Commissioner, we have the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest. 

On July 1, 2017, we issued a surplus note of $25 million to LNC.  The note calls for us to pay the principal amount of the note on or before June 30, 2037, and interest to be paid quarterly at an annual rate of LIBOR + 155 bps.  Subject to approval by the Commissioner, we have the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest. 

On October 1, 2017, we issued a surplus note of $50 million to LNC.  The note calls for us to pay the principal amount of the note on or before July 1, 2037, and interest to be paid quarterly at an annual rate of 4.20%.  Subject to approval by the Commissioner, we have the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest. 

On October 9, 2007, we issued a surplus note of $375 million that LNC has held effective December 31, 2008.  The note calls for us to pay the principal amount of the note on or before October 9, 2037, and interest to be paid quarterly at an annual rate of LIBOR + 100 bps.  On June 15, 2017, the surplus note was amended to include repayment terms stating subject to approval by the Commissioner, we have the right to repay the note in whole or in part prior to the maturity date, if our statutory capital surplus exceeds the sum of our surplus at closing plus any accrued but unpaid interest.  In fourth quarter of 2017, we executed the right to repay the surplus note in part totaling $50 million to LNC.

Credit Facilities and Letters of Credit

Credit facilities, which allow for borrowing or issuances of letters of credit (“LOCs”), and LOCs (in millions) were as follows:

		As of December 31, 2017
	Expiration	Maximum		LOCs
	Date	Available		Issued
Credit Facilities
Five-year revolving credit facility	Jun-2021	$	2,500	$	275
LOC facility (1)	Aug-2031		990		945
LOC facility (1)	Oct-2031		1,023		1,020
Total		$	4,513	$	2,240

⁽¹⁾ Our wholly-owned subsidiaries entered into irrevocable LOC facility agreements with third-party lenders supporting inter-company reinsurance agreements. 

On June 30, 2016, we refinanced the existing credit agreement with a syndicate of banks.  This agreement (the “credit facility”) allows for the borrowing and issuance of LOCs of up to $2.5 billion, $1.75 billion of which is available only to reimburse the banks for drawn LOCs.  The credit facility is unsecured and has a commitment termination date of June 30, 2021.  The LOCs under the facility are used primarily to satisfy reserve credit requirements of (i) ourselves and LLANY for which reserve credit is provided by our captive reinsurance subsidiaries and LNBAR and (ii) certain ceding companies of our legacy reinsurance business.

49

The credit facility contains or includes:

· Customary terms and conditions, including covenants restricting our ability to incur liens, merge or consolidate with another entity where we are not the surviving entity and dispose of all or substantially all of our assets;

· Financial covenants including maintenance of a minimum consolidated net worth (as defined in the facility) equal to the sum of $10.5 billion plus 50% of the aggregate net proceeds of equity issuances received by us in accordance with the terms of the credit facility; and a debt-to-capital ratio as defined in accordance with the credit facility not to exceed 0.35 to 1.00; and

· Customary events of default, subject to certain materiality thresholds and grace periods for certain of those events of default.

Upon an event of default, the credit facility provides that, among other things, the commitments may be terminated and the loans then outstanding may be declared due and payable.  As of December 31, 2017, we were in compliance with all such covenants.

Our LOC facility agreements each contain customary terms and conditions, including early termination fees, covenants restricting the ability of the subsidiaries to incur liens, merge or consolidate with another entity and dispose of all or substantially all of their assets.  Upon an event of early termination, the agreements require the immediate payment of all or a portion of the present value of the future LOC fees that would have otherwise been paid.  Further, the agreements contain customary events of default, subject to certain materiality thresholds and grace periods for certain of those events of default.  The events of default include payment defaults, covenant defaults, material inaccuracies in representations and warranties, bankruptcy and liquidation proceedings and other customary defaults.  Upon an event of default, the agreements provide that, among other things, obligations to issue, amend or increase the amount of any LOC shall be terminated and any obligations shall become immediately due and payable.  As of December 31, 2017, we were in compliance with all such covenants.

13.  Contingencies and Commitments

Contingencies

Regulatory and Litigation Matters

Regulatory bodies, such as state insurance departments, the SEC, Financial Industry Regulatory Authority and other regulatory bodies regularly make inquiries and conduct examinations or investigations concerning our compliance with, among other things, insurance laws, securities laws, laws governing the activities of broker-dealers, registered investment advisors and unclaimed property laws. 

LNL and its affiliates are involved in various pending or threatened legal or regulatory proceedings, including purported class actions, arising from the conduct of business both in the ordinary course and otherwise.  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 verdicts obtained in the jurisdiction for similar matters.  This variability in pleadings, together with the actual experiences of LNL 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 unpredictable nature of litigation, the outcome of a litigation matter and the amount or range of potential loss at particular points in time is normally 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.

We establish liabilities for litigation and regulatory loss contingencies when information related to the loss contingencies shows both that it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated.  It is possible that some matters could require us to pay damages or make other expenditures or establish accruals in amounts that could not be estimated as of December 31, 2017.  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 adverse effect on LNL’s financial condition. 

For some matters, the Company is able to estimate a reasonably possible range of loss.  For such matters in which a loss is probable, an accrual has been made.  For such matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made.  Accordingly, the estimate contained in this paragraph reflects two types of matters.  For some matters included within this estimate, an accrual has been made, but there is a reasonable possibility that an exposure exists in excess of the amount accrued.  In these cases, the estimate reflects the reasonably possible range of loss in excess of the accrued amount.  For other matters included within this estimation, no accrual has been made because a loss, while potentially estimable, is believed to be reasonably possible but not probable.  In these cases, the estimate reflects the reasonably possible loss or range of loss.  As of December 31, 2017, we estimate the aggregate range of reasonably possible losses to be up to approximately $50  million. 

For other matters, we are not currently able to estimate the reasonably possible loss or range of loss.  We are 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

50

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 progress of settlement negotiations.  On a quarterly and annual basis, we review relevant information with respect to litigation contingencies and update our accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews.

Certain reinsurers have sought rate increases on certain yearly renewable term treaties.  We are disputing the requested rate increases under these treaties.  We have initiated and will initiate arbitration proceedings, as necessary, under these treaties in order to protect our contractual rights.  Additionally, reinsurers may initiate arbitration proceedings against us.  We believe it is unlikely the outcome of these disputes will have a material adverse effect on our financial condition.For more information about reinsurance, see Note 9.

Cost of Insurance Litigation

Glover v. Connecticut General Life Insurance Company and The Lincoln National Life Insurance Company, filed in the U.S. District Court for the District of Connecticut, No. 3:16cv00827, is a putative class action that was served on LNL on June 8, 2016.  Plaintiff is the owner of a universal life insurance policy who alleges that LNL charged more for non-guaranteed cost of insurance than permitted by the policy.  Plaintiff seeks to represent all universal life and variable universal life policyholders who owned policies containing non-guaranteed cost of insurance provisions that are similar to those of Plaintiff’s policy and seeks damages on behalf of all such policyholders.  We are vigorously defending this matter.

Helen Hanks v. The Lincoln Life and Annuity Company of New York(“LLANY”) and Voya Retirement Insurance and Annuity Company (“Voya”), filed in the U.S. District Court for the Southern District of New York, No. 16cv6399, is a putative class action that was served on LLANY on August 12, 2016.  Plaintiff owns a universal life policy originally issued by Aetna (now Voya) and alleges that (i) Voya breached the terms of the policy when it increased non-guaranteed cost of insurance rates on Plaintiff’s policy; and (ii) LLANY, as reinsurer and administrator of Plaintiff’s policy, engaged in wrongful conduct related to the cost of insurance increase and was unjustly enriched as a result.  Plaintiff seeks to represent all owners of Aetna life insurance policies that were subject to non-guaranteed cost of insurance rate increases in 2016 and seeks damages on their behalf.  We are vigorously defending this matter.

EFG Bank AG, Cayman Branch, et al. v. The Lincoln National Life Insurance Company, pending in the U.S. District Court for the Eastern District of Pennsylvania, No. 2:17-cv-02592, is a civil action filed on February 1, 2017.  Plaintiffs own Legend Series universal life insurance policies originally issued by Jefferson-Pilot (now LNL).  Plaintiffs allege that LNL breached the terms of policyholders’ contracts when it increased cost of insurance rates beginning in 2016.  We are vigorously defending this matter.

Swenson, et al. v. The Lincoln National Life Insurance Company, Lincoln Life & Annuity Company of New York, Lincoln National Corporation, Voya Retirement Insurance and Annuity Company, and Voya Financial, Inc., filed in the U.S. District Court for the Southern District of New York, No. 1:17-cv-04843, is a civil action filed on February 1, 2017.  Plaintiffs own universal life insurance policies originally issued by Aetna (now Voya).  Plaintiffs alleged that LNL breached the terms of policyholders’ contracts when it increased cost of insurance rates beginning in 2016.  Plaintiffs voluntarily dismissed this action without prejudice on November 14, 2017.

In re: Lincoln National COI Litigation, pending in the U.S. District Court for the Eastern District of Pennsylvania, Master File No. 16-cv-06605-GJP, is a consolidated litigation matter related to multiple putative class action filings that were consolidated by an order dated March 20, 2017. In addition to consolidating a number of existing matters, the order also covers any future cases filed in the same district related to the same subject matter.  Plaintiffs own universal life insurance policies originally issued by Jefferson-Pilot (now LNL). Plaintiffs allege that LNL and LNC breached the terms of policyholders’ contracts by increasing non-guaranteed cost of insurance rates beginning in 2016. Plaintiffs seek to represent classes of policyowners and seek damages on their behalf. We are vigorously defending this matter.

Tutor v. Lincoln National Corporation and The Lincoln National Life Insurance Company, pending in the U.S. District Court for the Eastern District of Pennsylvania, No. 2:17-cv-04150, is a putative class action filed on September 18, 2017. Plaintiff owns a universal life insurance policy originally issued by former Jefferson-Pilot (now LNL).  Plaintiff alleges that LNL and LNC breached the terms of policyholders’ contracts by increasing non-guaranteed cost of insurance rates beginning in 2017. We are vigorously defending this matter.

Trinchero, et al. v. Lincoln National Corporation and The Lincoln National Life Insurance Company, pending in the U.S. District Court for the Eastern District of Pennsylvania, No. 2:18-cv-00765, is a putative class action filed on February 22, 2018. Plaintiffs own universal life insurance policies originally issued by former Jefferson-Pilot (now LNL).  Plaintiffs allege that LNL and LNC breached the terms of policyholders’ contracts by increasing non-guaranteed cost of insurance rates beginning in 2017. We are vigorously defending this matter.

Commitments

Operating Leases

We lease our home office properties.  In 2017, we extended the Radnor lease with a new term expiring in 2024.  Additionally, in 2017, we extended the Fort Wayne lease with a new term expiring in 2029.  In 2016, a lease commenced in Atlanta, Georgia at our RiverEdge Summit location and the lease shall expire in 2027.  Furthermore, in 2016, we renegotiated the Hartford lease with a new term expiring in 2028.

51

Total rental expense on operating leases for the years ended December 31, 2017,  2016 and 2015, was $36million, $37 million and $35 million, respectively.  Future minimum rental commitments (in millions) as of December 31, 2017, were as follows:

2018	$	31
2019		31
2020		27
2021		24
2022		19
Thereafter		66
Total	$	198

Capital Leases

In 2017 and 2016, we entered into sale-leaseback transactions on $62 million and $85 million, respectively, (net of amortization) of assets.  These transactions have been classified as capital leases on our Consolidated Balance Sheets.  These assets will continue to be amortized on a straight-line basis over the assets’ remaining lives.  Total accumulated amortization related to these leased assets as of December 31, 2017 and 2016, was $101 million and $92 million, respectively.  Future minimum lease payments under capital leases (in millions) as of December 31, 2017, were as follows:

2018	$	7
2019		90
2020		52
2021		62
2022		63
Thereafter		28
Total minimum lease payments		302
Less: Amount representing interest		26
Present value of minimum lease payments	$	276

Vulnerability from Concentrations

As of December 31, 2017, we did not have a concentration of: business transactions with a particular customer or lender; sources of supply of labor or services used in the business; or a market or geographic area in which business is conducted that makes us vulnerable to an event that is at least reasonably possible to occur in the near term and which could cause a severe impact to our financial condition. 

Although we do not have any significant concentration of customers, our American Legacy Variable Annuity (“ALVA”) product offered in our Annuities segment is significant to this segment.  The ALVA product accounted for 14%,  21% and 18% of Annuities’ variable annuity product deposits in 2017, 2016 and 2015, respectively, and represented approximately 40%,  41% and 42% of the segment’s total variable annuity product account values as of December 31, 2017, 2016 and 2015, respectively.  In addition, fund choices for certain of our other variable annuity products offered in our Annuities segment include American Fund Insurance SeriesSM (“AFIS”) funds.  For the Annuities segment, AFIS funds accounted for 20%,  23% and 20% of variable annuity product deposits in 2017, 2016 and 2015, respectively, and represented 47%,  47% and 48% of the segment’s total variable annuity product account values as of December 31, 2017, 2016 and 2015, respectively.

Other Contingency Matters

State guaranty funds assess insurance companies to cover losses to contract holders of insolvent or rehabilitated companies.  Mandatory assessments may be partially recovered through a reduction in future premium taxes in some states.  We have accrued for expected assessments and the related reductions in future state premium taxes, which net to assessments (recoveries) of $(17) million and $(10) million as of December 31, 2017 and 2016, respectively.

52

14.  Shares and Stockholder’s Equity

All authorized and issued shares of LNL are owned by LNC.

AOCI

The following summarizes the components and changes in AOCI (in millions):

	For the Years Ended December 31,
	2017			2016			2015
Unrealized Gain (Loss) on AFS Securities
Balance as of beginning-of-year	$	1,687		$	934		$	3,054
Unrealized holding gains (losses) arising during the year		2,872			1,549			(4,386	)
Change in foreign currency exchange rate adjustment		134			(100	)		(45	)
Change in DAC, VOBA, DSI, future contract benefits and other contract holder funds		(703	)		(460	)		1,293
Income tax benefit (expense)		(745	)		(351	)		1,095
Less:
Reclassification adjustment for gains (losses) included in net income (loss)		(40	)		(155	)		147
Associated amortization of DAC, VOBA, DSI and DFEL		(19	)		(22	)		(28	)
Income tax benefit (expense)		21			62			(42	)
Balance as of end-of-year	$	3,283		$	1,687		$	934
Unrealized OTTI on AFS Securities
Balance as of beginning-of-year	$	22		$	19		$	19
(Increases) attributable to:
Gross OTTI recognized in OCI during the year		-			(53	)		(29	)
Change in DAC, VOBA, DSI and DFEL		-			12			4
Income tax benefit (expense)		-			14			8
Decreases attributable to:
Changes in fair value, sales, maturities or other settlements of AFS securities		34			51			43
Change in DAC, VOBA, DSI and DFEL		(7	)		(7	)		(17	)
Income tax benefit (expense)		(10	)		(15	)		(9	)
Balance as of end-of-year	$	39		$	22		$	19
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year	$	93		$	157		$	127
Unrealized holding gains (losses) arising during the year		63			(175	)		(185	)
Change in foreign currency exchange rate adjustment		(137	)		96			48
Change in DAC, VOBA, DSI and DFEL		1			2			3
Income tax benefit (expense)		26			27			46
Less:
Reclassification adjustment for gains (losses) included in net income (loss)		31			24			(184	)
Associated amortization of DAC, VOBA, DSI and DFEL		(2	)		(2	)		2
Income tax benefit (expense)		(10	)		(8	)		64
Balance as of end-of-year	$	27		$	93		$	157
Funded Status of Employee Benefit Plans
Balance as of beginning-of-year	$	(20	)	$	(19	)	$	(21	)
Adjustment arising during the year		(4	)		(2	)		3
Income tax benefit (expense)		2			1			(1	)
Balance as of end-of-year	$	(22	)	$	(20	)	$	(19	)

53

The following summarizes the reclassifications out of AOCI (in millions) and the associated line item in the Consolidated Statements of Comprehensive Income (Loss):

	For the Years Ended December 31,
	2017			2016			2015
Unrealized Gain (Loss) on AFS Securities
Gross reclassification	$	(40	)	$	(155	)	$	147		Total realized gain (loss)
Associated amortization of DAC,
VOBA, DSI and DFEL		(19	)		(22	)		(28	)	Total realized gain (loss)
Reclassification before income										Income (loss) from continuing
tax benefit (expense)		(59	)		(177	)		119		operations before taxes
Income tax benefit (expense)		21			62			(42	)	Federal income tax expense (benefit)
Reclassification, net of income tax	$	(38	)	$	(115	)	$	77		Net income (loss)
Unrealized OTTI on AFS Securities
Gross reclassification	$	5		$	3		$	2		Total realized gain (loss)
Change in DAC, VOBA, DSI and DFEL		(1	)		-			-		Total realized gain (loss)
Reclassification before income										Income (loss) from continuing
tax benefit (expense)		4			3			2		operations before taxes
Income tax benefit (expense)		(1	)		-			-		Federal income tax expense (benefit)
Reclassification, net of income tax	$	3		$	3		$	2		Net income (loss)
Unrealized Gain (Loss) on Derivative Instruments
Gross reclassifications:
Interest rate contracts	$	4		$	5		$	(190	)	Net investment income
Interest rate contracts		-			1			-		Total realized gain (loss)
Foreign currency contracts		18			11			6		Net investment income
Foreign currency contracts		9			7			-		Total realized gain (loss)
Total gross reclassifications		31			24			(184	)
Associated amortization of DAC,
VOBA, DSI and DFEL		(2	)		(2	)		2		Commissions and other expenses
Reclassifications before income										Income (loss) from continuing
tax benefit (expense)		29			22			(182	)	operations before taxes
Income tax benefit (expense)		(10	)		(8	)		64		Federal income tax expense (benefit)
Reclassifications, net of income tax	$	19		$	14		$	(118	)	Net income (loss)

54

15.  Realized Gain (Loss)

Details underlying realized gain (loss) (in millions) reported on our Consolidated Statements of Comprehensive Income (Loss) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Total realized gain (loss) related to certain investments (1)	$	(71	)	$	(241	)	$	(83	)
Realized gain (loss) on the mark-to-market on certain instruments (2)		(155	)		(66	)		123
Indexed annuity and IUL contracts net derivatives results: (3)
Gross gain (loss)		(22	)		(1	)		(78	)
Associated amortization of DAC, VOBA, DSI and DFEL		(2	)		(4	)		14
GLB fees ceded to LNBAR and attributed fees:
Gross gain (loss)		(174	)		(166	)		(161	)
Associated amortization of DAC, VOBA, DSI and DFEL		(32	)		(32	)		(34	)
Realized gain (loss) on sale of subsidiaries/businesses (4)		-			-			(3	)
Total realized gain (loss)	$	(456	)	$	(510	)	$	(222	)

⁽¹⁾ See “Realized Gain (Loss) Related to Certain Investments” section in Note 5.

⁽²⁾ Represents changes in the fair values of certain derivative investments (not including those associated with our variable and indexed annuity and IUL contracts net derivatives results), reinsurance related embedded derivatives and trading securities.

⁽³⁾ Represents the net difference between the change in the fair value of the S&P 500call options that we hold and the change in the fair value of the embedded derivative liabilities of our indexed annuity and IUL contracts along with changes in the fair value of embedded derivative liabilities related to index call options we may purchase in the future to hedge contract holder index allocations applicable to future reset periods for our indexed annuity products.

⁽⁴⁾ See “Lincoln Financial Media Company” in Note 3.

16.  Commissions and Other Expenses

Details underlying commissions and other expenses (in millions) were as follows:

	For the Years Ended December 31,
	2017			2016			2015
Commissions	$	1,998		$	1,927		$	2,082
General and administrative expenses		1,715			1,623			1,683
Expenses associated with reserve financing and unrelated LOCs		57			40			32
DAC and VOBA deferrals and interest, net of amortization		(390	)		(170	)		(292	)
Broker-dealer expenses		329			320			329
Specifically identifiable intangible asset amortization		4			4			4
Media expenses		-			-			28
Taxes, licenses and fees		254			261			243
Total	$	3,967		$	4,005		$	4,109

17.  Retirement and Deferred Compensation Plans

Defined Benefit Pension and Other Postretirement Benefit Plans

We maintain defined benefit pension plans in which certain agents are participants.  These defined benefit pension plans are closed to new entrants and existing participants do not accrue any additional benefits.  We comply with applicable minimum funding requirementsand do not expect to be required to make any contributions to these pension plans in 2018.  We sponsor other postretirement benefit plans that provide health care and life insurance to certain retired agents.  Total net periodic cost (recovery) for these plans was$5 million, $3 million and $3 million during 2017, 2016 and 2015, respectively.  In 2018, we expect to make benefit payments of approximately $11 million for these plans. 

55

Information (in millions) with respect to these plans was as follows:

	As of or For the Years Ended December 31,
	2017			2016			2017			2016
							Other Postretirement
	Pension Plans						Benefit Plans
Fair value of plan assets	$	111		$	117		$	7		$	7
Projected benefit obligation		119			117			12			11
Funded status	$	(8	)	$	-		$	(5	)	$	(4	)
Amounts Recognized on the
Consolidated Balance Sheets
Other assets	$	-		$	2		$	-		$	-
Other liabilities		(8	)		(2	)		(5	)		(4	)
Net amount recognized	$	(8	)	$	-		$	(5	)	$	(4	)
Weighted-Average Assumptions
Benefit obligations:
Weighted-average discount rate		4.00%			4.50%			4.00%			4.50%
Net periodic benefit cost:
Weighted-average discount rate		4.50%			4.50%			4.50%			4.50%
Expected return on plan assets		4.75%			5.50%			6.50%			6.50%

The weighted average discount rate was determined based on a corporate yield curve as of December 31, 2017, and projected benefit obligation cash flows.  The expected return on plan assets was determined based on historical and expected future returns of the various asset categories, using the plans’ target plan allocation.  We reevaluate these assumptions each plan year. 

The following summarizes our fair value measurements of our benefit plans’ assets (in millions) on a recurring basis by asset category:

	As of December 31,
	2017		2016
Fixed maturity securities:
Corporate bonds	$	1	$	21
U.S. government bonds		105		93
U.S. government mortgage-backed
securities		3		-
Cash and invested cash		2		2
Other investments		7		8
Total	$	118	$	124

See “Fair Value Measurement” in Note 1 for discussion on how we categorize our pension plans’ assets into the three-level fair value hierarchy.  See “Financial Instruments Carried at Fair Value” in Note 20 for a summary of our fair value measurement of our pension plans’ assets by the three-level fair value hierarchy. 

Participation in Defined Benefit Pension and Other Postretirement Benefit Plans

We participate in defined benefit pension plans that are sponsored by LNC for certain employees and non-employee directors.  These defined benefit pension plans are closed to new entrants, and existing participants do not accrue any additional benefits.  We also participate in other postretirement benefit plans sponsored by LNC that provide health care and life insurance to certain retired employees. Our expense for these plans was $7 million, $9 million and $30 million for the years ended December 31, 2017, 2016 and2015, respectively.

Defined Contribution Plans

We sponsor tax-qualified defined contribution plans for eligible agents that are administered in accordance with the plan documents and various limitations under section 401(a) of the Internal Revenue Code of 1986.  We also participate in defined contribution plans sponsored by LNC for eligible employees.  Our expense for these plans was $85  million,  $83  million and $79  million, for the years ended December 31, 2017, 2016 and 2015, respectively. 

56

Deferred Compensation Plans

We sponsor non-qualified, unfunded, deferred compensation plans for certain current and former agents.  Certain current employees participate in non-qualified, unfunded, deferred compensation plans sponsored by LNC. The results of certain notional investment options within some of the plans are hedged by total return swaps.Our expenses increase or decrease in direct proportion to the change in market value of the participants’ investment options.  Participants of certain plans are able to select LNC stock as a notional investment option; however, it is not hedged by the total return swaps and is a primary source of expense volatility related to these plans.  Our expense for these plans was $27  million, $22  million and $12 million for the years ended December 31, 2017, 2016 and 2015, respectively.For further discussion of total return swaps related to our deferred compensation plans, see Note 6.

Information (in millions) with respect to these plans was as follows:

	As of December 31,
	2017		2016
Total liabilities (1)	$	517	$	440
Investments dedicated to fund liabilities (2)		182		159

⁽¹⁾ Reported in other liabilities on our Consolidated Balance Sheets.

⁽²⁾ Reported in other assets on our Consolidated Balance Sheets.

18.  Stock-Based Incentive Compensation Plans

Our employees and agents are included in LNC’s various incentive plans that provide for the issuance of stock options, performance shares (performance-vested shares as opposed to service-vested shares), stock appreciation rights (“SARs”) and restricted stock units (“RSUs”).  LNC issues new shares to satisfy option exercises.

Total compensation expense (in millions) by award type for all of our stock-based incentive plans was as follows:

	For the Years Ended December 31,
	2017		2016		2015
Stock options	$	9	$	9	$	7
Performance shares		12		10		11
SARs		2		3		-
RSUs		24		22		21
Total	$	47	$	44	$	39
Recognized tax benefit	$	16	$	15	$	14

19.  Statutory Information and Restrictions

We prepare financial statements in accordance with statutory accounting principles (“SAP”) prescribed or permitted by the insurance departments of our states of domicile, which may vary materially from GAAP.

Prescribed SAP includes the Accounting Practices and Procedures Manual of the National Association of Insurance Commissioners (“NAIC”) as well as state laws, regulations and administrative rules.  Permitted SAP encompasses all accounting practices not so prescribed.  The principal differences between statutory financial statements and financial statements prepared in accordance with GAAP are that statutory financial statements do not reflect DAC, some bond portfolios may be carried at amortized cost, assets and liabilities are presented net of reinsurance, contract holder liabilities are generally valued using more conservative assumptions and certain assets are non-admitted.

We are subject to the applicable laws and regulations of our states of domicile.  Changes in these laws and regulations could change capital levels or capital requirements for the Company.

Statutory capital and surplus, net gain (loss) from operations, after-tax, net income (loss) and dividends to the LNC holding company amounts (in millions) below consist of all or a combination of the following entities:  LNL, Lincoln Reinsurance Company of South Carolina, LLANY, Lincoln Reinsurance Company of Vermont I, Lincoln Reinsurance Company of Vermont III, Lincoln Reinsurance Company of Vermont IV, Lincoln Reinsurance Company of Vermont V, Lincoln Reinsurance Company of Vermont VI and Lincoln Reinsurance Company of Vermont VII.

57

	As of December 31,
	2017		2016
U.S. capital and surplus	$	8,074	$	8,017

	For the Years Ended December 31,
	2017		2016		2015
U.S. net gain (loss) from operations, after-tax	$	1,312	$	1,088	$	583
U.S. net income (loss)		1,452		982		786
U.S. dividends to LNC holding company		954		950		1,121

Comparison of 2017 to 2016

Statutory net income (loss) increased due primarily to higher dividends from affiliates, higher realized gains on investments and increased other revenue, partially offset by unfavorable reserve strain on certain products.

Comparison of 2016 to 2015

Statutory net income (loss) increased due primarily to changes in estimate on reserves for certain products and gains related to reinsurance transactions, partially offset by lower realized gains on investments.

Our states of domicile, Indiana for LNL and New York for LLANY, have adopted certain prescribed accounting practices that differ from those found in NAIC SAP.  These prescribed practices are the use of continuous Commissioners Annuity Reserve Valuation Method (“CARVM”) in the calculation of reserves as prescribed by the state of New York, the calculation of reserves on universal life policies based on the Indiana universal life method as prescribed by the state of Indiana for policies issued before January 1, 2006, and the use of a more conservative valuation interest rate on certain annuities prescribed by the states of Indiana and New York.  The Vermont reinsurance subsidiaries also have certain accounting practices permitted by the state of Vermont that differ from those found in NAIC SAP.  One permitted practice involves accounting for the lesser of the face amount of all amounts outstanding under a LOC and the value of the Valuation of Life Insurance Policies Model Regulation (“XXX”) additional statutory reserves as an admitted asset and a form of surplus as of December 31, 2017 and 2016.  Another permitted practice involves the acquisition of an LLC note in exchange for a variable value surplus note that is recognized as an admitted asset and a form of surplus as of December 31, 2017.  Lastly, the state of Vermont has permitted a practice to account for certain excess of loss reinsurance treaties with unaffiliated reinsurers as an asset and form of surplus as of December 31, 2017.  These permitted practices are related to structures that continue to be allowed in accordance with the grandfathered structures under the provisions of Actuarial Guideline 48 (“AG48”). 

The favorable (unfavorable) effects on statutory surplus compared to NAIC statutory surplus from the use of these prescribed and permitted practices (in millions) were as follows:

	As of December 31,
	2017			2016
State Prescribed Practices
Calculation of reserves using the Indiana universal life method	$	54		$	79
Conservative valuation rate on certain annuities		(50	)		(49	)
Vermont Subsidiaries Permitted Practices (1)
Lesser of LOC and XXX additional reserve as surplus		1,965			2,855
LLC notes and variable value surplus notes		1,585			-
Excess of loss reinsurance treaties		185			-

⁽¹⁾ These permitted practices are related to structures that continue to be allowed in accordance with the grandfathered structures under the provisions of AG48.

During the third quarter of 2013, the New York State Department of Financial Services announced that it would not recognize the NAIC revisions to Actuarial Guideline 38 in applying the New York law governing the reserves to be held for UL and VUL products containing secondary guarantees.  The change, which was effective as of December 31, 2013, impacts our New York-domiciled insurance subsidiary, LLANY.  Although LLANY discontinued the sale of these products in early 2013, the change affected those policies previously sold.  We began phasing in the increase in reserves in 2013 at $90 million per year over five years.  As of December 31, 2017, we completed the phased in increase in reserves over five years, for a total of $450 million. 

The NAIC has adopted risk-based capital (“RBC”) requirements for life insurance companies to evaluate the adequacy of statutory capital and surplus in relation to investment and insurance risks.  The requirements provide a means of measuring the minimum amount of

58

statutory surplus appropriate for an insurance company to support its overall business operations based on its size and risk profile.  Under RBC requirements, regulatory compliance is determined by the ratio of a company’s total adjusted capital, as defined by the NAIC, to its company action level of RBC (known as the “RBC ratio”), also as defined by the NAIC.  The company action level may be triggered if the RBC ratio is between 75% and 100%, which would require the insurer to submit a plan to the regulator detailing corrective action it proposes to undertake.  As of December 31, 2017, the Company’s RBC ratio was nearly five times the aforementioned company action level.

We are subject to certain insurance department regulatory restrictions as to the transfer of funds and payment of dividends to the holding company.  Under Indiana laws and regulations, LNL may pay dividends to LNC without prior approval of the Commissioner, only from unassigned surplus and must receive prior approval of the Commissioner to pay a dividend if such dividend, along with all other dividends paid within the preceding 12 consecutive months, would exceed the statutory limitation.  The current statutory limitation is the greater of 10% of the insurer’s contract holders’ surplus, as shown on its last annual statement on file with the Commissioner or the insurer’s statutory net gain from operations for the previous 12 months, but in no event to exceed statutory unassigned surplus.  Indiana law gives the Commissioner broad discretion to disapprove requests for dividends in excess of these limits.  LNL’s subsidiary, LLANY, a New York domiciled insurance company, is bound by similar restrictions, under New York law, with the applicable statutory limitation on dividends equal to the lesser of 10% of surplus to contract holders as of the immediately preceding calendar year or net gain from operations for the immediately preceding calendar year, not including realized capital gains.  We expect that we could pay dividends of approximately $1.2billion in 2018 without prior approval from the respective state commissioners.

All payments of principal and interest on surplus notes must be approved by the respective Commissioner of Insurance.

59

20.  Fair Value of Financial Instruments

The carrying values and estimated fair values of our financial instruments (in millions) were as follows:

	As of December 31, 2017						As of December 31, 2016
	Carrying			Fair			Carrying			Fair
	Value			Value			Value			Value
Assets
AFS securities:
Fixed maturity securities	$	93,340		$	93,340		$	87,866		$	87,866
VIEs’ fixed maturity securities		-			-			200			200
Equity securities		246			246			275			275
Trading securities		1,533			1,533			1,624			1,624
Mortgage loans on real estate		10,662			10,773			9,761			9,719
Derivative investments (1)		845			845			900			900
Other investments		2,006			2,006			2,034			2,034
Cash and invested cash		947			947			2,057			2,057
Reinsurance related embedded derivatives		-			-			58			58
Other assets:
GLB direct embedded derivatives		903			903			-			-
GLB ceded embedded derivatives		51			51			371			371
Indexed annuity ceded embedded derivatives		11			11			-			-
Separate account assets		144,219			144,219			128,397			128,397
Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(1,418	)		(1,418	)		(1,139	)		(1,139	)
Other contract holder funds:
Remaining guaranteed interest and similar contracts		(592	)		(592	)		(629	)		(629	)
Account values of certain investment contracts		(32,332	)		(36,161	)		(31,475	)		(35,647	)
Short-term debt		(10	)		(10	)		(280	)		(280	)
Long-term debt		(2,374	)		(2,677	)		(2,549	)		(2,739	)
Reinsurance related embedded derivatives		(51	)		(51	)		-			-
Other liabilities:
Derivative liabilities (1)		(455	)		(455	)		(738	)		(738	)
GLB direct embedded derivatives		-			-			(371	)		(371	)
GLB ceded embedded derivatives		(954	)		(954	)		-			-
Benefit Plans’ Assets (2)		118			118			124			124

⁽¹⁾ We have master netting agreements with each of our derivative counterparties, which allow for the netting of our derivative asset and liability positions by counterparty.

⁽²⁾ Included in the funded statuses of the benefit plans, which is reported in other liabilities on our Consolidated Balance Sheets.  Refer to Note 17 for information regarding our benefit plans. 

Valuation Methodologies and Associated Inputs for Financial Instruments Not Carried at Fair Value

The following discussion outlines the methodologies and assumptions used to determine the fair value of our financial instruments not carried at fair value on our Consolidated Balance Sheets.  Considerable judgment is required to develop these assumptions used to measure fair value.  Accordingly, the estimates shown are not necessarily indicative of the amounts that would be realized in a one-time, current market exchange of all of our financial instruments. 

Mortgage Loans on Real Estate

The fair value of mortgage loans on real estate is established using a discounted cash flow method based on credit rating, maturity and future income.  The ratings for mortgages in good standing are based on property type, location, market conditions, occupancy, debt-service coverage, loan-to-value, quality of tenancy, borrower and payment record.  The fair value for impaired mortgage loans is based on the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s market price or the fair value of the collateral if the loan is collateral dependent.  The inputs used to measure the fair value of our mortgage loans on real estate are classified as Level 2 within the fair value hierarchy. 

60

Other Investments

The carrying value of our assets classified as other investments approximates fair value.  Other investments includes primarily LPs and other privately held investments that are accounted for using the equity method of accounting and the carrying value is based on our proportional share of the net assets of the LPs.  The inputs used to measure the fair value of our LPs and other privately held investments are classified as Level 3 within the fair value hierarchy.  Other investments also includes securities that are not LPs or other privately held investments and the inputs used to measure the fair value of these securities are classified as Level 1 within the fair value hierarchy.

Other Contract Holder Funds

Other contract holder funds include remaining guaranteed interest and similar contracts and account values of certain investment contracts.  The fair value for the remaining guaranteed interest and similar contracts is estimated using discounted cash flow calculations as of the balance sheet date.  These calculations are based on interest rates currently offered on similar contracts with maturities that are consistent with those remaining for the contracts being valued.  As of December 31, 2017 and 2016, the remaining guaranteed interest and similar contracts carrying value approximated fair value.  The fair value of the account values of certain investment contracts is based on their approximate surrender value as of the balance sheet date.  The inputs used to measure the fair value of our other contract holder funds are classified as Level 3 within the fair value hierarchy.

Short-Term and Long-Term Debt

The fair value of short-term and long-term debt is based on quoted market prices.  The inputs used to measure the fair value of our short-term and long-term debt are classified as Level 2 within the fair value hierarchy. 

Financial Instruments Carried at Fair Value

We did not have any assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2017 or 2016, and we noted no changes in our valuation methodologies between these periods. 

61

The following summarizes our financial instruments carried at fair value (in millions) on a recurring basis by the fair value hierarchy levels described above:

		As of December 31, 2017
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	75,810			$	5,350		$	81,160
ABS			-			927				26			953
U.S. government bonds			522			6				5			533
Foreign government bonds			-			336				110			446
RMBS			-			3,246				12			3,258
CMBS			-			593				6			599
CLOs			-			717				91			808
State and municipal bonds			-			4,959				-			4,959
Hybrid and redeemable preferred securities			70			478				76			624
Equity AFS securities			28			57				161			246
Trading securities			73			1,411				49			1,533
Derivative investments (1)			-			740				603			1,343
Cash and invested cash			-			947				-			947
Other assets:
GLB direct embedded derivatives			-			-				903			903
GLB ceded embedded derivatives			-			-				51			51
Indexed annuity ceded embedded derivatives			-			-				11			11
Separate account assets			814			143,405				-			144,219
Total assets		$	1,507		$	233,632			$	7,454		$	242,593
Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(1,418	)	$	(1,418	)
Reinsurance related embedded derivatives			-			(51	)			-			(51	)
Other liabilities:
Derivative liabilities (1)			-			(380	)			(573	)		(953	)
GLB ceded embedded derivatives			-			-				(954	)		(954	)
Total liabilities		$	-		$	(431	)		$	(2,945	)	$	(3,376	)
Benefit Plans’ Assets		$	-		$	118			$	-		$	118

62

		As of December 31, 2016
		Quoted
		Prices
		in Active
	Markets for			Significant				Significant
		Identical		Observable				Unobservable				Total
		Assets			Inputs				Inputs			Fair
		(Level 1)			(Level 2)				(Level 3)			Value
Assets
Investments:
Fixed maturity AFS securities:
Corporate bonds		$	-		$	71,554			$	4,809		$	76,363
ABS			-			1,021				33			1,054
U.S. government bonds			366			11				-			377
Foreign government bonds			-			390				111			501
RMBS			-			3,394				3			3,397
CMBS			-			339				7			346
CLOs			-			676				68			744
State and municipal bonds			-			4,495				-			4,495
Hybrid and redeemable preferred securities			60			453				76			589
VIEs’ fixed maturity securities			-			200				-			200
Equity AFS securities			17			81				177			275
Trading securities			102			1,457				65			1,624
Derivative investments (1)			-			1,148				599			1,747
Cash and invested cash			-			2,057				-			2,057
Reinsurance related embedded derivatives			-			58				-			58
Other assets – GLB ceded embedded derivatives			-			-				371			371
Separate account assets			813			127,584				-			128,397
Total assets		$	1,358		$	214,918			$	6,319		$	222,595
Liabilities
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		$	-		$	-			$	(1,139	)	$	(1,139	)
Other liabilities:
Derivative liabilities (1)			-			(893	)			(692	)		(1,585	)
GLB direct embedded derivatives			-			-				(371	)		(371	)
Total liabilities		$	-		$	(893	)		$	(2,202	)	$	(3,095	)
Benefit Plans’ Assets		$	-		$	124			$	-		$	124

⁽¹⁾ Derivative investment assets and liabilities presented within the fair value hierarchy are presented on a gross basis by derivative type and not on a master netting basis by counterparty. 

63

The following summarizes changes to our financial instruments carried at fair value (in millions) and classified within Level 3 of the fair value hierarchy.  This summary excludes any effect of amortization of DAC, VOBA, DSI and DFEL.  The gains and losses below may include changes in fair value due in part to observable inputs that are a component of the valuation methodology.

	For the Year Ended December 31, 2017
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other (1)			Net			Net (2)			Value
Investments: (3)
Fixed maturity AFS securities:
Corporate bonds	$	4,809		$	17		$	199		$	(45	)	$	370		$	5,350
ABS		33			-			-			-			(7	)		26
U.S. government bonds		-			-			-			-			5			5
Foreign government bonds		111			-			(1	)		-			-			110
RMBS		3			-			-			19			(10	)		12
CMBS		7			-			1			54			(56	)		6
CLOs		68			-			-			124			(101	)		91
State and municipal bonds		-			(1	)		-			-			1			-
Hybrid and redeemable
preferred securities		76			-			14			-			(14	)		76
Equity AFS securities		177			1			(3	)		(13	)		(1	)		161
Trading securities		65			3			8			(26	)		(1	)		49
Derivative investments		(93	)		(27	)		127			23			-			30
Other assets: (4)
GLB direct embedded derivatives		-			903			-			-			-			903
GLB ceded embedded derivatives		371			(320	)		-			-			-			51
Indexed annuity ceded embedded derivatives		-			-			-			11			-			11
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives (4)		(1,139	)		(400	)		-			121			-			(1,418	)
Other liabilities: (4)
GLB direct embedded derivatives		(371	)		371			-			-			-			-
GLB ceded embedded derivatives		-			(954	)		-			-			-			(954	)
Total, net	$	4,117		$	(407	)	$	345		$	268		$	186		$	4,509

64

	For the Year Ended December 31, 2016
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other (1)			Net			Net (2)			Value
Investments: (3)
Fixed maturity AFS securities:
Corporate bonds	$	4,273		$	4		$	(29	)	$	159		$	402		$	4,809
ABS		45			-			(1	)		14			(25	)		33
U.S. government bonds		-			-			-			(2	)		2			-
Foreign government bonds		111			-			-			-			-			111
RMBS		1			-			-			54			(52	)		3
CMBS		10			2			(1	)		27			(31	)		7
CLOs		551			-			-			138			(621	)		68
Hybrid and redeemable
preferred securities		94			-			(3	)		(15	)		-			76
Equity AFS securities		164			5			(4	)		12			-			177
Trading securities		73			3			-			6			(17	)		65
Derivative investments		555			(483	)		(1	)		(164	)		-			(93	)
Other assets – GLB ceded embedded derivatives (4)		952			(581	)		-			-			-			371
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives (4)		(1,100	)		(120	)		-			81			-			(1,139	)
VIEs’ liabilities – derivative instruments (5)		(4	)		4			-			-			-			-
Other liabilities:
Credit default swaps (5)		(9	)		(6	)		-			15			-			-
GLB direct embedded derivatives (4)		(952	)		581			-			-			-			(371	)
Total, net	$	4,764		$	(591	)	$	(39	)	$	325		$	(342	)	$	4,117

65

	For the Year Ended December 31, 2015
							Gains		Issuances,				Transfers
				Items			(Losses)		Sales,				Into or
				Included			in		Maturities,				Out
	Beginning			in			OCI		Settlements,				of			Ending
	Fair			Net			and			Calls,			Level 3,			Fair
	Value			Income			Other (1)			Net			Net (2)			Value
Investments: (3)
Fixed maturity AFS securities:
Corporate bonds	$	4,052		$	4		$	(138	)	$	298		$	57		$	4,273
ABS		33			-			-			12			-			45
Foreign government bonds		110			-			1			-			-			111
RMBS		1			3			-			(3	)		-			1
CMBS		15			1			8			(14	)		-			10
CLOs		368			-			1			194			(12	)		551
Hybrid and redeemable
preferred securities		55			-			(3	)		-			42			94
Equity AFS securities		157			1			4			3			(1	)		164
Trading securities		73			2			(2	)		-			-			73
Derivative investments		989			(90	)		(41	)		(303	)		-			555
Other assets – GLB ceded embedded derivatives (4)		174			778			-			-			-			952
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives (4)		(1,170	)		(57	)		-			127			-			(1,100	)
VIEs’ liabilities – derivative instruments (5)		(13	)		9			-			-			-			(4	)
Other liabilities:
Credit default swaps (5)		(3	)		(6	)		-			-			-			(9	)
GLB direct embedded derivatives (4)		(174	)		(778	)		-			-			-			(952	)
Total, net	$	4,667		$	(133	)	$	(170	)	$	314		$	86		$	4,764

⁽¹⁾ The changes in fair value of the interest rate swaps are offset by an adjustment to derivative investments (see Note 6).

⁽²⁾ Transfers into or out of Level 3 for AFS and trading securities are displayed at amortized cost as of the beginning-of-year.  For AFS and trading securities, the difference between beginning-of-year amortized cost and beginning-of-year fair value was included in OCI and earnings, respectively, in prior years.

⁽³⁾ Amortization and accretion of premiums and discounts are included in net investment income on our Consolidated Statements of Comprehensive Income (Loss).  Gains (losses) from sales, maturities, settlements and calls and OTTI are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss). 

⁽⁴⁾ Gains (losses) from sales, maturities, settlements and calls are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

⁽⁵⁾ The changes in fair value of the credit default swaps and contingency forwards are included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss).

66

The following provides the components of the items included in issuances, sales, maturities, settlements and calls, net, excluding any effect of amortization of DAC, VOBA, DSI and DFEL and changes in future contract benefits, (in millions) as reported above:

	For the Year Ended December 31, 2017
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	850		$	(448	)	$	(98	)	$	(205	)	$	(144	)	$	(45	)
RMBS		19			-			-			-			-			19
CMBS		55			-			-			(1	)		-			54
CLOs		124			-			-			-			-			124
Equity AFS securities		18			(31	)		-			-			-			(13	)
Trading securities		2			(27	)		-			(1	)		-			(26	)
Derivative investments		197			233			(407	)		-			-			23
Other assets – indexed annuity ceded
embedded derivatives		11			-			-			-			-			11
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(71	)		-			-			192			-			121
Total, net	$	1,205		$	(273	)	$	(505	)	$	(15	)	$	(144	)	$	268

	For the Year Ended December 31, 2016
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	560		$	(62	)	$	(23	)	$	(176	)	$	(140	)	$	159
ABS		15			-			-			(1	)		-			14
U.S. government bonds		-			-			-			(2	)		-			(2	)
RMBS		54			-			-			-			-			54
CMBS		31			(1	)		-			(3	)		-			27
CLOs		140			-			-			(2	)		-			138
Hybrid and redeemable
preferred securities		-			(15	)		-			-			-			(15	)
Equity AFS securities		18			(6	)		-			-			-			12
Trading securities		7			-			-			(1	)		-			6
Derivative investments		176			(169	)		(171	)		-			-			(164	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(70	)		-			-			151			-			81
Other liabilities – credit default swaps		-			15			-			-			-			15
Total, net	$	931		$	(238	)	$	(194	)	$	(34	)	$	(140	)	$	325

	For the Year Ended December 31, 2015
	Issuances			Sales			Maturities		Settlements				Calls			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	537		$	(38	)	$	(44	)	$	(117	)	$	(40	)	$	298
ABS		13			-			-			(1	)		-			12
RMBS		-			(3	)		-			-			-			(3	)
CMBS		-			-			-			(13	)		(1	)		(14	)
CLOs		217			-			-			(23	)		-			194
Equity AFS securities		43			(40	)		-			-			-			3
Trading securities		1			-			-			(1	)		-			-
Derivative investments		179			(162	)		(320	)		-			-			(303	)
Future contract benefits – indexed annuity
and IUL contracts embedded derivatives		(51	)		-			-			178			-			127
Total, net	$	939		$	(243	)	$	(364	)	$	23		$	(41	)	$	314

67

The following summarizes changes in unrealized gains (losses) included in net income, excluding any effect of amortization of DAC, VOBA, DSI and DFEL and changes in future contract benefits, related to financial instruments carried at fair value classified within Level 3 that we still held (in millions):

	For the Years Ended December 31,
	2017			2016			2015
Derivative investments	$	(266	)	$	(432	)	$	(102	)
Embedded derivatives:
Indexed annuity and IUL contracts		(14	)		(16	)		(84	)
Other assets – GLB ceded		1,904			1,122			(244	)
Other liabilities – GLB direct		(1,904	)		(1,122	)		244
VIEs’ liabilities – derivative instruments		-			4			9
Credit default swaps		-			-			(6	)
Total, net (1)	$	(280	)	$	(444	)	$	(183	)

⁽¹⁾ Included in realized gain (loss) on our Consolidated Statements of Comprehensive Income (Loss). 

The following provides the components of the transfers into and out of Level 3 (in millions) as reported above:

	For the Year Ended December 31, 2017
	Transfers		Transfers
	Into		Out of
	Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	458	$	(88	)	$	370
ABS		14		(21	)		(7	)
U.S. government bonds		5		-			5
RMBS		-		(10	)		(10	)
CMBS		3		(59	)		(56	)
CLOs		30		(131	)		(101	)
State and municipal bonds		2		(1	)		1
Hybrid and redeemable preferred
securities		-		(14	)		(14	)
Equity AFS securities		-		(1	)		(1	)
Trading securities		4		(5	)		(1	)
Total, net	$	516	$	(330	)	$	186

	For the Year Ended December 31, 2016
	Transfers		Transfers
	Into		Out of
	Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	605	$	(203	)	$	402
ABS		3		(28	)		(25	)
U.S. government bonds		9		(7	)		2
RMBS		2		(54	)		(52	)
CMBS		-		(31	)		(31	)
CLOs		-		(621	)		(621	)
Trading securities		1		(18	)		(17	)
Total, net	$	620	$	(962	)	$	(342	)

68

	For the Year Ended December 31, 2015
	Transfers		Transfers
	Into		Out of
	Level 3		Level 3			Total
Investments:
Fixed maturity AFS securities:
Corporate bonds	$	224	$	(167	)	$	57
Foreign government bonds		4		(4	)		-
CLOs		4		(16	)		(12	)
Hybrid and redeemable preferred securities		47		(5	)		42
Equity AFS securities		-		(1	)		(1	)
Trading securities		4		(4	)		-
Total, net	$	283	$	(197	)	$	86

Transfers into and out of Level 3 are generally the result of observable market information on a security no longer being available or becoming available to our pricing vendors.  For the years ended December 31, 2017, 2016 and 2015, transfers in and out of Level 3 were attributable primarily to the securities’ observable market information no longer being available or becoming available.  Transfers into and out of Levels 1 and 2 are generally the result of a change in the type of input used to measure the fair value of an asset or liability at the end of the reporting period.  When quoted prices in active markets become available, transfers from Level 2 to Level 1 will result.  When quoted prices in active markets become unavailable, but we are able to employ a valuation methodology using significant observable inputs, transfers from Level 1 to Level 2 will result.  For the years ended December 31, 2017 and 2016, the transfers between Levels 1 and 2 of the fair value hierarchy were less than $1 million for our financial instruments carried at fair value.  For the year ended December 31, 2015, the transfers from Level 2 to Level 1 of the fair value hierarchy were $172 million for our financial instruments carried at fair value which was attributable to quoted market prices becoming available. 

69

The following summarizes the fair value (in millions), valuation techniques and significant unobservable inputs of the Level 3 fair value measurements as of December 31, 2017:

	Fair			Valuation	Significant	Assumption or
	Value			Technique	Unobservable Inputs	Input Ranges
Assets
Investments:
Fixed maturity AFS and trading
securities:
Corporate bonds	$	2,395		Discounted cash flow	Liquidity/duration adjustment (1)	0.5	%	-	21.0	%
ABS		24		Discounted cash flow	Liquidity/duration adjustment (1)	3.0	%	-	3.0	%
Foreign government bonds		78		Discounted cash flow	Liquidity/duration adjustment (1)	1.7	%	-	3.4	%
Hybrid and redeemable
preferred securities		4		Discounted cash flow	Liquidity/duration adjustment (1)	1.8	%	-	1.8	%
Equity AFS securities		22		Discounted cash flow	Liquidity/duration adjustment (1)	4.5	%	-	4.9	%
Other assets:
GLB direct and ceded
embedded derivatives		954		Discounted cash flow	Long-term lapse rate (2)	1	%	-	30	%
					Utilization of guaranteed withdrawals (3)	85	%	-	100	%
					Claims utilization factor (4)	60	%	-	100	%
					Premiums utilization factor (4)	80	%	-	115	%
					NPR (5)	0.01	%	-	0.25	%
					Mortality rate (6)				(8)
					Volatility (7)	1	%	-	29	%
Indexed annuity ceded
embedded derivatives		11		Discounted cash flow	Lapse rate (2)	1	%	-	9	%
					Mortality rate (6)				(8)
Liabilities
Future contract benefits – indexed
annuity and IUL contracts
embedded derivatives	$	(1,418	)	Discounted cash flow	Lapse rate (2)	1	%	-	9	%
					Mortality rate (6)				(8)
Other liabilities – GLB ceded
embedded derivatives		(954	)	Discounted cash flow	Long-term lapse rate (2)	1	%	-	30	%
					Utilization of guaranteed withdrawals (3)	85	%	-	100	%
					Claims utilization factor (4)	60	%	-	100	%
					Premiums utilization factor (4)	80	%	-	115	%
					NPR (5)	0.01	%	-	0.25	%
					Mortality rate (6)				(8)
					Volatility (7)	1	%	-	29	%

⁽¹⁾ The liquidity/duration adjustment input represents an estimated market participant composite of adjustments attributable to liquidity premiums, expected durations, structures and credit quality that would be applied to the market observable information of an investment.

⁽²⁾ The lapse rate input represents the estimated probability of a contract surrendering during a year, and thereby forgoing any future benefits.  The range for indexed annuity and IUL contracts represents the lapse rates during the surrender charge period.

⁽³⁾ The utilization of guaranteed withdrawals input represents the estimated percentage of contract holders that utilize the guaranteed withdrawal feature.

⁽⁴⁾ The utilization factors are applied to the present value of claims or premiums, as appropriate, in the GLB reserve calculation to estimate the impact of inefficient withdrawal behavior, including taking less than or more than the maximum guaranteed withdrawal.

⁽⁵⁾ The NPR input represents the estimated additional credit spread that market participants would apply to the market observable discount rate when pricing a contract.

⁽⁶⁾ The mortality rate input represents the estimated probability of when an individual belonging to a particular group, categorized according to age or some other factor such as gender, will die. 

⁽⁷⁾ The volatility input represents overall volatilities assumed for the underlying variable annuity funds, which include a mixture of equity and fixed-income assets.  Fair value of the variable annuity GLB embedded derivatives would increase if higher volatilities were used for valuation.

⁽⁸⁾ The mortality rate is based on a combination of company and industry experience, adjusted for improvement factors.

70

From the table above, we have excluded Level 3 fair value measurements obtained from independent, third-party pricing sources.  We do not develop the significant inputs used to measure the fair value of these assets and liabilities, and the information regarding the significant inputs is not readily available to us.  Independent broker-quoted fair values are non-binding quotes developed by market makers or broker-dealers obtained from third-party sources recognized as market participants.  The fair value of a broker-quoted asset or liability is based solely on the receipt of an updated quote from a single market maker or a broker-dealer recognized as a market participant as we do not adjust broker quotes when used as the fair value measurement for an asset or liability.  Significant increases or decreases in any of the quotes received from a third-party broker-dealer may result in a significantly higher or lower fair value measurement. 

Changes in any of the significant inputs presented in the table above may result in a significant change in the fair value measurement of the asset or liability as follows:

· Investments – An increase in the liquidity/duration adjustment input would result in a decrease in the fair value measurement.

· Indexed annuity and IUL contracts embedded derivatives – For direct embedded derivatives, an increase in the lapse rate or mortality rate inputs would result in a decrease in the fair value measurement. 

· GLB embedded derivatives – Assuming our GLB direct embedded derivatives are in a liability position: an increase in our lapse rate, NPR or mortality rate inputs would result in a decrease in the fair value measurement; and an increase in the utilization of guaranteed withdrawal or volatility inputs would result in an increase in the fair value measurement.

For each category discussed above, the unobservable inputs are not inter-related; therefore, a directional change in one input will not affect the other inputs. 

As part of our ongoing valuation process, we assess the reasonableness of our valuation techniques or models and make adjustments as necessary.  For more information, see “Summary of Significant Accounting Policies” above.

21.  Segment Information

We provide products and services and report results through our Annuities, Retirement Plan Services, Life Insurance and Group Protection segments.  We also have Other Operations, which includes the financial data for operations that are not directly related to the business segments.  Our reporting segments reflect the manner by which our chief operating decision makers view and manage the business.  The following is a brief description of these segments and Other Operations.

The Annuities segment provides tax-deferred investment growth and lifetime income opportunities for its clients by offering fixed (including indexed) and variable annuities.

The Retirement Plan Services segment provides employer-sponsored defined benefit and individual retirement accounts, as well as individual and group variable annuities, group fixed annuities and mutual-fund based programs in the retirement plan marketplace. 

The Life Insurance segment focuses in the creation and protection of wealth through life insurance products, including term insurance, a linked-benefit product (which is a UL policy linked with riders that provide for long-term care costs), IUL and both single and survivorship versions of UL and VUL, including corporate-owned UL and VUL insurance and bank-owned UL and VUL insurance products.

The Group Protection segment offers principally group non-medical insurance products, including term life, universal life, disability, dental, vision, accident and critical illness insurance to the employer market place through various forms of contributory and non-contributory plans.  Its products are marketed primarily through a national distribution system of regional group offices.  These offices develop business through employee benefit brokers, third-party administrators and other employee benefit firms. 

Other Operations includes investments related to our excess capital; investments in media properties (see Note 3 for more information) and other corporate investments; benefit plan net liability; the unamortized deferred gain on indemnity reinsurance related to the sale of reinsurance; the results of certain disability income business; our run-off institutional pension business, the majority of which was sold on a group annuity basis; debt costs; and strategic digitization expense.

71

Segment operating revenues and income (loss) from operations are internal measures used by our management and Board of Directors to evaluate and assess the results of our segments.  Income (loss) from operations is GAAP net income excluding the after-tax effects of the following items, as applicable:

· Realized gains and losses associated with the following (“excluded realized gain (loss)”):

§ Sales or disposals and impairments of securities;  

§ Changes in the fair value of derivatives, embedded derivatives within certain reinsurance arrangements and trading securities;

§ GLB rider fees ceded to LNBAR;

§ The net valuation premium of the GLB attributed rider fees; and

§ Changes in the fair value of the embedded derivative liabilities related to index call options we may purchase in the future to hedge contract holder index allocations applicable to future reset periods for our indexed annuity products accounted for at fair value;

· Income (loss) from reserve changes, net of related amortization, on business sold through reinsurance;

· Gains (losses) on early extinguishment of debt;

· Losses from the impairment of intangible assets;

· Income (loss) from discontinued operations;

· Acquisition and integration costs related to mergers and acquisitions; and

· Income (loss) from the initial adoption of new accounting standards, regulations, and policy changes including the net impact from the Tax Cuts and Jobs Act.

Operating revenues represent GAAP revenues excluding the pre-tax effects of the following items, as applicable:

· Excluded realized gain (loss);

· Revenue adjustments from the initial adoption of new accounting standards;

· Amortization of DFEL arising from changes in GDB and GLB benefit ratio unlocking; and

· Amortization of deferred gains arising from reserve changes on business sold through reinsurance.

We use our prevailing corporate federal income tax rate of 35%, where applicable, while taking into account any permanent differences for events recognized differently in our financial statements and federal income tax returns when reconciling our non-GAAP measures to the most comparable GAAP measure.  Operating revenues and income (loss) from operations do not replace revenues and net income as the GAAP measures of our consolidated results of operations.

72

Segment information (in millions) was as follows:

	For the Years Ended December 31,
	2017			2016			2015
Revenues
Operating revenues:
Annuities	$	4,034		$	3,710		$	3,815
Retirement Plan Services		1,152			1,092			1,090
Life Insurance		6,128			5,798			5,484
Group Protection		2,200			2,129			2,356
Other Operations		263			301			335
Excluded realized gain (loss), pre-tax		(630	)		(690	)		(400	)
Amortization of deferred gain arising from reserve changes on business
sold through reinsurance, pre-tax		1			3			3
Total revenues	$	13,148		$	12,343		$	12,683

	For the Years Ended December 31,
	2017			2016			2015
Net Income (Loss)
Income (loss) from operations:
Annuities	$	1,072		$	971		$	1,032
Retirement Plan Services		142			121			134
Life Insurance		522			464			296
Group Protection		103			65			42
Other Operations		(30	)		-			(73	)
Excluded realized gain (loss), after-tax		(409	)		(450	)		(260	)
Gain (loss) on early extinguishment of debt, after-tax		(3	)		-			-
Income (loss) from reserve changes (net of related amortization)
on business sold through reinsurance, after-tax		-			2			2
Net impact from the Tax Cuts and Jobs Act		1,526			-			-
Impairment of intangibles, after-tax		(905	)		-			-
Net income (loss)	$	2,018		$	1,173		$	1,173

73

	For the Years Ended December 31,
	2017		2016		2015
Net Investment Income
Annuities	$	982	$	983	$	977
Retirement Plan Services		893		855		842
Life Insurance		2,496		2,403		2,390
Group Protection		167		176		183
Other Operations		222		214		219
Total net investment income	$	4,760	$	4,631	$	4,611

	For the Years Ended December 31,
	2017		2016		2015
Amortization of DAC and VOBA, Net of Interest
Annuities	$	402	$	310	$	284
Retirement Plan Services		26		27		29
Life Insurance		455		709		806
Group Protection		79		126		80
Total amortization of DAC and VOBA, net of interest	$	962	$	1,172	$	1,199

	For the Years Ended December 31,
	2017			2016			2015
Federal Income Tax Expense (Benefit)
Annuities	$	198		$	261		$	281
Retirement Plan Services		50			43			46
Life Insurance		236			210			118
Group Protection		55			35			23
Other Operations		(78	)		(42	)		(33	)
Excluded realized gain (loss)		(220	)		(241	)		(141	)
Gain (loss) on early extinguishment of debt		(2	)		-			-
Reserve changes (net of related amortization)
on business sold through reinsurance		-			1			1
Net impact from the Tax Cuts and Jobs Act		(1,526	)		-			-
Total federal income tax expense (benefit)	$	(1,287	)	$	267		$	295

	As of December 31,
	2017		2016
Assets
Annuities	$	144,035	$	132,956
Retirement Plan Services		37,077		34,346
Life Insurance		81,565		75,868
Group Protection		4,033		4,007
Other Operations		15,162		14,874
Total assets	$	281,872	$	262,051

74

22.  Supplemental Disclosures of Cash Flow Data

The following summarizes our supplemental cash flow data (in millions):

	For the Years Ended December 31,
	2017			2016			2015
Interest paid	$	123		$	91		$	106
Income taxes paid (received)		215			121			125
Significant non-cash investing and financing transactions:
Acquisition of note receivable from affiliate		74			42			54
Other assets received in our financing transaction		-			-			252
Exchange of surplus note for promissory note with affiliate:
Carrying value of asset		109			124			123
Carrying value of liability		(109	)		(124	)		(123	)
Net asset (liability) from exchange	$	-		$	-		$	-

23.  Quarterly Results of Operations (Unaudited)

The unaudited quarterly results of operations (in millions) were as follows:

	For the Three Months Ended
	March 31,		June 30,		September 30,			December 31, (1)
2017
Total revenues	$	3,229	$	3,237		$	3,269		$	3,413
Total expenses		2,881		2,840			2,809			3,887
Net income (loss)		349		321			385			963
2016
Total revenues	$	2,885	$	2,930		$	3,181		$	3,347
Total expenses		2,781		2,677			2,739			2,706
Net income (loss)		125		219			359			470

(1)Fourth quarter 2017 results include a goodwill impairment charge and the impacts of remeasuring our existing deferred tax balances for the impact of the Tax Act as disclosed elsewhere herein.

75

24.  Transactions with Affiliates

The following summarizes transactions with affiliates (in millions) and the associated line item on our Consolidated Balance Sheets:

	As of December 31,
	2017			2016
Assets with affiliates:
Accrued inter-company interest receivable	$	8		$	8		Accrued investment income
Bonds		1,444			1,611		Fixed maturity AFS securities
Limited partnerships		(66	)		-		Other investments
Ceded reinsurance contracts		(188	)		(191	)	Deferred acquisition costs and value of
							business acquired
Ceded reinsurance contracts		2,152			2,148		Reinsurance recoverables
Ceded reinsurance contracts		8			112		Reinsurance related embedded derivatives
Ceded reinsurance contracts		39			207		Other assets
Cash management agreement		441			164		Other assets
Service agreement receivable		15			27		Other assets
Liabilities with affiliates:
Accrued inter-company interest payable		29			26		Other liabilities
Assumed reinsurance contracts		32			31		Future contract benefits
Assumed reinsurance contracts		400			403		Other contract holder funds
Service agreement payable		8			34		Other liabilities
Ceded reinsurance contracts		(47	)		(47	)	Other contract holder funds
Ceded reinsurance contracts		2,587			2,851		Funds withheld reinsurance liabilities
Ceded reinsurance contracts		(166	)		(171	)	Deferred gain on business sold
							through reinsurance
Ceded reinsurance contracts		984			84		Other liabilities
Inter-company short-term debt		10			280		Short-term debt
Inter-company long-term debt		2,374			2,549		Long-term debt

The following summarizes transactions with affiliates (in millions) and the associated line item on our Consolidated Statements of Comprehensive Income (Loss):

	For the Years Ended
	December 31,
	2017			2016			2015
Revenues with affiliates:
Premiums received on assumed (paid on ceded)	$	(393	)	$	(389	)	$	(411	)	Insurance premiums
reinsurance contracts
Net investment income on inter-company notes		42			38			31		Net investment income
Fees for management of general account		(100	)		(117	)		(109	)	Net investment income
Net investment income on ceded funds withheld treaties		(84	)		(69	)		(62	)	Net investment income
Realized gains (losses) on ceded reinsurance contracts:
GLB reserves embedded derivatives		(1,055	)		(516	)		664		Realized gain (loss)
Reinsurance related settlements		951			488			(881	)	Realized gain (loss)
Other gains (losses)		(150	)		(93	)		157		Realized gain (loss)
Amortization of deferred gain on reinsurance contracts		(5	)		(5	)		(5	)	Amortization of deferred gain
										on business sold through
										reinsurance
Benefits and expenses with affiliates:
Reinsurance (recoveries) benefits on ceded reinsurance		(299	)		(424	)		(478	)	Benefits
Ceded reinsurance contracts		(12	)		(14	)		(15	)	Commissions and other
										expenses
Service agreement payments		3			76			42		Commissions and other
										expenses
Interest expense on inter-company debt		120			111			102		Interest and debt expense
Interest credited on assumed reinsurance contracts		67			61			59		Interest credited

76

Bonds

LNC issues bonds to us for a predetermined face value to be repaid by LNC at a predetermined maturity with a specified interest rate.

Cash Management Agreement

In order to manage our capital more efficiently, we participate in an inter-company cash management program where LNC can lend to orborrow from us to meet short-term borrowing needs.  The cash management program is essentially a series of demand loans, which arepermitted under applicable insurance laws, among LNC and its affiliates that reduces overall borrowing costs by allowing LNC and itssubsidiaries to access internal resources instead of incurring third-party transaction costs.  The borrowing and lending limit is currently3% of our admitted assets as of December 31, 2017.

Service Agreement

In accordance with service agreements with LNC and other subsidiaries of LNC for personnel and facilities usage, general managementservices and investment management services, we receive services from and provide services to affiliated companies and receive anallocation of corporate overhead.  Corporate overhead expenses are allocated based on specific methodologies for each function.  Themajority of the expenses are allocated based on the following methodologies: headcount, capital, investments by product, assets under management, weightedpolicies in force and sales.

Ceded Reinsurance Contracts

As discussed in Note 9, we cede insurance contracts to and assume insurancecontracts from LNBAR.  We cede certain guaranteed benefit risks (including certain GDB and GWB benefits) to LNBAR.  As discussed in Note 6, we cede the GLB reserves embedded derivatives and therelated hedge results to LNBAR. 

Substantially all reinsurance ceded to affiliated companies is with unauthorized companies.  To take reserve credit for such reinsurance,wehold assets from the reinsurer, including funds held under reinsurance treaties, and are the beneficiary of LOCs aggregating to $610 million and $320 million as of December 31, 2017 and 2016, respectively.  The LOCs are obtained by the affiliatereinsurer and issued by banks in order for the Company to recognize the reserve credit.

25.  Subsequent Events

On January 19, 2018, LNL and, for the limited purposes set forth therein, LNC, entered into a Master Transaction Agreement (the “Master Transaction Agreement”) with Liberty Mutual Insurance Company (“LMIC”), Liberty Mutual Fire Insurance Company (collectively with LMIC, “Sellers”), for the limited purposes set forth therein, Liberty Mutual Group Inc. (“Liberty”), Protective Life Insurance Company (“Reinsurer”), and for the limited purposes set forth therein, Protective Life Corporation, to acquire all of the issued and outstanding capital stock of Liberty Life Assurance Company of Boston (“Liberty Life”), which currently operates Liberty’s Group Benefits Business (the “Liberty Group Business”) and Individual Life and Annuity Business (the “Liberty Life Business”), for cash consideration of approximately $3.3 billion (the “Liberty Transaction”).

The consideration includes approximately $1.4 billion total net investment for the Liberty Group Business, including a purchase price of $1.0 billion and $425 million in required capital.  The remaining components of the payment to Sellers include $410 million of individual life and annuity value paid by Reinsurer, $1.2 billion associated with excess capital in Liberty Life and $211 million of tax items.

Additionally, pursuant to the Master Transaction Agreement, Liberty Life and Reinsurer agreed to enter into a reinsurance agreement (the “Reinsurance Agreement”) and related ancillary documents at the closing of the Liberty Transaction.  On the terms and subject to the conditions of the Reinsurance Agreement, Liberty Life will cede to Reinsurer, effective as of the closing of the Liberty Transaction, the insurance policies relating to the Liberty Life Business.  The aggregate statutory reserves of Liberty Life to be ceded to Reinsurer as of the closing of the Liberty Transaction are expected to be approximately $13 billion.  To support its obligations under the Reinsurance Agreement, Reinsurer will establish a trust account for the benefit of LNL.

The Liberty Transaction is subject to the satisfaction or waiver of customary closing conditions, including regulatory approvals and the execution of the Reinsurance Agreement and related ancillary documents.  LNL expects the Liberty Transaction to be completed in the second quarter of 2018, pending regulatory approvals and other customary closing conditions.  We have requested regulatory approval for the Liberty Transaction and expect to receive such approval in due course.

77

Lincoln Life Variable Annuity Account N

N-1

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
AB VPS Global Thematic Growth Portfolio - Class B	$	31,791,974	$	—	$	31,791,974	$	12,185	$	4,280	$	31,775,509
AB VPS International Value Portfolio - Class B		1,232		—		1,232		—		—		1,232
AB VPS Large Cap Growth Portfolio - Class B		10,227,533		—		10,227,533		649		1,384		10,225,500
AB VPS Small/Mid Cap Value Portfolio - Class A		458,783		—		458,783		—		16		458,767
AB VPS Small/Mid Cap Value Portfolio - Class B		212,595,435		—		212,595,435		177,930		28,376		212,389,129
ALPS/Alerian Energy Infrastructure Portfolio - Class I		546,186		—		546,186		—		17		546,169
ALPS/Alerian Energy Infrastructure Portfolio - Class III		5,669,303		—		5,669,303		5,501		509		5,663,293
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		54,487		—		54,487		—		3		54,484
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		9,258,599		—		9,258,599		114		992		9,257,493
ALPS/Stadion Core ETF Portfolio - Class I		59,908		—		59,908		—		3		59,905
ALPS/Stadion Core ETF Portfolio - Class III		10,044,151		100,237		10,144,388		—		1,261		10,143,127
ALPS/Stadion Tactical Growth Portfolio - Class III		4,967,899		—		4,967,899		5,028		497		4,962,374
American Century VP Balanced Fund - Class I		71,689		—		71,689		—		2		71,687
American Century VP Balanced Fund - Class II		50,253,819		62,364		50,316,183		—		6,362		50,309,821
American Century VP Inflation Protection Fund - Class II		25,808		—		25,808		—		5		25,803
American Century VP Large Company Value Fund - Class I		352,524		—		352,524		—		15		352,509
American Century VP Large Company Value Fund - Class II		3,760,866		23,974		3,784,840		—		478		3,784,362
American Funds Asset Allocation Fund - Class 1		18,850,822		—		18,850,822		—		896		18,849,926
American Funds Asset Allocation Fund - Class 1A		4,094,939		—		4,094,939		1,413		161		4,093,365
American Funds Asset Allocation Fund - Class 4		125,487,181		—		125,487,181		374,526		12,906		125,099,749
American Funds Blue Chip Income and Growth Fund - Class 1		4,490,177		—		4,490,177		—		304		4,489,873
American Funds Blue Chip Income and Growth Fund - Class 1A		618,777		—		618,777		25		25		618,727
American Funds Blue Chip Income and Growth Fund - Class 4		29,889,830		—		29,889,830		11,376		2,927		29,875,527
American Funds Bond Fund - Class 1		6,354,179		7,921		6,362,100		—		413		6,361,687
American Funds Bond Fund - Class 1A		1,061,900		—		1,061,900		290		52		1,061,558
American Funds Capital Income Builder® - Class 1		1,003,868		242		1,004,110		—		39		1,004,071
American Funds Capital Income Builder® - Class 1A		454,571		—		454,571		171		20		454,380
American Funds Capital Income Builder® - Class 4		34,850,589		35,061		34,885,650		—		3,528		34,882,122
American Funds Global Balanced Fund - Class 1		556,205		—		556,205		—		30		556,175
American Funds Global Balanced Fund - Class 1A		238,904		—		238,904		16		10		238,878
American Funds Global Bond Fund - Class 1		2,828,055		1,920		2,829,975		—		194		2,829,781

See accompanying notes.
N-2

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
American Funds Global Bond Fund - Class 1A	$	64,019	$	—	$	64,019	$	53	$	3	$	63,963
American Funds Global Growth and Income Fund - Class 1		1,415,463		—		1,415,463		—		111		1,415,352
American Funds Global Growth and Income Fund - Class 1A		119,373		—		119,373		—		5		119,368
American Funds Global Growth Fund - Class 1		2,230,836		—		2,230,836		—		131		2,230,705
American Funds Global Growth Fund - Class 1A		1,729,428		—		1,729,428		62		85		1,729,281
American Funds Global Growth Fund - Class 2		308,672,518		—		308,672,518		132,716		38,974		308,500,828
American Funds Global Growth Fund - Class 4		37,667,688		11,984		37,679,672		—		3,402		37,676,270
American Funds Global Small Capitalization Fund - Class 1		1,447,519		—		1,447,519		—		93		1,447,426
American Funds Global Small Capitalization Fund - Class 1A		181,654		—		181,654		3		5		181,646
American Funds Global Small Capitalization Fund - Class 2		407,777,664		—		407,777,664		282,178		42,272		407,453,214
American Funds Global Small Capitalization Fund - Class 4		10,099,844		15,158		10,115,002		—		987		10,114,015
American Funds Growth Fund - Class 1		10,608,494		—		10,608,494		5,678		653		10,602,163
American Funds Growth Fund - Class 1A		2,803,489		—		2,803,489		395		139		2,802,955
American Funds Growth Fund - Class 2		1,495,078,161		—		1,495,078,161		915,246		202,755		1,493,960,160
American Funds Growth Fund - Class 4		104,965,253		369,894		105,335,147		—		10,330		105,324,817
American Funds Growth-Income Fund - Class 1		6,650,910		—		6,650,910		4,189		407		6,646,314
American Funds Growth-Income Fund - Class 1A		2,158,202		—		2,158,202		682		105		2,157,415
American Funds Growth-Income Fund - Class 2		1,953,557,336		—		1,953,557,336		978,577		233,515		1,952,345,244
American Funds Growth-Income Fund - Class 4		69,128,536		38,961		69,167,497		—		6,893		69,160,604
American Funds High-Income Bond Fund - Class 1		1,730,644		1,529		1,732,173		—		113		1,732,060
American Funds High-Income Bond Fund - Class 1A		387,389		—		387,389		—		38		387,351
American Funds International Fund - Class 1		6,193,159		—		6,193,159		3,019		351		6,189,789
American Funds International Fund - Class 1A		1,624,555		—		1,624,555		435		60		1,624,060
American Funds International Fund - Class 2		706,640,566		—		706,640,566		410,378		82,650		706,147,538
American Funds International Fund - Class 4		31,960,600		24,450		31,985,050		—		3,061		31,981,989
American Funds International Growth and Income Fund - Class 1		1,740,232		—		1,740,232		—		125		1,740,107
American Funds International Growth and Income Fund - Class 1A		663,897		—		663,897		87		29		663,781
American Funds Managed Risk Asset Allocation Fund - Class P1		883,412		—		883,412		—		107		883,305
American Funds Managed Risk Asset Allocation Fund - Class P2		105,785,147		800,313		106,585,460		—		12,957		106,572,503
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		84,417		—		84,417		—		8		84,409
American Funds Managed Risk Growth Fund - Class P1		105,312		—		105,312		—		7		105,305
American Funds Managed Risk Growth-Income Fund - Class P1		26,142		—		26,142		—		3		26,139

See accompanying notes.
N-3

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
American Funds Managed Risk International Fund - Class P1	$	15,846	$	—	$	15,846	$	—	$	1	$	15,845
American Funds Mortgage Fund - Class 1		417,527		—		417,527		—		36		417,491
American Funds Mortgage Fund - Class 1A		93,728		—		93,728		—		5		93,723
American Funds Mortgage Fund - Class 4		5,068,017		—		5,068,017		7		546		5,067,464
American Funds New World Fund® - Class 1		4,165,079		—		4,165,079		2,520		236		4,162,323
American Funds New World Fund® - Class 1A		649,475		—		649,475		26		19		649,430
American Funds New World Fund® - Class 4		24,102,936		—		24,102,936		12,013		2,336		24,088,587
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		187,775		571		188,346		—		13		188,333
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A		292,991		—		292,991		40		33		292,918
BlackRock Global Allocation V.I. Fund - Class I		4,965,963		—		4,965,963		—		242		4,965,721
BlackRock Global Allocation V.I. Fund - Class III		1,146,877,979		—		1,146,877,979		152,231		158,762		1,146,566,986
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		14,959		—		14,959		5		—		14,954
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		4,445,593		82		4,445,675		—		475		4,445,200
ClearBridge Variable Aggressive Growth Portfolio - Class I		309,605		—		309,605		—		10		309,595
ClearBridge Variable Aggressive Growth Portfolio - Class II		22,310,972		—		22,310,972		52,939		2,166		22,255,867
ClearBridge Variable Large Cap Growth Portfolio - Class I		336,206		—		336,206		107		14		336,085
ClearBridge Variable Large Cap Growth Portfolio - Class II		13,714,813		177,459		13,892,272		—		1,819		13,890,453
ClearBridge Variable Mid Cap Portfolio - Class I		533,232		—		533,232		16		24		533,192
ClearBridge Variable Mid Cap Portfolio - Class II		31,258,208		9,308		31,267,516		—		3,444		31,264,072
Columbia VP Commodity Strategy Fund - Class 1		165,074		—		165,074		17		5		165,052
Columbia VP Commodity Strategy Fund - Class 2		490,615		—		490,615		—		41		490,574
Columbia VP Emerging Markets Bond Fund - Class 1		256,103		—		256,103		—		7		256,096
Columbia VP Emerging Markets Bond Fund - Class 2		1,163,607		—		1,163,607		—		106		1,163,501
Columbia VP Strategic Income Fund - Class 2		2,922,354		—		2,922,354		—		333		2,922,021
Delaware VIP® Diversified Income Series - Service Class		2,015,690,814		229,744		2,015,920,558		—		264,702		2,015,655,856
Delaware VIP® Diversified Income Series - Standard Class		6,538,179		643		6,538,822		—		371		6,538,451
Delaware VIP® Emerging Markets Series - Service Class		341,148,828		—		341,148,828		428,389		45,169		340,675,270
Delaware VIP® Emerging Markets Series - Standard Class		522,718		—		522,718		—		18		522,700
Delaware VIP® High Yield Series - Service Class		129,116,550		—		129,116,550		18,936		18,135		129,079,479
Delaware VIP® High Yield Series - Standard Class		2,886,572		—		2,886,572		—		342		2,886,230
Delaware VIP® International Value Equity Series - Standard Class		118,458		—		118,458		—		14		118,444

See accompanying notes.
N-4

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
Delaware VIP® Limited-Term Diversified Income Series - Service Class	$	1,262,177,517	$	158,402	$	1,262,335,919	$	—	$	139,262	$	1,262,196,657
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		1,445,890		317		1,446,207		—		141		1,446,066
Delaware VIP® REIT Series - Service Class		155,368,450		—		155,368,450		115,568		20,433		155,232,449
Delaware VIP® REIT Series - Standard Class		3,128,002		—		3,128,002		—		332		3,127,670
Delaware VIP® Small Cap Value Series - Service Class		400,023,182		—		400,023,182		71,643		53,770		399,897,769
Delaware VIP® Small Cap Value Series - Standard Class		7,203,155		—		7,203,155		—		813		7,202,342
Delaware VIP® Smid Cap Core Series - Service Class		189,072,441		—		189,072,441		40,698		25,097		189,006,646
Delaware VIP® Smid Cap Core Series - Standard Class		7,246,904		—		7,246,904		—		833		7,246,071
Delaware VIP® U.S. Growth Series - Service Class		329,493,224		—		329,493,224		95,051		30,754		329,367,419
Delaware VIP® Value Series - Service Class		315,543,007		—		315,543,007		18,141		42,856		315,482,010
Delaware VIP® Value Series - Standard Class		6,860,767		—		6,860,767		—		821		6,859,946
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		1,263,843		32		1,263,875		—		96		1,263,779
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		54,835,493		—		54,835,493		5,134		7,376		54,822,983
Deutsche Equity 500 Index VIP Portfolio - Class A		5,803,015		—		5,803,015		35		797		5,802,183
Deutsche Small Cap Index VIP Portfolio - Class A		3,640,154		2		3,640,156		—		484		3,639,672
Eaton Vance VT Floating-Rate Income Fund - ADV Class		3,542,544		—		3,542,544		—		118		3,542,426
Eaton Vance VT Floating-Rate Income Fund - Initial Class		17,287,541		106,374		17,393,915		—		1,745		17,392,170
Fidelity® VIP Contrafund® Portfolio - Initial Class		1,754,864		—		1,754,864		51		58		1,754,755
Fidelity® VIP Contrafund® Portfolio - Service Class 2		1,134,439,654		—		1,134,439,654		365,014		151,270		1,133,923,370
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		6,059,816		—		6,059,816		468		807		6,058,541
Fidelity® VIP Growth Portfolio - Initial Class		4,933,873		—		4,933,873		18		542		4,933,313
Fidelity® VIP Growth Portfolio - Service Class 2		221,688,859		254,887		221,943,746		—		29,525		221,914,221
Fidelity® VIP Mid Cap Portfolio - Initial Class		1,896,595		—		1,896,595		28		64		1,896,503
Fidelity® VIP Mid Cap Portfolio - Service Class 2		583,861,080		—		583,861,080		570,526		76,369		583,214,185
Fidelity® VIP Strategic Income Portfolio - Initial Class		605,475		—		605,475		25		20		605,430
Fidelity® VIP Strategic Income Portfolio - Service Class 2		15,481,363		91,260		15,572,623		—		1,499		15,571,124
First Trust Dorsey Wright Tactical Core Portfolio - Class I		4,627,349		170,591		4,797,940		—		452		4,797,488
First Trust Multi Income Allocation Portfolio - Class I		5,591,837		—		5,591,837		—		600		5,591,237
First Trust Multi Income Allocation Portfolio - Class II		49,060		—		49,060		—		3		49,057
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		85,957,226		241,338		86,198,564		—		10,853		86,187,711

See accompanying notes.
N-5

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II	$	190,467	$	—	$	190,467	$	—	$	9	$	190,458
Franklin Founding Funds Allocation VIP Fund - Class 4		8,357,329		—		8,357,329		244,344		864		8,112,121
Franklin Income VIP Fund - Class 1		162,613		—		162,613		—		5		162,608
Franklin Income VIP Fund - Class 2		568,097,041		—		568,097,041		84,355		72,022		567,940,664
Franklin Income VIP Fund - Class 4		51,661,547		43,568		51,705,115		—		5,499		51,699,616
Franklin Mutual Shares VIP Fund - Class 1		860,500		—		860,500		—		28		860,472
Franklin Mutual Shares VIP Fund - Class 2		729,251,982		—		729,251,982		362,374		73,010		728,816,598
Franklin Mutual Shares VIP Fund - Class 4		16,483,526		2,551		16,486,077		—		1,755		16,484,322
Franklin Rising Dividends VIP Fund - Class 1		693,213		—		693,213		11		23		693,179
Franklin Rising Dividends VIP Fund - Class 4		22,519,799		—		22,519,799		21		2,229		22,517,549
Franklin Small Cap Value VIP Fund - Class 1		616,431		—		616,431		2		21		616,408
Franklin Small Cap Value VIP Fund - Class 4		7,200,313		1,130		7,201,443		—		710		7,200,733
Franklin Small-Mid Cap Growth VIP Fund - Class 1		234,967		—		234,967		1		8		234,958
Franklin Small-Mid Cap Growth VIP Fund - Class 4		5,462,498		48		5,462,546		—		536		5,462,010
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		456,100		—		456,100		—		26		456,074
Goldman Sachs VIT Government Money Market Fund - Service Shares		35,105,257		—		35,105,257		123,661		2,966		34,978,630
Goldman Sachs VIT Large Cap Value Fund - Service Shares		154,443,213		—		154,443,213		67,175		12,426		154,363,612
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		2,446,762		—		2,446,762		18,561		240		2,427,961
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		107,356		—		107,356		—		5		107,351
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		4,880,224		—		4,880,224		—		494		4,879,730
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		22,543		—		22,543		—		1		22,542
Guggenheim VT Long Short Equity		4,813,218		—		4,813,218		2		405		4,812,811
Guggenheim VT Multi-Hedge Strategies		4,703,327		5,096		4,708,423		—		438		4,707,985
Hartford Capital Appreciation HLS Fund - Class IA		99,166		—		99,166		—		3		99,163
Hartford Capital Appreciation HLS Fund - Class IC		11,633,333		285,498		11,918,831		—		1,235		11,917,596
Invesco V.I. American Franchise Fund - Series I Shares		2,712,634		—		2,712,634		—		320		2,712,314
Invesco V.I. American Franchise Fund - Series II Shares		1,494,402		—		1,494,402		—		212		1,494,190
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		741,515		—		741,515		5		22		741,488
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		13,957,524		32,111		13,989,635		—		1,411		13,988,224
Invesco V.I. Comstock Fund - Series I Shares		121,435		—		121,435		—		4		121,431
Invesco V.I. Comstock Fund - Series II Shares		5,326,418		51,038		5,377,456		—		492		5,376,964
Invesco V.I. Core Equity Fund - Series I Shares		6,276,349		—		6,276,349		25		759		6,275,565
Invesco V.I. Core Equity Fund - Series II Shares		1,453,350		—		1,453,350		—		192		1,453,158
Invesco V.I. Diversified Dividend Fund - Series I Shares		106,530		—		106,530		—		3		106,527

See accompanying notes.
N-6

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
Invesco V.I. Diversified Dividend Fund - Series II Shares	$	19,647,978	$	3,839	$	19,651,817	$	—	$	1,877	$	19,649,940
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		69,207		—		69,207		13		2		69,192
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		75,336,960		239,885		75,576,845		—		9,588		75,567,257
Invesco V.I. Equity and Income Fund - Series I Shares		46,539		—		46,539		—		1		46,538
Invesco V.I. Equity and Income Fund - Series II Shares		15,730,818		—		15,730,818		—		1,521		15,729,297
Invesco V.I. International Growth Fund - Series I Shares		2,275,145		—		2,275,145		203		240		2,274,702
Invesco V.I. International Growth Fund - Series II Shares		49,251,137		—		49,251,137		334,615		6,096		48,910,426
Ivy VIP Asset Strategy Portfolio		9,073,536		—		9,073,536		24		913		9,072,599
Ivy VIP Energy Portfolio		6,655,877		—		6,655,877		63,223		648		6,592,006
Ivy VIP High Income Portfolio		18,861,808		3,716		18,865,524		—		1,880		18,863,644
Ivy VIP High Income Portfolio - Class I		106,108		—		106,108		—		6		106,102
Ivy VIP Micro Cap Growth Portfolio		3,995,820		5,118		4,000,938		—		371		4,000,567
Ivy VIP Micro Cap Growth Portfolio - Class I		107,341		—		107,341		3		3		107,335
Ivy VIP Mid Cap Growth Portfolio		7,889,485		—		7,889,485		—		746		7,888,739
Ivy VIP Mid Cap Growth Portfolio - Class I		386,789		—		386,789		—		16		386,773
Ivy VIP Science and Technology Portfolio		21,095,924		11,047		21,106,971		—		1,984		21,104,987
Ivy VIP Science and Technology Portfolio - Class I		154,567		—		154,567		—		4		154,563
Janus Henderson Balanced Portfolio - Service Shares		14,203,810		—		14,203,810		17,751		1,915		14,184,144
Janus Henderson Enterprise Portfolio - Service Shares		6,869,947		—		6,869,947		1		946		6,869,000
Janus Henderson Global Research Portfolio - Service Shares		680,687		—		680,687		—		90		680,597
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		829,889		—		829,889		—		29		829,860
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		47,075,511		174,893		47,250,404		—		6,048		47,244,356
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		5,957,613		—		5,957,613		25,000		742		5,931,871
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		55,958		—		55,958		—		2		55,956
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		2,076,270		32,560		2,108,830		—		211		2,108,619
Lincoln iShares® Global Growth Allocation Fund - Standard Class		525,896		—		525,896		—		32		525,864
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		797,203		—		797,203		—		49		797,154
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		22,415,348		139,295		22,554,643		—		2,054		22,552,589
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		7,100,133		—		7,100,133		10,345		688		7,089,100
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		14,978,734		—		14,978,734		4,178		1,185		14,973,371
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		23,702,854		16,928		23,719,782		—		2,156		23,717,626

See accompanying notes.
N-7

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP American Balanced Allocation Fund - Service Class	$	46,622,713	$	—	$	46,622,713	$	—	$	4,577	$	46,618,136
LVIP American Balanced Allocation Fund - Standard Class		6,912,014		—		6,912,014		725		606		6,910,683
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		338,571,628		—		338,571,628		213,967		45,395		338,312,266
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		25,466,127		13,524		25,479,651		—		3,139		25,476,512
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		718,838		—		718,838		—		51		718,787
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		72,357,117		13,581		72,370,698		—		8,786		72,361,912
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		410,021		—		410,021		—		24		409,997
LVIP American Global Growth Fund - Service Class II		189,922,419		—		189,922,419		416,951		26,073		189,479,395
LVIP American Global Small Capitalization Fund - Service Class II		75,257,093		—		75,257,093		18,303		10,014		75,228,776
LVIP American Growth Allocation Fund - Service Class		33,257,532		100,909		33,358,441		—		3,213		33,355,228
LVIP American Growth Allocation Fund - Standard Class		1,336,874		—		1,336,874		—		65		1,336,809
LVIP American Growth Fund - Service Class II		542,959,922		347,556		543,307,478		—		74,384		543,233,094
LVIP American Growth-Income Fund - Service Class II		463,226,641		—		463,226,641		15,719		62,213		463,148,709
LVIP American Income Allocation Fund - Standard Class		82,347		—		82,347		—		11		82,336
LVIP American International Fund - Service Class II		192,907,008		—		192,907,008		61,907		26,286		192,818,815
LVIP American Preservation Fund - Service Class		7,252,923		5,116		7,258,039		—		728		7,257,311
LVIP American Preservation Fund - Standard Class		127,800		—		127,800		—		15		127,785
LVIP Baron Growth Opportunities Fund - Service Class		187,509,740		—		187,509,740		128,998		25,637		187,355,105
LVIP Baron Growth Opportunities Fund - Standard Class		834,234		—		834,234		5		30		834,199
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		892,060,051		59,334		892,119,385		—		119,682		891,999,703
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		548,027		—		548,027		709		28		547,290
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		947,788,687		—		947,788,687		735,042		133,440		946,920,205
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		176,637		—		176,637		—		14		176,623
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		195,957,975		968,192		196,926,167		—		25,507		196,900,660
LVIP BlackRock Inflation Protected Bond Fund - Service Class		789,617,302		—		789,617,302		53,714		106,723		789,456,865
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		1,969,530		531		1,970,061		—		119		1,969,942
LVIP BlackRock Multi-Asset Income Fund - Service Class		8,042,581		—		8,042,581		68,681		842		7,973,058

See accompanying notes.
N-8

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP BlackRock Multi-Asset Income Fund - Standard Class	$	215,948	$	—	$	215,948	$	—	$	7	$	215,941
LVIP BlackRock Scientific Allocation Fund - Service Class		1,706,152		—		1,706,152		2,287		214		1,703,651
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		236,255,918		826,539		237,082,457		—		31,967		237,050,490
LVIP Blended Core Equity Managed Volatility Fund - Service Class		264,392,157		—		264,392,157		47,709		35,129		264,309,319
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		77,341		—		77,341		—		6		77,335
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		582,103,448		287,943		582,391,391		—		77,320		582,314,071
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class		2,422,346		15		2,422,361		—		391		2,421,970
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		509,486,636		63,657		509,550,293		—		68,452		509,481,841
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		83,998		—		83,998		—		6		83,992
LVIP Clarion Global Real Estate Fund - Service Class		103,579,999		—		103,579,999		43,735		13,433		103,522,831
LVIP Clarion Global Real Estate Fund - Standard Class		619,732		—		619,732		17		20		619,695
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		121,761,912		95,673		121,857,585		—		16,139		121,841,446
LVIP Delaware Bond Fund - Service Class		3,400,974,478		3,713,112		3,404,687,590		—		397,024		3,404,290,566
LVIP Delaware Bond Fund - Standard Class		76,545,642		4,799		76,550,441		—		10,583		76,539,858
LVIP Delaware Diversified Floating Rate Fund - Service Class		768,966,378		—		768,966,378		83,977		106,045		768,776,356
LVIP Delaware Diversified Floating Rate Fund - Standard Class		1,963,293		—		1,963,293		—		154		1,963,139
LVIP Delaware Social Awareness Fund - Service Class		59,974,248		30,886		60,005,134		—		7,804		59,997,330
LVIP Delaware Social Awareness Fund - Standard Class		7,579,380		—		7,579,380		15,999		1,008		7,562,373
LVIP Delaware Special Opportunities Fund - Service Class		78,619,942		—		78,619,942		120,547		10,374		78,489,021
LVIP Delaware Wealth Builder Fund - Service Class		13,257,520		618		13,258,138		—		1,904		13,256,234
LVIP Delaware Wealth Builder Fund - Standard Class		4,614,227		52		4,614,279		—		647		4,613,632
LVIP Dimensional International Core Equity Fund - Service Class		41,624,922		10,767		41,635,689		—		5,288		41,630,401
LVIP Dimensional International Core Equity Fund - Standard Class		3,572,858		—		3,572,858		39		162		3,572,657
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		360,115,360		86,342		360,201,702		—		48,051		360,153,651
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		1,458,024		—		1,458,024		—		79		1,457,945
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		89,544,698		—		89,544,698		10,563		11,822		89,522,313
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		4,175,827		—		4,175,827		4		187		4,175,636

See accompanying notes.
N-9

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class	$	36,826,753	$	—	$	36,826,753	$	108,605	$	4,805	$	36,713,343
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		3,256,650		—		3,256,650		3		168		3,256,479
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		673,946,227		—		673,946,227		95,057		89,598		673,761,572
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		2,346,916		—		2,346,916		—		120		2,346,796
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		570,902,213		86,293		570,988,506		—		75,263		570,913,243
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		8,444,213		—		8,444,213		26		434		8,443,753
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		842,756,515		59,892		842,816,407		—		113,024		842,703,383
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		7,416,024		8,549		7,424,573		—		903		7,423,670
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		13,430		—		13,430		—		1		13,429
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		310,391,726		7,038		310,398,764		—		41,740		310,357,024
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		11,575		8		11,583		—		1		11,582
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		1,188,580,846		—		1,188,580,846		821,039		164,350		1,187,595,457
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		190,024		—		190,024		—		10		190,014
LVIP Global Growth Allocation Managed Risk Fund - Service Class		8,676,120,065		587,605		8,676,707,670		—		1,055,537		8,675,652,133
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		7,078,994		—		7,078,994		2		530		7,078,462
LVIP Global Income Fund - Service Class		651,609,096		202,836		651,811,932		—		86,635		651,725,297
LVIP Global Income Fund - Standard Class		728,712		—		728,712		—		24		728,688
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		6,742,193,495		—		6,742,193,495		769,189		828,420		6,740,595,886
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		1,243,458		—		1,243,458		—		105		1,243,353
LVIP Goldman Sachs Income Builder Fund - Service Class		9,551,897		82,096		9,633,993		—		1,097		9,632,896
LVIP Goldman Sachs Income Builder Fund - Standard Class		45,965		—		45,965		64		2		45,899
LVIP Government Money Market Fund - Service Class		211,977,421		727,373		212,704,794		—		26,672		212,678,122
LVIP Government Money Market Fund - Standard Class		22,851,954		—		22,851,954		33,055		2,906		22,815,993
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		309,616,452		152,667		309,769,119		—		41,447		309,727,672
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		139,413,447		—		139,413,447		200,256		18,506		139,194,685
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		80,399		—		80,399		—		7		80,392
LVIP JPMorgan High Yield Fund - Service Class		181,523,058		—		181,523,058		10,990		21,060		181,491,008
LVIP JPMorgan High Yield Fund - Standard Class		306,577		—		306,577		27		9		306,541

See accompanying notes.
N-10

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP JPMorgan Retirement Income Fund - Service Class	$	1,518,709	$	—	$	1,518,709	$	2,210	$	177	$	1,516,322
LVIP JPMorgan Retirement Income Fund - Standard Class		769,962		—		769,962		84		32		769,846
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		619,773,873		—		619,773,873		81,493		82,764		619,609,616
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		301,651		—		301,651		706		25		300,920
LVIP Managed Risk Profile 2010 Fund - Service Class		5,815,719		—		5,815,719		38		751		5,814,930
LVIP Managed Risk Profile 2020 Fund - Service Class		10,177,752		—		10,177,752		1,730		1,376		10,174,646
LVIP Managed Risk Profile 2030 Fund - Service Class		5,123,980		—		5,123,980		293		731		5,122,956
LVIP Managed Risk Profile 2040 Fund - Service Class		4,703,748		—		4,703,748		—		626		4,703,122
LVIP MFS International Equity Managed Volatility Fund - Service Class		290,330,398		154,773		290,485,171		—		39,351		290,445,820
LVIP MFS International Growth Fund - Service Class		189,666,554		24,298		189,690,852		—		20,900		189,669,952
LVIP MFS International Growth Fund - Standard Class		8,271		—		8,271		—		—		8,271
LVIP MFS Value Fund - Service Class		978,007,082		—		978,007,082		458,883		98,791		977,449,408
LVIP MFS Value Fund - Standard Class		1,528,573		—		1,528,573		53		46		1,528,474
LVIP Mondrian International Value Fund - Service Class		284,030,514		—		284,030,514		190,027		32,557		283,807,930
LVIP Mondrian International Value Fund - Standard Class		12,013,724		—		12,013,724		11,501		1,665		12,000,558
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		42,339,947		69,178		42,409,125		—		5,654		42,403,471
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		219,306		—		219,306		—		16		219,290
LVIP PIMCO Low Duration Bond Fund - Service Class		402,278,517		230,770		402,509,287		—		52,957		402,456,330
LVIP PIMCO Low Duration Bond Fund - Standard Class		6,281,045		—		6,281,045		48		326		6,280,671
LVIP Select Core Equity Managed Volatility Fund - Service Class		437,077,801		—		437,077,801		117,391		60,350		436,900,060
LVIP Select Core Equity Managed Volatility Fund - Standard Class		133,187		—		133,187		—		9		133,178
LVIP SSGA Bond Index Fund - Service Class		991,475,494		—		991,475,494		717,858		136,895		990,620,741
LVIP SSGA Bond Index Fund - Standard Class		2,640,743		1,054		2,641,797		—		194		2,641,603
LVIP SSGA Conservative Index Allocation Fund - Service Class		72,065,031		—		72,065,031		4,584		9,616		72,050,831
LVIP SSGA Conservative Structured Allocation Fund - Service Class		188,371,407		—		188,371,407		14,619		24,181		188,332,607
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		678,736		—		678,736		—		23		678,713
LVIP SSGA Developed International 150 Fund - Service Class		163,274,222		—		163,274,222		35,767		22,174		163,216,281
LVIP SSGA Developed International 150 Fund - Standard Class		589,633		—		589,633		—		37		589,596

See accompanying notes.
N-11

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP SSGA Emerging Markets 100 Fund - Service Class	$	187,910,788	$	—	$	187,910,788	$	67,362	$	25,168	$	187,818,258
LVIP SSGA Emerging Markets 100 Fund - Standard Class		1,455,068		—		1,455,068		—		66		1,455,002
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		877,109,160		—		877,109,160		379,927		120,326		876,608,907
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		746,620		—		746,620		82		40		746,498
LVIP SSGA International Index Fund - Service Class		297,648,003		—		297,648,003		164,817		39,914		297,443,272
LVIP SSGA International Index Fund - Standard Class		2,431,053		—		2,431,053		122		156		2,430,775
LVIP SSGA International Managed Volatility Fund - Service Class		378,886,781		5,045		378,891,826		—		51,172		378,840,654
LVIP SSGA International Managed Volatility Fund - Standard Class		156,301		—		156,301		—		19		156,282
LVIP SSGA Large Cap 100 Fund - Service Class		350,453,471		—		350,453,471		76,667		48,368		350,328,436
LVIP SSGA Large Cap 100 Fund - Standard Class		2,976,217		—		2,976,217		—		239		2,975,978
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		371,034,936		66,375		371,101,311		—		49,801		371,051,510
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		38,214		—		38,214		—		3		38,211
LVIP SSGA Mid-Cap Index Fund - Service Class		33,508,817		97,354		33,606,171		—		4,116		33,602,055
LVIP SSGA Mid-Cap Index Fund - Standard Class		1,251,654		—		1,251,654		174		72		1,251,408
LVIP SSGA Moderate Index Allocation Fund - Service Class		228,741,878		—		228,741,878		12,059		30,444		228,699,375
LVIP SSGA Moderate Index Allocation Fund - Standard Class		29,087		—		29,087		73		1		29,013
LVIP SSGA Moderate Structured Allocation Fund - Service Class		805,493,746		—		805,493,746		330,807		106,906		805,056,033
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		186,958		—		186,958		—		6		186,952
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		191,108,430		—		191,108,430		14,932		25,487		191,068,011
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		280,672		—		280,672		—		12		280,660
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		460,651,048		388,142		461,039,190		—		61,691		460,977,499
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		2,353,068		—		2,353,068		—		119		2,352,949
LVIP SSGA S&P 500 Index Fund - Service Class		1,099,039,081		—		1,099,039,081		968,735		146,862		1,097,923,484
LVIP SSGA S&P 500 Index Fund - Standard Class		46,502,480		—		46,502,480		4,199		4,836		46,493,445
LVIP SSGA Small-Cap Index Fund - Service Class		311,632,017		—		311,632,017		325,750		41,507		311,264,760
LVIP SSGA Small-Cap Index Fund - Standard Class		6,542,319		—		6,542,319		283		391		6,541,645
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		142,586,603		15,017		142,601,620		—		19,349		142,582,271
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		3,360,575		374		3,360,949		—		230		3,360,719

See accompanying notes.
N-12

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class	$	366,784,481	$	141,868	$	366,926,349	$	—	$	50,013	$	366,876,336
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		94,383		—		94,383		—		7		94,376
LVIP T. Rowe Price Growth Stock Fund - Service Class		302,815,152		—		302,815,152		164,104		39,257		302,611,791
LVIP T. Rowe Price Growth Stock Fund - Standard Class		1,451,293		—		1,451,293		—		47		1,451,246
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		163,276,724		—		163,276,724		76,522		21,320		163,178,882
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		3,968,630		35		3,968,665		—		485		3,968,180
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		905,166,275		63,815		905,230,090		—		103,757		905,126,333
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		35,273		—		35,273		—		2		35,271
LVIP Vanguard Domestic Equity ETF Fund - Service Class		198,312,443		379,074		198,691,517		—		24,548		198,666,969
LVIP Vanguard Domestic Equity ETF Fund - Standard Class		1,369,406		—		1,369,406		17		104		1,369,285
LVIP Vanguard International Equity ETF Fund - Service Class		132,388,711		—		132,388,711		182,924		16,587		132,189,200
LVIP Vanguard International Equity ETF Fund - Standard Class		1,536,951		—		1,536,951		373		101		1,536,477
LVIP Wellington Capital Growth Fund - Service Class		338,094,601		—		338,094,601		288,791		29,886		337,775,924
LVIP Wellington Capital Growth Fund - Standard Class		63,374		—		63,374		—		2		63,372
LVIP Wellington Mid-Cap Value Fund - Service Class		98,686,370		—		98,686,370		49,788		12,701		98,623,881
LVIP Wellington Mid-Cap Value Fund - Standard Class		340,998		—		340,998		—		11		340,987
LVIP Western Asset Core Bond Fund - Service Class		38,144,660		103,254		38,247,914		—		5,008		38,242,906
LVIP Western Asset Core Bond Fund - Standard Class		622,439		—		622,439		291		47		622,101
MFS® VIT Growth Series - Initial Class		3,738,951		—		3,738,951		—		413		3,738,538
MFS® VIT Growth Series - Service Class		106,065,584		—		106,065,584		42,647		12,012		106,010,925
MFS® VIT Total Return Series - Initial Class		6,620,090		—		6,620,090		—		773		6,619,317
MFS® VIT Total Return Series - Service Class		69,540,979		—		69,540,979		5,648		8,869		69,526,462
MFS® VIT Utilities Series - Initial Class		7,091,251		—		7,091,251		557		809		7,089,885
MFS® VIT Utilities Series - Service Class		194,490,329		—		194,490,329		20,072		25,130		194,445,127
MFS® VIT II Core Equity Portfolio - Service Class		2,491,491		—		2,491,491		47		342		2,491,102
MFS® VIT II International Value Portfolio - Initial Class		1,034,695		—		1,034,695		—		33		1,034,662
MFS® VIT II International Value Portfolio - Service Class		30,761,797		28		30,761,825		—		2,963		30,758,862
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		292,306		—		292,306		—		9		292,297
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		6,946,553		—		6,946,553		4,592		676		6,941,285
Morgan Stanley VIF Growth Portfolio - Class II		2,392,982		—		2,392,982		374		200		2,392,408

See accompanying notes.
N-13

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class	$	27,550,352	$	—	$	27,550,352	$	569	$	3,828	$	27,545,955
Oppenheimer Global Fund/VA Service Shares		9,049,624		—		9,049,624		1,079		730		9,047,815
Oppenheimer International Growth Fund/VA Non-Service Shares		1,458,235		—		1,458,235		3		47		1,458,185
Oppenheimer International Growth Fund/VA Service Shares		13,746,767		5,235		13,752,002		—		1,311		13,750,691
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		605,717		—		605,717		—		20		605,697
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		10,621,653		3,330		10,624,983		—		1,073		10,623,910
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		3,168,749		—		3,168,749		46		315		3,168,388
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		113,447		—		113,447		—		4		113,443
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		12,507,267		—		12,507,267		23,079		1,473		12,482,715
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		33,087		—		33,087		—		1		33,086
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		3,605,120		—		3,605,120		—		347		3,604,773
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		32,121		—		32,121		—		1		32,120
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		3,901,182		—		3,901,182		145		409		3,900,628
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		41,115		—		41,115		—		1		41,114
Putnam VT Absolute Return 500 Fund - Class IA		1,385		—		1,385		—		—		1,385
Putnam VT Absolute Return 500 Fund - Class IB		2,926,132		—		2,926,132		255		269		2,925,608
Putnam VT Equity Income Fund - Class IB		1,219,032		—		1,219,032		—		166		1,218,866
Putnam VT George Putnam Balanced Fund - Class IA		236,872		—		236,872		—		10		236,862
Putnam VT George Putnam Balanced Fund - Class IB		14,159,024		49,700		14,208,724		—		1,874		14,206,850
Putnam VT Global Health Care Fund - Class IA		132,921		—		132,921		—		4		132,917
Putnam VT Global Health Care Fund - Class IB		13,257,609		286,445		13,544,054		—		1,394		13,542,660
Putnam VT Income Fund - Class IB		6,134,532		5,118		6,139,650		—		627		6,139,023
QS Variable Conservative Growth - Class II		973,219		—		973,219		2,280		121		970,818
Rational Dividend Capture VA Fund		1,268,031		188		1,268,219		—		138		1,268,081
SEI VP Market Growth Strategy Fund - Class III		2,647,840		—		2,647,840		—		302		2,647,538
SEI VP Market Plus Strategy Fund - Class III		2,054,892		—		2,054,892		—		199		2,054,693
Templeton Foreign VIP Fund - Class 1		29,746		—		29,746		—		1		29,745
Templeton Foreign VIP Fund - Class 4		3,132,114		3,974		3,136,088		—		309		3,135,779
Templeton Global Bond VIP Fund - Class 1		2,377,156		—		2,377,156		98		76		2,376,982
Templeton Global Bond VIP Fund - Class 2		333,834,284		91,727		333,926,011		—		43,652		333,882,359
Templeton Global Bond VIP Fund - Class 4		26,208,415		1,264		26,209,679		—		2,605		26,207,074
Templeton Growth VIP Fund - Class 2		30,101,871		—		30,101,871		44,075		4,225		30,053,571
VanEck VIP Global Hard Assets Fund - Class S Shares		3,673,122		—		3,673,122		68,546		364		3,604,212

See accompanying notes.
N-14

Lincoln Life Variable Annuity Account N

Statements of assets and liabilities (continued)

December 31, 2017

Subaccount	Investments		Contract Purchases Due From The Lincoln National Life Insurance Company		Total Assets		Contract Redemptions Due To The Lincoln National Life Insurance Company		Mortality & Expense Guarantee Charges Payable To The Lincoln National Life Insurance Company		Net Assets
VanEck VIP Global Hard Assets Fund - Initial Class Shares	$	383,615	$	—	$	383,615	$	—	$	12	$	383,603
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		13,492,958		20,442		13,513,400		—		1,409		13,511,991
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares		1,213,798		—		1,213,798		—		38		1,213,760
Virtus Rampart Equity Trend Series - Class A Shares		1,445,802		—		1,445,802		—		152		1,445,650
Virtus Rampart Equity Trend Series - Class I Shares		51		—		51		—		—		51

See accompanying notes.
N-15

Lincoln Life Variable Annuity Account N

Statements of operations

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
AB VPS Global Thematic Growth Portfolio - Class B	$	81,291	$	(470,594	)	$	(389,303	)	$	2,270,665
AB VPS Growth and Income Portfolio - Class B		—		(2	)		(2	)		(34	)
AB VPS International Value Portfolio - Class B		30		(35	)		(5	)		439
AB VPS Large Cap Growth Portfolio - Class B		—		(166,871	)		(166,871	)		2,030,561
AB VPS Small/Mid Cap Value Portfolio - Class A		1,884		(1,743	)		141			4,413
AB VPS Small/Mid Cap Value Portfolio - Class B		490,245		(3,240,057	)		(2,749,812	)		3,594,805
ALPS/Alerian Energy Infrastructure Portfolio - Class I		12,172		(1,193	)		10,979			(5,202	)
ALPS/Alerian Energy Infrastructure Portfolio - Class III		106,849		(64,101	)		42,748			91,369
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		1,565		(296	)		1,269			4,340
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		209,827		(98,585	)		111,242			207,041
ALPS/Stadion Core ETF Portfolio - Class I		160		(419	)		(259	)		404
ALPS/Stadion Core ETF Portfolio - Class III		12,181		(90,080	)		(77,899	)		77,695
ALPS/Stadion Tactical Growth Portfolio - Class III		13,731		(56,685	)		(42,954	)		104,529
American Century VP Balanced Fund - Class I		667		(142	)		525			122
American Century VP Balanced Fund - Class II		507,219		(578,084	)		(70,865	)		351,817
American Century VP Inflation Protection Fund - Class II		689		(589	)		100			(105	)
American Century VP Large Company Value Fund - Class I		702		(297	)		405			413
American Century VP Large Company Value Fund - Class II		14,818		(14,342	)		476			8,787
American Funds Asset Allocation Fund - Class 1		320,466		(104,883	)		215,583			117,018
American Funds Asset Allocation Fund - Class 1A		47,602		(7,763	)		39,839			4,250
American Funds Asset Allocation Fund - Class 4		1,559,363		(1,345,159	)		214,204			722,024
American Funds Blue Chip Income and Growth Fund - Class 1		93,931		(33,600	)		60,331			37,877
American Funds Blue Chip Income and Growth Fund - Class 1A		10,539		(1,089	)		9,450			114
American Funds Blue Chip Income and Growth Fund - Class 4		516,877		(298,307	)		218,570			204,621
American Funds Bond Fund - Class 1		133,974		(45,611	)		88,363			(2,079	)
American Funds Bond Fund - Class 1A		15,441		(1,528	)		13,913			(2,354	)
American Funds Capital Income Builder® - Class 1		29,123		(4,548	)		24,575			3,223
American Funds Capital Income Builder® - Class 1A		4,649		(707	)		3,942			373
American Funds Capital Income Builder® - Class 4		769,925		(369,152	)		400,773			155,431
American Funds Global Balanced Fund - Class 1		6,125		(3,563	)		2,562			7,899
American Funds Global Balanced Fund - Class 1A		2,365		(214	)		2,151			2
American Funds Global Bond Fund - Class 1		15,526		(22,434	)		(6,908	)		(2,278	)
American Funds Global Bond Fund - Class 1A		342		(91	)		251			2
American Funds Global Growth and Income Fund - Class 1		32,710		(13,643	)		19,067			67,018
American Funds Global Growth and Income Fund - Class 1A		2,261		(220	)		2,041			166
American Funds Global Growth Fund - Class 1		20,674		(16,800	)		3,874			44,171
American Funds Global Growth Fund - Class 1A		10,863		(2,343	)		8,520			2,917
American Funds Global Growth Fund - Class 2		1,911,616		(4,584,218	)		(2,672,602	)		10,577,261
American Funds Global Growth Fund - Class 4		190,955		(300,636	)		(109,681	)		199,362
American Funds Global Small Capitalization Fund - Class 1		8,974		(10,333	)		(1,359	)		(1,054	)
American Funds Global Small Capitalization Fund - Class 1A		751		(385	)		366			36
American Funds Global Small Capitalization Fund - Class 2		1,718,310		(5,015,328	)		(3,297,018	)		7,584,848
American Funds Global Small Capitalization Fund - Class 4		29,634		(86,620	)		(56,986	)		(30,920	)
American Funds Growth Fund - Class 1		73,740		(72,830	)		910			60,007
American Funds Growth Fund - Class 1A		12,961		(5,069	)		7,892			955
American Funds Growth Fund - Class 2		7,141,812		(23,968,312	)		(16,826,500	)		67,672,714
American Funds Growth Fund - Class 4		396,526		(942,018	)		(545,492	)		330,034
American Funds Growth-Income Fund - Class 1		101,686		(44,847	)		56,839			7,172
American Funds Growth-Income Fund - Class 1A		23,973		(2,902	)		21,071			1,163
American Funds Growth-Income Fund - Class 2		25,980,150		(27,704,075	)		(1,723,925	)		69,238,531
American Funds Growth-Income Fund - Class 4		782,247		(614,325	)		167,922			168,404
American Funds High-Income Bond Fund - Class 1		116,285		(13,408	)		102,877			(1,112	)
American Funds High-Income Bond Fund - Class 1A		11,455		(832	)		10,623			59
American Funds International Fund - Class 1		84,127		(36,823	)		47,304			41,732
American Funds International Fund - Class 1A		17,099		(2,736	)		14,363			5,387
American Funds International Fund - Class 2		8,380,477		(9,766,463	)		(1,385,986	)		15,782,619
American Funds International Fund - Class 4		366,094		(274,717	)		91,377			172,225

See accompanying notes.
N-16

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
AB VPS Global Thematic Growth Portfolio - Class B	$	—	$	2,270,665		$	6,286,429		$	8,167,791
AB VPS Growth and Income Portfolio - Class B		—		(34	)		—			(36	)
AB VPS International Value Portfolio - Class B		—		439			79			513
AB VPS Large Cap Growth Portfolio - Class B		590,315		2,620,876			184,619			2,638,624
AB VPS Small/Mid Cap Value Portfolio - Class A		20,266		24,679			26,678			51,498
AB VPS Small/Mid Cap Value Portfolio - Class B		9,979,977		13,574,782			10,802,593			21,627,563
ALPS/Alerian Energy Infrastructure Portfolio - Class I		—		(5,202	)		(4,750	)		1,027
ALPS/Alerian Energy Infrastructure Portfolio - Class III		—		91,369			(223,707	)		(89,590	)
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		—		4,340			3,928			9,537
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		—		207,041			1,142,348			1,460,631
ALPS/Stadion Core ETF Portfolio - Class I		—		404			7,053			7,198
ALPS/Stadion Core ETF Portfolio - Class III		—		77,695			716,112			715,908
ALPS/Stadion Tactical Growth Portfolio - Class III		—		104,529			421,794			483,369
American Century VP Balanced Fund - Class I		1,820		1,942			2,509			4,976
American Century VP Balanced Fund - Class II		1,635,285		1,987,102			2,006,722			3,922,959
American Century VP Inflation Protection Fund - Class II		—		(105	)		321			316
American Century VP Large Company Value Fund - Class I		—		413			6,394			7,212
American Century VP Large Company Value Fund - Class II		—		8,787			128,091			137,354
American Funds Asset Allocation Fund - Class 1		814,606		931,624			1,457,181			2,604,388
American Funds Asset Allocation Fund - Class 1A		70,886		75,136			87,616			202,591
American Funds Asset Allocation Fund - Class 4		4,865,068		5,587,092			8,362,048			14,163,344
American Funds Blue Chip Income and Growth Fund - Class 1		152,507		190,384			374,121			624,836
American Funds Blue Chip Income and Growth Fund - Class 1A		5,504		5,618			34,242			49,310
American Funds Blue Chip Income and Growth Fund - Class 4		922,944		1,127,565			2,335,588			3,681,723
American Funds Bond Fund - Class 1		86,380		84,301			2,575			175,239
American Funds Bond Fund - Class 1A		5,118		2,764			(12,038	)		4,639
American Funds Capital Income Builder® - Class 1		—		3,223			87,902			115,700
American Funds Capital Income Builder® - Class 1A		—		373			8,219			12,534
American Funds Capital Income Builder® - Class 4		—		155,431			2,565,470			3,121,674
American Funds Global Balanced Fund - Class 1		16,152		24,051			71,308			97,921
American Funds Global Balanced Fund - Class 1A		5,750		5,752			(3,084	)		4,819
American Funds Global Bond Fund - Class 1		16,154		13,876			151,748			158,716
American Funds Global Bond Fund - Class 1A		—		2			287			540
American Funds Global Growth and Income Fund - Class 1		30,037		97,055			226,006			342,128
American Funds Global Growth and Income Fund - Class 1A		—		166			4,875			7,082
American Funds Global Growth Fund - Class 1		75,957		120,128			516,472			640,474
American Funds Global Growth Fund - Class 1A		15,435		18,352			75,287			102,159
American Funds Global Growth Fund - Class 2		8,980,660		19,557,921			59,570,380			76,455,699
American Funds Global Growth Fund - Class 4		720,032		919,394			5,392,170			6,201,883
American Funds Global Small Capitalization Fund - Class 1		—		(1,054	)		298,153			295,740
American Funds Global Small Capitalization Fund - Class 1A		—		36			22,388			22,790
American Funds Global Small Capitalization Fund - Class 2		—		7,584,848			82,252,839			86,540,669
American Funds Global Small Capitalization Fund - Class 4		—		(30,920	)		1,613,350			1,525,444
American Funds Growth Fund - Class 1		907,359		967,366			1,339,803			2,308,079
American Funds Growth Fund - Class 1A		63,745		64,700			121,115			193,707
American Funds Growth Fund - Class 2		140,329,943		208,002,657			147,458,557			338,634,714
American Funds Growth Fund - Class 4		7,196,426		7,526,460			10,507,894			17,488,862
American Funds Growth-Income Fund - Class 1		388,652		395,824			710,452			1,163,115
American Funds Growth-Income Fund - Class 1A		15,503		16,666			80,393			118,130
American Funds Growth-Income Fund - Class 2		123,177,917		192,416,448			168,212,172			358,904,695
American Funds Growth-Income Fund - Class 4		3,075,173		3,243,577			5,954,830			9,366,329
American Funds High-Income Bond Fund - Class 1		—		(1,112	)		(1,115	)		100,650
American Funds High-Income Bond Fund - Class 1A		—		59			(6,055	)		4,627
American Funds International Fund - Class 1		58,456		100,188			1,233,062			1,380,554
American Funds International Fund - Class 1A		2,843		8,230			89,544			112,137
American Funds International Fund - Class 2		7,931,759		23,714,378			157,187,166			179,515,558
American Funds International Fund - Class 4		260,633		432,858			5,096,957			5,621,192

N-17

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

See accompanying notes.
N-18

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments			Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
American Funds International Growth and Income Fund - Class 1	$	40,243	$	(14,418	)	$	25,825		$	1,296		$	—	$	1,296		$	329,101		$	356,222
American Funds International Growth and Income Fund - Class 1A		13,649		(711	)		12,938			25			—		25			9,310			22,273
American Funds Managed Risk Asset Allocation Fund - Class P1		1,077		(3,995	)		(2,918	)		57,742			1,299		59,041			3,801			59,924
American Funds Managed Risk Asset Allocation Fund - Class P2		671,344		(1,320,704	)		(649,360	)		560,514			825,753		1,386,267			9,775,520			10,512,427
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		1,408		(1,233	)		175			9,760			1,226		10,986			1,594			12,755
American Funds Managed Risk Growth Fund - Class P1		931		(1,190	)		(259	)		13,280			2,877		16,157			19,853			35,751
American Funds Managed Risk Growth-Income Fund - Class P1		264		(356	)		(92	)		(86	)		1,048		962			3,080			3,950
American Funds Managed Risk International Fund - Class P1		140		(271	)		(131	)		5,221			162		5,383			3,909			9,161
American Funds Mortgage Fund - Class 1		6,937		(4,329	)		2,608			34			2,513		2,547			(3,791	)		1,364
American Funds Mortgage Fund - Class 1A		1,435		(584	)		851			19			590		609			(1,290	)		170
American Funds Mortgage Fund - Class 4		65,418		(63,620	)		1,798			(17,431	)		31,831		14,400			(33,263	)		(17,065	)
American Funds New World Fund® - Class 1		45,267		(26,842	)		18,425			42,357			—		42,357			896,932			957,714
American Funds New World Fund® - Class 1A		5,948		(827	)		5,121			469			—		469			36,941			42,531
American Funds New World Fund® - Class 4		171,699		(232,317	)		(60,618	)		331,994			—		331,994			4,212,925			4,484,301
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		2,872		(1,696	)		1,176			(1,668	)		—		(1,668	)		2,886			2,394
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A		1,390		(429	)		961			199			—		199			(1,406	)		(246	)
BlackRock Global Allocation V.I. Fund - Class I		61,726		(26,194	)		35,532			7,101			49,069		56,170			430,758			522,460
BlackRock Global Allocation V.I. Fund - Class III		14,288,076		(19,166,951	)		(4,878,875	)		1,735,961			13,169,969		14,905,930			116,290,099			126,317,154
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		396		(48	)		348			10			—		10			946			1,304
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		109,211		(51,252	)		57,959			7,425			—		7,425			327,006			392,390
ClearBridge Variable Aggressive Growth Portfolio - Class I		1,516		(1,009	)		507			(3,334	)		19,200		15,866			19,665			36,038
ClearBridge Variable Aggressive Growth Portfolio - Class II		56,800		(249,519	)		(192,719	)		(208,344	)		1,416,247		1,207,903			1,794,484			2,809,668
ClearBridge Variable Large Cap Growth Portfolio - Class I		641		(499	)		142			41			14,206		14,247			10,454			24,843
ClearBridge Variable Large Cap Growth Portfolio - Class II		17,616		(59,784	)		(42,168	)		34,215			568,405		602,620			254,057			814,509
ClearBridge Variable Mid Cap Portfolio - Class I		1,980		(2,233	)		(253	)		1,468			26,040		27,508			18,975			46,230
ClearBridge Variable Mid Cap Portfolio - Class II		57,264		(355,649	)		(298,385	)		224,059			1,695,733		1,919,792			1,134,157			2,755,564
Columbia VP Commodity Strategy Fund - Class 1		666		(118	)		548			(36	)		—		(36	)		3,133			3,645
Columbia VP Commodity Strategy Fund - Class 2		7,793		(1,819	)		5,974			4			—		4			14,410			20,388
Columbia VP Emerging Markets Bond Fund - Class 1		5,272		(307	)		4,965			1,340			—		1,340			(3,633	)		2,672
Columbia VP Emerging Markets Bond Fund - Class 2		22,575		(5,467	)		17,108			1,117			—		1,117			8,108			26,333
Columbia VP Strategic Income Fund - Class 1		—		(2	)		(2	)		211			—		211			—			209
Columbia VP Strategic Income Fund - Class 2		36,643		(13,885	)		22,758			574			—		574			17,588			40,920
Delaware VIP® Diversified Income Series - Service Class		46,087,930		(30,766,687	)		15,321,243			(1,945,913	)		—		(1,945,913	)		46,289,784			59,665,114
Delaware VIP® Diversified Income Series - Standard Class		140,871		(41,043	)		99,828			(16,389	)		—		(16,389	)		151,770			235,209
Delaware VIP® Emerging Markets Series - Service Class		1,250,086		(5,219,557	)		(3,969,471	)		11,831,175			—		11,831,175			93,073,292			100,934,996
Delaware VIP® Emerging Markets Series - Standard Class		2,208		(1,718	)		490			37,133			—		37,133			78,683			116,306
Delaware VIP® High Yield Series - Service Class		7,983,692		(2,352,978	)		5,630,714			(1,823,315	)		—		(1,823,315	)		3,579,194			7,386,593
Delaware VIP® High Yield Series - Standard Class		181,341		(54,543	)		126,798			11,308			—		11,308			45,351			183,457
Delaware VIP® International Value Equity Series - Standard Class		2,064		(1,860	)		204			(743	)		—		(743	)		25,113			24,574
Delaware VIP® Limited-Term Diversified Income Series - Service Class		22,813,252		(17,101,675	)		5,711,577			(1,240,125	)		—		(1,240,125	)		2,665,016			7,136,468
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		27,443		(16,493	)		10,950			(97	)		—		(97	)		562			11,415
Delaware VIP® REIT Series - Service Class		2,194,690		(2,618,477	)		(423,787	)		826,367			22,214,545		23,040,912			(23,180,826	)		(563,701	)
Delaware VIP® REIT Series - Standard Class		53,092		(43,951	)		9,141			(149,345	)		451,500		302,155			(302,061	)		9,235
Delaware VIP® Small Cap Value Series - Service Class		2,355,376		(6,052,245	)		(3,696,869	)		12,299,553			12,550,017		24,849,570			15,395,766			36,548,467
Delaware VIP® Small Cap Value Series - Standard Class		60,767		(97,001	)		(36,234	)		1,663,456			244,468		1,907,924			(1,155,318	)		716,372
Delaware VIP® Smid Cap Core Series - Service Class		161,817		(2,961,668	)		(2,799,851	)		2,503,368			12,699,367		15,202,735			15,666,589			28,069,473
Delaware VIP® Smid Cap Core Series - Standard Class		22,771		(100,042	)		(77,271	)		229,242			490,949		720,191			486,967			1,129,887
Delaware VIP® U.S. Growth Series - Service Class		—		(3,718,939	)		(3,718,939	)		3,030,861			3,407,183		6,438,044			74,446,430			77,165,535
Delaware VIP® U.S. Growth Series - Standard Class		—		(44	)		(44	)		2,619			—		2,619			—			2,575
Delaware VIP® Value Series - Service Class		4,647,163		(5,188,811	)		(541,648	)		12,593,722			10,818,848		23,412,570			11,604,839			34,475,761
Delaware VIP® Value Series - Standard Class		111,066		(94,683	)		16,383			1,792,391			223,217		2,015,608			(1,245,316	)		786,675
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		24,676		(10,858	)		13,818			(2,353	)		—		(2,353	)		55,784			67,249
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		1,110,348		(889,668	)		220,680			(152,904	)		—		(152,904	)		2,734,881			2,802,657
Deutsche Equity 500 Index VIP Portfolio - Class A		107,351		(97,241	)		10,110			773,416			301,568		1,074,984			(27,046	)		1,058,048
Deutsche Small Cap Index VIP Portfolio - Class A		33,275		(56,220	)		(22,945	)		170,146			128,846		298,992			139,284			415,331
Eaton Vance VT Floating-Rate Income Fund - ADV Class		103,262		(12,133	)		91,129			1,792			—		1,792			(852	)		92,069
Eaton Vance VT Floating-Rate Income Fund - Initial Class		487,839		(183,761	)		304,078			80,538			—		80,538			(77,092	)		307,524

N-19

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
Fidelity® VIP Contrafund® Portfolio - Initial Class	$	16,628	$	(6,515	)	$	10,113		$	13,769
Fidelity® VIP Contrafund® Portfolio - Service Class 2		8,393,153		(17,489,284	)		(9,096,131	)		35,572,637
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		58,379		(51,238	)		7,141			28,210
Fidelity® VIP Growth Portfolio - Initial Class		9,972		(61,980	)		(52,008	)		1,431,749
Fidelity® VIP Growth Portfolio - Service Class 2		154,143		(3,204,100	)		(3,049,957	)		8,769,732
Fidelity® VIP Mid Cap Portfolio - Initial Class		11,541		(6,069	)		5,472			10,848
Fidelity® VIP Mid Cap Portfolio - Service Class 2		2,692,171		(8,699,412	)		(6,007,241	)		9,300,230
Fidelity® VIP Overseas Portfolio - Service Class 2		—		(2	)		(2	)		(3	)
Fidelity® VIP Strategic Income Portfolio - Initial Class		18,828		(2,216	)		16,612			4,094
Fidelity® VIP Strategic Income Portfolio - Service Class 2		430,589		(133,783	)		296,806			108,742
First Trust Dorsey Wright Tactical Core Portfolio - Class I		21,965		(38,959	)		(16,994	)		33,249
First Trust Multi Income Allocation Portfolio - Class I		141,667		(70,965	)		70,702			35,050
First Trust Multi Income Allocation Portfolio - Class II		1,406		(405	)		1,001			135
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		856,258		(727,275	)		128,983			324,997
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		1,716		(128	)		1,588			6
Franklin Founding Funds Allocation VIP Fund - Class 4		184,766		(93,311	)		91,455			22,450
Franklin Income VIP Fund - Class 1		5,510		(536	)		4,974			886
Franklin Income VIP Fund - Class 2		23,796,186		(8,885,081	)		14,911,105			4,135,012
Franklin Income VIP Fund - Class 4		1,368,260		(469,352	)		898,908			149,836
Franklin Mutual Shares VIP Fund - Class 1		20,181		(3,181	)		17,000			341
Franklin Mutual Shares VIP Fund - Class 2		16,323,340		(8,866,768	)		7,456,572			18,229,668
Franklin Mutual Shares VIP Fund - Class 4		252,949		(134,415	)		118,534			29,030
Franklin Rising Dividends VIP Fund - Class 1		11,419		(2,590	)		8,829			70
Franklin Rising Dividends VIP Fund - Class 4		279,551		(227,783	)		51,768			52,134
Franklin Small Cap Value VIP Fund - Class 1		4,126		(2,130	)		1,996			(1,680	)
Franklin Small Cap Value VIP Fund - Class 4		27,465		(76,640	)		(49,175	)		10,021
Franklin Small-Mid Cap Growth VIP Fund - Class 1		—		(961	)		(961	)		3,165
Franklin Small-Mid Cap Growth VIP Fund - Class 4		—		(54,913	)		(54,913	)		(38,372	)
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		5,781		(3,379	)		2,402			—
Goldman Sachs VIT Government Money Market Fund - Service Shares		189,915		(417,267	)		(227,352	)		—
Goldman Sachs VIT Large Cap Value Fund - Service Shares		2,124,556		(1,472,017	)		652,539			576,659
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		47,899		(28,309	)		19,590			(7,207	)
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		2,452		(472	)		1,980			(161	)
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		38,191		(61,387	)		(23,196	)		(38,391	)
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		243		(94	)		149			(11	)
Guggenheim VT Long Short Equity		11,970		(39,636	)		(27,666	)		27,448
Guggenheim VT Multi-Hedge Strategies		—		(47,808	)		(47,808	)		755
Hartford Capital Appreciation HLS Fund - Class IA		1,050		(376	)		674			(4,230	)
Hartford Capital Appreciation HLS Fund - Class IC		75,468		(132,747	)		(57,279	)		(47,102	)
Invesco V.I. American Franchise Fund - Series I Shares		2,106		(38,373	)		(36,267	)		152,049
Invesco V.I. American Franchise Fund - Series II Shares		—		(24,618	)		(24,618	)		30,972
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		26,686		(1,605	)		25,081			(364	)
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		508,023		(153,746	)		354,277			28,282
Invesco V.I. Comstock Fund - Series I Shares		2,451		(446	)		2,005			3,420
Invesco V.I. Comstock Fund - Series II Shares		94,482		(49,541	)		44,941			31,814
Invesco V.I. Core Equity Fund - Series I Shares		65,465		(94,756	)		(29,291	)		284,403
Invesco V.I. Core Equity Fund - Series II Shares		11,827		(24,449	)		(12,622	)		81,235
Invesco V.I. Diversified Dividend Fund - Series I Shares		718		(187	)		531			10
Invesco V.I. Diversified Dividend Fund - Series II Shares		281,298		(211,928	)		69,370			321,134
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		277		(137	)		140			2,956
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		405,131		(664,689	)		(259,558	)		351,788
Invesco V.I. Equity and Income Fund - Series I Shares		738		(112	)		626			831
Invesco V.I. Equity and Income Fund - Series II Shares		183,232		(131,948	)		51,284			53,323
Invesco V.I. International Growth Fund - Series I Shares		28,926		(27,025	)		1,901			684,171
Invesco V.I. International Growth Fund - Series II Shares		540,584		(596,956	)		(56,372	)		646,985
Ivy VIP Asset Strategy Portfolio		137,063		(107,338	)		29,725			(206,433	)
Ivy VIP Energy Portfolio		49,891		(73,063	)		(23,172	)		(72,822	)

See accompanying notes.
N-20

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
Fidelity® VIP Contrafund® Portfolio - Initial Class	$	83,079	$	96,848		$	199,624		$	306,585
Fidelity® VIP Contrafund® Portfolio - Service Class 2		58,494,560		94,067,197			107,502,765			192,473,831
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		36,702		64,912			244,080			316,133
Fidelity® VIP Growth Portfolio - Initial Class		326,897		1,758,646			(419,720	)		1,286,918
Fidelity® VIP Growth Portfolio - Service Class 2		13,607,967		22,377,699			33,985,186			53,312,928
Fidelity® VIP Mid Cap Portfolio - Initial Class		56,460		67,308			205,732			278,512
Fidelity® VIP Mid Cap Portfolio - Service Class 2		25,187,326		34,487,556			65,926,138			94,406,453
Fidelity® VIP Overseas Portfolio - Service Class 2		—		(3	)		—			(5	)
Fidelity® VIP Strategic Income Portfolio - Initial Class		3,045		7,139			14,001			37,752
Fidelity® VIP Strategic Income Portfolio - Service Class 2		74,453		183,195			150,088			630,089
First Trust Dorsey Wright Tactical Core Portfolio - Class I		44,885		78,134			418,053			479,193
First Trust Multi Income Allocation Portfolio - Class I		—		35,050			133,531			239,283
First Trust Multi Income Allocation Portfolio - Class II		—		135			1,489			2,625
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		3,646,668		3,971,665			1,926,901			6,027,549
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		7,434		7,440			(6,066	)		2,962
Franklin Founding Funds Allocation VIP Fund - Class 4		296,314		318,764			321,465			731,684
Franklin Income VIP Fund - Class 1		—		886			6,101			11,961
Franklin Income VIP Fund - Class 2		—		4,135,012			25,122,118			44,168,235
Franklin Income VIP Fund - Class 4		—		149,836			1,774,167			2,822,911
Franklin Mutual Shares VIP Fund - Class 1		33,036		33,377			8,304			58,681
Franklin Mutual Shares VIP Fund - Class 2		29,602,071		47,831,739			(5,344,816	)		49,943,495
Franklin Mutual Shares VIP Fund - Class 4		484,585		513,615			3,281			635,430
Franklin Rising Dividends VIP Fund - Class 1		23,626		23,696			88,884			121,409
Franklin Rising Dividends VIP Fund - Class 4		679,176		731,310			2,527,668			3,310,746
Franklin Small Cap Value VIP Fund - Class 1		38,609		36,929			21,527			60,452
Franklin Small Cap Value VIP Fund - Class 4		441,508		451,529			186,005			588,359
Franklin Small-Mid Cap Growth VIP Fund - Class 1		22,302		25,467			18,197			42,703
Franklin Small-Mid Cap Growth VIP Fund - Class 4		446,706		408,334			438,500			791,921
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		—		—			—			2,402
Goldman Sachs VIT Government Money Market Fund - Service Shares		—		—			—			(227,352	)
Goldman Sachs VIT Large Cap Value Fund - Service Shares		26,651,742		27,228,401			(15,406,739	)		12,474,201
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		—		(7,207	)		79,095			91,478
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		—		(161	)		1,499			3,318
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		—		(38,391	)		(112,430	)		(174,017	)
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		—		(11	)		(703	)		(565	)
Guggenheim VT Long Short Equity		—		27,448			476,265			476,047
Guggenheim VT Multi-Hedge Strategies		—		755			154,511			107,458
Hartford Capital Appreciation HLS Fund - Class IA		5,092		862			16,991			18,527
Hartford Capital Appreciation HLS Fund - Class IC		614,827		567,725			1,333,501			1,843,947
Invesco V.I. American Franchise Fund - Series I Shares		205,387		357,436			280,478			601,647
Invesco V.I. American Franchise Fund - Series II Shares		115,871		146,843			186,957			309,182
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		36,188		35,824			(8,851	)		52,054
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		728,737		757,019			(73,246	)		1,038,050
Invesco V.I. Comstock Fund - Series I Shares		4,774		8,194			8,159			18,358
Invesco V.I. Comstock Fund - Series II Shares		206,989		238,803			434,303			718,047
Invesco V.I. Core Equity Fund - Series I Shares		327,915		612,318			122,416			705,443
Invesco V.I. Core Equity Fund - Series II Shares		77,009		158,244			14,987			160,609
Invesco V.I. Diversified Dividend Fund - Series I Shares		1,473		1,483			2,559			4,573
Invesco V.I. Diversified Dividend Fund - Series II Shares		647,279		968,413			216,411			1,254,194
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		669		3,625			3,568			7,333
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		1,131,194		1,482,982			5,786,702			7,010,126
Invesco V.I. Equity and Income Fund - Series I Shares		801		1,632			1,328			3,586
Invesco V.I. Equity and Income Fund - Series II Shares		228,854		282,177			733,411			1,066,872
Invesco V.I. International Growth Fund - Series I Shares		—		684,171			(296,047	)		390,025
Invesco V.I. International Growth Fund - Series II Shares		—		646,985			6,596,743			7,187,356
Ivy VIP Asset Strategy Portfolio		—		(206,433	)		1,548,624			1,371,916
Ivy VIP Energy Portfolio		—		(72,822	)		(772,171	)		(868,165	)

N-21

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
Ivy VIP High Income Portfolio	$	818,344	$	(186,195	)	$	632,149		$	36,776
Ivy VIP High Income Portfolio - Class I		—		(93	)		(93	)		34
Ivy VIP Micro Cap Growth Portfolio		—		(36,773	)		(36,773	)		(30,518	)
Ivy VIP Micro Cap Growth Portfolio - Class I		—		(62	)		(62	)		4
Ivy VIP Mid Cap Growth Portfolio		—		(70,572	)		(70,572	)		43,842
Ivy VIP Mid Cap Growth Portfolio - Class I		—		(503	)		(503	)		541
Ivy VIP Science and Technology Portfolio		—		(188,650	)		(188,650	)		199,386
Ivy VIP Science and Technology Portfolio - Class I		—		(130	)		(130	)		1,223
Janus Henderson Balanced Portfolio - Service Shares		187,765		(223,737	)		(35,972	)		447,183
Janus Henderson Enterprise Portfolio - Service Shares		9,520		(109,864	)		(100,344	)		429,338
Janus Henderson Global Research Portfolio - Service Shares		4,759		(11,298	)		(6,539	)		66,628
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		12,201		(1,763	)		10,438			232
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		393,573		(348,442	)		45,131			3,170
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		65,750		(66,431	)		(681	)		52,448
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		2,026		(122	)		1,904			14
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		69,807		(20,582	)		49,225			11,884
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1		—		(181	)		(181	)		1,769
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2		—		(43,956	)		(43,956	)		(101,881	)
Lincoln iShares® Global Growth Allocation Fund - Standard Class		5,169		(1,152	)		4,017			1,380
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		9,695		(3,335	)		6,360			559
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		914,605		(203,952	)		710,653			114,475
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		—		(64,104	)		(64,104	)		66,758
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		151,733		(139,761	)		11,972			184,182
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		810,580		(233,473	)		577,107			(40,958	)
LVIP American Balanced Allocation Fund - Service Class		834,382		(411,525	)		422,857			93,599
LVIP American Balanced Allocation Fund - Standard Class		146,326		(67,784	)		78,542			26,724
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		2,939,782		(5,038,924	)		(2,099,142	)		4,172,973
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		452,764		(365,554	)		87,210			123,907
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		15,135		(6,011	)		9,124			769
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		964,178		(1,010,419	)		(46,241	)		266,648
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		6,780		(3,069	)		3,711			(1,031	)
LVIP American Global Growth Fund - Service Class II		567,510		(2,580,639	)		(2,013,129	)		2,544,217
LVIP American Global Small Capitalization Fund - Service Class II		10,907		(1,132,466	)		(1,121,559	)		1,299,551
LVIP American Growth Allocation Fund - Service Class		509,519		(333,241	)		176,278			81,917
LVIP American Growth Allocation Fund - Standard Class		24,842		(8,007	)		16,835			2,707
LVIP American Growth Fund - Service Class II		1,895,562		(7,388,563	)		(5,493,001	)		7,638,672
LVIP American Growth-Income Fund - Service Class II		4,849,005		(6,153,196	)		(1,304,191	)		5,647,300
LVIP American Income Allocation Fund - Standard Class		1,899		(1,190	)		709			62
LVIP American International Fund - Service Class II		1,619,818		(2,688,873	)		(1,069,055	)		3,337,128
LVIP American Preservation Fund - Service Class		85,588		(85,741	)		(153	)		(5,139	)
LVIP American Preservation Fund - Standard Class		1,956		(1,841	)		115			(55	)
LVIP Baron Growth Opportunities Fund - Service Class		—		(2,845,977	)		(2,845,977	)		5,752,722
LVIP Baron Growth Opportunities Fund - Standard Class		—		(3,327	)		(3,327	)		4,208
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		13,671,710		(13,499,466	)		172,244			10,599,885
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		9,610		(2,853	)		6,757			2,443
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		6,859,989		(15,893,985	)		(9,033,996	)		(2,186,251	)
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		1,796		(1,655	)		141			(138	)
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		2,119,538		(2,139,404	)		(19,866	)		510,917
LVIP BlackRock Inflation Protected Bond Fund - Service Class		12,957,872		(12,921,882	)		35,990			(4,154,602	)
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		26,843		(10,731	)		16,112			(1,247	)
LVIP BlackRock Multi-Asset Income Fund - Service Class		246,911		(93,030	)		153,881			18,169
LVIP BlackRock Multi-Asset Income Fund - Standard Class		7,142		(919	)		6,223			(392	)
LVIP BlackRock Scientific Allocation Fund - Service Class		30,199		(5,994	)		24,205			(5,707	)
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		2,318,427		(3,142,785	)		(824,358	)		1,495,992
LVIP Blended Core Equity Managed Volatility Fund - Service Class		2,728,484		(3,921,817	)		(1,193,333	)		3,238,659
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		1,040		(737	)		303			934
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		2,269,018		(8,245,435	)		(5,976,417	)		10,745,661

See accompanying notes.
N-22

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
Ivy VIP High Income Portfolio	$	—	$	36,776		$	108,829		$	777,754
Ivy VIP High Income Portfolio - Class I		—		34			650			591
Ivy VIP Micro Cap Growth Portfolio		11,923		(18,595	)		302,717			247,349
Ivy VIP Micro Cap Growth Portfolio - Class I		320		324			4,197			4,459
Ivy VIP Mid Cap Growth Portfolio		169,136		212,978			1,250,514			1,392,920
Ivy VIP Mid Cap Growth Portfolio - Class I		—		541			24,363			24,401
Ivy VIP Science and Technology Portfolio		1,460,556		1,659,942			2,562,760			4,034,052
Ivy VIP Science and Technology Portfolio - Class I		5,623		6,846			(3,469	)		3,247
Janus Henderson Balanced Portfolio - Service Shares		26,169		473,352			1,616,075			2,053,455
Janus Henderson Enterprise Portfolio - Service Shares		435,173		864,511			704,881			1,469,048
Janus Henderson Global Research Portfolio - Service Shares		—		66,628			95,172			155,261
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		—		232			524			11,194
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		—		3,170			91,914			140,215
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		218,046		270,494			321,337			591,150
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		459		473			993			3,370
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		17,138		29,022			80,968			159,215
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1		—		1,769			4,652			6,240
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2		—		(101,881	)		586,455			440,618
Lincoln iShares® Global Growth Allocation Fund - Standard Class		—		1,380			18,322			23,719
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		—		559			49,178			56,097
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		215,464		329,939			325,323			1,365,915
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		—		66,758			1,402,907			1,405,561
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		1,123,089		1,307,271			288,011			1,607,254
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		—		(40,958	)		(350,451	)		185,698
LVIP American Balanced Allocation Fund - Service Class		935,591		1,029,190			2,509,198			3,961,245
LVIP American Balanced Allocation Fund - Standard Class		148,757		175,481			486,045			740,068
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		3,779,363		7,952,336			27,272,493			33,125,687
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		—		123,907			2,081,876			2,292,993
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		—		769			62,490			72,383
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		—		266,648			9,069,008			9,289,415
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		—		(1,031	)		64,009			66,689
LVIP American Global Growth Fund - Service Class II		9,094,027		11,638,244			27,320,396			36,945,511
LVIP American Global Small Capitalization Fund - Service Class II		10,590,786		11,890,337			3,763,041			14,531,819
LVIP American Growth Allocation Fund - Service Class		981,934		1,063,851			2,792,373			4,032,502
LVIP American Growth Allocation Fund - Standard Class		43,245		45,952			141,906			204,693
LVIP American Growth Fund - Service Class II		28,560,754		36,199,426			67,922,510			98,628,935
LVIP American Growth-Income Fund - Service Class II		29,280,436		34,927,736			34,812,361			68,435,906
LVIP American Income Allocation Fund - Standard Class		1,266		1,328			3,844			5,881
LVIP American International Fund - Service Class II		10,441,595		13,778,723			27,741,380			40,451,048
LVIP American Preservation Fund - Service Class		—		(5,139	)		13,589			8,297
LVIP American Preservation Fund - Standard Class		—		(55	)		161			221
LVIP Baron Growth Opportunities Fund - Service Class		7,031,377		12,784,099			27,540,152			37,478,274
LVIP Baron Growth Opportunities Fund - Standard Class		30,158		34,366			146,674			177,713
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		—		10,599,885			100,117,635			110,889,764
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		—		2,443			59,427			68,627
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		—		(2,186,251	)		106,332,311			95,112,064
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		—		(138	)		19,218			19,221
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		170,666		681,583			13,879,871			14,541,588
LVIP BlackRock Inflation Protected Bond Fund - Service Class		—		(4,154,602	)		6,198,065			2,079,453
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		—		(1,247	)		6,820			21,685
LVIP BlackRock Multi-Asset Income Fund - Service Class		—		18,169			123,821			295,871
LVIP BlackRock Multi-Asset Income Fund - Standard Class		—		(392	)		6,499			12,330
LVIP BlackRock Scientific Allocation Fund - Service Class		57,261		51,554			(31,782	)		43,977
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		4,053		1,500,045			19,092,830			19,768,517
LVIP Blended Core Equity Managed Volatility Fund - Service Class		—		3,238,659			39,450,628			41,495,954
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		—		934			12,347			13,584
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		13,400,437		24,146,098			88,753,117			106,922,798

N-23

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class	$	14,669	$	(45,025	)	$	(30,356	)	$	169,699
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		—		(7,719,353	)		(7,719,353	)		4,367,149
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		—		(661	)		(661	)		1,953
LVIP Clarion Global Real Estate Fund - Service Class		4,116,114		(1,603,063	)		2,513,051			1,672,028
LVIP Clarion Global Real Estate Fund - Standard Class		24,932		(1,923	)		23,009			5
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		796,246		(1,680,625	)		(884,379	)		790,421
LVIP Delaware Bond Fund - Service Class		84,326,069		(45,782,670	)		38,543,399			(862,686	)
LVIP Delaware Bond Fund - Standard Class		2,178,628		(1,336,668	)		841,960			1,101,256
LVIP Delaware Diversified Floating Rate Fund - Service Class		6,426,918		(12,646,198	)		(6,219,280	)		97,983
LVIP Delaware Diversified Floating Rate Fund - Standard Class		22,109		(18,152	)		3,957			3,861
LVIP Delaware Social Awareness Fund - Service Class		537,962		(926,645	)		(388,683	)		595,425
LVIP Delaware Social Awareness Fund - Standard Class		93,252		(121,486	)		(28,234	)		167,773
LVIP Delaware Special Opportunities Fund - Service Class		709,937		(1,074,072	)		(364,135	)		772,402
LVIP Delaware Wealth Builder Fund - Service Class		263,085		(228,649	)		34,436			214,462
LVIP Delaware Wealth Builder Fund - Standard Class		102,792		(78,153	)		24,639			54,960
LVIP Dimensional International Core Equity Fund - Service Class		592,490		(378,136	)		214,354			484,346
LVIP Dimensional International Core Equity Fund - Standard Class		61,341		(14,578	)		46,763			41,031
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		6,610,292		(4,906,428	)		1,703,864			1,022,977
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		30,399		(9,061	)		21,338			10,834
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		915,171		(1,140,762	)		(225,591	)		(761,321	)
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		60,659		(18,969	)		41,690			3,130
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		311,099		(413,918	)		(102,819	)		905,930
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		35,390		(14,790	)		20,600			43,142
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		5,789,673		(9,754,124	)		(3,964,451	)		4,837,317
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		25,440		(16,142	)		9,298			87,620
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		9,031,024		(8,365,135	)		665,889			58,158
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		154,262		(43,609	)		110,653			7,717
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		8,939,779		(12,764,739	)		(3,824,960	)		4,947,793
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		152,895		(68,027	)		84,868			10,332
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		288		(2	)		286			—
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		9,359,770		(4,812,214	)		4,547,556			1,097,717
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		386		(71	)		315			1
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		23,822,576		(20,406,088	)		3,416,488			12,674,018
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		4,249		(1,198	)		3,051			165
LVIP Global Growth Allocation Managed Risk Fund - Service Class		172,680,871		(124,946,460	)		47,734,411			81,643,441
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		157,686		(30,949	)		126,737			12,841
LVIP Global Income Fund - Service Class		—		(10,240,179	)		(10,240,179	)		(1,121,556	)
LVIP Global Income Fund - Standard Class		—		(2,781	)		(2,781	)		616
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		131,466,036		(99,093,616	)		32,372,420			69,684,053
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		27,044		(11,049	)		15,995			928
LVIP Goldman Sachs Income Builder Fund - Service Class		229,371		(88,362	)		141,009			36,970
LVIP Goldman Sachs Income Builder Fund - Standard Class		1,212		(162	)		1,050			(185	)
LVIP Government Money Market Fund - Service Class		390,503		(3,452,784	)		(3,062,281	)		—
LVIP Government Money Market Fund - Standard Class		106,979		(408,082	)		(301,103	)		4
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		3,139,992		(4,741,542	)		(1,601,550	)		1,848,203
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		1,930,334		(2,112,078	)		(181,744	)		886,284
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		1,365		(881	)		484			407
LVIP JPMorgan High Yield Fund - Service Class		10,236,056		(2,521,713	)		7,714,343			579,309
LVIP JPMorgan High Yield Fund - Standard Class		17,915		(914	)		17,001			2,527
LVIP JPMorgan Retirement Income Fund - Service Class		33,353		(4,902	)		28,451			553
LVIP JPMorgan Retirement Income Fund - Standard Class		18,724		(779	)		17,945			9
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		4,741,077		(9,419,814	)		(4,678,737	)		6,783,383
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		2,986		(2,966	)		20			15,195
LVIP Managed Risk Profile 2010 Fund - Service Class		93,767		(87,242	)		6,525			99,776
LVIP Managed Risk Profile 2020 Fund - Service Class		168,793		(169,875	)		(1,082	)		233,020
LVIP Managed Risk Profile 2030 Fund - Service Class		85,851		(87,760	)		(1,909	)		146,450
LVIP Managed Risk Profile 2040 Fund - Service Class		80,336		(70,359	)		9,977			69,016

See accompanying notes.
N-24

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class	$	54,676	$	224,375		$	300,029		$	494,048
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		—		4,367,149			101,829,186			98,476,982
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		—		1,953			15,701			16,993
LVIP Clarion Global Real Estate Fund - Service Class		—		1,672,028			4,379,157			8,564,236
LVIP Clarion Global Real Estate Fund - Standard Class		—		5			28,144			51,158
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		3,153,036		3,943,457			11,799,975			14,859,053
LVIP Delaware Bond Fund - Service Class		—		(862,686	)		42,543,795			80,224,508
LVIP Delaware Bond Fund - Standard Class		—		1,101,256			148,799			2,092,015
LVIP Delaware Diversified Floating Rate Fund - Service Class		—		97,983			10,317,261			4,195,964
LVIP Delaware Diversified Floating Rate Fund - Standard Class		—		3,861			19,779			27,597
LVIP Delaware Social Awareness Fund - Service Class		6,181,179		6,776,604			3,255,559			9,643,480
LVIP Delaware Social Awareness Fund - Standard Class		795,428		963,201			329,016			1,263,983
LVIP Delaware Special Opportunities Fund - Service Class		5,962,964		6,735,366			3,589,336			9,960,567
LVIP Delaware Wealth Builder Fund - Service Class		650,751		865,213			345,537			1,245,186
LVIP Delaware Wealth Builder Fund - Standard Class		234,475		289,435			134,730			448,804
LVIP Dimensional International Core Equity Fund - Service Class		—		484,346			4,422,462			5,121,162
LVIP Dimensional International Core Equity Fund - Standard Class		—		41,031			514,639			602,433
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		—		1,022,977			60,947,545			63,674,386
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		—		10,834			277,598			309,770
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		1,141,691		380,370			12,158,023			12,312,802
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		61,220		64,350			542,056			648,096
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		—		905,930			3,472,176			4,275,287
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		—		43,142			339,358			403,100
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		—		4,837,317			93,723,754			94,596,620
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		—		87,620			357,544			454,462
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		274,405		332,563			3,967,678			4,966,130
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		3,924		11,641			26,454			148,748
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		—		4,947,793			134,434,550			135,557,383
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		—		10,332			290,597			385,797
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		—		—			(286	)		—
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		—		1,097,717			19,381,315			25,026,588
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		—		1			774			1,090
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		8,156,516		20,830,534			73,431,387			97,678,409
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		1,285		1,450			12,641			17,142
LVIP Global Growth Allocation Managed Risk Fund - Service Class		—		81,643,441			941,703,538			1,071,081,390
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		—		12,841			474,412			613,990
LVIP Global Income Fund - Service Class		3,296,756		2,175,200			26,993,047			18,928,068
LVIP Global Income Fund - Standard Class		3,666		4,282			29,409			30,910
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		2,931,762		72,615,815			661,581,775			766,570,010
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		539		1,467			104,757			122,219
LVIP Goldman Sachs Income Builder Fund - Service Class		—		36,970			212,570			390,549
LVIP Goldman Sachs Income Builder Fund - Standard Class		—		(185	)		1,728			2,593
LVIP Government Money Market Fund - Service Class		7,246		7,246			—			(3,055,035	)
LVIP Government Money Market Fund - Standard Class		880		884			—			(300,219	)
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		5,107,205		6,955,408			19,350,771			24,704,629
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		—		886,284			18,714,807			19,419,347
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		—		407			11,283			12,174
LVIP JPMorgan High Yield Fund - Service Class		—		579,309			96,597			8,390,249
LVIP JPMorgan High Yield Fund - Standard Class		—		2,527			(5,524	)		14,004
LVIP JPMorgan Retirement Income Fund - Service Class		33,532		34,085			(36,995	)		25,541
LVIP JPMorgan Retirement Income Fund - Standard Class		13,559		13,568			(17,621	)		13,892
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		—		6,783,383			66,856,636			68,961,282
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		—		15,195			23,481			38,696
LVIP Managed Risk Profile 2010 Fund - Service Class		68,474		168,250			224,975			399,750
LVIP Managed Risk Profile 2020 Fund - Service Class		337,428		570,448			409,536			978,902
LVIP Managed Risk Profile 2030 Fund - Service Class		99,967		246,417			295,885			540,393
LVIP Managed Risk Profile 2040 Fund - Service Class		85,682		154,698			339,226			503,901

N-25

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
LVIP MFS International Equity Managed Volatility Fund - Service Class	$	2,868,558	$	(3,934,062	)	$	(1,065,504	)	$	1,824,715
LVIP MFS International Growth Fund - Service Class		1,570,063		(2,298,842	)		(728,779	)		6,790,429
LVIP MFS International Growth Fund - Standard Class		112		(136	)		(24	)		7,895
LVIP MFS Value Fund - Service Class		14,074,408		(11,169,317	)		2,905,091			38,826,125
LVIP MFS Value Fund - Standard Class		23,060		(1,930	)		21,130			2,296
LVIP Mondrian International Value Fund - Service Class		8,458,908		(3,919,044	)		4,539,864			1,504,129
LVIP Mondrian International Value Fund - Standard Class		386,250		(200,383	)		185,867			88,808
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		522,139		(562,737	)		(40,598	)		369,163
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		3,405		(1,768	)		1,637			199
LVIP PIMCO Low Duration Bond Fund - Service Class		6,022,967		(6,259,031	)		(236,064	)		546,128
LVIP PIMCO Low Duration Bond Fund - Standard Class		109,334		(33,438	)		75,896			873
LVIP Select Core Equity Managed Volatility Fund - Service Class		9,210,511		(7,153,219	)		2,057,292			6,616,177
LVIP Select Core Equity Managed Volatility Fund - Standard Class		3,225		(1,113	)		2,112			8,389
LVIP SSGA Bond Index Fund - Service Class		21,757,385		(16,624,886	)		5,132,499			1,796,241
LVIP SSGA Bond Index Fund - Standard Class		62,830		(12,853	)		49,977			(864	)
LVIP SSGA Conservative Index Allocation Fund - Service Class		1,382,132		(1,141,600	)		240,532			924,850
LVIP SSGA Conservative Structured Allocation Fund - Service Class		5,764,243		(2,913,423	)		2,850,820			1,940,922
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		22,342		(2,821	)		19,521			1,443
LVIP SSGA Developed International 150 Fund - Service Class		6,277,678		(2,520,872	)		3,756,806			3,224,402
LVIP SSGA Developed International 150 Fund - Standard Class		23,187		(3,749	)		19,438			(2,739	)
LVIP SSGA Emerging Markets 100 Fund - Service Class		4,398,667		(2,986,240	)		1,412,427			181,232
LVIP SSGA Emerging Markets 100 Fund - Standard Class		37,014		(6,210	)		30,804			22,104
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		31,853,854		(14,292,179	)		17,561,675			5,753,349
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		28,752		(4,064	)		24,688			1,706
LVIP SSGA International Index Fund - Service Class		6,753,055		(4,660,926	)		2,092,129			7,598,264
LVIP SSGA International Index Fund - Standard Class		59,082		(9,162	)		49,920			41,593
LVIP SSGA International Managed Volatility Fund - Service Class		7,125,683		(5,967,303	)		1,158,380			4,605,631
LVIP SSGA International Managed Volatility Fund - Standard Class		3,290		(2,236	)		1,054			2,393
LVIP SSGA Large Cap 100 Fund - Service Class		8,745,709		(5,508,962	)		3,236,747			10,993,360
LVIP SSGA Large Cap 100 Fund - Standard Class		80,421		(26,556	)		53,865			15,508
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		5,265,214		(5,143,070	)		122,144			3,612,039
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		628		(318	)		310			279
LVIP SSGA Mid-Cap Index Fund - Service Class		322,428		(254,424	)		68,004			73,424
LVIP SSGA Mid-Cap Index Fund - Standard Class		15,296		(4,580	)		10,716			5,297
LVIP SSGA Moderate Index Allocation Fund - Service Class		4,250,492		(3,523,596	)		726,896			3,989,700
LVIP SSGA Moderate Index Allocation Fund - Standard Class		604		(26	)		578			352
LVIP SSGA Moderate Structured Allocation Fund - Service Class		28,656,131		(12,790,926	)		15,865,205			10,509,485
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		7,076		(789	)		6,287			3,449
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		3,431,951		(2,862,406	)		569,545			3,414,357
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		5,672		(241	)		5,431			280
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		17,055,219		(7,216,173	)		9,839,046			6,449,509
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		92,377		(5,865	)		86,512			1,070
LVIP SSGA S&P 500 Index Fund - Service Class		16,976,599		(16,412,510	)		564,089			48,008,369
LVIP SSGA S&P 500 Index Fund - Standard Class		819,239		(532,921	)		286,318			1,711,556
LVIP SSGA Small-Cap Index Fund - Service Class		2,232,281		(4,654,256	)		(2,421,975	)		12,714,504
LVIP SSGA Small-Cap Index Fund - Standard Class		61,551		(33,650	)		27,901			53,214
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		3,153,030		(2,223,110	)		929,920			2,770,349
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		82,814		(24,271	)		58,543			(150	)
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		3,901,723		(5,377,358	)		(1,475,635	)		3,090,111
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		1,220		(770	)		450			3,036
LVIP T. Rowe Price Growth Stock Fund - Service Class		—		(4,297,469	)		(4,297,469	)		17,443,588
LVIP T. Rowe Price Growth Stock Fund - Standard Class		3,101		(4,152	)		(1,051	)		26,369
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		—		(2,211,156	)		(2,211,156	)		4,062,129
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		7,430		(54,881	)		(47,451	)		166,887
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		12,234,449		(10,793,832	)		1,440,617			5,188,621
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		559		(229	)		330			314
LVIP Vanguard Domestic Equity ETF Fund - Service Class		2,320,888		(2,445,278	)		(124,390	)		6,082,745

See accompanying notes.
N-26

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
LVIP MFS International Equity Managed Volatility Fund - Service Class	$	—	$	1,824,715		$	53,464,182		$	54,223,393
LVIP MFS International Growth Fund - Service Class		—		6,790,429			38,473,279			44,534,929
LVIP MFS International Growth Fund - Standard Class		—		7,895			668			8,539
LVIP MFS Value Fund - Service Class		16,527,061		55,353,186			78,314,054			136,572,331
LVIP MFS Value Fund - Standard Class		5,399		7,695			64,830			93,655
LVIP Mondrian International Value Fund - Service Class		474,490		1,978,619			43,341,379			49,859,862
LVIP Mondrian International Value Fund - Standard Class		20,128		108,936			1,795,641			2,090,444
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		227,078		596,241			5,075,013			5,630,656
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		1,172		1,371			32,866			35,874
LVIP PIMCO Low Duration Bond Fund - Service Class		—		546,128			(1,211,811	)		(901,747	)
LVIP PIMCO Low Duration Bond Fund - Standard Class		—		873			(27,048	)		49,721
LVIP Select Core Equity Managed Volatility Fund - Service Class		2,742,924		9,359,101			54,145,743			65,562,136
LVIP Select Core Equity Managed Volatility Fund - Standard Class		832		9,221			12,791			24,124
LVIP SSGA Bond Index Fund - Service Class		—		1,796,241			4,911,810			11,840,550
LVIP SSGA Bond Index Fund - Standard Class		—		(864	)		(14,737	)		34,376
LVIP SSGA Conservative Index Allocation Fund - Service Class		199,264		1,124,114			4,412,807			5,777,453
LVIP SSGA Conservative Structured Allocation Fund - Service Class		2,056,108		3,997,030			7,012,487			13,860,337
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		7,819		9,262			30,716			59,499
LVIP SSGA Developed International 150 Fund - Service Class		—		3,224,402			21,891,294			28,872,502
LVIP SSGA Developed International 150 Fund - Standard Class		—		(2,739	)		81,152			97,851
LVIP SSGA Emerging Markets 100 Fund - Service Class		—		181,232			33,035,560			34,629,219
LVIP SSGA Emerging Markets 100 Fund - Standard Class		—		22,104			127,454			180,362
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		—		5,753,349			78,041,881			101,356,905
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		—		1,706			53,964			80,358
LVIP SSGA International Index Fund - Service Class		—		7,598,264			46,931,670			56,622,063
LVIP SSGA International Index Fund - Standard Class		—		41,593			192,708			284,221
LVIP SSGA International Managed Volatility Fund - Service Class		—		4,605,631			65,253,170			71,017,181
LVIP SSGA International Managed Volatility Fund - Standard Class		—		2,393			27,384			30,831
LVIP SSGA Large Cap 100 Fund - Service Class		43,771,342		54,764,702			(7,458,706	)		50,542,743
LVIP SSGA Large Cap 100 Fund - Standard Class		366,932		382,440			3,522			439,827
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		—		3,612,039			50,415,399			54,149,582
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		—		279			5,877			6,466
LVIP SSGA Mid-Cap Index Fund - Service Class		150,798		224,222			2,043,352			2,335,578
LVIP SSGA Mid-Cap Index Fund - Standard Class		6,407		11,704			90,451			112,871
LVIP SSGA Moderate Index Allocation Fund - Service Class		837,253		4,826,953			19,534,901			25,088,750
LVIP SSGA Moderate Index Allocation Fund - Standard Class		23		375			(593	)		360
LVIP SSGA Moderate Structured Allocation Fund - Service Class		12,628,022		23,137,507			43,334,685			82,337,397
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		3,160		6,609			10,595			23,491
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		769,707		4,184,064			19,446,102			24,199,711
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		501		781			(1,128	)		5,084
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		7,274,047		13,723,556			28,844,082			52,406,684
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		14,977		16,047			47,522			150,081
LVIP SSGA S&P 500 Index Fund - Service Class		11,041,209		59,049,578			117,769,002			177,382,669
LVIP SSGA S&P 500 Index Fund - Standard Class		455,929		2,167,485			5,159,371			7,613,174
LVIP SSGA Small-Cap Index Fund - Service Class		7,118,876		19,833,380			16,100,671			33,512,076
LVIP SSGA Small-Cap Index Fund - Standard Class		133,718		186,932			437,166			651,999
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		11,367,701		14,138,050			(9,114,682	)		5,953,288
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		270,243		270,093			(156,353	)		172,283
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		—		3,090,111			36,101,927			37,716,403
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		—		3,036			8,459			11,945
LVIP T. Rowe Price Growth Stock Fund - Service Class		4,988,213		22,431,801			53,245,569			71,379,901
LVIP T. Rowe Price Growth Stock Fund - Standard Class		23,396		49,765			227,850			276,564
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		4,651,151		8,713,280			21,257,903			27,760,027
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		102,845		269,732			458,563			680,844
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		9,464,828		14,653,449			76,539,509			92,633,575
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		372		686			3,735			4,751
LVIP Vanguard Domestic Equity ETF Fund - Service Class		262,296		6,345,041			20,642,347			26,862,998

N-27

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
LVIP Vanguard Domestic Equity ETF Fund - Standard Class	$	19,085	$	(8,280	)	$	10,805		$	16,630
LVIP Vanguard International Equity ETF Fund - Service Class		2,201,669		(1,550,907	)		650,762			1,665,183
LVIP Vanguard International Equity ETF Fund - Standard Class		28,944		(8,055	)		20,889			22,884
LVIP Wellington Capital Growth Fund - Service Class		—		(3,441,702	)		(3,441,702	)		19,961,992
LVIP Wellington Capital Growth Fund - Standard Class		—		(96	)		(96	)		3,299
LVIP Wellington Mid-Cap Value Fund - Service Class		151,258		(1,432,785	)		(1,281,527	)		4,017,353
LVIP Wellington Mid-Cap Value Fund - Standard Class		1,319		(1,159	)		160			2,107
LVIP Western Asset Core Bond Fund - Service Class		456,352		(156,688	)		299,664			8,694
LVIP Western Asset Core Bond Fund - Standard Class		9,870		(1,055	)		8,815			(5	)
MFS® VIT Growth Series - Initial Class		3,709		(48,299	)		(44,590	)		1,295,960
MFS® VIT Growth Series - Service Class		—		(1,291,157	)		(1,291,157	)		3,120,147
MFS® VIT Total Return Series - Initial Class		160,067		(102,691	)		57,376			390,055
MFS® VIT Total Return Series - Service Class		1,285,451		(860,819	)		424,632			287,409
MFS® VIT Utilities Series - Initial Class		311,476		(102,469	)		209,007			1,397,162
MFS® VIT Utilities Series - Service Class		8,031,682		(3,136,319	)		4,895,363			1,565,434
MFS® VIT II Core Equity Portfolio - Service Class		16,382		(38,563	)		(22,181	)		(759	)
MFS® VIT II International Value Portfolio - Initial Class		7,991		(2,477	)		5,514			6,985
MFS® VIT II International Value Portfolio - Service Class		330,959		(283,017	)		47,942			392,336
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		2,922		(495	)		2,427			(3,815	)
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		127,199		(76,086	)		51,113			(1,635	)
Morgan Stanley VIF Growth Portfolio - Class II		—		(20,888	)		(20,888	)		114,302
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		225,801		(469,759	)		(243,958	)		1,305,591
Oppenheimer Global Fund/VA Service Shares		62,758		(83,189	)		(20,431	)		423,238
Oppenheimer International Growth Fund/VA Non-Service Shares		8,404		(3,445	)		4,959			302
Oppenheimer International Growth Fund/VA Service Shares		131,573		(129,604	)		1,969			59,876
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		4,623		(2,191	)		2,432			3,328
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		57,025		(113,029	)		(56,004	)		101,525
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		127,639		(29,314	)		98,325			6,255
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		5,725		(483	)		5,242			29
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		1,418,389		(190,553	)		1,227,836			(1,206,126	)
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		3,466		(123	)		3,343			(9	)
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		164,053		(39,104	)		124,949			16,512
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		1,858		(141	)		1,717			693
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		62,893		(49,241	)		13,652			15,502
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		725		(155	)		570			1
Putnam VT Absolute Return 500 Fund - Class IA		—		(2	)		(2	)		—
Putnam VT Absolute Return 500 Fund - Class IB		—		(30,166	)		(30,166	)		4,428
Putnam VT Equity Income Fund - Class IB		—		(12,342	)		(12,342	)		6,384
Putnam VT George Putnam Balanced Fund - Class IA		—		(219	)		(219	)		15
Putnam VT George Putnam Balanced Fund - Class IB		50,133		(120,020	)		(69,887	)		50,361
Putnam VT Global Health Care Fund - Class IA		166		(310	)		(144	)		(426	)
Putnam VT Global Health Care Fund - Class IB		62,481		(162,938	)		(100,457	)		(157,508	)
Putnam VT Growth & Income Fund - Class IB		25,869		(7,467	)		18,402			155,507
Putnam VT Income Fund - Class IB		180,808		(61,766	)		119,042			(9,635	)
QS Variable Conservative Growth - Class II		19,876		(2,893	)		16,983			1,052
Rational Dividend Capture VA Fund		43,889		(17,256	)		26,633			10,867
SEI VP Market Growth Strategy Fund - Class III		36,654		(30,945	)		5,709			11,284
SEI VP Market Plus Strategy Fund - Class III		26,867		(22,279	)		4,588			(3,116	)
Templeton Foreign VIP Fund - Class 1		767		(102	)		665			(57	)
Templeton Foreign VIP Fund - Class 4		49,320		(34,977	)		14,343			58,717
Templeton Global Bond VIP Fund - Class 1		—		(8,268	)		(8,268	)		9,390
Templeton Global Bond VIP Fund - Class 2		—		(5,523,496	)		(5,523,496	)		(1,965,593	)
Templeton Global Bond VIP Fund - Class 4		—		(267,239	)		(267,239	)		25,371
Templeton Growth VIP Fund - Class 2		492,370		(512,835	)		(20,465	)		1,268,184
VanEck VIP Global Hard Assets Fund - Class S Shares		—		(36,167	)		(36,167	)		(7,835	)
VanEck VIP Global Hard Assets Fund - Initial Class Shares		—		(1,120	)		(1,120	)		(10,794	)
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		555,197		(156,519	)		398,678			21,158

See accompanying notes.
N-28

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments			Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
LVIP Vanguard Domestic Equity ETF Fund - Standard Class	$	1,795	$	18,425		$	134,253		$	163,483
LVIP Vanguard International Equity ETF Fund - Service Class		—		1,665,183			20,011,789			22,327,734
LVIP Vanguard International Equity ETF Fund - Standard Class		—		22,884			189,764			233,537
LVIP Wellington Capital Growth Fund - Service Class		21,183,315		41,145,307			56,418,149			94,121,754
LVIP Wellington Capital Growth Fund - Standard Class		1,478		4,777			1,918			6,599
LVIP Wellington Mid-Cap Value Fund - Service Class		1,955,500		5,972,853			5,314,980			10,006,306
LVIP Wellington Mid-Cap Value Fund - Standard Class		6,160		8,267			28,361			36,788
LVIP Western Asset Core Bond Fund - Service Class		—		8,694			(206,373	)		101,985
LVIP Western Asset Core Bond Fund - Standard Class		—		(5	)		(3,945	)		4,865
MFS® VIT Growth Series - Initial Class		140,347		1,436,307			(483,131	)		908,586
MFS® VIT Growth Series - Service Class		3,833,402		6,953,549			17,785,283			23,447,675
MFS® VIT Total Return Series - Initial Class		186,258		576,313			96,046			729,735
MFS® VIT Total Return Series - Service Class		1,650,088		1,937,497			2,815,013			5,177,142
MFS® VIT Utilities Series - Initial Class		—		1,397,162			(693,296	)		912,873
MFS® VIT Utilities Series - Service Class		—		1,565,434			17,358,723			23,819,520
MFS® VIT II Core Equity Portfolio - Service Class		136,622		135,863			354,765			468,447
MFS® VIT II International Value Portfolio - Initial Class		507		7,492			118,738			131,744
MFS® VIT II International Value Portfolio - Service Class		24,130		416,466			4,713,601			5,178,009
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		5,869		2,054			5,992			10,473
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		276,761		275,126			344,492			670,731
Morgan Stanley VIF Growth Portfolio - Class II		179,451		293,753			417,618			690,483
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		—		1,305,591			2,800,430			3,862,063
Oppenheimer Global Fund/VA Service Shares		—		423,238			2,148,652			2,551,459
Oppenheimer International Growth Fund/VA Non-Service Shares		—		302			158,933			164,194
Oppenheimer International Growth Fund/VA Service Shares		—		59,876			2,267,002			2,328,847
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		28,380		31,708			36,710			70,850
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		475,571		577,096			569,833			1,090,925
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		—		6,255			88,650			193,230
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		—		29			5,473			10,744
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		—		(1,206,126	)		(19,334	)		2,376
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		—		(9	)		(2,624	)		710
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		—		16,512			111,365			252,826
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		—		693			564			2,974
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		—		15,502			106,162			135,316
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		—		1			1,187			1,758
Putnam VT Absolute Return 500 Fund - Class IA		—		—			42			40
Putnam VT Absolute Return 500 Fund - Class IB		—		4,428			160,802			135,064
Putnam VT Equity Income Fund - Class IB		—		6,384			138,948			132,990
Putnam VT George Putnam Balanced Fund - Class IA		—		15			5,101			4,897
Putnam VT George Putnam Balanced Fund - Class IB		—		50,361			842,310			822,784
Putnam VT Global Health Care Fund - Class IA		1,779		1,353			4,866			6,075
Putnam VT Global Health Care Fund - Class IB		1,012,883		855,375			548,386			1,303,304
Putnam VT Growth & Income Fund - Class IB		140,951		296,458			(259,762	)		55,098
Putnam VT Income Fund - Class IB		—		(9,635	)		81,926			191,333
QS Variable Conservative Growth - Class II		101,194		102,246			(95,633	)		23,596
Rational Dividend Capture VA Fund		—		10,867			(73,494	)		(35,994	)
SEI VP Market Growth Strategy Fund - Class III		—		11,284			235,836			252,829
SEI VP Market Plus Strategy Fund - Class III		—		(3,116	)		293,953			295,425
Templeton Foreign VIP Fund - Class 1		—		(57	)		3,118			3,726
Templeton Foreign VIP Fund - Class 4		—		58,717			326,927			399,987
Templeton Global Bond VIP Fund - Class 1		6,781		16,171			4,765			12,668
Templeton Global Bond VIP Fund - Class 2		1,117,553		(848,040	)		7,917,616			1,546,080
Templeton Global Bond VIP Fund - Class 4		65,927		91,298			133,891			(42,050	)
Templeton Growth VIP Fund - Class 2		—		1,268,184			3,348,344			4,596,063
VanEck VIP Global Hard Assets Fund - Class S Shares		—		(7,835	)		(36,112	)		(80,114	)
VanEck VIP Global Hard Assets Fund - Initial Class Shares		—		(10,794	)		13,803			1,889
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		—		21,158			190,293			610,129

N-29

Lincoln Life Variable Annuity Account N

Statements of operations (continued)

Year Ended December 31, 2017

Subaccount	Dividends from Investment Income		Mortality and Expense Guarantee Charges			Net Investment Income (Loss)			Net Realized Gain (Loss) on Investments
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares	$	50,941	$	(3,080	)	$	47,861		$	2,336
Virtus Rampart Equity Trend Series - Class A Shares		—		(16,438	)		(16,438	)		(4,896	)
Virtus Rampart Equity Trend Series - Class I Shares		—		—			—			—

See accompanying notes.
N-30

Subaccount	Dividends from Net Realized Gain on Investments		Total Net Realized Gain (Loss) on Investments		Net Change in Unrealized Appreciation or Depreciation on Investments			Net Increase (Decrease) in Net Assets Resulting from Operations
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares	$	—	$	2,336	$	(10,335	)	$	39,862
Virtus Rampart Equity Trend Series - Class A Shares		34,514		29,618		212,164			225,344
Virtus Rampart Equity Trend Series - Class I Shares		1		1		6			7

N-31

Lincoln Life Variable Annuity Account N

Statements of changes in net assets

Years Ended December 31, 2016 and 2017

	AB VPS Global Thematic Growth Portfolio - Class B Subaccount			AB VPS Growth and Income Portfolio - Class B Subaccount			AB VPS International Value Portfolio - Class B Subaccount			AB VPS Large Cap Growth Portfolio - Class B Subaccount			AB VPS Small/Mid Cap Value Portfolio - Class A Subaccount			AB VPS Small/Mid Cap Value Portfolio - Class B Subaccount			ALPS/Alerian Energy Infrastructure Portfolio - Class I Subaccount
NET ASSETS AT JANUARY 1, 2016	$	29,135,815		$	—		$	5,045		$	10,319,207		$	77,770		$	167,462,421		$	181,504
Changes From Operations:
• Net investment income (loss)		(435,126	)		—			(36	)		(155,836	)		906			(2,158,495	)		4,242
• Net realized gain (loss) on investments		726,942			—			(94	)		1,668,403			17,341			9,740,754			(5,839	)
• Net change in unrealized appreciation or depreciation on investments		(987,705	)		—			76			(1,468,362	)		42,896			28,671,115			74,404
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(695,889	)		—			(54	)		44,205			61,143			36,253,374			72,807
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		630,355			—			172			40,632			226,053			6,446,385			3,236
• Contract withdrawals and transfers to annuity reserves		(2,136,282	)		—			(2,709	)		(1,056,499	)		(3,458	)		(16,763,122	)		(21,130	)
• Contract transfers		(2,367,735	)		—			—			78,487			20,497			(1,666,426	)		4,612
		(3,873,662	)		—			(2,537	)		(937,380	)		243,092			(11,983,163	)		(13,282	)
Annuity Reserves:
• Annuity Payments		(3,375	)		—			—			—			—			(7,433	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		87			—			—			—			—			(5	)		—
		(3,288	)		—			—			—			—			(7,438	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(3,876,950	)		—			(2,537	)		(937,380	)		243,092			(11,990,601	)		(13,282	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(4,572,839	)		—			(2,591	)		(893,175	)		304,235			24,262,773			59,525
NET ASSETS AT DECEMBER 31, 2016		24,562,976			—			2,454			9,426,032			382,005			191,725,194			241,029
Changes From Operations:
• Net investment income (loss)		(389,303	)		(2	)		(5	)		(166,871	)		141			(2,749,812	)		10,979
• Net realized gain (loss) on investments		2,270,665			(34	)		439			2,620,876			24,679			13,574,782			(5,202	)
• Net change in unrealized appreciation or depreciation on investments		6,286,429			—			79			184,619			26,678			10,802,593			(4,750	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		8,167,791			(36	)		513			2,638,624			51,498			21,627,563			1,027
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		746,790			88			21			106,650			33,931			14,668,033			140,679
• Contract withdrawals and transfers to annuity reserves		(2,643,327	)		(57	)		(190	)		(2,149,456	)		(12,972	)		(19,193,655	)		(32,952	)
• Contract transfers		945,086			5			(1,566	)		203,650			4,305			3,570,361			196,386
		(951,451	)		36			(1,735	)		(1,839,156	)		25,264			(955,261	)		304,113
Annuity Reserves:
• Annuity Payments		(3,929	)		—			—			—			—			(8,375	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		122			—			—			—			—			8			—
		(3,807	)		—			—			—			—			(8,367	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(955,258	)		36			(1,735	)		(1,839,156	)		25,264			(963,628	)		304,113
TOTAL INCREASE (DECREASE) IN NET ASSETS		7,212,533			—			(1,222	)		799,468			76,762			20,663,935			305,140
NET ASSETS AT DECEMBER 31, 2017	$	31,775,509		$	—		$	1,232		$	10,225,500		$	458,767		$	212,389,129		$	546,169

See accompanying notes.
N-32

	ALPS/Alerian Energy Infrastructure Portfolio - Class III Subaccount			ALPS/Red Rocks Listed Private Equity Portfolio - Class I Subaccount			ALPS/Red Rocks Listed Private Equity Portfolio - Class III Subaccount			ALPS/Stadion Core ETF Portfolio - Class I Subaccount			ALPS/Stadion Core ETF Portfolio - Class III Subaccount			ALPS/Stadion Tactical Growth Portfolio - Class III Subaccount
NET ASSETS AT JANUARY 1, 2016	$	2,388,413		$	—		$	3,424,521		$	8,312		$	5,324,167		$	1,373,696
Changes From Operations:
• Net investment income (loss)		57,497			1,291			(18,472	)		(69	)		(60,448	)		(22,500	)
• Net realized gain (loss) on investments		(111,399	)		4,623			(7,205	)		(1	)		(67,388	)		16,567
• Net change in unrealized appreciation or depreciation on investments		1,352,299			635			342,341			2,147			530,717			277,441
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,298,397			6,549			316,664			2,077			402,881			271,508
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		771,189			—			1,876,248			—			467,944			1,188,117
• Contract withdrawals and transfers to annuity reserves		(276,370	)		(4,954	)		(248,986	)		—			(2,067,833	)		(306,079	)
• Contract transfers		1,286,873			25,281			66,553			45,056			382,830			1,445,059
		1,781,692			20,327			1,693,815			45,056			(1,217,059	)		2,327,097
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,781,692			20,327			1,693,815			45,056			(1,217,059	)		2,327,097
TOTAL INCREASE (DECREASE) IN NET ASSETS		3,080,089			26,876			2,010,479			47,133			(814,178	)		2,598,605
NET ASSETS AT DECEMBER 31, 2016		5,468,502			26,876			5,435,000			55,445			4,509,989			3,972,301
Changes From Operations:
• Net investment income (loss)		42,748			1,269			111,242			(259	)		(77,899	)		(42,954	)
• Net realized gain (loss) on investments		91,369			4,340			207,041			404			77,695			104,529
• Net change in unrealized appreciation or depreciation on investments		(223,707	)		3,928			1,142,348			7,053			716,112			421,794
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(89,590	)		9,537			1,460,631			7,198			715,908			483,369
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		956,121			3,012			1,000,348			—			2,850,006			369,939
• Contract withdrawals and transfers to annuity reserves		(364,090	)		(1,032	)		(629,309	)		(2,738	)		(528,510	)		(764,685	)
• Contract transfers		(307,650	)		16,091			1,990,823			—			2,595,734			901,450
		284,381			18,071			2,361,862			(2,738	)		4,917,230			506,704
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		284,381			18,071			2,361,862			(2,738	)		4,917,230			506,704
TOTAL INCREASE (DECREASE) IN NET ASSETS		194,791			27,608			3,822,493			4,460			5,633,138			990,073
NET ASSETS AT DECEMBER 31, 2017	$	5,663,293		$	54,484		$	9,257,493		$	59,905		$	10,143,127		$	4,962,374

N-33

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	American Century VP Balanced Fund - Class I Subaccount			American Century VP Balanced Fund - Class II Subaccount			American Century VP Inflation Protection Fund - Class II Subaccount			American Century VP Large Company Value Fund - Class I Subaccount			American Century VP Large Company Value Fund - Class II Subaccount			American Funds Asset Allocation Fund - Class 1 Subaccount			American Funds Asset Allocation Fund - Class 1A Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	—		$	—		$	—		$	—		$	3,379,682		$	—
Changes From Operations:
• Net investment income (loss)		—			(7,295	)		119			—			—			172,714			—
• Net realized gain (loss) on investments		—			14,225			1,675			—			—			114,496			—
• Net change in unrealized appreciation or depreciation on investments		—			127,163			(822	)		—			—			272,027			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			134,093			972			—			—			559,237			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			6,115,031			17,639			—			—			2,198,849			—
• Contract withdrawals and transfers to annuity reserves		—			(545,898	)		(3,131	)		—			—			(128,142	)		—
• Contract transfers		—			12,588,366			11,745			—			—			7,803,485			—
		—			18,157,499			26,253			—			—			9,874,192			—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			18,157,499			26,253			—			—			9,874,192			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			18,291,592			27,225			—			—			10,433,429			—
NET ASSETS AT DECEMBER 31, 2016		—			18,291,592			27,225			—			—			13,813,111			—
Changes From Operations:
• Net investment income (loss)		525			(70,865	)		100			405			476			215,583			39,839
• Net realized gain (loss) on investments		1,942			1,987,102			(105	)		413			8,787			931,624			75,136
• Net change in unrealized appreciation or depreciation on investments		2,509			2,006,722			321			6,394			128,091			1,457,181			87,616
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		4,976			3,922,959			316			7,212			137,354			2,604,388			202,591
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		13,932			16,758,561			120			154,163			2,504,403			3,923,755			3,903,401
• Contract withdrawals and transfers to annuity reserves		(2,221	)		(3,482,071	)		(1,864	)		(812	)		(120,202	)		(499,536	)		(157,742	)
• Contract transfers		55,000			14,818,780			6			191,946			1,262,807			(991,792	)		145,115
		66,711			28,095,270			(1,738	)		345,297			3,647,008			2,432,427			3,890,774
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		66,711			28,095,270			(1,738	)		345,297			3,647,008			2,432,427			3,890,774
TOTAL INCREASE (DECREASE) IN NET ASSETS		71,687			32,018,229			(1,422	)		352,509			3,784,362			5,036,815			4,093,365
NET ASSETS AT DECEMBER 31, 2017	$	71,687		$	50,309,821		$	25,803		$	352,509		$	3,784,362		$	18,849,926		$	4,093,365

See accompanying notes.
N-34

	American Funds Asset Allocation Fund - Class 4 Subaccount			American Funds Blue Chip Income and Growth Fund - Class 1 Subaccount			American Funds Blue Chip Income and Growth Fund - Class 1A Subaccount			American Funds Blue Chip Income and Growth Fund - Class 4 Subaccount			American Funds Bond Fund - Class 1 Subaccount			American Funds Bond Fund - Class 1A Subaccount
NET ASSETS AT JANUARY 1, 2016	$	46,560,007		$	2,465,234		$	—		$	9,935,928		$	2,408,720		$	—
Changes From Operations:
• Net investment income (loss)		324,416			46,414			—			169,158			46,290			—
• Net realized gain (loss) on investments		1,459,436			227,964			—			1,002,189			19,132			—
• Net change in unrealized appreciation or depreciation on investments		3,393,432			189,451			—			1,131,917			(19,263	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,177,284			463,829			—			2,303,264			46,159			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		28,418,990			327,505			—			5,383,433			1,999,985			—
• Contract withdrawals and transfers to annuity reserves		(3,078,980	)		(218,025	)		—			(642,870	)		(83,437	)		—
• Contract transfers		10,594,908			306,475			—			2,637,801			(716,734	)		—
		35,934,918			415,955			—			7,378,364			1,199,814			—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		35,934,918			415,955			—			7,378,364			1,199,814			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		41,112,202			879,784			—			9,681,628			1,245,973			—
NET ASSETS AT DECEMBER 31, 2016		87,672,209			3,345,018			—			19,617,556			3,654,693			—
Changes From Operations:
• Net investment income (loss)		214,204			60,331			9,450			218,570			88,363			13,913
• Net realized gain (loss) on investments		5,587,092			190,384			5,618			1,127,565			84,301			2,764
• Net change in unrealized appreciation or depreciation on investments		8,362,048			374,121			34,242			2,335,588			2,575			(12,038	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		14,163,344			624,836			49,310			3,681,723			175,239			4,639
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		23,186,110			353,309			463,510			6,041,416			978,940			1,243,382
• Contract withdrawals and transfers to annuity reserves		(6,395,164	)		(213,506	)		(3,568	)		(1,286,290	)		(121,567	)		(2,036	)
• Contract transfers		6,473,250			380,216			109,475			1,821,122			1,674,382			(184,427	)
		23,264,196			520,019			569,417			6,576,248			2,531,755			1,056,919
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		23,264,196			520,019			569,417			6,576,248			2,531,755			1,056,919
TOTAL INCREASE (DECREASE) IN NET ASSETS		37,427,540			1,144,855			618,727			10,257,971			2,706,994			1,061,558
NET ASSETS AT DECEMBER 31, 2017	$	125,099,749		$	4,489,873		$	618,727		$	29,875,527		$	6,361,687		$	1,061,558

N-35

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	American Funds Capital Income Builder® - Class 1 Subaccount			American Funds Capital Income Builder® - Class 1A Subaccount			American Funds Capital Income Builder® - Class 4 Subaccount			American Funds Global Balanced Fund - Class 1 Subaccount			American Funds Global Balanced Fund - Class 1A Subaccount			American Funds Global Bond Fund - Class 1 Subaccount			American Funds Global Bond Fund - Class 1A Subaccount
NET ASSETS AT JANUARY 1, 2016	$	352,892		$	—		$	12,866,136		$	314,361		$	—		$	1,783,495		$	—
Changes From Operations:
• Net investment income (loss)		19,115			—			388,348			6,016			—			129			—
• Net realized gain (loss) on investments		(404	)		—			(59,532	)		(442	)		—			(2,058	)		—
• Net change in unrealized appreciation or depreciation on investments		388			—			(45,315	)		5,547			—			16,695			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		19,099			—			283,501			11,121			—			14,766			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		247,130			—			9,885,629			389,621			—			536,457			—
• Contract withdrawals and transfers to annuity reserves		(26,712	)		—			(1,608,899	)		(111,361	)		—			(141,833	)		—
• Contract transfers		324,096			—			5,166,905			(47,882	)		—			29,700			—
		544,514			—			13,443,635			230,378			—			424,324			—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		544,514			—			13,443,635			230,378			—			424,324			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		563,613			—			13,727,136			241,499			—			439,090			—
NET ASSETS AT DECEMBER 31, 2016		916,505			—			26,593,272			555,860			—			2,222,585			—
Changes From Operations:
• Net investment income (loss)		24,575			3,942			400,773			2,562			2,151			(6,908	)		251
• Net realized gain (loss) on investments		3,223			373			155,431			24,051			5,752			13,876			2
• Net change in unrealized appreciation or depreciation on investments		87,902			8,219			2,565,470			71,308			(3,084	)		151,748			287
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		115,700			12,534			3,121,674			97,921			4,819			158,716			540
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		45,001			786,383			6,701,689			1			209,143			305,182			63,532
• Contract withdrawals and transfers to annuity reserves		(68,567	)		(855	)		(3,107,004	)		(38,672	)		(84	)		(109,702	)		(109	)
• Contract transfers		(4,568	)		(343,682	)		1,572,491			(58,935	)		25,000			253,000			—
		(28,134	)		441,846			5,167,176			(97,606	)		234,059			448,480			63,423
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(28,134	)		441,846			5,167,176			(97,606	)		234,059			448,480			63,423
TOTAL INCREASE (DECREASE) IN NET ASSETS		87,566			454,380			8,288,850			315			238,878			607,196			63,963
NET ASSETS AT DECEMBER 31, 2017	$	1,004,071		$	454,380		$	34,882,122		$	556,175		$	238,878		$	2,829,781		$	63,963

See accompanying notes.
N-36

	American Funds Global Growth and Income Fund - Class 1 Subaccount			American Funds Global Growth and Income Fund - Class 1A Subaccount			American Funds Global Growth Fund - Class 1 Subaccount			American Funds Global Growth Fund - Class 1A Subaccount			American Funds Global Growth Fund - Class 2 Subaccount			American Funds Global Growth Fund - Class 4 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	828,333		$	—		$	1,966,526		$	—		$	299,327,181		$	12,998,542
Changes From Operations:
• Net investment income (loss)		19,105			—			10,507			—			(1,795,271	)		(68,800	)
• Net realized gain (loss) on investments		198			—			147,806			—			26,867,926			743,097
• Net change in unrealized appreciation or depreciation on investments		40,014			—			(156,035	)		—			(27,554,781	)		(637,593	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		59,317			—			2,278			—			(2,482,126	)		36,704
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		570,403			—			27,478			—			4,333,713			5,862,059
• Contract withdrawals and transfers to annuity reserves		(22,913	)		—			(58,329	)		—			(26,501,592	)		(1,286,339	)
• Contract transfers		36,319			—			230,710			—			(1,595,148	)		(784,391	)
		583,809			—			199,859			—			(23,763,027	)		3,791,329
Annuity Reserves:
• Annuity Payments		—			—			—			—			(18,685	)		(1,975	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			258			84
		—			—			—			—			(18,427	)		(1,891	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		583,809			—			199,859			—			(23,781,454	)		3,789,438
TOTAL INCREASE (DECREASE) IN NET ASSETS		643,126			—			202,137			—			(26,263,580	)		3,826,142
NET ASSETS AT DECEMBER 31, 2016		1,471,459			—			2,168,663			—			273,063,601			16,824,684
Changes From Operations:
• Net investment income (loss)		19,067			2,041			3,874			8,520			(2,672,602	)		(109,681	)
• Net realized gain (loss) on investments		97,055			166			120,128			18,352			19,557,921			919,394
• Net change in unrealized appreciation or depreciation on investments		226,006			4,875			516,472			75,287			59,570,380			5,392,170
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		342,128			7,082			640,474			102,159			76,455,699			6,201,883
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		18,126			75,401			46,745			1,606,832			2,486,329			9,637,615
• Contract withdrawals and transfers to annuity reserves		(72,797	)		(2,813	)		(246,191	)		(2,229	)		(34,497,262	)		(873,028	)
• Contract transfers		(343,564	)		39,698			(378,986	)		22,519			(8,987,198	)		5,887,261
		(398,235	)		112,286			(578,432	)		1,627,122			(40,998,131	)		14,651,848
Annuity Reserves:
• Annuity Payments		—			—			—			—			(21,474	)		(2,258	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			1,133			113
		—			—			—			—			(20,341	)		(2,145	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(398,235	)		112,286			(578,432	)		1,627,122			(41,018,472	)		14,649,703
TOTAL INCREASE (DECREASE) IN NET ASSETS		(56,107	)		119,368			62,042			1,729,281			35,437,227			20,851,586
NET ASSETS AT DECEMBER 31, 2017	$	1,415,352		$	119,368		$	2,230,705		$	1,729,281		$	308,500,828		$	37,676,270

N-37

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	American Funds Global Small Capitalization Fund - Class 1 Subaccount			American Funds Global Small Capitalization Fund - Class 1A Subaccount			American Funds Global Small Capitalization Fund - Class 2 Subaccount			American Funds Global Small Capitalization Fund - Class 4 Subaccount			American Funds Growth Fund - Class 1 Subaccount			American Funds Growth Fund - Class 1A Subaccount			American Funds Growth Fund - Class 2 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	713,056		$	—		$	407,238,808		$	4,478,298		$	5,907,860		$	—		$	1,430,702,928
Changes From Operations:
• Net investment income (loss)		(951	)		—			(3,956,929	)		(50,669	)		25,673			—			(11,886,719	)
• Net realized gain (loss) on investments		96,512			—			74,009,787			431,917			549,788			—			150,044,917
• Net change in unrealized appreciation or depreciation on investments		(91,148	)		—			(66,130,924	)		(330,643	)		106,879			—			(36,919,070	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		4,413			—			3,921,934			50,605			682,340			—			101,239,128
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		313,539			—			3,203,359			1,103,320			1,184,063			—			12,857,037
• Contract withdrawals and transfers to annuity reserves		(35,248	)		—			(32,922,920	)		(337,599	)		(261,044	)		—			(141,668,455	)
• Contract transfers		149,958			—			(2,607,581	)		(224,298	)		585,174			—			(30,272,710	)
		428,249			—			(32,327,142	)		541,423			1,508,193			—			(159,084,128	)
Annuity Reserves:
• Annuity Payments		—			—			(15,796	)		—			—			—			(117,414	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			4,237			—			—			—			4,044
		—			—			(11,559	)		—			—			—			(113,370	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		428,249			—			(32,338,701	)		541,423			1,508,193			—			(159,197,498	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		432,662			—			(28,416,767	)		592,028			2,190,533			—			(57,958,370	)
NET ASSETS AT DECEMBER 31, 2016		1,145,718			—			378,822,041			5,070,326			8,098,393			—			1,372,744,558
Changes From Operations:
• Net investment income (loss)		(1,359	)		366			(3,297,018	)		(56,986	)		910			7,892			(16,826,500	)
• Net realized gain (loss) on investments		(1,054	)		36			7,584,848			(30,920	)		967,366			64,700			208,002,657
• Net change in unrealized appreciation or depreciation on investments		298,153			22,388			82,252,839			1,613,350			1,339,803			121,115			147,458,557
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		295,740			22,790			86,540,669			1,525,444			2,308,079			193,707			338,634,714
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		5,607			135,084			2,277,905			2,052,504			711,873			2,509,148			10,912,789
• Contract withdrawals and transfers to annuity reserves		(40,898	)		(190	)		(39,115,117	)		(163,708	)		(416,707	)		(9,142	)		(171,577,315	)
• Contract transfers		41,259			23,962			(21,054,436	)		1,629,449			(99,475	)		109,242			(56,625,002	)
		5,968			158,856			(57,891,648	)		3,518,245			195,691			2,609,248			(217,289,528	)
Annuity Reserves:
• Annuity Payments		—			—			(22,999	)		—			—			—			(129,882	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			5,151			—			—			—			298
		—			—			(17,848	)		—			—			—			(129,584	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		5,968			158,856			(57,909,496	)		3,518,245			195,691			2,609,248			(217,419,112	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		301,708			181,646			28,631,173			5,043,689			2,503,770			2,802,955			121,215,602
NET ASSETS AT DECEMBER 31, 2017	$	1,447,426		$	181,646		$	407,453,214		$	10,114,015		$	10,602,163		$	2,802,955		$	1,493,960,160

See accompanying notes.
N-38

	American Funds Growth Fund - Class 4 Subaccount			American Funds Growth-Income Fund - Class 1 Subaccount			American Funds Growth-Income Fund - Class 1A Subaccount			American Funds Growth-Income Fund - Class 2 Subaccount			American Funds Growth-Income Fund - Class 4 Subaccount			American Funds High-Income Bond Fund - Class 1 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	29,556,538		$	2,966,116		$	—		$	1,864,034,886		$	20,582,982		$	894,088
Changes From Operations:
• Net investment income (loss)		(205,785	)		42,262			—			71,156			71,152			66,382
• Net realized gain (loss) on investments		2,688,470			352,010			—			237,706,854			2,521,769			(6,787	)
• Net change in unrealized appreciation or depreciation on investments		1,194,351			(9,690	)		—			(63,111,936	)		283,030			105,922
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		3,677,036			384,582			—			174,666,074			2,875,951			165,517
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		16,355,739			851,696			—			20,995,179			11,309,310			324,828
• Contract withdrawals and transfers to annuity reserves		(1,949,086	)		(68,935	)		—			(182,131,592	)		(1,954,243	)		(26,726	)
• Contract transfers		4,447,417			222,368			—			(20,580,576	)		1,928,603			(50,786	)
		18,854,070			1,005,129			—			(181,716,989	)		11,283,670			247,316
Annuity Reserves:
• Annuity Payments		(1,743	)		—			—			(248,051	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		75			—			—			(15,052	)		—			—
		(1,668	)		—			—			(263,103	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		18,852,402			1,005,129			—			(181,980,092	)		11,283,670			247,316
TOTAL INCREASE (DECREASE) IN NET ASSETS		22,529,438			1,389,711			—			(7,314,018	)		14,159,621			412,833
NET ASSETS AT DECEMBER 31, 2016		52,085,976			4,355,827			—			1,856,720,868			34,742,603			1,306,921
Changes From Operations:
• Net investment income (loss)		(545,492	)		56,839			21,071			(1,723,925	)		167,922			102,877
• Net realized gain (loss) on investments		7,526,460			395,824			16,666			192,416,448			3,243,577			(1,112	)
• Net change in unrealized appreciation or depreciation on investments		10,507,894			710,452			80,393			168,212,172			5,954,830			(1,115	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		17,488,862			1,163,115			118,130			358,904,695			9,366,329			100,650
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		25,126,504			748,752			2,119,775			13,697,535			18,670,047			204,365
• Contract withdrawals and transfers to annuity reserves		(3,112,028	)		(136,122	)		(8,287	)		(210,776,908	)		(2,931,406	)		(42,514	)
• Contract transfers		13,737,450			514,742			(72,203	)		(65,894,823	)		9,313,031			162,638
		35,751,926			1,127,372			2,039,285			(262,974,196	)		25,051,672			324,489
Annuity Reserves:
• Annuity Payments		(2,049	)		—			—			(311,336	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		102			—			—			5,213			—			—
		(1,947	)		—			—			(306,123	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		35,749,979			1,127,372			2,039,285			(263,280,319	)		25,051,672			324,489
TOTAL INCREASE (DECREASE) IN NET ASSETS		53,238,841			2,290,487			2,157,415			95,624,376			34,418,001			425,139
NET ASSETS AT DECEMBER 31, 2017	$	105,324,817		$	6,646,314		$	2,157,415		$	1,952,345,244		$	69,160,604		$	1,732,060

N-39

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	American Funds High-Income Bond Fund - Class 1A Subaccount			American Funds International Fund - Class 1 Subaccount			American Funds International Fund - Class 1A Subaccount			American Funds International Fund - Class 2 Subaccount			American Funds International Fund - Class 4 Subaccount			American Funds International Growth and Income Fund - Class 1 Subaccount			American Funds International Growth and Income Fund - Class 1A Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	3,084,558		$	—		$	664,730,962		$	10,804,545		$	1,501,645		$	—
Changes From Operations:
Net investment income (loss)		—			36,020			—			(440,539	)		29,186			28,108			—
Net realized gain (loss) on investments		—			164,158			—			52,029,362			612,487			(25,628	)		—
Net change in unrealized appreciation or depreciation on investments		—			(101,046	)		—			(36,975,243	)		(329,687	)		12,147			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			99,132			—			14,613,580			311,986			14,627			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			949,076			—			5,517,153			4,291,761			66,247			—
• Contract withdrawals and transfers to annuity reserves		—			(62,409	)		—			(54,810,894	)		(643,165	)		(119,229	)		—
• Contract transfers		—			(570,166	)		—			(997,259	)		682,056			(44,540	)		—
		—			316,501			—			(50,291,000	)		4,330,652			(97,522	)		—
Annuity Reserves:
• Annuity Payments		—			—			—			(25,698	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			2,614			—			—			—
		—			—			—			(23,084	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			316,501			—			(50,314,084	)		4,330,652			(97,522	)		—
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			415,633			—			(35,700,504	)		4,642,638			(82,895	)		—
NET ASSETS AT DECEMBER 31, 2016		—			3,500,191			—			629,030,458			15,447,183			1,418,750			—
Changes From Operations:
• Net investment income (loss)		10,623			47,304			14,363			(1,385,986	)		91,377			25,825			12,938
• Net realized gain (loss) on investments		59			100,188			8,230			23,714,378			432,858			1,296			25
• Net change in unrealized appreciation or depreciation on investments		(6,055	)		1,233,062			89,544			157,187,166			5,096,957			329,101			9,310
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		4,627			1,380,554			112,137			179,515,558			5,621,192			356,222			22,273
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		353,961			680,291			1,236,518			4,953,867			7,203,131			2,568			216,560
• Contract withdrawals and transfers to annuity reserves		(6,198	)		(176,398	)		(6,477	)		(69,492,222	)		(755,115	)		(87,930	)		(979	)
• Contract transfers		34,961			805,151			281,882			(37,799,995	)		4,465,598			50,497			425,927
		382,724			1,309,044			1,511,923			(102,338,350	)		10,913,614			(34,865	)		641,508
Annuity Reserves:
• Annuity Payments		—			—			—			(51,551	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			(8,577	)		—			—			—
		—			—			—			(60,128	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		382,724			1,309,044			1,511,923			(102,398,478	)		10,913,614			(34,865	)		641,508
TOTAL INCREASE (DECREASE) IN NET ASSETS		387,351			2,689,598			1,624,060			77,117,080			16,534,806			321,357			663,781
NET ASSETS AT DECEMBER 31, 2017	$	387,351		$	6,189,789		$	1,624,060		$	706,147,538		$	31,981,989		$	1,740,107		$	663,781

See accompanying notes.
N-40

	American Funds Managed Risk Asset Allocation Fund - Class P1 Subaccount			American Funds Managed Risk Asset Allocation Fund - Class P2 Subaccount			American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1 Subaccount			American Funds Managed Risk Growth Fund - Class P1 Subaccount			American Funds Managed Risk Growth-Income Fund - Class P1 Subaccount			American Funds Managed Risk International Fund - Class P1 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	889,748		$	31,081,934		$	73,829		$	21,404		$	23,786		$	55,274
Changes From Operations:
Net investment income (loss)		9,492			(73,669	)		1,119			(274	)		10			196
Net realized gain (loss) on investments		34,808			1,414,440			4,320			10,027			1,313			(866	)
Net change in unrealized appreciation or depreciation on investments		33,910			1,784,799			13,487			(1,503	)		(132	)		(499	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		78,210			3,125,570			18,926			8,250			1,191			(1,169	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		118,250			19,052,822			60,002			88,011			—			30,000
• Contract withdrawals and transfers to annuity reserves		(14,220	)		(2,404,210	)		(3,165	)		(75	)		(1,258	)		(12,560	)
• Contract transfers		136,337			17,937,682			(2,005	)		(93	)		357			(28,952	)
		240,367			34,586,294			54,832			87,843			(901	)		(11,512	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		240,367			34,586,294			54,832			87,843			(901	)		(11,512	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		318,577			37,711,864			73,758			96,093			290			(12,681	)
NET ASSETS AT DECEMBER 31, 2016		1,208,325			68,793,798			147,587			117,497			24,076			42,593
Changes From Operations:
• Net investment income (loss)		(2,918	)		(649,360	)		175			(259	)		(92	)		(131	)
• Net realized gain (loss) on investments		59,041			1,386,267			10,986			16,157			962			5,383
• Net change in unrealized appreciation or depreciation on investments		3,801			9,775,520			1,594			19,853			3,080			3,909
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		59,924			10,512,427			12,755			35,751			3,950			9,161
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		645,028			19,092,936			—			—			—			—
• Contract withdrawals and transfers to annuity reserves		(7,393	)		(4,051,775	)		(3,238	)		(652	)		(1,282	)		(96	)
• Contract transfers		(1,022,579	)		12,225,117			(72,695	)		(47,291	)		(605	)		(35,813	)
		(384,944	)		27,266,278			(75,933	)		(47,943	)		(1,887	)		(35,909	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(384,944	)		27,266,278			(75,933	)		(47,943	)		(1,887	)		(35,909	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(325,020	)		37,778,705			(63,178	)		(12,192	)		2,063			(26,748	)
NET ASSETS AT DECEMBER 31, 2017	$	883,305		$	106,572,503		$	84,409		$	105,305		$	26,139		$	15,845

N-41

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	American Funds Mortgage Fund - Class 1 Subaccount			American Funds Mortgage Fund - Class 1A Subaccount			American Funds Mortgage Fund - Class 4 Subaccount			American Funds New World Fund® - Class 1 Subaccount			American Funds New World Fund® - Class 1A Subaccount			American Funds New World Fund® - Class 4 Subaccount			American Funds U.S. Government/ AAA-Rated Securities Fund - Class 1 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	250,122		$	—		$	4,794,465		$	2,068,339		$	—		$	9,799,068		$	127,303
Changes From Operations:
• Net investment income (loss)		3,677			—			4,248			10,267			—			(59,865	)		2,149
• Net realized gain (loss) on investments		3,475			—			47,665			(25,783	)		—			(157,667	)		4,577
• Net change in unrealized appreciation or depreciation on investments		(4,268	)		—			(10,209	)		133,624			—			761,479			(6,608	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,884			—			41,704			118,108			—			543,947			118
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		80,302			—			777,692			712,288			—			4,139,074			52,164
• Contract withdrawals and transfers to annuity reserves		(23,705	)		—			(599,299	)		(103,194	)		—			(1,185,927	)		(22,059	)
• Contract transfers		64,238			—			(393,116	)		146,158			—			1,260,213			89,258
		120,835			—			(214,723	)		755,252			—			4,213,360			119,363
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		120,835			—			(214,723	)		755,252			—			4,213,360			119,363
TOTAL INCREASE (DECREASE) IN NET ASSETS		123,719			—			(173,019	)		873,360			—			4,757,307			119,481
NET ASSETS AT DECEMBER 31, 2016		373,841			—			4,621,446			2,941,699			—			14,556,375			246,784
Changes From Operations:
• Net investment income (loss)		2,608			851			1,798			18,425			5,121			(60,618	)		1,176
• Net realized gain (loss) on investments		2,547			609			14,400			42,357			469			331,994			(1,668	)
• Net change in unrealized appreciation or depreciation on investments		(3,791	)		(1,290	)		(33,263	)		896,932			36,941			4,212,925			2,886
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,364			170			(17,065	)		957,714			42,531			4,484,301			2,394
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		69			98,752			921,265			465,859			557,536			4,364,225			—
• Contract withdrawals and transfers to annuity reserves		(12,464	)		(5,199	)		(716,614	)		(187,175	)		(780	)		(750,181	)		(11,605	)
• Contract transfers		54,681			—			258,432			(15,774	)		50,143			1,433,867			(49,240	)
		42,286			93,553			463,083			262,910			606,899			5,047,911			(60,845	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		42,286			93,553			463,083			262,910			606,899			5,047,911			(60,845	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		43,650			93,723			446,018			1,220,624			649,430			9,532,212			(58,451	)
NET ASSETS AT DECEMBER 31, 2017	$	417,491		$	93,723		$	5,067,464		$	4,162,323		$	649,430		$	24,088,587		$	188,333

See accompanying notes.
N-42

	American Funds U.S. Government/ AAA-Rated Securities Fund - Class 1A Subaccount			BlackRock Global Allocation V.I. Fund - Class I Subaccount			BlackRock Global Allocation V.I. Fund - Class III Subaccount			BlackRock iShares® Alternative Strategies V.I. Fund - Class I Subaccount			BlackRock iShares® Alternative Strategies V.I. Fund - Class III Subaccount			ClearBridge Variable Aggressive Growth Portfolio - Class I Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	2,832,358		$	1,199,215,935		$	—		$	515,429		$	188,486
Changes From Operations:
• Net investment income (loss)		—			29,672			(5,832,544	)		225			63,881			513
• Net realized gain (loss) on investments		—			(27,949	)		(15,456,759	)		42			6,520			8,208
• Net change in unrealized appreciation or depreciation on investments		—			143,258			43,547,748			(52	)		(142,572	)		(6,504	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			144,981			22,258,445			215			(72,171	)		2,217
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			432,340			36,887,249			—			2,440,428			24,561
• Contract withdrawals and transfers to annuity reserves		—			(192,090	)		(99,272,594	)		—			(160,183	)		(5,887	)
• Contract transfers		—			514,291			(40,244,636	)		9,108			605,273			(11,084	)
		—			754,541			(102,629,981	)		9,108			2,885,518			7,590
Annuity Reserves:
• Annuity Payments		—			—			(33,941	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(1,228	)		—			—			—
		—			—			(35,169	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			754,541			(102,665,150	)		9,108			2,885,518			7,590
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			899,522			(80,406,705	)		9,323			2,813,347			9,807
NET ASSETS AT DECEMBER 31, 2016		—			3,731,880			1,118,809,230			9,323			3,328,776			198,293
Changes From Operations:
• Net investment income (loss)		961			35,532			(4,878,875	)		348			57,959			507
• Net realized gain (loss) on investments		199			56,170			14,905,930			10			7,425			15,866
• Net change in unrealized appreciation or depreciation on investments		(1,406	)		430,758			116,290,099			946			327,006			19,665
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(246	)		522,460			126,317,154			1,304			392,390			36,038
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		957,209			749,432			38,755,867			4,288			548,620			89,985
• Contract withdrawals and transfers to annuity reserves		(1,492	)		(119,887	)		(106,420,846	)		(10	)		(178,684	)		(1,290	)
• Contract transfers		(662,553	)		81,836			(30,852,441	)		49			354,098			(13,431	)
		293,164			711,381			(98,517,420	)		4,327			724,034			75,264
Annuity Reserves:
• Annuity Payments		—			—			(41,718	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(260	)		—			—			—
		—			—			(41,978	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		293,164			711,381			(98,559,398	)		4,327			724,034			75,264
TOTAL INCREASE (DECREASE) IN NET ASSETS		292,918			1,233,841			27,757,756			5,631			1,116,424			111,302
NET ASSETS AT DECEMBER 31, 2017	$	292,918		$	4,965,721		$	1,146,566,986		$	14,954		$	4,445,200		$	309,595

N-43

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	ClearBridge Variable Aggressive Growth Portfolio - Class II Subaccount			ClearBridge Variable Large Cap Growth Portfolio - Class I Subaccount			ClearBridge Variable Large Cap Growth Portfolio - Class II Subaccount			ClearBridge Variable Mid Cap Portfolio - Class I Subaccount			ClearBridge Variable Mid Cap Portfolio - Class II Subaccount			Columbia VP Commodity Strategy Fund - Class 1 Subaccount			Columbia VP Commodity Strategy Fund - Class 2 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	17,765,237		$	—		$	—		$	176,720		$	17,287,110		$	—		$	—
Changes From Operations:
• Net investment income (loss)		(132,256	)		—			—			1,035			(175,871	)		—			—
• Net realized gain (loss) on investments		364,106			—			—			3,137			96,604			—			—
• Net change in unrealized appreciation or depreciation on investments		(218,229	)		—			—			11,770			1,704,246			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		13,621			—			—			15,942			1,624,979			—			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		2,488,290			—			—			45,476			4,131,000			—			—
• Contract withdrawals and transfers to annuity reserves		(962,717	)		—			—			(21,570	)		(1,129,321	)		—			—
• Contract transfers		(251,417	)		—			—			97,053			(335,148	)		—			—
		1,274,156			—			—			120,959			2,666,531			—			—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,274,156			—			—			120,959			2,666,531			—			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,287,777			—			—			136,901			4,291,510			—			—
NET ASSETS AT DECEMBER 31, 2016		19,053,014			—			—			313,621			21,578,620			—			—
Changes From Operations:
• Net investment income (loss)		(192,719	)		142			(42,168	)		(253	)		(298,385	)		548			5,974
• Net realized gain (loss) on investments		1,207,903			14,247			602,620			27,508			1,919,792			(36	)		4
• Net change in unrealized appreciation or depreciation on investments		1,794,484			10,454			254,057			18,975			1,134,157			3,133			14,410
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,809,668			24,843			814,509			46,230			2,755,564			3,645			20,388
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,787,264			190,566			6,386,856			118,010			5,002,908			11,425			152,622
• Contract withdrawals and transfers to annuity reserves		(1,177,575	)		(635	)		(182,482	)		(14,812	)		(1,216,319	)		(50	)		(3,735	)
• Contract transfers		(216,504	)		121,311			6,871,570			70,143			3,143,299			150,032			321,299
		393,185			311,242			13,075,944			173,341			6,929,888			161,407			470,186
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		393,185			311,242			13,075,944			173,341			6,929,888			161,407			470,186
TOTAL INCREASE (DECREASE) IN NET ASSETS		3,202,853			336,085			13,890,453			219,571			9,685,452			165,052			490,574
NET ASSETS AT DECEMBER 31, 2017	$	22,255,867		$	336,085		$	13,890,453		$	533,192		$	31,264,072		$	165,052		$	490,574

See accompanying notes.
N-44

	Columbia VP Emerging Markets Bond Fund - Class 1 Subaccount			Columbia VP Emerging Markets Bond Fund - Class 2 Subaccount			Columbia VP Strategic Income Fund - Class 1 Subaccount			Columbia VP Strategic Income Fund - Class 2 Subaccount			Delaware VIP® Diversified Income Series - Service Class Subaccount			Delaware VIP® Diversified Income Series - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	—		$	—		$	—		$	1,691,750,437		$	3,257,476
Changes From Operations:
• Net investment income (loss)		—			—			—			—			25,974,775			85,451
• Net realized gain (loss) on investments		—			—			—			—			(4,380,391	)		(12,534	)
• Net change in unrealized appreciation or depreciation on investments		—			—			—			—			4,597,903			10,210
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			—			—			—			26,192,287			83,127
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			—			—			—			61,281,961			1,284,848
• Contract withdrawals and transfers to annuity reserves		—			—			—			—			(137,084,284	)		(103,879	)
• Contract transfers		—			—			—			—			122,596,344			(2,164	)
		—			—			—			—			46,794,021			1,178,805
Annuity Reserves:
• Annuity Payments		—			—			—			—			(55,225	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			2,743			—
		—			—			—			—			(52,482	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			—			—			—			46,741,539			1,178,805
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			—			—			—			72,933,826			1,261,932
NET ASSETS AT DECEMBER 31, 2016		—			—			—			—			1,764,684,263			4,519,408
Changes From Operations:
• Net investment income (loss)		4,965			17,108			(2	)		22,758			15,321,243			99,828
• Net realized gain (loss) on investments		1,340			1,117			211			574			(1,945,913	)		(16,389	)
• Net change in unrealized appreciation or depreciation on investments		(3,633	)		8,108			—			17,588			46,289,784			151,770
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,672			26,333			209			40,920			59,665,114			235,209
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		245,738			794,635			—			2,177,182			92,279,011			1,262,724
• Contract withdrawals and transfers to annuity reserves		(2,849	)		(11,073	)		(61	)		(83,843	)		(166,223,824	)		(365,939	)
• Contract transfers		10,535			353,606			(148	)		787,762			265,310,891			887,049
		253,424			1,137,168			(209	)		2,881,101			191,366,078			1,783,834
Annuity Reserves:
• Annuity Payments		—			—			—			—			(57,132	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			(2,467	)		—
		—			—			—			—			(59,599	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		253,424			1,137,168			(209	)		2,881,101			191,306,479			1,783,834
TOTAL INCREASE (DECREASE) IN NET ASSETS		256,096			1,163,501			—			2,922,021			250,971,593			2,019,043
NET ASSETS AT DECEMBER 31, 2017	$	256,096		$	1,163,501		$	—		$	2,922,021		$	2,015,655,856		$	6,538,451

N-45

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Delaware VIP® Emerging Markets Series - Service Class Subaccount			Delaware VIP® Emerging Markets Series - Standard Class Subaccount			Delaware VIP® High Yield Series - Service Class Subaccount			Delaware VIP® High Yield Series - Standard Class Subaccount			Delaware VIP® International Value Equity Series - Standard Class Subaccount			Delaware VIP® Limited-Term Diversified Income Series - Service Class Subaccount			Delaware VIP® Limited-Term Diversified Income Series - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	277,740,382		$	—		$	141,996,806		$	3,371,137		$	151,785		$	1,323,115,458		$	1,136,777
Changes From Operations:
• Net investment income (loss)		(2,170,846	)		(382	)		7,468,485			315,795			574			711,649			4,681
• Net realized gain (loss) on investments		(379,247	)		446			(4,983,001	)		(46,020	)		(6,609	)		(1,519,352	)		113
• Net change in unrealized appreciation or depreciation on investments		34,790,778			21,520			12,216,340			351,383			9,239			5,812,521			4,588
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		32,240,685			21,584			14,701,824			621,158			3,204			5,004,818			9,382
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		4,409,529			192,389			3,625,786			2,605			111			42,359,091			31,029
• Contract withdrawals and transfers to annuity reserves		(23,390,028	)		(817	)		(19,865,857	)		(618,836	)		(34,603	)		(113,431,669	)		(94,510	)
• Contract transfers		(15,065,653	)		30,151			(254,457	)		1,953,533			322			17,199,396			33,105
		(34,046,152	)		221,723			(16,494,528	)		1,337,302			(34,170	)		(53,873,182	)		(30,376	)
Annuity Reserves:
• Annuity Payments		(12,338	)		—			(25,598	)		(274	)		—			(57,009	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			689			103			—			(6,402	)		—
		(12,338	)		—			(24,909	)		(171	)		—			(63,411	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(34,058,490	)		221,723			(16,519,437	)		1,337,131			(34,170	)		(53,936,593	)		(30,376	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(1,817,805	)		243,307			(1,817,613	)		1,958,289			(30,966	)		(48,931,775	)		(20,994	)
NET ASSETS AT DECEMBER 31, 2016		275,922,577			243,307			140,179,193			5,329,426			120,819			1,274,183,683			1,115,783
Changes From Operations:
• Net investment income (loss)		(3,969,471	)		490			5,630,714			126,798			204			5,711,577			10,950
• Net realized gain (loss) on investments		11,831,175			37,133			(1,823,315	)		11,308			(743	)		(1,240,125	)		(97	)
• Net change in unrealized appreciation or depreciation on investments		93,073,292			78,683			3,579,194			45,351			25,113			2,665,016			562
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		100,934,996			116,306			7,386,593			183,457			24,574			7,136,468			11,415
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		9,638,500			58,174			923,342			24,356			124			32,285,633			252,416
• Contract withdrawals and transfers to annuity reserves		(31,244,909	)		(19,817	)		(17,169,191	)		(331,728	)		(27,187	)		(116,971,059	)		(119,256	)
• Contract transfers		(14,559,042	)		124,730			(2,211,274	)		(2,319,116	)		114			65,634,562			185,708
		(36,165,451	)		163,087			(18,457,123	)		(2,626,488	)		(26,949	)		(19,050,864	)		318,868
Annuity Reserves:
• Annuity Payments		(16,826	)		—			(31,702	)		(288	)		—			(90,852	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		(26	)		—			2,518			123			—			18,222			—
		(16,852	)		—			(29,184	)		(165	)		—			(72,630	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(36,182,303	)		163,087			(18,486,307	)		(2,626,653	)		(26,949	)		(19,123,494	)		318,868
TOTAL INCREASE (DECREASE) IN NET ASSETS		64,752,693			279,393			(11,099,714	)		(2,443,196	)		(2,375	)		(11,987,026	)		330,283
NET ASSETS AT DECEMBER 31, 2017	$	340,675,270		$	522,700		$	129,079,479		$	2,886,230		$	118,444		$	1,262,196,657		$	1,446,066

See accompanying notes.
N-46

	Delaware VIP® REIT Series - Service Class Subaccount			Delaware VIP® REIT Series - Standard Class Subaccount			Delaware VIP® Small Cap Value Series - Service Class Subaccount			Delaware VIP® Small Cap Value Series - Standard Class Subaccount			Delaware VIP® Smid Cap Core Series - Service Class Subaccount			Delaware VIP® Smid Cap Core Series - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	163,379,321		$	3,944,404		$	301,130,775		$	6,367,026		$	170,242,554		$	7,913,109
Changes From Operations:
• Net investment income (loss)		(1,021,792	)		8,760			(2,884,452	)		(26,718	)		(2,779,557	)		(87,511	)
• Net realized gain (loss) on investments		15,093,308			497,041			32,949,544			801,762			23,334,329			1,179,131
• Net change in unrealized appreciation or depreciation on investments		(8,247,035	)		(330,342	)		54,875,203			968,184			(10,147,871	)		(613,493	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,824,481			175,459			84,940,295			1,743,228			10,406,901			478,127
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		8,418,695			63,101			10,203,064			180,813			7,335,931			90,821
• Contract withdrawals and transfers to annuity reserves		(15,405,771	)		(595,541	)		(29,573,599	)		(960,051	)		(15,593,418	)		(850,667	)
• Contract transfers		9,567,184			(104,078	)		(2,372,148	)		7,430			4,543,487			(242,588	)
		2,580,108			(636,518	)		(21,742,683	)		(771,808	)		(3,714,000	)		(1,002,434	)
Annuity Reserves:
• Annuity Payments		(31,635	)		(22,441	)		(14,045	)		(1,340	)		(24,676	)		(7,029	)
• Receipt (reimbursement) of mortality guarantee adjustments		4,275			693			63			130			(3,218	)		55
		(27,360	)		(21,748	)		(13,982	)		(1,210	)		(27,894	)		(6,974	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,552,748			(658,266	)		(21,756,665	)		(773,018	)		(3,741,894	)		(1,009,408	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		8,377,229			(482,807	)		63,183,630			970,210			6,665,007			(531,281	)
NET ASSETS AT DECEMBER 31, 2016		171,756,550			3,461,597			364,314,405			7,337,236			176,907,561			7,381,828
Changes From Operations:
• Net investment income (loss)		(423,787	)		9,141			(3,696,869	)		(36,234	)		(2,799,851	)		(77,271	)
• Net realized gain (loss) on investments		23,040,912			302,155			24,849,570			1,907,924			15,202,735			720,191
• Net change in unrealized appreciation or depreciation on investments		(23,180,826	)		(302,061	)		15,395,766			(1,155,318	)		15,666,589			486,967
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(563,701	)		9,235			36,548,467			716,372			28,069,473			1,129,887
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		5,558,757			217,472			30,489,090			99,378			6,619,701			80,924
• Contract withdrawals and transfers to annuity reserves		(16,476,756	)		(476,363	)		(34,575,989	)		(734,416	)		(17,562,145	)		(853,557	)
• Contract transfers		(5,001,504	)		(59,133	)		3,146,603			(214,801	)		(4,993,550	)		(480,022	)
		(15,919,503	)		(318,024	)		(940,296	)		(849,839	)		(15,935,994	)		(1,252,655	)
Annuity Reserves:
• Annuity Payments		(45,037	)		(24,775	)		(21,855	)		(1,595	)		(33,044	)		(11,674	)
• Receipt (reimbursement) of mortality guarantee adjustments		4,140			(363	)		(2,952	)		168			(1,350	)		(1,315	)
		(40,897	)		(25,138	)		(24,807	)		(1,427	)		(34,394	)		(12,989	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(15,960,400	)		(343,162	)		(965,103	)		(851,266	)		(15,970,388	)		(1,265,644	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(16,524,101	)		(333,927	)		35,583,364			(134,894	)		12,099,085			(135,757	)
NET ASSETS AT DECEMBER 31, 2017	$	155,232,449		$	3,127,670		$	399,897,769		$	7,202,342		$	189,006,646		$	7,246,071

N-47

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Delaware VIP® U.S. Growth Series - Service Class Subaccount			Delaware VIP® U.S. Growth Series - Standard Class Subaccount			Delaware VIP® Value Series - Service Class Subaccount			Delaware VIP® Value Series - Standard Class Subaccount			Deutsche Alternative Asset Allocation VIP Portfolio - Class A Subaccount			Deutsche Alternative Asset Allocation VIP Portfolio - Class B Subaccount			Deutsche Equity 500 Index VIP Portfolio - Class A Subaccount
NET ASSETS AT JANUARY 1, 2016	$	351,628,194		$	—		$	262,215,467		$	6,159,729		$	920,543		$	53,959,007		$	6,242,087
Changes From Operations:
• Net investment income (loss)		(2,381,922	)		—			53,580			32,834			11,445			170,190			28,314
• Net realized gain (loss) on investments		93,804,790			—			34,287,578			766,369			(6,755	)		(516,731	)		711,099
• Net change in unrealized appreciation or depreciation on investments		(113,936,702	)		—			(745,188	)		(11,890	)		34,645			2,053,463			(181,894	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(22,513,834	)		—			33,595,970			787,313			39,335			1,706,922			557,519
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		3,364,119			—			11,131,069			82,954			79,763			2,401,099			18,147
• Contract withdrawals and transfers to annuity reserves		(24,549,725	)		—			(27,445,068	)		(375,709	)		(64,383	)		(3,759,650	)		(714,006	)
• Contract transfers		1,486,254			—			34,494,438			276,087			47,898			(961,306	)		(117,528	)
		(19,699,352	)		—			18,180,439			(16,668	)		63,278			(2,319,857	)		(813,387	)
Annuity Reserves:
• Annuity Payments		(4,751	)		—			(19,021	)		(11,697	)		—			(3,396	)		(943	)
• Receipt (reimbursement) of mortality guarantee adjustments		413			—			473			(954	)		—			86			519
		(4,338	)		—			(18,548	)		(12,651	)		—			(3,310	)		(424	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(19,703,690	)		—			18,161,891			(29,319	)		63,278			(2,323,167	)		(813,811	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(42,217,524	)		—			51,757,861			757,994			102,613			(616,245	)		(256,292	)
NET ASSETS AT DECEMBER 31, 2016		309,410,670			—			313,973,328			6,917,723			1,023,156			53,342,762			5,985,795
Changes From Operations:
• Net investment income (loss)		(3,718,939	)		(44	)		(541,648	)		16,383			13,818			220,680			10,110
• Net realized gain (loss) on investments		6,438,044			2,619			23,412,570			2,015,608			(2,353	)		(152,904	)		1,074,984
• Net change in unrealized appreciation or depreciation on investments		74,446,430			—			11,604,839			(1,245,316	)		55,784			2,734,881			(27,046	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		77,165,535			2,575			34,475,761			786,675			67,249			2,802,657			1,058,048
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		4,150,401			—			13,699,553			222,221			41,604			1,170,488			14,503
• Contract withdrawals and transfers to annuity reserves		(28,356,601	)		—			(33,161,120	)		(862,918	)		(111,802	)		(4,349,303	)		(1,338,242	)
• Contract transfers		(32,988,683	)		(2,575	)		(13,479,167	)		(203,755	)		243,572			1,859,656			82,541
		(57,194,883	)		(2,575	)		(32,940,734	)		(844,452	)		173,374			(1,319,159	)		(1,241,198	)
Annuity Reserves:
• Annuity Payments		(13,752	)		—			(35,724	)		—			—			(3,380	)		(1,067	)
• Receipt (reimbursement) of mortality guarantee adjustments		(151	)		—			9,379			—			—			103			605
		(13,903	)		—			(26,345	)		—			—			(3,277	)		(462	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(57,208,786	)		(2,575	)		(32,967,079	)		(844,452	)		173,374			(1,322,436	)		(1,241,660	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		19,956,749			—			1,508,682			(57,777	)		240,623			1,480,221			(183,612	)
NET ASSETS AT DECEMBER 31, 2017	$	329,367,419		$	—		$	315,482,010		$	6,859,946		$	1,263,779		$	54,822,983		$	5,802,183

See accompanying notes.
N-48

	Deutsche Small Cap Index VIP Portfolio - Class A Subaccount			Eaton Vance VT Floating-Rate Income Fund - ADV Class Subaccount			Eaton Vance VT Floating-Rate Income Fund - Initial Class Subaccount			Fidelity® VIP Contrafund® Portfolio - Initial Class Subaccount			Fidelity® VIP Contrafund® Portfolio - Service Class 2 Subaccount			Fidelity® VIP Equity-Income Portfolio - Service Class 2 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	3,512,931		$	2,053,882		$	6,754,584		$	288,974		$	1,042,372,893		$	—
Changes From Operations:
• Net investment income (loss)		(15,184	)		70,883			187,215			3,865			(10,198,053	)		(2	)
• Net realized gain (loss) on investments		337,327			(1,238	)		(32,294	)		24,793			102,553,821			76
• Net change in unrealized appreciation or depreciation on investments		281,228			110,400			453,016			24,501			(33,661,114	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		603,371			180,045			607,937			53,159			58,694,654			74
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		22,515			1,005			1,679,705			933,631			23,942,895			2
• Contract withdrawals and transfers to annuity reserves		(372,611	)		(6,796	)		(1,265,546	)		(5,716	)		(91,217,794	)		(76	)
• Contract transfers		(143,102	)		(90	)		3,749,055			71,917			(16,989,026	)		—
		(493,198	)		(5,881	)		4,163,214			999,832			(84,263,925	)		(74	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			(42,055	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			4,058			—
		—			—			—			—			(37,997	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(493,198	)		(5,881	)		4,163,214			999,832			(84,301,922	)		(74	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		110,173			174,164			4,771,151			1,052,991			(25,607,268	)		—
NET ASSETS AT DECEMBER 31, 2016		3,623,104			2,228,046			11,525,735			1,341,965			1,016,765,625			—
Changes From Operations:
• Net investment income (loss)		(22,945	)		91,129			304,078			10,113			(9,096,131	)		—
• Net realized gain (loss) on investments		298,992			1,792			80,538			96,848			94,067,197			—
• Net change in unrealized appreciation or depreciation on investments		139,284			(852	)		(77,092	)		199,624			107,502,765			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		415,331			92,069			307,524			306,585			192,473,831			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		21,784			1,016,517			4,527,012			157,329			55,115,727			—
• Contract withdrawals and transfers to annuity reserves		(433,116	)		(14,501	)		(2,365,046	)		(111,025	)		(109,674,557	)		—
• Contract transfers		12,569			220,295			3,396,945			59,901			(20,707,284	)		—
		(398,763	)		1,222,311			5,558,911			106,205			(75,266,114	)		—
Annuity Reserves:
• Annuity Payments		—			—			—			—			(48,999	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			(973	)		—
		—			—			—			—			(49,972	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(398,763	)		1,222,311			5,558,911			106,205			(75,316,086	)		—
TOTAL INCREASE (DECREASE) IN NET ASSETS		16,568			1,314,380			5,866,435			412,790			117,157,745			—
NET ASSETS AT DECEMBER 31, 2017	$	3,639,672		$	3,542,426		$	17,392,170		$	1,754,755		$	1,133,923,370		$	—

N-49

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2 Subaccount			Fidelity® VIP Growth Portfolio - Initial Class Subaccount			Fidelity® VIP Growth Portfolio - Service Class 2 Subaccount			Fidelity® VIP Mid Cap Portfolio - Initial Class Subaccount			Fidelity® VIP Mid Cap Portfolio - Service Class 2 Subaccount			Fidelity® VIP Overseas Portfolio - Service Class 2 Subaccount			Fidelity® VIP Strategic Income Portfolio - Initial Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	5,172,442		$	165,705,481		$	629,561		$	502,064,436		$	—		$	169,676
Changes From Operations:
• Net investment income (loss)		—			(62,357	)		(2,671,246	)		1,144			(6,420,333	)		(5	)		15,059
• Net realized gain (loss) on investments		—			755,973			19,516,021			25,368			30,857,092			315			76
• Net change in unrealized appreciation or depreciation on investments		—			(752,822	)		(18,692,405	)		68,771			25,293,200			—			199
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			(59,206	)		(1,847,630	)		95,283			49,729,959			310			15,334
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			137,948			10,555,658			526,428			14,029,997			124			41,119
• Contract withdrawals and transfers to annuity reserves		—			(487,895	)		(14,556,119	)		(9,440	)		(42,145,676	)		(914	)		(757	)
• Contract transfers		—			(807,338	)		1,493,497			(99,410	)		(5,161,775	)		480			232,885
		—			(1,157,285	)		(2,506,964	)		417,578			(33,277,454	)		(310	)		273,247
Annuity Reserves:
• Annuity Payments		—			—			(5,837	)		—			(14,580	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(131	)		—			(951	)		—			—
		—			—			(5,968	)		—			(15,531	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			(1,157,285	)		(2,512,932	)		417,578			(33,292,985	)		(310	)		273,247
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			(1,216,491	)		(4,360,562	)		512,861			16,436,974			—			288,581
NET ASSETS AT DECEMBER 31, 2016		—			3,955,951			161,344,919			1,142,422			518,501,410			—			458,257
Changes From Operations:
• Net investment income (loss)		7,141			(52,008	)		(3,049,957	)		5,472			(6,007,241	)		(2	)		16,612
• Net realized gain (loss) on investments		64,912			1,758,646			22,377,699			67,308			34,487,556			(3	)		7,139
• Net change in unrealized appreciation or depreciation on investments		244,080			(419,720	)		33,985,186			205,732			65,926,138			—			14,001
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		316,133			1,286,918			53,312,928			278,512			94,406,453			(5	)		37,752
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		5,193,815			254,684			11,601,756			485,923			28,796,121			53			143,692
• Contract withdrawals and transfers to annuity reserves		(117,953	)		(568,636	)		(16,397,117	)		(60,150	)		(52,203,552	)		(54	)		(10,051	)
• Contract transfers		666,546			4,396			12,055,741			49,796			(6,260,596	)		6			(24,220	)
		5,742,408			(309,556	)		7,260,380			475,569			(29,668,027	)		5			109,421
Annuity Reserves:
• Annuity Payments		—			—			(5,259	)		—			(23,452	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			1,253			—			(2,199	)		—			—
		—			—			(4,006	)		—			(25,651	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		5,742,408			(309,556	)		7,256,374			475,569			(29,693,678	)		5			109,421
TOTAL INCREASE (DECREASE) IN NET ASSETS		6,058,541			977,362			60,569,302			754,081			64,712,775			—			147,173
NET ASSETS AT DECEMBER 31, 2017	$	6,058,541		$	4,933,313		$	221,914,221		$	1,896,503		$	583,214,185		$	—		$	605,430

See accompanying notes.
N-50

	Fidelity® VIP Strategic Income Portfolio - Service Class 2 Subaccount			First Trust Dorsey Wright Tactical Core Portfolio - Class I Subaccount			First Trust Multi Income Allocation Portfolio - Class I Subaccount			First Trust Multi Income Allocation Portfolio - Class II Subaccount			First Trust/ Dow Jones Dividend &Income Allocation Portfolio - Class I Subaccount			First Trust/ Dow Jones Dividend &Income Allocation Portfolio - Class II Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,905,317		$	—		$	2,903,830		$	—		$	8,848,494		$	5,917
Changes From Operations:
• Net investment income (loss)		203,136			627			47,061			680			(24,521	)		49
• Net realized gain (loss) on investments		15,727			87,132			4,191			—			380,208			121
• Net change in unrealized appreciation or depreciation on investments		19,637			10,575			232,091			189			851,337			443
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		238,500			98,334			283,343			869			1,207,024			613
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		3,549,908			1,344,932			1,451,400			—			4,878,354			—
• Contract withdrawals and transfers to annuity reserves		(147,691	)		(40,807	)		(243,443	)		—			(979,311	)		—
• Contract transfers		2,308,410			525,708			683,007			48,495			2,775,717			(394	)
		5,710,627			1,829,833			1,890,964			48,495			6,674,760			(394	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		5,710,627			1,829,833			1,890,964			48,495			6,674,760			(394	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		5,949,127			1,928,167			2,174,307			49,364			7,881,784			219
NET ASSETS AT DECEMBER 31, 2016		7,854,444			1,928,167			5,078,137			49,364			16,730,278			6,136
Changes From Operations:
• Net investment income (loss)		296,806			(16,994	)		70,702			1,001			128,983			1,588
• Net realized gain (loss) on investments		183,195			78,134			35,050			135			3,971,665			7,440
• Net change in unrealized appreciation or depreciation on investments		150,088			418,053			133,531			1,489			1,926,901			(6,066	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		630,089			479,193			239,283			2,625			6,027,549			2,962
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		6,437,621			1,887,088			559,176			—			28,062,132			21,484
• Contract withdrawals and transfers to annuity reserves		(1,343,171	)		(82,255	)		(540,373	)		(2,932	)		(4,259,347	)		(274	)
• Contract transfers		1,992,141			585,295			255,014			—			39,627,099			160,150
		7,086,591			2,390,128			273,817			(2,932	)		63,429,884			181,360
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		7,086,591			2,390,128			273,817			(2,932	)		63,429,884			181,360
TOTAL INCREASE (DECREASE) IN NET ASSETS		7,716,680			2,869,321			513,100			(307	)		69,457,433			184,322
NET ASSETS AT DECEMBER 31, 2017	$	15,571,124		$	4,797,488		$	5,591,237		$	49,057		$	86,187,711		$	190,458

N-51

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Franklin Founding Funds Allocation VIP Fund - Class 4 Subaccount			Franklin Income VIP Fund - Class 1 Subaccount			Franklin Income VIP Fund - Class 2 Subaccount			Franklin Income VIP Fund - Class 4 Subaccount			Franklin Mutual Shares VIP Fund - Class 1 Subaccount			Franklin Mutual Shares VIP Fund - Class 2 Subaccount			Franklin Mutual Shares VIP Fund - Class 4 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	3,901,773		$	56,787		$	546,576,674		$	16,724,357		$	42,696		$	722,209,227		$	3,439,996
Changes From Operations:
• Net investment income (loss)		120,485			3,516			18,749,767			712,454			10,846			5,559,327			28,444
• Net realized gain (loss) on investments		122,517			12			(3,693,202	)		(182,465	)		41,417			73,019,028			276,316
• Net change in unrealized appreciation or depreciation on investments		362,254			7,138			48,871,536			2,037,405			24,069			20,827,938			319,623
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		605,256			10,666			63,928,101			2,567,394			76,332			99,406,293			624,383
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,586,159			37,500			14,173,202			3,274,204			538,579			7,631,659			1,700,307
• Contract withdrawals and transfers to annuity reserves		(182,064	)		—			(49,976,187	)		(1,343,291	)		(2,236	)		(56,883,306	)		(235,833	)
• Contract transfers		350,948			(236	)		(3,303,230	)		3,774,030			(18,321	)		(39,357,432	)		(25,673	)
		1,755,043			37,264			(39,106,215	)		5,704,943			518,022			(88,609,079	)		1,438,801
Annuity Reserves:
• Annuity Payments		—			—			(49,322	)		—			—			(26,738	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(514	)		—			—			(807	)		—
		—			—			(49,836	)		—			—			(27,545	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,755,043			37,264			(39,156,051	)		5,704,943			518,022			(88,636,624	)		1,438,801
TOTAL INCREASE (DECREASE) IN NET ASSETS		2,360,299			47,930			24,772,050			8,272,337			594,354			10,769,669			2,063,184
NET ASSETS AT DECEMBER 31, 2016		6,262,072			104,717			571,348,724			24,996,694			637,050			732,978,896			5,503,180
Changes From Operations:
• Net investment income (loss)		91,455			4,974			14,911,105			898,908			17,000			7,456,572			118,534
• Net realized gain (loss) on investments		318,764			886			4,135,012			149,836			33,377			47,831,739			513,615
• Net change in unrealized appreciation or depreciation on investments		321,465			6,101			25,122,118			1,774,167			8,304			(5,344,816	)		3,281
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		731,684			11,961			44,168,235			2,822,911			58,681			49,943,495			635,430
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,326,046			45,000			4,698,370			19,962,287			167,856			4,294,031			8,646,413
• Contract withdrawals and transfers to annuity reserves		(630,007	)		(103	)		(55,175,224	)		(2,367,073	)		(29,379	)		(61,902,895	)		(467,396	)
• Contract transfers		422,326			1,033			2,956,242			6,284,602			26,264			3,542,060			2,166,695
		1,118,365			45,930			(47,520,612	)		23,879,816			164,741			(54,066,804	)		10,345,712
Annuity Reserves:
• Annuity Payments		—			—			(55,525	)		(296	)		—			(37,728	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(158	)		491			—			(1,261	)		—
		—			—			(55,683	)		195			—			(38,989	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,118,365			45,930			(47,576,295	)		23,880,011			164,741			(54,105,793	)		10,345,712
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,850,049			57,891			(3,408,060	)		26,702,922			223,422			(4,162,298	)		10,981,142
NET ASSETS AT DECEMBER 31, 2017	$	8,112,121		$	162,608		$	567,940,664		$	51,699,616		$	860,472		$	728,816,598		$	16,484,322

See accompanying notes.
N-52

	Franklin Rising Dividends VIP Fund - Class 1 Subaccount			Franklin Rising Dividends VIP Fund - Class 4 Subaccount			Franklin Small Cap Value VIP Fund - Class 1 Subaccount			Franklin Small Cap Value VIP Fund - Class 4 Subaccount			Franklin Small-Mid Cap Growth VIP Fund - Class 1 Subaccount			Franklin Small-Mid Cap Growth VIP Fund - Class 2 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	403,470		$	8,143,641		$	273,520		$	2,302,665		$	5,227		$	—
Changes From Operations:
• Net investment income (loss)		5,334			1,668			1,999			(21,171	)		(268	)		(31	)
• Net realized gain (loss) on investments		50,794			1,096,722			44,505			431,071			5,065			728
• Net change in unrealized appreciation or depreciation on investments		13,345			350,516			38,357			582,656			(2,447	)		62
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		69,473			1,448,906			84,861			992,556			2,350			759
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		46,079			3,893,023			13,296			1,355,149			39,179			9
• Contract withdrawals and transfers to annuity reserves		(37,972	)		(466,206	)		(3,191	)		(112,216	)		(668	)		(768	)
• Contract transfers		167,647			2,990,073			14,105			1,425,515			153,724			—
		175,754			6,416,890			24,210			2,668,448			192,235			(759	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		175,754			6,416,890			24,210			2,668,448			192,235			(759	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		245,227			7,865,796			109,071			3,661,004			194,585			—
NET ASSETS AT DECEMBER 31, 2016		648,697			16,009,437			382,591			5,963,669			199,812			—
Changes From Operations:
• Net investment income (loss)		8,829			51,768			1,996			(49,175	)		(961	)		—
• Net realized gain (loss) on investments		23,696			731,310			36,929			451,529			25,467			—
• Net change in unrealized appreciation or depreciation on investments		88,884			2,527,668			21,527			186,005			18,197			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		121,409			3,310,746			60,452			588,359			42,703			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		11,151			3,537,832			155,473			1,021,100			12,646			—
• Contract withdrawals and transfers to annuity reserves		(96,232	)		(1,311,232	)		(1,693	)		(183,422	)		(47,714	)		—
• Contract transfers		8,154			970,766			19,585			(188,973	)		27,511			—
		(76,927	)		3,197,366			173,365			648,705			(7,557	)		—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(76,927	)		3,197,366			173,365			648,705			(7,557	)		—
TOTAL INCREASE (DECREASE) IN NET ASSETS		44,482			6,508,112			233,817			1,237,064			35,146			—
NET ASSETS AT DECEMBER 31, 2017	$	693,179		$	22,517,549		$	616,408		$	7,200,733		$	234,958		$	—

N-53

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Franklin Small-Mid Cap Growth VIP Fund - Class 4 Subaccount			Goldman Sachs VIT Government Money Market Fund - Institutional Shares Subaccount			Goldman Sachs VIT Government Money Market Fund - Service Shares Subaccount			Goldman Sachs VIT Large Cap Value Fund - Service Shares Subaccount			Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares Subaccount			Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares Subaccount			Goldman Sachs VIT Strategic Income Fund - Advisor Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	2,101,188		$	829,040		$	35,943,941		$	152,745,824		$	2,503,876		$	28,443		$	3,727,127
Changes From Operations:
• Net investment income (loss)		(28,631	)		(1,510	)		(475,154	)		1,333,677			(10,373	)		471			40,654
• Net realized gain (loss) on investments		136,799			—			—			770,764			(74,469	)		(790	)		(43,287	)
• Net change in unrealized appreciation or depreciation on investments		(28,089	)		—			—			13,078,399			67,159			699			(1,237	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		80,079			(1,510	)		(475,154	)		15,182,840			(17,683	)		380			(3,870	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		736,143			5,807,435			33,869,585			1,328,362			495,061			3,244			836,389
• Contract withdrawals and transfers to annuity reserves		(222,818	)		(33,174	)		(12,745,990	)		(10,913,281	)		(156,009	)		—			(163,478	)
• Contract transfers		543,271			(5,167,495	)		(9,127,302	)		(5,632,942	)		(264,117	)		24,541			662,402
		1,056,596			606,766			11,996,293			(15,217,861	)		74,935			27,785			1,335,313
Annuity Reserves:
• Annuity Payments		(1,576	)		—			—			(2,152	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		67			—			—			—			—			—			—
		(1,509	)		—			—			(2,152	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,055,087			606,766			11,996,293			(15,220,013	)		74,935			27,785			1,335,313
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,135,166			605,256			11,521,139			(37,173	)		57,252			28,165			1,331,443
NET ASSETS AT DECEMBER 31, 2016		3,236,354			1,434,296			47,465,080			152,708,651			2,561,128			56,608			5,058,570
Changes From Operations:
• Net investment income (loss)		(54,913	)		2,402			(227,352	)		652,539			19,590			1,980			(23,196	)
• Net realized gain (loss) on investments		408,334			—			—			27,228,401			(7,207	)		(161	)		(38,391	)
• Net change in unrealized appreciation or depreciation on investments		438,500			—			—			(15,406,739	)		79,095			1,499			(112,430	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		791,921			2,402			(227,352	)		12,474,201			91,478			3,318			(174,017	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,469,308			744			324,821			751,313			137,875			49,944			472,070
• Contract withdrawals and transfers to annuity reserves		(337,330	)		(141,472	)		(6,426,634	)		(12,069,791	)		(110,487	)		(2,350	)		(993,864	)
• Contract transfers		303,403			(839,896	)		(6,157,285	)		505,580			(252,033	)		(169	)		516,971
		1,435,381			(980,624	)		(12,259,098	)		(10,812,898	)		(224,645	)		47,425			(4,823	)
Annuity Reserves:
• Annuity Payments		(1,732	)		—			—			(5,513	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		86			—			—			(829	)		—			—			—
		(1,646	)		—			—			(6,342	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,433,735			(980,624	)		(12,259,098	)		(10,819,240	)		(224,645	)		47,425			(4,823	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		2,225,656			(978,222	)		(12,486,450	)		1,654,961			(133,167	)		50,743			(178,840	)
NET ASSETS AT DECEMBER 31, 2017	$	5,462,010		$	456,074		$	34,978,630		$	154,363,612		$	2,427,961		$	107,351		$	4,879,730

See accompanying notes.
N-54

	Goldman Sachs VIT Strategic Income Fund - Institutional Shares Subaccount			Guggenheim VT Long Short Equity Subaccount			Guggenheim VT Multi-Hedge Strategies Subaccount			Hartford Capital Appreciation HLS Fund - Class IA Subaccount			Hartford Capital Appreciation HLS Fund - Class IC Subaccount			Invesco V.I. American Franchise Fund - Series I Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	3,484,473		$	3,504,194		$	79,900		$	6,107,986		$	2,552,845
Changes From Operations:
• Net investment income (loss)		243			(36,850	)		(42,468	)		586			(31,215	)		(34,655	)
• Net realized gain (loss) on investments		—			(36,424	)		(3,255	)		6,790			492,704			283,706
• Net change in unrealized appreciation or depreciation on investments		(106	)		46,695			(15,394	)		(3,368	)		(140,675	)		(229,765	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		137			(26,579	)		(61,117	)		4,008			320,814			19,286
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			460,937			1,050,476			—			2,040,120			29,540
• Contract withdrawals and transfers to annuity reserves		(124	)		(330,824	)		(377,737	)		(2,446	)		(231,077	)		(148,135	)
• Contract transfers		24,543			(204,511	)		26,620			—			411,461			3,841
		24,419			(74,398	)		699,359			(2,446	)		2,220,504			(114,754	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		24,419			(74,398	)		699,359			(2,446	)		2,220,504			(114,754	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		24,556			(100,977	)		638,242			1,562			2,541,318			(95,468	)
NET ASSETS AT DECEMBER 31, 2016		24,556			3,383,496			4,142,436			81,462			8,649,304			2,457,377
Changes From Operations:
• Net investment income (loss)		149			(27,666	)		(47,808	)		674			(57,279	)		(36,267	)
• Net realized gain (loss) on investments		(11	)		27,448			755			862			567,725			357,436
• Net change in unrealized appreciation or depreciation on investments		(703	)		476,265			154,511			16,991			1,333,501			280,478
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(565	)		476,047			107,458			18,527			1,843,947			601,647
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			341,386			310,441			62			1,227,899			1,284
• Contract withdrawals and transfers to annuity reserves		(1,449	)		(240,404	)		(170,318	)		—			(519,346	)		(235,996	)
• Contract transfers		—			852,286			317,968			(888	)		715,792			(111,998	)
		(1,449	)		953,268			458,091			(826	)		1,424,345			(346,710	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,449	)		953,268			458,091			(826	)		1,424,345			(346,710	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(2,014	)		1,429,315			565,549			17,701			3,268,292			254,937
NET ASSETS AT DECEMBER 31, 2017	$	22,542		$	4,812,811		$	4,707,985		$	99,163		$	11,917,596		$	2,712,314

N-55

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Invesco V.I. American Franchise Fund - Series II Shares Subaccount			Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares Subaccount			Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares Subaccount			Invesco V.I. Comstock Fund - Series I Shares Subaccount			Invesco V.I. Comstock Fund - Series II Shares Subaccount			Invesco V.I. Core Equity Fund - Series I Shares Subaccount			Invesco V.I. Core Equity Fund - Series II Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,394,206		$	181,221		$	6,040,193		$	76,058		$	2,250,576		$	6,827,267		$	1,779,813
Changes From Operations:
• Net investment income (loss)		(21,764	)		16			(84,323	)		1,452			8,532			(47,819	)		(18,290	)
• Net realized gain (loss) on investments		146,851			(3,935	)		(65,987	)		9,136			203,126			684,509			177,180
• Net change in unrealized appreciation or depreciation on investments		(128,922	)		23,090			853,995			7,036			241,880			(68,882	)		(31,447	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(3,835	)		19,171			703,685			17,624			453,538			567,808			127,443
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		5,331			188			3,052,718			37,605			845,091			35,068			3,500
• Contract withdrawals and transfers to annuity reserves		(118,233	)		(888	)		(722,043	)		(1,534	)		(141,406	)		(521,129	)		(198,192	)
• Contract transfers		(15,427	)		(20,223	)		2,426,042			(2,582	)		201,332			(293,958	)		(128,122	)
		(128,329	)		(20,923	)		4,756,717			33,489			905,017			(780,019	)		(322,814	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(128,329	)		(20,923	)		4,756,717			33,489			905,017			(780,019	)		(322,814	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(132,164	)		(1,752	)		5,460,402			51,113			1,358,555			(212,211	)		(195,371	)
NET ASSETS AT DECEMBER 31, 2016		1,262,042			179,469			11,500,595			127,171			3,609,131			6,615,056			1,584,442
Changes From Operations:
• Net investment income (loss)		(24,618	)		25,081			354,277			2,005			44,941			(29,291	)		(12,622	)
• Net realized gain (loss) on investments		146,843			35,824			757,019			8,194			238,803			612,318			158,244
• Net change in unrealized appreciation or depreciation on investments		186,957			(8,851	)		(73,246	)		8,159			434,303			122,416			14,987
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		309,182			52,054			1,038,050			18,358			718,047			705,443			160,609
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,774			511,968			2,710,495			278			1,041,374			45,142			1,630
• Contract withdrawals and transfers to annuity reserves		(69,569	)		(11,975	)		(1,185,098	)		(284	)		(223,616	)		(765,696	)		(148,619	)
• Contract transfers		(9,239	)		9,972			(75,818	)		(24,092	)		232,028			(324,380	)		(144,904	)
		(77,034	)		509,965			1,449,579			(24,098	)		1,049,786			(1,044,934	)		(291,893	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(77,034	)		509,965			1,449,579			(24,098	)		1,049,786			(1,044,934	)		(291,893	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		232,148			562,019			2,487,629			(5,740	)		1,767,833			(339,491	)		(131,284	)
NET ASSETS AT DECEMBER 31, 2017	$	1,494,190		$	741,488		$	13,988,224		$	121,431		$	5,376,964		$	6,275,565		$	1,453,158

See accompanying notes.
N-56

	Invesco V.I. Diversified Dividend Fund - Series I Shares Subaccount			Invesco V.I. Diversified Dividend Fund - Series II Shares Subaccount			Invesco V.I. Equally- Weighted S&P 500 Fund - Series I Shares Subaccount			Invesco V.I. Equally- Weighted S&P 500 Fund - Series II Shares Subaccount			Invesco V.I. Equity and Income Fund - Series I Shares Subaccount			Invesco V.I. Equity and Income Fund - Series II Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	28,870		$	5,324,096		$	9,448		$	8,844,073		$	—		$	4,477,860
Changes From Operations:
• Net investment income (loss)		219			29,967			116			(91,844	)		(10	)		27,180
• Net realized gain (loss) on investments		2,434			97,560			1,118			262,370			1			124,345
• Net change in unrealized appreciation or depreciation on investments		3,301			1,294,130			1,534			1,268,800			705			662,653
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,954			1,421,657			2,768			1,439,326			696			814,178
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		28,787			4,416,743			23,502			2,888,462			—			1,412,511
• Contract withdrawals and transfers to annuity reserves		(30,654	)		(378,942	)		(154	)		(503,584	)		(43	)		(295,200	)
• Contract transfers		(1,058	)		5,304,333			(6,857	)		2,955,136			17,486			1,130,470
		(2,925	)		9,342,134			16,491			5,340,014			17,443			2,247,781
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(2,925	)		9,342,134			16,491			5,340,014			17,443			2,247,781
TOTAL INCREASE (DECREASE) IN NET ASSETS		3,029			10,763,791			19,259			6,779,340			18,139			3,061,959
NET ASSETS AT DECEMBER 31, 2016		31,899			16,087,887			28,707			15,623,413			18,139			7,539,819
Changes From Operations:
• Net investment income (loss)		531			69,370			140			(259,558	)		626			51,284
• Net realized gain (loss) on investments		1,483			968,413			3,625			1,482,982			1,632			282,177
• Net change in unrealized appreciation or depreciation on investments		2,559			216,411			3,568			5,786,702			1,328			733,411
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		4,573			1,254,194			7,333			7,010,126			3,586			1,066,872
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		31,346			2,276,021			9,133			35,617,914			—			2,313,848
• Contract withdrawals and transfers to annuity reserves		(54	)		(1,651,806	)		(8,190	)		(4,168,663	)		(2,257	)		(413,962	)
• Contract transfers		38,763			1,683,644			32,209			21,484,467			27,070			5,222,720
		70,055			2,307,859			33,152			52,933,718			24,813			7,122,606
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		70,055			2,307,859			33,152			52,933,718			24,813			7,122,606
TOTAL INCREASE (DECREASE) IN NET ASSETS		74,628			3,562,053			40,485			59,943,844			28,399			8,189,478
NET ASSETS AT DECEMBER 31, 2017	$	106,527		$	19,649,940		$	69,192		$	75,567,257		$	46,538		$	15,729,297

N-57

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Invesco V.I. International Growth Fund - Series I Shares Subaccount			Invesco V.I. International Growth Fund - Series II Shares Subaccount			Ivy VIP Asset Strategy Portfolio Subaccount			Ivy VIP Energy Portfolio Subaccount			Ivy VIP High Income Portfolio Subaccount			Ivy VIP High Income Portfolio - Class I Subaccount			Ivy VIP Micro Cap Growth Portfolio Subaccount
NET ASSETS AT JANUARY 1, 2016	$	2,279,644		$	24,503,635		$	9,680,546		$	3,978,380		$	7,556,617		$	—		$	1,517,813
Changes From Operations:
• Net investment income (loss)		(81	)		(72,764	)		(56,300	)		(57,372	)		569,782			—			(23,149	)
• Net realized gain (loss) on investments		98,149			(177,330	)		(607,853	)		(37,715	)		(130,528	)		—			118,137
• Net change in unrealized appreciation or depreciation on investments		(133,513	)		(304,434	)		306,549			1,814,405			960,713			—			180,140
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(35,445	)		(554,528	)		(357,604	)		1,719,318			1,399,967			—			275,128
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		41,721			3,648,070			993,121			1,278,860			2,917,737			—			579,882
• Contract withdrawals and transfers to annuity reserves		(213,129	)		(1,648,843	)		(306,489	)		(380,188	)		(433,460	)		—			(75,238	)
• Contract transfers		(134,916	)		5,295,925			(1,381,500	)		745,704			1,236,126			—			783,574
		(306,324	)		7,295,152			(694,868	)		1,644,376			3,720,403			—			1,288,218
Annuity Reserves:
• Annuity Payments		—			(3,223	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			80			—			—			—			—			—
		—			(3,143	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(306,324	)		7,292,009			(694,868	)		1,644,376			3,720,403			—			1,288,218
TOTAL INCREASE (DECREASE) IN NET ASSETS		(341,769	)		6,737,481			(1,052,472	)		3,363,694			5,120,370			—			1,563,346
NET ASSETS AT DECEMBER 31, 2016		1,937,875			31,241,116			8,628,074			7,342,074			12,676,987			—			3,081,159
Changes From Operations:
• Net investment income (loss)		1,901			(56,372	)		29,725			(23,172	)		632,149			(93	)		(36,773	)
• Net realized gain (loss) on investments		684,171			646,985			(206,433	)		(72,822	)		36,776			34			(18,595	)
• Net change in unrealized appreciation or depreciation on investments		(296,047	)		6,596,743			1,548,624			(772,171	)		108,829			650			302,717
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		390,025			7,187,356			1,371,916			(868,165	)		777,754			591			247,349
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		201,583			9,175,756			166,292			954,389			4,526,950			100,191			708,919
• Contract withdrawals and transfers to annuity reserves		(162,537	)		(2,295,039	)		(545,104	)		(281,741	)		(1,187,672	)		(117	)		(651,304	)
• Contract transfers		(92,244	)		3,604,586			(548,579	)		(554,551	)		2,069,625			5,437			614,444
		(53,198	)		10,485,303			(927,391	)		118,097			5,408,903			105,511			672,059
Annuity Reserves:
• Annuity Payments		—			(3,456	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			107			—			—			—			—			—
		—			(3,349	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(53,198	)		10,481,954			(927,391	)		118,097			5,408,903			105,511			672,059
TOTAL INCREASE (DECREASE) IN NET ASSETS		336,827			17,669,310			444,525			(750,068	)		6,186,657			106,102			919,408
NET ASSETS AT DECEMBER 31, 2017	$	2,274,702		$	48,910,426		$	9,072,599		$	6,592,006		$	18,863,644		$	106,102		$	4,000,567

See accompanying notes.
N-58

	Ivy VIP Micro Cap Growth Portfolio - Class I Subaccount			Ivy VIP Mid Cap Growth Portfolio Subaccount			Ivy VIP Mid Cap Growth Portfolio - Class I Subaccount			Ivy VIP Science and Technology Portfolio Subaccount			Ivy VIP Science and Technology Portfolio - Class I Subaccount			Janus Henderson Balanced Portfolio - Service Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	2,963,011		$	—		$	9,642,947		$	—		$	13,858,969
Changes From Operations:
• Net investment income (loss)		—			(44,435	)		—			(120,069	)		—			43,382
• Net realized gain (loss) on investments		—			144,578			—			(1,223	)		—			436,109
• Net change in unrealized appreciation or depreciation on investments		—			119,401			—			260,255			—			(144,157	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			219,544			—			138,963			—			335,334
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			1,165,362			—			1,754,393			—			138,234
• Contract withdrawals and transfers to annuity reserves		—			(234,419	)		—			(462,648	)		—			(1,822,969	)
• Contract transfers		—			446,379			—			213,877			—			923,474
		—			1,377,322			—			1,505,622			—			(761,261	)
Annuity Reserves:
• Annuity Payments		—			—			—			(1,260	)		—			(5,971	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			53			—			(1	)
		—			—			—			(1,207	)		—			(5,972	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			1,377,322			—			1,504,415			—			(767,233	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			1,596,866			—			1,643,378			—			(431,899	)
NET ASSETS AT DECEMBER 31, 2016		—			4,559,877			—			11,286,325			—			13,427,070
Changes From Operations:
• Net investment income (loss)		(62	)		(70,572	)		(503	)		(188,650	)		(130	)		(35,972	)
• Net realized gain (loss) on investments		324			212,978			541			1,659,942			6,846			473,352
• Net change in unrealized appreciation or depreciation on investments		4,197			1,250,514			24,363			2,562,760			(3,469	)		1,616,075
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		4,459			1,392,920			24,401			4,034,052			3,247			2,053,455
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		2,873			878,286			168,010			3,156,297			140,957			84,796
• Contract withdrawals and transfers to annuity reserves		(5	)		(135,698	)		(3,458	)		(541,372	)		(141	)		(1,498,755	)
• Contract transfers		100,008			1,193,354			197,820			3,171,126			10,500			124,026
		102,876			1,935,942			362,372			5,786,051			151,316			(1,289,933	)
Annuity Reserves:
• Annuity Payments		—			—			—			(1,518	)		—			(6,450	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			77			—			2
		—			—			—			(1,441	)		—			(6,448	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		102,876			1,935,942			362,372			5,784,610			151,316			(1,296,381	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		107,335			3,328,862			386,773			9,818,662			154,563			757,074
NET ASSETS AT DECEMBER 31, 2017	$	107,335		$	7,888,739		$	386,773		$	21,104,987		$	154,563		$	14,184,144

N-59

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Janus Henderson Enterprise Portfolio - Service Shares Subaccount			Janus Henderson Global Research Portfolio - Service Shares Subaccount			JPMorgan Insurance Trust Core Bond Portfolio - Class 1 Subaccount			JPMorgan Insurance Trust Core Bond Portfolio - Class 2 Subaccount			JPMorgan Insurance Trust Global Allocation Portfolio - Class 2 Subaccount			JPMorgan Insurance Trust Income Builder Portfolio - Class 1 Subaccount			JPMorgan Insurance Trust Income Builder Portfolio - Class 2 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	5,621,941		$	768,416		$	—		$	—		$	1,992,066		$	—		$	253,706
Changes From Operations:
• Net investment income (loss)		(95,347	)		(4,684	)		—			—			55,858			—			24,403
• Net realized gain (loss) on investments		688,749			26,858			—			—			5,790			—			3,511
• Net change in unrealized appreciation or depreciation on investments		(10,245	)		(20,937	)		—			—			100,923			—			12,847
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		583,157			1,237			—			—			162,571			—			40,761
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		41,848			13,148			—			—			877,197			—			742,024
• Contract withdrawals and transfers to annuity reserves		(494,787	)		(82,243	)		—			—			(186,495	)		—			(43,945	)
• Contract transfers		520,330			(14,860	)		—			—			826,315			—			194,857
		67,391			(83,955	)		—			—			1,517,017			—			892,936
Annuity Reserves:
• Annuity Payments		—			(817	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			448			—			—			—			—			—
		—			(369	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		67,391			(84,324	)		—			—			1,517,017			—			892,936
TOTAL INCREASE (DECREASE) IN NET ASSETS		650,548			(83,087	)		—			—			1,679,588			—			933,697
NET ASSETS AT DECEMBER 31, 2016		6,272,489			685,329			—			—			3,671,654			—			1,187,403
Changes From Operations:
• Net investment income (loss)		(100,344	)		(6,539	)		10,438			45,131			(681	)		1,904			49,225
• Net realized gain (loss) on investments		864,511			66,628			232			3,170			270,494			473			29,022
• Net change in unrealized appreciation or depreciation on investments		704,881			95,172			524			91,914			321,337			993			80,968
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,469,048			155,261			11,194			140,215			591,150			3,370			159,215
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		28,454			935			542,299			17,309,385			25,071			52,860			579,025
• Contract withdrawals and transfers to annuity reserves		(897,782	)		(144,791	)		(1,947	)		(1,739,111	)		(116,856	)		(274	)		(216,146	)
• Contract transfers		(3,209	)		(15,741	)		278,314			31,533,867			1,760,852			—			399,122
		(872,537	)		(159,597	)		818,666			47,104,141			1,669,067			52,586			762,001
Annuity Reserves:
• Annuity Payments		—			(927	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			531			—			—			—			—			—
		—			(396	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(872,537	)		(159,993	)		818,666			47,104,141			1,669,067			52,586			762,001
TOTAL INCREASE (DECREASE) IN NET ASSETS		596,511			(4,732	)		829,860			47,244,356			2,260,217			55,956			921,216
NET ASSETS AT DECEMBER 31, 2017	$	6,869,000		$	680,597		$	829,860		$	47,244,356		$	5,931,871		$	55,956		$	2,108,619

See accompanying notes.
N-60

	JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1 Subaccount			JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2 Subaccount			Lincoln iShares® Global Growth Allocation Fund - Standard Class Subaccount			Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class Subaccount			Lord Abbett Series Fund Bond Debenture Portfolio - Class VC Subaccount			Lord Abbett Series Fund Developing Growth Portfolio - Class VC Subaccount
NET ASSETS AT JANUARY 1, 2016	$	67,093		$	5,539,019		$	—		$	—		$	7,172,203		$	3,564,305
Changes From Operations:
• Net investment income (loss)		84			(46,202	)		—			—			501,509			(45,375	)
• Net realized gain (loss) on investments		6,898			599,854			—			—			(12,548	)		(153,955	)
• Net change in unrealized appreciation or depreciation on investments		5,149			204,790			—			—			570,014			131,812
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		12,131			758,442			—			—			1,058,975			(67,518	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		63,587			1,937,302			—			—			4,301,793			898,642
• Contract withdrawals and transfers to annuity reserves		(3,247	)		(360,996	)		—			—			(612,851	)		(186,519	)
• Contract transfers		13,380			1,523,340			—			—			2,147,068			61,573
		73,720			3,099,646			—			—			5,836,010			773,696
Annuity Reserves:
• Annuity Payments		—			—			—			—			(2,496	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			107			—
		—			—			—			—			(2,389	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		73,720			3,099,646			—			—			5,833,621			773,696
TOTAL INCREASE (DECREASE) IN NET ASSETS		85,851			3,858,088			—			—			6,892,596			706,178
NET ASSETS AT DECEMBER 31, 2016		152,944			9,397,107			—			—			14,064,799			4,270,483
Changes From Operations:
• Net investment income (loss)		(181	)		(43,956	)		4,017			6,360			710,653			(64,104	)
• Net realized gain (loss) on investments		1,769			(101,881	)		1,380			559			329,939			66,758
• Net change in unrealized appreciation or depreciation on investments		4,652			586,455			18,322			49,178			325,323			1,402,907
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		6,240			440,618			23,719			56,097			1,365,915			1,405,561
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		48,194			651,123			503,501			754,004			5,588,293			878,869
• Contract withdrawals and transfers to annuity reserves		(474	)		(195,449	)		(1,356	)		(12,947	)		(1,476,480	)		(179,785	)
• Contract transfers		(206,904	)		(10,293,399	)		—			—			3,012,563			713,972
		(159,184	)		(9,837,725	)		502,145			741,057			7,124,376			1,413,056
Annuity Reserves:
• Annuity Payments		—			—			—			—			(2,628	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			127			—
		—			—			—			—			(2,501	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(159,184	)		(9,837,725	)		502,145			741,057			7,121,875			1,413,056
TOTAL INCREASE (DECREASE) IN NET ASSETS		(152,944	)		(9,397,107	)		525,864			797,154			8,487,790			2,818,617
NET ASSETS AT DECEMBER 31, 2017	$	—		$	—		$	525,864		$	797,154		$	22,552,589		$	7,089,100

N-61

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC Subaccount			Lord Abbett Series Fund Short Duration Income Portfolio - Class VC Subaccount			LVIP American Balanced Allocation Fund - Service Class Subaccount			LVIP American Balanced Allocation Fund - Standard Class Subaccount			LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class Subaccount			LVIP American Global Balanced Allocation Managed Risk Fund - Service Class Subaccount			LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	14,585,552		$	13,185,468		$	12,378,996		$	9,397,360		$	148,581,982		$	14,213,210		$	559,801
Changes From Operations:
• Net investment income (loss)		24,754			275,883			206,326			32,561			(204,466	)		92,506			7,614
• Net realized gain (loss) on investments		274,170			(90,912	)		787,580			589,388			897,863			(78,767	)		(110	)
• Net change in unrealized appreciation or depreciation on investments		1,677,925			62,360			(103,484	)		(2,121	)		26,744,582			411,562			17,279
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,976,849			247,331			890,422			619,828			27,437,979			425,301			24,783
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		46,372			4,503,890			8,249,709			3,197,828			12,591,346			4,808,619			76,011
• Contract withdrawals and transfers to annuity reserves		(991,061	)		(1,277,316	)		(1,204,405	)		(310,404	)		(9,578,181	)		(574,477	)		(6,403	)
• Contract transfers		(1,113,256	)		680,125			4,576,563			(7,396,551	)		61,342,332			3,055,524			330
		(2,057,945	)		3,906,699			11,621,867			(4,509,127	)		64,355,497			7,289,666			69,938
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(2,057,945	)		3,906,699			11,621,867			(4,509,127	)		64,355,497			7,289,666			69,938
TOTAL INCREASE (DECREASE) IN NET ASSETS		(81,096	)		4,154,030			12,512,289			(3,889,299	)		91,793,476			7,714,967			94,721
NET ASSETS AT DECEMBER 31, 2016		14,504,456			17,339,498			24,891,285			5,508,061			240,375,458			21,928,177			654,522
Changes From Operations:
• Net investment income (loss)		11,972			577,107			422,857			78,542			(2,099,142	)		87,210			9,124
• Net realized gain (loss) on investments		1,307,271			(40,958	)		1,029,190			175,481			7,952,336			123,907			769
• Net change in unrealized appreciation or depreciation on investments		288,011			(350,451	)		2,509,198			486,045			27,272,493			2,081,876			62,490
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,607,254			185,698			3,961,245			740,068			33,125,687			2,292,993			72,383
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		34,795			6,117,910			9,712,272			810,621			27,723,076			2,753,833			—
• Contract withdrawals and transfers to annuity reserves		(1,131,995	)		(2,936,717	)		(2,341,535	)		(323,548	)		(19,762,346	)		(1,683,521	)		(8,277	)
• Contract transfers		(41,139	)		3,011,237			10,394,869			175,481			56,850,391			185,030			159
		(1,138,339	)		6,192,430			17,765,606			662,554			64,811,121			1,255,342			(8,118	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,138,339	)		6,192,430			17,765,606			662,554			64,811,121			1,255,342			(8,118	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		468,915			6,378,128			21,726,851			1,402,622			97,936,808			3,548,335			64,265
NET ASSETS AT DECEMBER 31, 2017	$	14,973,371		$	23,717,626		$	46,618,136		$	6,910,683		$	338,312,266		$	25,476,512		$	718,787

See accompanying notes.
N-62

	LVIP American Global Growth Allocation Managed Risk Fund - Service Class Subaccount			LVIP American Global Growth Allocation Managed Risk Fund - Standard Class Subaccount			LVIP American Global Growth Fund - Service Class II Subaccount			LVIP American Global Small Capitalization Fund - Service Class II Subaccount			LVIP American Growth Allocation Fund - Service Class Subaccount			LVIP American Growth Allocation Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	53,755,700		$	909,822		$	116,266,383		$	68,593,027		$	13,171,250		$	1,242,794
Changes From Operations:
• Net investment income (loss)		(481	)		5,872			(864,635	)		(985,181	)		145,955			28,298
• Net realized gain (loss) on investments		(320,077	)		(22,691	)		10,003,667			5,804,133			722,787			99,070
• Net change in unrealized appreciation or depreciation on investments		1,292,123			29,574			(10,209,564	)		(4,763,486	)		(88,047	)		(12,554	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		971,565			12,755			(1,070,532	)		55,466			780,695			114,814
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		8,360,012			4,250			8,057,908			1,544,820			4,012,735			314,163
• Contract withdrawals and transfers to annuity reserves		(2,810,594	)		(32,968	)		(6,805,702	)		(4,696,606	)		(1,100,017	)		(28,399	)
• Contract transfers		2,945,927			(228,022	)		878,430			(1,963,873	)		3,332,650			478,878
		8,495,345			(256,740	)		2,130,636			(5,115,659	)		6,245,368			764,642
Annuity Reserves:
• Annuity Payments		—			—			(5,031	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			98			—			—			—
		—			—			(4,933	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		8,495,345			(256,740	)		2,125,703			(5,115,659	)		6,245,368			764,642
TOTAL INCREASE (DECREASE) IN NET ASSETS		9,466,910			(243,985	)		1,055,171			(5,060,193	)		7,026,063			879,456
NET ASSETS AT DECEMBER 31, 2016		63,222,610			665,837			117,321,554			63,532,834			20,197,313			2,122,250
Changes From Operations:
• Net investment income (loss)		(46,241	)		3,711			(2,013,129	)		(1,121,559	)		176,278			16,835
• Net realized gain (loss) on investments		266,648			(1,031	)		11,638,244			11,890,337			1,063,851			45,952
• Net change in unrealized appreciation or depreciation on investments		9,069,008			64,009			27,320,396			3,763,041			2,792,373			141,906
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		9,289,415			66,689			36,945,511			14,531,819			4,032,502			204,693
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		8,711,749			—			36,274,503			3,406,629			4,890,211			394,460
• Contract withdrawals and transfers to annuity reserves		(3,054,782	)		(33,294	)		(9,390,085	)		(4,876,783	)		(1,014,605	)		(132,074	)
• Contract transfers		(5,807,080	)		(289,235	)		8,333,370			(1,365,723	)		5,249,807			(1,252,520	)
		(150,113	)		(322,529	)		35,217,788			(2,835,877	)		9,125,413			(990,134	)
Annuity Reserves:
• Annuity Payments		—			—			(6,108	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			650			—			—			—
		—			—			(5,458	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(150,113	)		(322,529	)		35,212,330			(2,835,877	)		9,125,413			(990,134	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		9,139,302			(255,840	)		72,157,841			11,695,942			13,157,915			(785,441	)
NET ASSETS AT DECEMBER 31, 2017	$	72,361,912		$	409,997		$	189,479,395		$	75,228,776		$	33,355,228		$	1,336,809

N-63

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP American Growth Fund - Service Class II Subaccount			LVIP American Growth- Income Fund - Service Class II Subaccount			LVIP American Income Allocation Fund - Standard Class Subaccount			LVIP American International Fund - Service Class II Subaccount			LVIP American Preservation Fund - Service Class Subaccount			LVIP American Preservation Fund - Standard Class Subaccount			LVIP AQR Enhanced Global Strategies Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	321,970,300		$	273,014,519		$	6,182		$	137,660,329		$	3,307,550		$	81,310		$	2,566,129
Changes From Operations:
• Net investment income (loss)		(3,986,429	)		254,301			1,079			(859,996	)		14,165			1,423			(3,208	)
• Net realized gain (loss) on investments		71,791,223			42,803,807			424			8,811,962			6,496			(430	)		3,112
• Net change in unrealized appreciation or depreciation on investments		(43,457,913	)		(16,817,740	)		(1,374	)		(5,567,369	)		(31,611	)		(1,056	)		29,352
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		24,346,881			26,240,368			129			2,384,597			(10,950	)		(63	)		29,256
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		19,996,265			17,223,345			—			4,471,453			3,269,065			73,143			40,537
• Contract withdrawals and transfers to annuity reserves		(21,910,002	)		(18,034,887	)		(881	)		(9,123,551	)		(643,331	)		(1,924	)		(32,551	)
• Contract transfers		4,131,166			5,449,802			51,648			(211,137	)		1,315,661			(34,447	)		(2,603,371	)
		2,217,429			4,638,260			50,767			(4,863,235	)		3,941,395			36,772			(2,595,385	)
Annuity Reserves:
• Annuity Payments		(149,444	)		(144,993	)		—			(64,434	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		(5,301	)		(5,415	)		—			(2,547	)		—			—			—
		(154,745	)		(150,408	)		—			(66,981	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,062,684			4,487,852			50,767			(4,930,216	)		3,941,395			36,772			(2,595,385	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		26,409,565			30,728,220			50,896			(2,545,619	)		3,930,445			36,709			(2,566,129	)
NET ASSETS AT DECEMBER 31, 2016		348,379,865			303,742,739			57,078			135,114,710			7,237,995			118,019			—
Changes From Operations:
• Net investment income (loss)		(5,493,001	)		(1,304,191	)		709			(1,069,055	)		(153	)		115			—
• Net realized gain (loss) on investments		36,199,426			34,927,736			1,328			13,778,723			(5,139	)		(55	)		—
• Net change in unrealized appreciation or depreciation on investments		67,922,510			34,812,361			3,844			27,741,380			13,589			161			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		98,628,935			68,435,906			5,881			40,451,048			8,297			221			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		110,149,465			90,644,321			11,137			26,040,762			1,212,301			—			—
• Contract withdrawals and transfers to annuity reserves		(28,803,404	)		(24,818,473	)		(4,064	)		(11,191,146	)		(516,863	)		(7,065	)		—
• Contract transfers		15,064,071			25,316,853			12,304			2,481,628			(684,419	)		16,610			—
		96,410,132			91,142,701			19,377			17,331,244			11,019			9,545			—
Annuity Reserves:
• Annuity Payments		(186,622	)		(173,301	)		—			(78,965	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		784			664			—			778			—			—			—
		(185,838	)		(172,637	)		—			(78,187	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		96,224,294			90,970,064			19,377			17,253,057			11,019			9,545			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		194,853,229			159,405,970			25,258			57,704,105			19,316			9,766			—
NET ASSETS AT DECEMBER 31, 2017	$	543,233,094		$	463,148,709		$	82,336		$	192,818,815		$	7,257,311		$	127,785		$	—

See accompanying notes.
N-64

	LVIP AQR Enhanced Global Strategies Fund - Standard Class Subaccount			LVIP Baron Growth Opportunities Fund - Service Class Subaccount			LVIP Baron Growth Opportunities Fund - Standard Class Subaccount			LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class Subaccount			LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class Subaccount			LVIP BlackRock Emerging Markets Managed Volatility Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	14,227		$	165,654,313		$	488,196		$	547,885,035		$	110,478		$	212,918,114
Changes From Operations:
• Net investment income (loss)		(33	)		(1,817,338	)		2,195			1,341,237			5,418			5,374,881
• Net realized gain (loss) on investments		977			13,329,836			42,062			1,714,287			622			(42,001,074	)
• Net change in unrealized appreciation or depreciation on investments		(795	)		(6,058,489	)		(11,475	)		60,522,167			21,822			48,743,340
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		149			5,454,009			32,782			63,577,691			27,862			12,117,147
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			4,679,474			134,560			78,304,952			21,000			3,479,747
• Contract withdrawals and transfers to annuity reserves		—			(12,680,657	)		(14,228	)		(35,949,367	)		(5,196	)		(10,518,369	)
• Contract transfers		(14,376	)		(11,508,831	)		—			87,943,294			220,726			(217,996,639	)
		(14,376	)		(19,510,014	)		120,332			130,298,879			236,530			(225,035,261	)
Annuity Reserves:
• Annuity Payments		—			(18,612	)		—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			157			—			2,123			—			—
		—			(18,455	)		—			2,123			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(14,376	)		(19,528,469	)		120,332			130,301,002			236,530			(225,035,261	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(14,227	)		(14,074,460	)		153,114			193,878,693			264,392			(212,918,114	)
NET ASSETS AT DECEMBER 31, 2016		—			151,579,853			641,310			741,763,728			374,870			—
Changes From Operations:
• Net investment income (loss)		—			(2,845,977	)		(3,327	)		172,244			6,757			—
• Net realized gain (loss) on investments		—			12,784,099			34,366			10,599,885			2,443			—
• Net change in unrealized appreciation or depreciation on investments		—			27,540,152			146,674			100,117,635			59,427			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			37,478,274			177,713			110,889,764			68,627			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			15,572,999			13,384			45,023,550			42,587			—
• Contract withdrawals and transfers to annuity reserves		—			(15,032,909	)		(22,497	)		(53,585,824	)		(9,904	)		—
• Contract transfers		—			(2,221,961	)		24,289			47,910,829			71,110			—
		—			(1,681,871	)		15,176			39,348,555			103,793			—
Annuity Reserves:
• Annuity Payments		—			(22,033	)		—			(190	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			882			—			(2,154	)		—			—
		—			(21,151	)		—			(2,344	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			(1,703,022	)		15,176			39,346,211			103,793			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			35,775,252			192,889			150,235,975			172,420			—
NET ASSETS AT DECEMBER 31, 2017	$	—		$	187,355,105		$	834,199		$	891,999,703		$	547,290		$	—

N-65

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP BlackRock Emerging Markets Managed Volatility Fund - Standard Class Subaccount			LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class Subaccount			LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class Subaccount			LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class Subaccount			LVIP BlackRock Inflation Protected Bond Fund - Service Class Subaccount			LVIP BlackRock Inflation Protected Bond Fund - Standard Class Subaccount			LVIP BlackRock Multi-Asset Income Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	139,424		$	905,299,405		$	255,285		$	—		$	741,288,073		$	653,809		$	3,524,117
Changes From Operations:
• Net investment income (loss)		3,999			(8,932,719	)		(883	)		353,343			(6,121,168	)		4,251			105,505
• Net realized gain (loss) on investments		(27,906	)		(7,339,702	)		(7,308	)		(4,356	)		(7,336,640	)		(4,401	)		(24,523	)
• Net change in unrealized appreciation or depreciation on investments		34,659			23,566,061			13,031			(391,765	)		25,302,796			19,536			169,439
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		10,752			7,293,640			4,840			(42,778	)		11,844,988			19,386			250,421
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			59,002,775			18,750			20,871,675			20,267,724			134,931			2,771,682
• Contract withdrawals and transfers to annuity reserves		(26,764	)		(52,801,633	)		(105,067	)		(555,298	)		(62,178,626	)		(82,168	)		(371,412	)
• Contract transfers		(123,412	)		(8,311,442	)		(13,854	)		47,170,631			37,598,715			120,421			124,992
		(150,176	)		(2,110,300	)		(100,171	)		67,487,008			(4,312,187	)		173,184			2,525,262
Annuity Reserves:
• Annuity Payments		—			(3,785	)		—			—			(17,615	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			123			—			—			(584	)		—			—
		—			(3,662	)		—			—			(18,199	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(150,176	)		(2,113,962	)		(100,171	)		67,487,008			(4,330,386	)		173,184			2,525,262
TOTAL INCREASE (DECREASE) IN NET ASSETS		(139,424	)		5,179,678			(95,331	)		67,444,230			7,514,602			192,570			2,775,683
NET ASSETS AT DECEMBER 31, 2016		—			910,479,083			159,954			67,444,230			748,802,675			846,379			6,299,800
Changes From Operations:
• Net investment income (loss)		—			(9,033,996	)		141			(19,866	)		35,990			16,112			153,881
• Net realized gain (loss) on investments		—			(2,186,251	)		(138	)		681,583			(4,154,602	)		(1,247	)		18,169
• Net change in unrealized appreciation or depreciation on investments		—			106,332,311			19,218			13,879,871			6,198,065			6,820			123,821
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			95,112,064			19,221			14,541,588			2,079,453			21,685			295,871
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			42,165,089			—			65,803,461			31,169,399			926,578			1,708,341
• Contract withdrawals and transfers to annuity reserves		—			(65,687,499	)		(4,027	)		(6,134,153	)		(75,239,331	)		(43,683	)		(588,477	)
• Contract transfers		—			(35,142,317	)		1,475			55,245,534			82,663,728			218,983			257,523
		—			(58,664,727	)		(2,552	)		114,914,842			38,593,796			1,101,878			1,377,387
Annuity Reserves:
• Annuity Payments		—			(5,746	)		—			—			(18,991	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			(469	)		—			—			(68	)		—			—
		—			(6,215	)		—			—			(19,059	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			(58,670,942	)		(2,552	)		114,914,842			38,574,737			1,101,878			1,377,387
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			36,441,122			16,669			129,456,430			40,654,190			1,123,563			1,673,258
NET ASSETS AT DECEMBER 31, 2017	$	—		$	946,920,205		$	176,623		$	196,900,660		$	789,456,865		$	1,969,942		$	7,973,058

See accompanying notes.
N-66

	LVIP BlackRock Multi-Asset Income Fund - Standard Class Subaccount			LVIP BlackRock Scientific Allocation Fund - Service Class Subaccount			LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class Subaccount			LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Service Class Subaccount			LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Standard Class Subaccount			LVIP Blended Core Equity Managed Volatility Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	220,487		$	—		$	—		$	26,647,714		$	304,560		$	122,709,888
Changes From Operations:
• Net investment income (loss)		6,408			—			166,832			(345,721	)		(875	)		(667,361	)
• Net realized gain (loss) on investments		(1,529	)		—			56,521			1,288,501			(11,705	)		(65,661	)
• Net change in unrealized appreciation or depreciation on investments		10,298			—			1,144,476			1,210,524			7,285			12,261,337
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		15,177			—			1,367,829			2,153,304			(5,295	)		11,528,315
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		53,274			—			29,603,818			2,691,032			103,020			46,088,222
• Contract withdrawals and transfers to annuity reserves		(25,212	)		—			(1,619,560	)		(1,540,971	)		(13,667	)		(8,393,691	)
• Contract transfers		(6,538	)		—			89,024,303			(29,951,079	)		(388,618	)		42,907,604
		21,524			—			117,008,561			(28,801,018	)		(299,265	)		80,602,135
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		21,524			—			117,008,561			(28,801,018	)		(299,265	)		80,602,135
TOTAL INCREASE (DECREASE) IN NET ASSETS		36,701			—			118,376,390			(26,647,714	)		(304,560	)		92,130,450
NET ASSETS AT DECEMBER 31, 2016		257,188			—			118,376,390			—			—			214,840,338
Changes From Operations:
• Net investment income (loss)		6,223			24,205			(824,358	)		—			—			(1,193,333	)
• Net realized gain (loss) on investments		(392	)		51,554			1,500,045			—			—			3,238,659
• Net change in unrealized appreciation or depreciation on investments		6,499			(31,782	)		19,092,830			—			—			39,450,628
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		12,330			43,977			19,768,517			—			—			41,495,954
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		7,924			978,277			58,323,960			—			—			13,630,274
• Contract withdrawals and transfers to annuity reserves		(45,005	)		(11,816	)		(13,588,594	)		—			—			(12,253,427	)
• Contract transfers		(16,496	)		693,213			54,170,217			—			—			6,596,180
		(53,577	)		1,659,674			98,905,583			—			—			7,973,027
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(53,577	)		1,659,674			98,905,583			—			—			7,973,027
TOTAL INCREASE (DECREASE) IN NET ASSETS		(41,247	)		1,703,651			118,674,100			—			—			49,468,981
NET ASSETS AT DECEMBER 31, 2017	$	215,941		$	1,703,651		$	237,050,490		$	—		$	—		$	264,309,319

N-67

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP Blended Core Equity Managed Volatility Fund - Standard Class Subaccount			LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class Subaccount			LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class Subaccount			LVIP Blended Mid Cap Managed Volatility Fund - Service Class Subaccount			LVIP Blended Mid Cap Managed Volatility Fund - Standard Class Subaccount			LVIP Clarion Global Real Estate Fund - Service Class Subaccount			LVIP Clarion Global Real Estate Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	68,980		$	358,222,133		$	2,331,556		$	285,610,686		$	—		$	105,644,091		$	306,765
Changes From Operations:
• Net investment income (loss)		187			(5,585,840	)		(32,189	)		(5,153,778	)		(486	)		2,298,356			12,011
• Net realized gain (loss) on investments		(37	)		3,010,128			93,618			6,246,295			1,791			2,906,371			878
• Net change in unrealized appreciation or depreciation on investments		5,249			(6,743,741	)		(132,995	)		(1,146,337	)		3,878			(5,718,165	)		(9,849	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,399			(9,319,453	)		(71,566	)		(53,820	)		5,183			(513,438	)		3,040
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			64,257,766			27,246			44,300,552			62,734			5,415,493			43,422
• Contract withdrawals and transfers to annuity reserves		(1,934	)		(23,262,487	)		(176,890	)		(18,025,978	)		(96	)		(8,601,683	)		(1,846	)
• Contract transfers		(2,175	)		53,539,426			161,574			129,305,103			11,668			(3,518,156	)		(27,788	)
		(4,109	)		94,534,705			11,930			155,579,677			74,306			(6,704,346	)		13,788
Annuity Reserves:
• Annuity Payments		—			—			—			(5,086	)		—			(11,212	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			78			—			(2,460	)		—
		—			—			—			(5,008	)		—			(13,672	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(4,109	)		94,534,705			11,930			155,574,669			74,306			(6,718,018	)		13,788
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,290			85,215,252			(59,636	)		155,520,849			79,489			(7,231,456	)		16,828
NET ASSETS AT DECEMBER 31, 2016		70,270			443,437,385			2,271,920			441,131,535			79,489			98,412,635			323,593
Changes From Operations:
• Net investment income (loss)		303			(5,976,417	)		(30,356	)		(7,719,353	)		(661	)		2,513,051			23,009
• Net realized gain (loss) on investments		934			24,146,098			224,375			4,367,149			1,953			1,672,028			5
• Net change in unrealized appreciation or depreciation on investments		12,347			88,753,117			300,029			101,829,186			15,701			4,379,157			28,144
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		13,584			106,922,798			494,048			98,476,982			16,993			8,564,236			51,158
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			38,109,056			15,413			22,322,071			—			3,642,743			195,967
• Contract withdrawals and transfers to annuity reserves		(1,978	)		(35,439,529	)		(295,001	)		(32,103,643	)		(141	)		(9,025,778	)		(1,829	)
• Contract transfers		(4,541	)		29,284,361			(64,410	)		(20,339,648	)		(12,349	)		1,942,735			50,806
		(6,519	)		31,953,888			(343,998	)		(30,121,220	)		(12,490	)		(3,440,300	)		244,944
Annuity Reserves:
• Annuity Payments		—			—			—			(5,564	)		—			(13,950	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			108			—			210			—
		—			—			—			(5,456	)		—			(13,740	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(6,519	)		31,953,888			(343,998	)		(30,126,676	)		(12,490	)		(3,454,040	)		244,944
TOTAL INCREASE (DECREASE) IN NET ASSETS		7,065			138,876,686			150,050			68,350,306			4,503			5,110,196			296,102
NET ASSETS AT DECEMBER 31, 2017	$	77,335		$	582,314,071		$	2,421,970		$	509,481,841		$	83,992		$	103,522,831		$	619,695

See accompanying notes.
N-68

	LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class Subaccount			LVIP Delaware Bond Fund - Service Class Subaccount			LVIP Delaware Bond Fund - Standard Class Subaccount			LVIP Delaware Diversified Floating Rate Fund - Service Class Subaccount			LVIP Delaware Diversified Floating Rate Fund - Standard Class Subaccount			LVIP Delaware Social Awareness Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	50,734,955		$	2,823,625,874		$	94,155,133		$	723,155,146		$	1,749,425		$	60,575,856
Changes From Operations:
• Net investment income (loss)		(513,440	)		31,704,830			846,373			(11,832,951	)		(15,220	)		(244,482	)
• Net realized gain (loss) on investments		1,549,984			37,354,250			1,625,306			(2,968,380	)		(15,316	)		7,576,796
• Net change in unrealized appreciation or depreciation on investments		1,033,286			(46,800,327	)		(1,406,880	)		16,655,550			46,321			(4,773,577	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,069,830			22,258,753			1,064,799			1,854,219			15,785			2,558,737
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		14,098,902			247,817,075			677,316			21,707,015			180,488			1,509,178
• Contract withdrawals and transfers to annuity reserves		(3,076,428	)		(230,845,148	)		(10,756,623	)		(54,143,639	)		(97,559	)		(5,654,730	)
• Contract transfers		19,059,296			197,220,596			(558,746	)		8,543,091			(501,303	)		(1,443,376	)
		30,081,770			214,192,523			(10,638,053	)		(23,893,533	)		(418,374	)		(5,588,928	)
Annuity Reserves:
• Annuity Payments		—			(98,381	)		(47,393	)		(1,303	)		—			(278	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			(4,514	)		(16,642	)		(531	)		—			—
		—			(102,895	)		(64,035	)		(1,834	)		—			(278	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		30,081,770			214,089,628			(10,702,088	)		(23,895,367	)		(418,374	)		(5,589,206	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		32,151,600			236,348,381			(9,637,289	)		(22,041,148	)		(402,589	)		(3,030,469	)
NET ASSETS AT DECEMBER 31, 2016		82,886,555			3,059,974,255			84,517,844			701,113,998			1,346,836			57,545,387
Changes From Operations:
• Net investment income (loss)		(884,379	)		38,543,399			841,960			(6,219,280	)		3,957			(388,683	)
• Net realized gain (loss) on investments		3,943,457			(862,686	)		1,101,256			97,983			3,861			6,776,604
• Net change in unrealized appreciation or depreciation on investments		11,799,975			42,543,795			148,799			10,317,261			19,779			3,255,559
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		14,859,053			80,224,508			2,092,015			4,195,964			27,597			9,643,480
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		15,473,195			213,222,347			1,454,906			39,974,178			823,351			2,127,286
• Contract withdrawals and transfers to annuity reserves		(5,061,234	)		(269,504,584	)		(11,384,295	)		(65,626,540	)		(194,025	)		(5,753,947	)
• Contract transfers		13,683,877			320,494,459			(111,954	)		89,125,280			(40,620	)		(3,564,559	)
		24,095,838			264,212,222			(10,041,343	)		63,472,918			588,706			(7,191,220	)
Annuity Reserves:
• Annuity Payments		—			(119,840	)		(30,079	)		(5,922	)		—			(317	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			(579	)		1,421			(602	)		—			—
		—			(120,419	)		(28,658	)		(6,524	)		—			(317	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		24,095,838			264,091,803			(10,070,001	)		63,466,394			588,706			(7,191,537	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		38,954,891			344,316,311			(7,977,986	)		67,662,358			616,303			2,451,943
NET ASSETS AT DECEMBER 31, 2017	$	121,841,446		$	3,404,290,566		$	76,539,858		$	768,776,356		$	1,963,139		$	59,997,330

N-69

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP Delaware Social Awareness Fund - Standard Class Subaccount			LVIP Delaware Special Opportunities Fund - Service Class Subaccount			LVIP Delaware Wealth Builder Fund - Service Class Subaccount			LVIP Delaware Wealth Builder Fund - Standard Class Subaccount			LVIP Dimensional International Core Equity Fund - Service Class Subaccount			LVIP Dimensional International Core Equity Fund - Standard Class Subaccount			LVIP Dimensional International Equity Managed Volatility Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	8,181,511		$	50,665,570		$	14,777,248		$	4,810,124		$	5,366,591		$	341,341		$	234,564,080
Changes From Operations:
• Net investment income (loss)		(10,378	)		(106,204	)		(52,154	)		(2,138	)		59,245			20,624			1,268,317
• Net realized gain (loss) on investments		1,137,503			7,963,222			1,259,897			448,096			(14,083	)		(23	)		245,048
• Net change in unrealized appreciation or depreciation on investments		(783,985	)		1,433,242			(735,356	)		(275,883	)		335,715			15,255			(287,727	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		343,140			9,290,260			472,387			170,075			380,877			35,856			1,225,638
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		39,611			1,721,486			92,615			7,650			1,437,711			601,859			22,050,132
• Contract withdrawals and transfers to annuity reserves		(658,125	)		(4,017,715	)		(1,567,702	)		(570,194	)		(652,201	)		(5,580	)		(12,925,490	)
• Contract transfers		(447,886	)		1,896,651			(602,607	)		8,133			3,770,714			525,656			10,458,457
		(1,066,400	)		(399,578	)		(2,077,694	)		(554,411	)		4,556,224			1,121,935			19,583,099
Annuity Reserves:
• Annuity Payments		(8,082	)		(987	)		—			(3,459	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		66			12			—			10			—			—			—
		(8,016	)		(975	)		—			(3,449	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,074,416	)		(400,553	)		(2,077,694	)		(557,860	)		4,556,224			1,121,935			19,583,099
TOTAL INCREASE (DECREASE) IN NET ASSETS		(731,276	)		8,889,707			(1,605,307	)		(387,785	)		4,937,101			1,157,791			20,808,737
NET ASSETS AT DECEMBER 31, 2016		7,450,235			59,555,277			13,171,941			4,422,339			10,303,692			1,499,132			255,372,817
Changes From Operations:
• Net investment income (loss)		(28,234	)		(364,135	)		34,436			24,639			214,354			46,763			1,703,864
• Net realized gain (loss) on investments		963,201			6,735,366			865,213			289,435			484,346			41,031			1,022,977
• Net change in unrealized appreciation or depreciation on investments		329,016			3,589,336			345,537			134,730			4,422,462			514,639			60,947,545
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,263,983			9,960,567			1,245,186			448,804			5,121,162			602,433			63,674,386
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		102,821			11,054,579			645,529			66,925			15,358,503			1,515,639			31,965,272
• Contract withdrawals and transfers to annuity reserves		(980,801	)		(6,109,742	)		(2,110,134	)		(456,575	)		(1,629,172	)		(217,669	)		(20,116,250	)
• Contract transfers		(259,854	)		4,029,451			303,712			135,772			12,476,216			173,122			29,257,426
		(1,137,834	)		8,974,288			(1,160,893	)		(253,878	)		26,205,547			1,471,092			41,106,448
Annuity Reserves:
• Annuity Payments		(13,741	)		(1,129	)		—			(3,649	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		(270	)		18			—			16			—			—			—
		(14,011	)		(1,111	)		—			(3,633	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,151,845	)		8,973,177			(1,160,893	)		(257,511	)		26,205,547			1,471,092			41,106,448
TOTAL INCREASE (DECREASE) IN NET ASSETS		112,138			18,933,744			84,293			191,293			31,326,709			2,073,525			104,780,834
NET ASSETS AT DECEMBER 31, 2017	$	7,562,373		$	78,489,021		$	13,256,234		$	4,613,632		$	41,630,401		$	3,572,657		$	360,153,651

See accompanying notes.
N-70

	LVIP Dimensional International Equity Managed Volatility Fund - Standard Class Subaccount			LVIP Dimensional U.S. Core Equity 1 Fund - Service Class Subaccount			LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class Subaccount			LVIP Dimensional U.S. Core Equity 2 Fund - Service Class Subaccount			LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class Subaccount			LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,794,623		$	39,639,227		$	942,332		$	3,485,776		$	516,873		$	378,661,197
Changes From Operations:
• Net investment income (loss)		20,481			(108,750	)		17,821			24,713			11,283			(2,124,279	)
• Net realized gain (loss) on investments		(32,117	)		16,648,190			493,953			85,965			9,792			36,532,521
• Net change in unrealized appreciation or depreciation on investments		11,815			(11,119,214	)		(359,488	)		1,010,897			122,650			4,914,808
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		179			5,420,226			152,286			1,121,575			143,725			39,323,050
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		13,440			3,255,758			265,922			2,205,713			314,622			47,264,364
• Contract withdrawals and transfers to annuity reserves		(25,871	)		(3,583,094	)		(5,820	)		(1,286,537	)		(3,529	)		(23,769,612	)
• Contract transfers		(441,660	)		7,901,095			222,012			9,529,681			296,185			55,925,951
		(454,091	)		7,573,759			482,114			10,448,857			607,278			79,420,703
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(454,091	)		7,573,759			482,114			10,448,857			607,278			79,420,703
TOTAL INCREASE (DECREASE) IN NET ASSETS		(453,912	)		12,993,985			634,400			11,570,432			751,003			118,743,753
NET ASSETS AT DECEMBER 31, 2016		1,340,711			52,633,212			1,576,732			15,056,208			1,267,876			497,404,950
Changes From Operations:
• Net investment income (loss)		21,338			(225,591	)		41,690			(102,819	)		20,600			(3,964,451	)
• Net realized gain (loss) on investments		10,834			380,370			64,350			905,930			43,142			4,837,317
• Net change in unrealized appreciation or depreciation on investments		277,598			12,158,023			542,056			3,472,176			339,358			93,723,754
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		309,770			12,312,802			648,096			4,275,287			403,100			94,596,620
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		45,559			23,365,093			1,621,806			14,862,984			1,634,803			50,972,312
• Contract withdrawals and transfers to annuity reserves		(72,456	)		(8,383,968	)		(768,885	)		(2,267,070	)		(83,241	)		(41,229,179	)
• Contract transfers		(165,639	)		9,595,174			1,097,887			4,785,934			33,941			72,016,869
		(192,536	)		24,576,299			1,950,808			17,381,848			1,585,503			81,760,002
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(192,536	)		24,576,299			1,950,808			17,381,848			1,585,503			81,760,002
TOTAL INCREASE (DECREASE) IN NET ASSETS		117,234			36,889,101			2,598,904			21,657,135			1,988,603			176,356,622
NET ASSETS AT DECEMBER 31, 2017	$	1,457,945		$	89,522,313		$	4,175,636		$	36,713,343		$	3,256,479		$	673,761,572

N-71

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class Subaccount			LVIP Dimensional/ Vanguard Total Bond Fund - Service Class Subaccount			LVIP Dimensional/ Vanguard Total Bond Fund - Standard Class Subaccount			LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class Subaccount			LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class Subaccount			LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class Subaccount			LVIP Franklin Templeton Value Managed Volatility Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	4,437,665		$	408,799,837		$	3,514,167		$	683,969,015		$	2,083,712		$	—		$	166,643,018
Changes From Operations:
• Net investment income (loss)		17,817			(722,439	)		61,749			(2,278,673	)		(8,848	)		—			2,017,393
• Net realized gain (loss) on investments		302,418			633,124			1,809			(7,135,923	)		(30,408	)		—			1,692,067
• Net change in unrealized appreciation or depreciation on investments		66,793			(410,182	)		(45,780	)		15,483,363			30,099			—			16,890,441
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		387,028			(499,497	)		17,778			6,068,767			(9,157	)		—			20,599,901
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		102,102			38,965,967			593,624			65,572,647			133,724			—			52,503,201
• Contract withdrawals and transfers to annuity reserves		(38,928	)		(33,775,995	)		(128,714	)		(39,317,724	)		(88,330	)		—			(10,889,342	)
• Contract transfers		(1,433,832	)		59,993,262			1,446,715			8,994,145			6,725			—			29,719,928
		(1,370,658	)		65,183,234			1,911,625			35,249,068			52,119			—			71,333,787
Annuity Reserves:
• Annuity Payments		—			(2,028	)		—			(223	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			(545	)		—			—			—
		—			(2,028	)		—			(768	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,370,658	)		65,181,206			1,911,625			35,248,300			52,119			—			71,333,787
TOTAL INCREASE (DECREASE) IN NET ASSETS		(983,630	)		64,681,709			1,929,403			41,317,067			42,962			—			91,933,688
NET ASSETS AT DECEMBER 31, 2016		3,454,035			473,481,546			5,443,570			725,286,082			2,126,674			—			258,576,706
Changes From Operations:
• Net investment income (loss)		9,298			665,889			110,653			(3,824,960	)		84,868			286			4,547,556
• Net realized gain (loss) on investments		87,620			332,563			11,641			4,947,793			10,332			—			1,097,717
• Net change in unrealized appreciation or depreciation on investments		357,544			3,967,678			26,454			134,434,550			290,597			(286	)		19,381,315
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		454,462			4,966,130			148,748			135,557,383			385,797			—			25,026,588
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		218,853			73,109,943			3,216,925			66,386,492			4,040,960			13,429			15,904,100
• Contract withdrawals and transfers to annuity reserves		(305,372	)		(41,230,594	)		(782,913	)		(51,914,119	)		(160,766	)		—			(15,258,482	)
• Contract transfers		(1,475,182	)		60,588,329			417,423			(32,611,097	)		1,031,005			—			26,108,112
		(1,561,701	)		92,467,678			2,851,435			(18,138,724	)		4,911,199			13,429			26,753,730
Annuity Reserves:
• Annuity Payments		—			(2,112	)		—			(1,442	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			1			—			84			—			—			—
		—			(2,111	)		—			(1,358	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,561,701	)		92,465,567			2,851,435			(18,140,082	)		4,911,199			13,429			26,753,730
TOTAL INCREASE (DECREASE) IN NET ASSETS		(1,107,239	)		97,431,697			3,000,183			117,417,301			5,296,996			13,429			51,780,318
NET ASSETS AT DECEMBER 31, 2017	$	2,346,796		$	570,913,243		$	8,443,753		$	842,703,383		$	7,423,670		$	13,429		$	310,357,024

See accompanying notes.
N-72

	LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class Subaccount			LVIP Global Conservative Allocation Managed Risk Fund - Service Class Subaccount			LVIP Global Conservative Allocation Managed Risk Fund - Standard Class Subaccount			LVIP Global Growth Allocation Managed Risk Fund - Service Class Subaccount			LVIP Global Growth Allocation Managed Risk Fund - Standard Class Subaccount			LVIP Global Income Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	9,674		$	1,244,285,799		$	113,698		$	8,408,274,523		$	4,002,312		$	599,143,037
Changes From Operations:
• Net investment income (loss)		203			3,395,881			2,885			14,190,678			50,713			(9,714,796	)
• Net realized gain (loss) on investments		(766	)		24,578,959			3,312			13,350,811			(493	)		(981,694	)
• Net change in unrealized appreciation or depreciation on investments		1,643			10,213,318			1,105			210,948,115			108,205			2,184,123
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,080			38,188,158			7,302			238,489,604			158,425			(8,512,367	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			49,501,176			—			244,353,868			23			24,796,171
• Contract withdrawals and transfers to annuity reserves		(132	)		(109,799,431	)		(45,529	)		(466,038,614	)		(150,746	)		(41,469,325	)
• Contract transfers		(286	)		33,337,383			99,994			(218,419,014	)		355			20,282,941
		(418	)		(26,960,872	)		54,465			(440,103,760	)		(150,368	)		3,609,787
Annuity Reserves:
• Annuity Payments		—			(3,706	)		—			(1,938	)		—			(32,740	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			1,991			—			1,958			—			(1,694	)
		—			(1,715	)		—			20			—			(34,434	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(418	)		(26,962,587	)		54,465			(440,103,740	)		(150,368	)		3,575,353
TOTAL INCREASE (DECREASE) IN NET ASSETS		662			11,225,571			61,767			(201,614,136	)		8,057			(4,937,014	)
NET ASSETS AT DECEMBER 31, 2016		10,336			1,255,511,370			175,465			8,206,660,387			4,010,369			594,206,023
Changes From Operations:
• Net investment income (loss)		315			3,416,488			3,051			47,734,411			126,737			(10,240,179	)
• Net realized gain (loss) on investments		1			20,830,534			1,450			81,643,441			12,841			2,175,200
• Net change in unrealized appreciation or depreciation on investments		774			73,431,387			12,641			941,703,538			474,412			26,993,047
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,090			97,678,409			17,142			1,071,081,390			613,990			18,928,068
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			25,506,601			—			186,282,640			2,587,311			11,350,776
• Contract withdrawals and transfers to annuity reserves		(122	)		(117,440,614	)		(4,182	)		(573,375,646	)		(183,294	)		(53,177,368	)
• Contract transfers		278			(73,653,698	)		1,589			(214,989,293	)		50,086			80,454,885
		156			(165,587,711	)		(2,593	)		(602,082,299	)		2,454,103			38,628,293
Annuity Reserves:
• Annuity Payments		—			(7,391	)		—			(21,659	)		—			(36,625	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			780			—			14,314			—			(462	)
		—			(6,611	)		—			(7,345	)		—			(37,087	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		156			(165,594,322	)		(2,593	)		(602,089,644	)		2,454,103			38,591,206
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,246			(67,915,913	)		14,549			468,991,746			3,068,093			57,519,274
NET ASSETS AT DECEMBER 31, 2017	$	11,582		$	1,187,595,457		$	190,014		$	8,675,652,133		$	7,078,462		$	651,725,297

N-73

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP Global Income Fund - Standard Class Subaccount			LVIP Global Moderate Allocation Managed Risk Fund - Service Class Subaccount			LVIP Global Moderate Allocation Managed Risk Fund - Standard Class Subaccount			LVIP Goldman Sachs Income Builder Fund - Service Class Subaccount			LVIP Goldman Sachs Income Builder Fund - Standard Class Subaccount			LVIP Government Money Market Fund - Service Class Subaccount			LVIP Government Money Market Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	53,033		$	6,624,070,189		$	767,170		$	2,467,548		$	19,182		$	243,717,501		$	28,823,142
Changes From Operations:
• Net investment income (loss)		(1,622	)		3,575,128			5,974			77,733			829			(4,093,268	)		(460,355	)
• Net realized gain (loss) on investments		2,594			94,546,065			5,788			(22,853	)		(151	)		—			—
• Net change in unrealized appreciation or depreciation on investments		(9,201	)		65,734,214			15,490			200,936			1,317			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(8,229	)		163,855,407			27,252			255,816			1,995			(4,093,268	)		(460,355	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		578,640			250,453,417			25,501			1,486,760			15,274			25,690,477			2,309,355
• Contract withdrawals and transfers to annuity reserves		(2,134	)		(449,025,570	)		(39,628	)		(70,092	)		(330	)		(115,359,862	)		(9,541,595	)
• Contract transfers		882			(77,167,756	)		74,375			(215,510	)		(6,899	)		71,342,641			5,198,922
		577,388			(275,739,909	)		60,248			1,201,158			8,045			(18,326,744	)		(2,033,318	)
Annuity Reserves:
• Annuity Payments		—			(31,012	)		—			—			—			(17,325	)		(4,468	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			2,349			—			—			—			152			638
		—			(28,663	)		—			—			—			(17,173	)		(3,830	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		577,388			(275,768,572	)		60,248			1,201,158			8,045			(18,343,917	)		(2,037,148	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		569,159			(111,913,165	)		87,500			1,456,974			10,040			(22,437,185	)		(2,497,503	)
NET ASSETS AT DECEMBER 31, 2016		622,192			6,512,157,024			854,670			3,924,522			29,222			221,280,316			26,325,639
Changes From Operations:
• Net investment income (loss)		(2,781	)		32,372,420			15,995			141,009			1,050			(3,062,281	)		(301,103	)
• Net realized gain (loss) on investments		4,282			72,615,815			1,467			36,970			(185	)		7,246			884
• Net change in unrealized appreciation or depreciation on investments		29,409			661,581,775			104,757			212,570			1,728			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		30,910			766,570,010			122,219			390,549			2,593			(3,055,035	)		(300,219	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		90,844			160,703,805			45,975			3,621,117			21,232			46,426,263			9,565,897
• Contract withdrawals and transfers to annuity reserves		(26,974	)		(512,806,806	)		(39,905	)		(199,539	)		(282	)		(105,270,462	)		(11,241,149	)
• Contract transfers		11,716			(185,783,991	)		260,394			1,896,247			(6,866	)		53,313,110			(1,531,614	)
		75,586			(537,886,992	)		266,464			5,317,825			14,084			(5,531,089	)		(3,206,866	)
Annuity Reserves:
• Annuity Payments		—			(218,255	)		—			—			—			(16,419	)		(3,202	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			(25,901	)		—			—			—			349			641
		—			(244,156	)		—			—			—			(16,070	)		(2,561	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		75,586			(538,131,148	)		266,464			5,317,825			14,084			(5,547,159	)		(3,209,427	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		106,496			228,438,862			388,683			5,708,374			16,677			(8,602,194	)		(3,509,646	)
NET ASSETS AT DECEMBER 31, 2017	$	728,688		$	6,740,595,886		$	1,243,353		$	9,632,896		$	45,899		$	212,678,122		$	22,815,993

See accompanying notes.
N-74

	LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class Subaccount			LVIP Invesco Select Equity Managed Volatility Fund - Service Class Subaccount			LVIP Invesco Select Equity Managed Volatility Fund - Standard Class Subaccount			LVIP JPMorgan High Yield Fund - Service Class Subaccount			LVIP JPMorgan High Yield Fund - Standard Class Subaccount			LVIP JPMorgan Retirement Income Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	112,125,691		$	112,987,141		$	73,270		$	144,644,651		$	34,516		$	—
Changes From Operations:
• Net investment income (loss)		(984,683	)		(1,129,898	)		(141	)		6,142,757			6,765			—
• Net realized gain (loss) on investments		2,859,989			(1,350,182	)		(533	)		(1,625,716	)		(75	)		—
• Net change in unrealized appreciation or depreciation on investments		15,150,810			7,921,630			4,476			12,396,752			3,710			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		17,026,116			5,441,550			3,802			16,913,793			10,400			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		60,889,322			7,917,385			—			8,901,042			—			—
• Contract withdrawals and transfers to annuity reserves		(8,782,420	)		(6,093,015	)		(2,537	)		(11,596,018	)		(1,224	)		—
• Contract transfers		71,461,852			5,665,934			(886	)		13,096,543			91,655			—
		123,568,754			7,490,304			(3,423	)		10,401,567			90,431			—
Annuity Reserves:
• Annuity Payments		—			—			—			(11,441	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			(218	)		—			—
		—			—			—			(11,659	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		123,568,754			7,490,304			(3,423	)		10,389,908			90,431			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		140,594,870			12,931,854			379			27,303,701			100,831			—
NET ASSETS AT DECEMBER 31, 2016		252,720,561			125,918,995			73,649			171,948,352			135,347			—
Changes From Operations:
• Net investment income (loss)		(1,601,550	)		(181,744	)		484			7,714,343			17,001			28,451
• Net realized gain (loss) on investments		6,955,408			886,284			407			579,309			2,527			34,085
• Net change in unrealized appreciation or depreciation on investments		19,350,771			18,714,807			11,283			96,597			(5,524	)		(36,995	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		24,704,629			19,419,347			12,174			8,390,249			14,004			25,541
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		22,941,330			6,355,425			—			12,762,323			190,941			855,362
• Contract withdrawals and transfers to annuity reserves		(15,705,746	)		(7,188,987	)		(2,587	)		(15,058,613	)		(8,704	)		(50,954	)
• Contract transfers		25,066,898			(5,310,095	)		(2,844	)		3,464,806			(25,047	)		686,373
		32,302,482			(6,143,657	)		(5,431	)		1,168,516			157,190			1,490,781
Annuity Reserves:
• Annuity Payments		—			—			—			(16,114	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			5			—			—
		—			—			—			(16,109	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		32,302,482			(6,143,657	)		(5,431	)		1,152,407			157,190			1,490,781
TOTAL INCREASE (DECREASE) IN NET ASSETS		57,007,111			13,275,690			6,743			9,542,656			171,194			1,516,322
NET ASSETS AT DECEMBER 31, 2017	$	309,727,672		$	139,194,685		$	80,392		$	181,491,008		$	306,541		$	1,516,322

N-75

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP JPMorgan Retirement Income Fund - Standard Class Subaccount			LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class Subaccount			LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class Subaccount			LVIP Managed Risk Profile 2010 Fund - Service Class Subaccount			LVIP Managed Risk Profile 2020 Fund - Service Class Subaccount			LVIP Managed Risk Profile 2030 Fund - Service Class Subaccount			LVIP Managed Risk Profile 2040 Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	386,903,796		$	202,679		$	4,819,910		$	10,787,116		$	6,240,374		$	5,465,955
Changes From Operations:
• Net investment income (loss)		—			(4,863,746	)		(76	)		10,380			13,332			(11,707	)		(22,236	)
• Net realized gain (loss) on investments		—			1,293,611			(2,087	)		249,602			426,845			268,454			267,988
• Net change in unrealized appreciation or depreciation on investments		—			40,047,751			28,311			(139,005	)		(193,002	)		(169,022	)		(167,945	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			36,477,616			26,148			120,977			247,175			87,725			77,807
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			82,112,328			73,750			26,058			36,815			15,472			59,589
• Contract withdrawals and transfers to annuity reserves		—			(23,599,088	)		(40,232	)		(376,381	)		(829,045	)		(707,444	)		(253,114	)
• Contract transfers		—			46,897,475			(1,336	)		565,732			121,924			(617,932	)		(1,406,823	)
		—			105,410,715			32,182			215,409			(670,306	)		(1,309,904	)		(1,600,348	)
Annuity Reserves:
• Annuity Payments		—			(3,813	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			122			—			—			—			—			—
		—			(3,691	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			105,407,024			32,182			215,409			(670,306	)		(1,309,904	)		(1,600,348	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			141,884,640			58,330			336,386			(423,131	)		(1,222,179	)		(1,522,541	)
NET ASSETS AT DECEMBER 31, 2016		—			528,788,436			261,009			5,156,296			10,363,985			5,018,195			3,943,414
Changes From Operations:
• Net investment income (loss)		17,945			(4,678,737	)		20			6,525			(1,082	)		(1,909	)		9,977
• Net realized gain (loss) on investments		13,568			6,783,383			15,195			168,250			570,448			246,417			154,698
• Net change in unrealized appreciation or depreciation on investments		(17,621	)		66,856,636			23,481			224,975			409,536			295,885			339,226
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		13,892			68,961,282			38,696			399,750			978,902			540,393			503,901
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			29,405,366			120,856			67,048			26,828			26,083			126,920
• Contract withdrawals and transfers to annuity reserves		(451	)		(35,513,128	)		(53,742	)		(873,101	)		(1,404,361	)		(509,371	)		(239,932	)
• Contract transfers		756,405			27,971,537			(65,899	)		1,064,937			209,292			47,656			368,819
		755,954			21,863,775			1,215			258,884			(1,168,241	)		(435,632	)		255,807
Annuity Reserves:
• Annuity Payments		—			(4,041	)		—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			164			—			—			—			—			—
		—			(3,877	)		—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		755,954			21,859,898			1,215			258,884			(1,168,241	)		(435,632	)		255,807
TOTAL INCREASE (DECREASE) IN NET ASSETS		769,846			90,821,180			39,911			658,634			(189,339	)		104,761			759,708
NET ASSETS AT DECEMBER 31, 2017	$	769,846		$	619,609,616		$	300,920		$	5,814,930		$	10,174,646		$	5,122,956		$	4,703,122

See accompanying notes.
N-76

	LVIP MFS International Equity Managed Volatility Fund - Service Class Subaccount			LVIP MFS International Growth Fund - Service Class Subaccount			LVIP MFS International Growth Fund - Standard Class Subaccount			LVIP MFS Value Fund - Service Class Subaccount			LVIP MFS Value Fund - Standard Class Subaccount			LVIP Mondrian International Value Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	169,165,297		$	151,468,387		$	21,813		$	823,905,112		$	8,726		$	278,699,287
Changes From Operations:
• Net investment income (loss)		(997,641	)		17,206			356			4,488,733			849			3,637,939
• Net realized gain (loss) on investments		(1,383,260	)		1,708,538			651			70,698,027			665			6,929,716
• Net change in unrealized appreciation or depreciation on investments		(3,427,852	)		(1,248,489	)		(213	)		25,463,704			544			(3,920,723	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(5,808,753	)		477,255			794			100,650,464			2,058			6,646,932
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		22,932,119			4,761,859			—			22,707,053			36,232			4,684,524
• Contract withdrawals and transfers to annuity reserves		(9,814,871	)		(11,136,718	)		—			(64,621,030	)		(55	)		(23,926,226	)
• Contract transfers		21,779,111			5,898,283			8,176			(6,865,802	)		1,574			6,330,030
		34,896,359			(476,576	)		8,176			(48,779,779	)		37,751			(12,911,672	)
Annuity Reserves:
• Annuity Payments		—			(1,570	)		—			(57,787	)		—			(5,001	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			21			—			(799	)		—			(145	)
		—			(1,549	)		—			(58,586	)		—			(5,146	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		34,896,359			(478,125	)		8,176			(48,838,365	)		37,751			(12,916,818	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		29,087,606			(870	)		8,970			51,812,099			39,809			(6,269,886	)
NET ASSETS AT DECEMBER 31, 2016		198,252,903			151,467,517			30,783			875,717,211			48,535			272,429,401
Changes From Operations:
• Net investment income (loss)		(1,065,504	)		(728,779	)		(24	)		2,905,091			21,130			4,539,864
• Net realized gain (loss) on investments		1,824,715			6,790,429			7,895			55,353,186			7,695			1,978,619
• Net change in unrealized appreciation or depreciation on investments		53,464,182			38,473,279			668			78,314,054			64,830			43,341,379
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		54,223,393			44,534,929			8,539			136,572,331			93,655			49,859,862
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		27,100,196			9,861,223			5,805			44,824,792			1,386,224			6,094,883
• Contract withdrawals and transfers to annuity reserves		(13,678,643	)		(13,451,900	)		—			(74,432,161	)		(1,553	)		(25,340,245	)
• Contract transfers		24,547,971			(2,739,184	)		(36,856	)		(5,149,123	)		1,613			(19,228,139	)
		37,969,524			(6,329,861	)		(31,051	)		(34,756,492	)		1,386,284			(38,473,501	)
Annuity Reserves:
• Annuity Payments		—			(2,500	)		—			(82,100	)		—			(7,630	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			(133	)		—			(1,542	)		—			(202	)
		—			(2,633	)		—			(83,642	)		—			(7,832	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		37,969,524			(6,332,494	)		(31,051	)		(34,840,134	)		1,386,284			(38,481,333	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		92,192,917			38,202,435			(22,512	)		101,732,197			1,479,939			11,378,529
NET ASSETS AT DECEMBER 31, 2017	$	290,445,820		$	189,669,952		$	8,271		$	977,449,408		$	1,528,474		$	283,807,930

N-77

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVI Mondrian International Value Fund - Standard Class Subaccount			LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class Subaccount			LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class Subaccount			LVIP PIMCO Low Duration Bond Fund - Service Class Subaccount			LVIP PIMCO Low Duration Bond Fund - Standard Class Subaccount			LVIP Select Core Equity Managed Volatility Fund - Service Class Subaccount			LVIP Select Core Equity Managed Volatility Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	12,634,030		$	19,025,104		$	—		$	220,065,680		$	1,512,236		$	412,240,126		$	621,392
Changes From Operations:
• Net investment income (loss)		140,417			(41,201	)		2,441			(205,394	)		51,385			(3,877,898	)		(553	)
• Net realized gain (loss) on investments		302,584			(197,831	)		5			867,371			10,129			(1,799,876	)		(9,773	)
• Net change in unrealized appreciation or depreciation on investments		(206,651	)		1,269,746			4,256			1,417,357			(5,537	)		24,968,290			19,276
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		236,350			1,030,714			6,702			2,079,334			55,977			19,290,516			8,950
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		205,339			4,447,399			176,718			70,439,661			1,050,183			16,365,647			154,549
• Contract withdrawals and transfers to annuity reserves		(1,274,189	)		(1,153,597	)		—			(39,018,020	)		(261,252	)		(22,385,899	)		(5,015	)
• Contract transfers		(239,927	)		4,212,188			—			101,337,310			1,972,785			(9,144,704	)		(574,029	)
		(1,308,777	)		7,505,990			176,718			132,758,951			2,761,716			(15,164,956	)		(424,495	)
Annuity Reserves:
• Annuity Payments		(3,624	)		—			—			(1,175	)		—			(3,377	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		258			—			—			1,702			—			85			—
		(3,366	)		—			—			527			—			(3,292	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,312,143	)		7,505,990			176,718			132,759,478			2,761,716			(15,168,248	)		(424,495	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(1,075,793	)		8,536,704			183,420			134,838,812			2,817,693			4,122,268			(415,545	)
NET ASSETS AT DECEMBER 31, 2016		11,558,237			27,561,808			183,420			354,904,492			4,329,929			416,362,394			205,847
Changes From Operations:
• Net investment income (loss)		185,867			(40,598	)		1,637			(236,064	)		75,896			2,057,292			2,112
• Net realized gain (loss) on investments		108,936			596,241			1,371			546,128			873			9,359,101			9,221
• Net change in unrealized appreciation or depreciation on investments		1,795,641			5,075,013			32,866			(1,211,811	)		(27,048	)		54,145,743			12,791
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,090,444			5,630,656			35,874			(901,747	)		49,721			65,562,136			24,124
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		178,089			3,762,284			—			47,435,438			2,131,398			9,311,562			—
• Contract withdrawals and transfers to annuity reserves		(1,607,027	)		(2,110,651	)		(4	)		(49,452,127	)		(90,063	)		(29,968,688	)		(3,168	)
• Contract transfers		(218,220	)		7,559,374			—			50,471,208			(140,314	)		(24,363,741	)		(93,625	)
		(1,647,158	)		9,211,007			(4	)		48,454,519			1,901,021			(45,020,867	)		(96,793	)
Annuity Reserves:
• Annuity Payments		(1,260	)		—			—			(1,155	)		—			(3,718	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		295			—			—			221			—			115			—
		(965	)		—			—			(934	)		—			(3,603	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(1,648,123	)		9,211,007			(4	)		48,453,585			1,901,021			(45,024,470	)		(96,793	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		442,321			14,841,663			35,870			47,551,838			1,950,742			20,537,666			(72,669	)
NET ASSETS AT DECEMBER 31, 2017	$	12,000,558		$	42,403,471		$	219,290		$	402,456,330		$	6,280,671		$	436,900,060		$	133,178

See accompanying notes.
N-78

	LVIP SSGA Bond Index Fund - Service Class Subaccount			LVIP SSGA Bond Index Fund - Standard Class Subaccount			LVIP SSGA Conservative Index Allocation Fund - Service Class Subaccount			LVIP SSGA Conservative Structured Allocation Fund - Service Class Subaccount			LVIP SSGA Conservative Structured Allocation Fund - Standard Class Subaccount			LVIP SSGA Developed International 150 Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	934,380,829		$	741,796		$	64,280,361		$	177,202,319		$	561,459		$	136,712,693
Changes From Operations:
• Net investment income (loss)		3,538,097			15,237			132,088			789,975			10,977			2,513,364
• Net realized gain (loss) on investments		4,278,167			73			1,189,035			5,212,591			11,235			1,762,569
• Net change in unrealized appreciation or depreciation on investments		(6,008,706	)		(5,548	)		1,029,934			2,588,100			12,619			5,984,844
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,807,558			9,762			2,351,057			8,590,666			34,831			10,260,777
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		28,365,956			102,975			2,541,842			9,874,468			—			2,163,184
• Contract withdrawals and transfers to annuity reserves		(95,895,103	)		(13,401	)		(7,557,416	)		(19,333,669	)		(40,369	)		(11,881,702	)
• Contract transfers		104,706,269			296,479			7,179,506			9,141,568			32,323			(433,433	)
		37,177,122			386,053			2,163,932			(317,633	)		(8,046	)		(10,151,951	)
Annuity Reserves:
• Annuity Payments		(77,503	)		—			(2,364	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		16			—			(1	)		—			—			186
		(77,487	)		—			(2,365	)		—			—			186
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		37,099,635			386,053			2,161,567			(317,633	)		(8,046	)		(10,151,765	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		38,907,193			395,815			4,512,624			8,273,033			26,785			109,012
NET ASSETS AT DECEMBER 31, 2016		973,288,022			1,137,611			68,792,985			185,475,352			588,244			136,821,705
Changes From Operations:
• Net investment income (loss)		5,132,499			49,977			240,532			2,850,820			19,521			3,756,806
• Net realized gain (loss) on investments		1,796,241			(864	)		1,124,114			3,997,030			9,262			3,224,402
• Net change in unrealized appreciation or depreciation on investments		4,911,810			(14,737	)		4,412,807			7,012,487			30,716			21,891,294
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		11,840,550			34,376			5,777,453			13,860,337			59,499			28,872,502
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		36,809,586			864,271			2,514,808			6,516,157			87,075			11,552,201
• Contract withdrawals and transfers to annuity reserves		(116,868,717	)		(32,590	)		(7,125,548	)		(17,616,904	)		(56,105	)		(16,215,335	)
• Contract transfers		85,626,110			637,935			2,093,485			97,665			—			2,184,981
		5,566,979			1,469,616			(2,517,255	)		(11,003,082	)		30,970			(2,478,153	)
Annuity Reserves:
• Annuity Payments		(75,747	)		—			(2,354	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		937			—			2			—			—			227
		(74,810	)		—			(2,352	)		—			—			227
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		5,492,169			1,469,616			(2,519,607	)		(11,003,082	)		30,970			(2,477,926	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		17,332,719			1,503,992			3,257,846			2,857,255			90,469			26,394,576
NET ASSETS AT DECEMBER 31, 2017	$	990,620,741		$	2,641,603		$	72,050,831		$	188,332,607		$	678,713		$	163,216,281

N-79

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP SSGA Developed International 150 Fund - Standard Class Subaccount			LVIP SSGA Emerging Markets 100 Fund - Service Class Subaccount			LVIP SSGA Emerging Markets 100 Fund - Standard Class Subaccount			LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class Subaccount			LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class Subaccount			LVIP SSGA International Index Fund - Service Class Subaccount			LVIP SSGA International Index Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	284,992		$	153,201,469		$	514,809		$	866,175,460		$	497,007		$	257,372,034		$	794,436
Changes From Operations:
• Net investment income (loss)		10,090			1,382,882			11,620			(41,818	)		6,974			3,145,113			21,338
• Net realized gain (loss) on investments		(1,508	)		(7,436,170	)		(20,169	)		(3,676,794	)		(2,972	)		431,868			(13,689	)
• Net change in unrealized appreciation or depreciation on investments		17,182			27,018,393			85,927			33,318,462			23,414			(5,706,398	)		(5,740	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		25,764			20,965,105			77,378			29,599,850			27,416			(2,129,417	)		1,909
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		44,178			4,919,695			95,736			33,315,588			—			9,878,086			312,448
• Contract withdrawals and transfers to annuity reserves		(14,977	)		(13,432,376	)		(58,846	)		(53,092,896	)		(74,129	)		(22,270,330	)		(48,372	)
• Contract transfers		70,727			(3,674,515	)		(15,510	)		(38,329,237	)		91,274			15,534,298			(176,158	)
		99,928			(12,187,196	)		21,380			(58,106,545	)		17,145			3,142,054			87,918
Annuity Reserves:
• Annuity Payments		—			(1,717	)		—			(105,159	)		—			(16,624	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			156			—			627			—			(236	)		—
		—			(1,561	)		—			(104,532	)		—			(16,860	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		99,928			(12,188,757	)		21,380			(58,211,077	)		17,145			3,125,194			87,918
TOTAL INCREASE (DECREASE) IN NET ASSETS		125,692			8,776,348			98,758			(28,611,227	)		44,561			995,777			89,827
NET ASSETS AT DECEMBER 31, 2016		410,684			161,977,817			613,567			837,564,233			541,568			258,367,811			884,263
Changes From Operations:
• Net investment income (loss)		19,438			1,412,427			30,804			17,561,675			24,688			2,092,129			49,920
• Net realized gain (loss) on investments		(2,739	)		181,232			22,104			5,753,349			1,706			7,598,264			41,593
• Net change in unrealized appreciation or depreciation on investments		81,152			33,035,560			127,454			78,041,881			53,964			46,931,670			192,708
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		97,851			34,629,219			180,362			101,356,905			80,358			56,622,063			284,221
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		47,192			8,492,353			698,003			33,017,369			97,006			16,478,214			1,553,421
• Contract withdrawals and transfers to annuity reserves		(16,013	)		(17,815,333	)		(49,279	)		(63,042,593	)		(17,552	)		(29,432,959	)		(130,502	)
• Contract transfers		49,882			535,466			12,349			(32,179,004	)		45,118			(4,575,998	)		(160,628	)
		81,061			(8,787,514	)		661,073			(62,204,228	)		124,572			(17,530,743	)		1,262,291
Annuity Reserves:
• Annuity Payments		—			(1,451	)		—			(108,757	)		—			(16,100	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			187			—			754			—			241			—
		—			(1,264	)		—			(108,003	)		—			(15,859	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		81,061			(8,788,778	)		661,073			(62,312,231	)		124,572			(17,546,602	)		1,262,291
TOTAL INCREASE (DECREASE) IN NET ASSETS		178,912			25,840,441			841,435			39,044,674			204,930			39,075,461			1,546,512
NET ASSETS AT DECEMBER 31, 2017	$	589,596		$	187,818,258		$	1,455,002		$	876,608,907		$	746,498		$	297,443,272		$	2,430,775

See accompanying notes.
N-80

	LVIP SSGA International Managed Volatility Fund - Service Class Subaccount			LVIP SSGA International Managed Volatility Fund - Standard Class Subaccount			LVIP SSGA Large Cap 100 Fund - Service Class Subaccount			LVIP SSGA Large Cap 100 Fund - Standard Class Subaccount			LVIP SSGA Large Cap Managed Volatility Fund - Service Class Subaccount			LVIP SSGA Large Cap Managed Volatility Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	79,614,522		$	—		$	286,594,249		$	1,674,464		$	172,633,442		$	31,051
Changes From Operations:
• Net investment income (loss)		589,729			1,298			1,426,751			23,136			269,023			285
• Net realized gain (loss) on investments		(1,529,815	)		(131	)		37,544,393			137,905			(219,674	)		12
• Net change in unrealized appreciation or depreciation on investments		(4,521,015	)		(1,957	)		12,246,942			150,158			14,670,664			1,951
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(5,461,101	)		(790	)		51,218,086			311,199			14,720,013			2,248
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		29,350,547			3			5,869,451			109,048			53,631,641			—
• Contract withdrawals and transfers to annuity reserves		(5,127,975	)		(404	)		(26,895,020	)		(136,495	)		(11,161,560	)		(12	)
• Contract transfers		237,537,206			145,117			(9,811,003	)		310,401			34,675,507			2
		261,759,778			144,716			(30,836,572	)		282,954			77,145,588			(10	)
Annuity Reserves:
• Annuity Payments		—			—			(1,939	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			601			—			—			—
		—			—			(1,338	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		261,759,778			144,716			(30,837,910	)		282,954			77,145,588			(10	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		256,298,677			143,926			20,380,176			594,153			91,865,601			2,238
NET ASSETS AT DECEMBER 31, 2016		335,913,199			143,926			306,974,425			2,268,617			264,499,043			33,289
Changes From Operations:
• Net investment income (loss)		1,158,380			1,054			3,236,747			53,865			122,144			310
• Net realized gain (loss) on investments		4,605,631			2,393			54,764,702			382,440			3,612,039			279
• Net change in unrealized appreciation or depreciation on investments		65,253,170			27,384			(7,458,706	)		3,522			50,415,399			5,877
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		71,017,181			30,831			50,542,743			439,827			54,149,582			6,466
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		12,085,316			27			24,418,742			396,964			41,074,368			—
• Contract withdrawals and transfers to annuity reserves		(21,949,969	)		(7,186	)		(35,550,688	)		(184,916	)		(17,777,725	)		(8	)
• Contract transfers		(18,225,073	)		(11,316	)		3,967,293			55,486			29,106,242			(1,536	)
		(28,089,726	)		(18,475	)		(7,164,653	)		267,534			52,402,885			(1,544	)
Annuity Reserves:
• Annuity Payments		—			—			(8,523	)		—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(15,556	)		—			—			—
		—			—			(24,079	)		—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(28,089,726	)		(18,475	)		(7,188,732	)		267,534			52,402,885			(1,544	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		42,927,455			12,356			43,354,011			707,361			106,552,467			4,922
NET ASSETS AT DECEMBER 31, 2017	$	378,840,654		$	156,282		$	350,328,436		$	2,975,978		$	371,051,510		$	38,211

N-81

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP SSGA Mid-Cap Index Fund - Service Class Subaccount			LVIP SSGA Mid-Cap Index Fund - Standard Class Subaccount			LVIP SSGA Moderate Index Allocation Fund - Service Class Subaccount			LVIP SSGA Moderate Index Allocation Fund - Standard Class Subaccount			LVIP SSGA Moderate Structured Allocation Fund - Service Class Subaccount			LVIP SSGA Moderate Structured Allocation Fund - Standard Class Subaccount			LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	—		$	189,010,996		$	—		$	752,630,226		$	169,228		$	158,020,143
Changes From Operations:
• Net investment income (loss)		—			—			424,153			—			3,265,911			3,500			420,545
• Net realized gain (loss) on investments		—			—			4,525,702			—			28,047,549			5,389			3,832,769
• Net change in unrealized appreciation or depreciation on investments		—			—			3,888,679			—			21,630,239			6,060			4,163,367
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			—			8,838,534			—			52,943,699			14,949			8,416,681
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			—			12,041,149			—			27,138,289			—			4,617,312
• Contract withdrawals and transfers to annuity reserves		—			—			(16,530,976	)		—			(70,164,154	)		—			(11,604,725	)
• Contract transfers		—			—			8,622,352			—			3,121,679			271			5,087,315
		—			—			4,132,525			—			(39,904,186	)		271			(1,900,098	)
Annuity Reserves:
• Annuity Payments		—			—			(1,759	)		—			(14,421	)		—			(2,324	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			(1	)		—			4,103			—			(1	)
		—			—			(1,760	)		—			(10,318	)		—			(2,325	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			—			4,130,765			—			(39,914,504	)		271			(1,902,423	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			—			12,969,299			—			13,029,195			15,220			6,514,258
NET ASSETS AT DECEMBER 31, 2016		—			—			201,980,295			—			765,659,421			184,448			164,534,401
Changes From Operations:
• Net investment income (loss)		68,004			10,716			726,896			578			15,865,205			6,287			569,545
• Net realized gain (loss) on investments		224,222			11,704			4,826,953			375			23,137,507			6,609			4,184,064
• Net change in unrealized appreciation or depreciation on investments		2,043,352			90,451			19,534,901			(593	)		43,334,685			10,595			19,446,102
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,335,578			112,871			25,088,750			360			82,337,397			23,491			24,199,711
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		14,231,477			909,761			17,217,411			156,269			24,871,307			—			9,715,499
• Contract withdrawals and transfers to annuity reserves		(760,019	)		(17,881	)		(17,783,030	)		(73	)		(62,964,416	)		(51,505	)		(12,897,940	)
• Contract transfers		17,795,019			246,657			2,197,761			(127,543	)		(4,833,317	)		30,518			5,518,781
		31,266,477			1,138,537			1,632,142			28,653			(42,926,426	)		(20,987	)		2,336,340
Annuity Reserves:
• Annuity Payments		—			—			(1,813	)		—			(17,628	)		—			(2,442	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			1			—			3,269			—			1
		—			—			(1,812	)		—			(14,359	)		—			(2,441	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		31,266,477			1,138,537			1,630,330			28,653			(42,940,785	)		(20,987	)		2,333,899
TOTAL INCREASE (DECREASE) IN NET ASSETS		33,602,055			1,251,408			26,719,080			29,013			39,396,612			2,504			26,533,610
NET ASSETS AT DECEMBER 31, 2017	$	33,602,055		$	1,251,408		$	228,699,375		$	29,013		$	805,056,033		$	186,952		$	191,068,011

See accompanying notes.
N-82

	LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class Subaccount			LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class Subaccount			LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class Subaccount			LVIP SSGA S&P 500 Index Fund - Service Class Subaccount			LVIP SSGA S&P 500 Index Fund - Standard Class Subaccount			LVIP SSGA Small-Cap Index Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	403,797,689		$	—		$	855,810,465		$	32,697,167		$	251,759,365
Changes From Operations:
• Net investment income (loss)		—			2,037,774			13,102			1,385,212			280,570			(1,216,901	)
• Net realized gain (loss) on investments		—			16,116,714			20,314			45,678,817			1,298,045			14,307,114
• Net change in unrealized appreciation or depreciation on investments		—			13,988,348			21,659			32,843,563			1,850,457			30,944,965
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			32,142,836			55,075			79,907,592			3,429,072			44,035,178
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			10,948,431			588,827			40,192,859			1,744,568			8,588,493
• Contract withdrawals and transfers to annuity reserves		—			(28,913,034	)		—			(77,351,412	)		(3,601,391	)		(21,805,628	)
• Contract transfers		—			(1,366,621	)		—			13,110,552			4,287,504			(7,661,223	)
		—			(19,331,224	)		588,827			(24,048,001	)		2,430,681			(20,878,358	)
Annuity Reserves:
• Annuity Payments		—			—			—			(76,269	)		(6,915	)		(9,181	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			(7,750	)		457			(2,680	)
		—			—			—			(84,019	)		(6,458	)		(11,861	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			(19,331,224	)		588,827			(24,132,020	)		2,424,223			(20,890,219	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			12,811,612			643,902			55,775,572			5,853,295			23,144,959
NET ASSETS AT DECEMBER 31, 2016		—			416,609,301			643,902			911,586,037			38,550,462			274,904,324
Changes From Operations:
• Net investment income (loss)		5,431			9,839,046			86,512			564,089			286,318			(2,421,975	)
• Net realized gain (loss) on investments		781			13,723,556			16,047			59,049,578			2,167,485			19,833,380
• Net change in unrealized appreciation or depreciation on investments		(1,128	)		28,844,082			47,522			117,769,002			5,159,371			16,100,671
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,084			52,406,684			150,081			177,382,669			7,613,174			33,512,076
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		204,255			12,393,593			1,543,659			90,699,413			4,474,612			26,702,595
• Contract withdrawals and transfers to annuity reserves		(6	)		(33,531,506	)		(24,693	)		(99,114,734	)		(3,792,867	)		(27,207,505	)
• Contract transfers		71,327			13,099,427			40,000			17,459,803			(339,919	)		3,364,014
		275,576			(8,038,486	)		1,558,966			9,044,482			341,826			2,859,104
Annuity Reserves:
• Annuity Payments		—			—			—			(91,454	)		(11,347	)		(10,966	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			1,750			(670	)		222
		—			—			—			(89,704	)		(12,017	)		(10,744	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		275,576			(8,038,486	)		1,558,966			8,954,778			329,809			2,848,360
TOTAL INCREASE (DECREASE) IN NET ASSETS		280,660			44,368,198			1,709,047			186,337,447			7,942,983			36,360,436
NET ASSETS AT DECEMBER 31, 2017	$	280,660		$	460,977,499		$	2,352,949		$	1,097,923,484		$	46,493,445		$	311,264,760

N-83

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP SSGA Small-Cap Index Fund - Standard Class Subaccount			LVIP SSGA Small-Mid Cap 200 Fund - Service Class Subaccount			LVIP SSGA Small-Mid Cap 200 Fund - Standard Class Subaccount			LVIP SSGA SMID Cap Managed Volatility Fund - Service Class Subaccount			LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class Subaccount			LVIP T. Rowe Price Growth Stock Fund - Service Class Subaccount			LVIP T. Rowe Price Growth Stock Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	2,000,553		$	108,191,274		$	1,642,914		$	173,814,321		$	155,922		$	258,976,178		$	114,980
Changes From Operations:
• Net investment income (loss)		22,167			425,543			22,631			(1,122,080	)		413			(3,892,172	)		(1,179	)
• Net realized gain (loss) on investments		47,587			5,591,218			38,250			(667,259	)		(1,811	)		13,603,794			7,962
• Net change in unrealized appreciation or depreciation on investments		431,894			22,517,410			404,773			31,598,278			20,246			(11,031,196	)		25,025
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		501,648			28,534,171			465,654			29,808,939			18,848			(1,319,574	)		31,808
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		794,430			4,721,134			230,649			37,073,061			—			10,770,892			568,157
• Contract withdrawals and transfers to annuity reserves		(83,078	)		(8,655,593	)		(145,864	)		(10,601,324	)		(2,557	)		(18,311,774	)		(31,488	)
• Contract transfers		(81,444	)		(406,180	)		(15,138	)		38,347,040			(38,504	)		(16,170,354	)		1,040
		629,908			(4,340,639	)		69,647			64,818,777			(41,061	)		(23,711,236	)		537,709
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			(8,536	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			118			—			—			—			(549	)		—
		—			118			—			—			—			(9,085	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		629,908			(4,340,521	)		69,647			64,818,777			(41,061	)		(23,720,321	)		537,709
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,131,556			24,193,650			535,301			94,627,716			(22,213	)		(25,039,895	)		569,517
NET ASSETS AT DECEMBER 31, 2016		3,132,109			132,384,924			2,178,215			268,442,037			133,709			233,936,283			684,497
Changes From Operations:
• Net investment income (loss)		27,901			929,920			58,543			(1,475,635	)		450			(4,297,469	)		(1,051	)
• Net realized gain (loss) on investments		186,932			14,138,050			270,093			3,090,111			3,036			22,431,801			49,765
• Net change in unrealized appreciation or depreciation on investments		437,166			(9,114,682	)		(156,353	)		36,101,927			8,459			53,245,569			227,850
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		651,999			5,953,288			172,283			37,716,403			11,945			71,379,901			276,564
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		2,297,851			14,733,492			934,396			31,911,788			—			16,572,706			471,253
• Contract withdrawals and transfers to annuity reserves		(167,836	)		(13,133,273	)		(226,138	)		(18,335,521	)		(4,298	)		(22,096,667	)		(37,463	)
• Contract transfers		627,522			2,643,705			301,963			47,141,629			(46,980	)		2,830,570			56,395
		2,757,537			4,243,924			1,010,221			60,717,896			(51,278	)		(2,693,391	)		490,185
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			(11,634	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		—			135			—			—			—			632			—
		—			135			—			—			—			(11,002	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,757,537			4,244,059			1,010,221			60,717,896			(51,278	)		(2,704,393	)		490,185
TOTAL INCREASE (DECREASE) IN NET ASSETS		3,409,536			10,197,347			1,182,504			98,434,299			(39,333	)		68,675,508			766,749
NET ASSETS AT DECEMBER 31, 2017	$	6,541,645		$	142,582,271		$	3,360,719		$	366,876,336		$	94,376		$	302,611,791		$	1,451,246

See accompanying notes.
N-84

	LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class Subaccount			LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class Subaccount			LVIP U.S. Growth Allocation Managed Risk Fund - Service Class Subaccount			LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class Subaccount			LVIP Vanguard Domestic Equity ETF Fund - Service Class Subaccount			LVIP Vanguard Domestic Equity ETF Fund - Standard Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	115,246,446		$	2,836,264		$	235,159,439		$	33,058		$	107,974,953		$	530,619
Changes From Operations:
• Net investment income (loss)		(1,756,503	)		(42,048	)		(92,456	)		210			(25,967	)		4,280
• Net realized gain (loss) on investments		8,143,664			239,222			(266,012	)		(1	)		3,684,591			19,937
• Net change in unrealized appreciation or depreciation on investments		(339,101	)		(25,477	)		15,248,961			930			8,358,390			39,687
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		6,048,060			171,697			14,890,493			1,139			12,017,014			63,904
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		6,037,799			56,672			155,697,721			—			6,519,495			183,357
• Contract withdrawals and transfers to annuity reserves		(9,260,986	)		(430,536	)		(19,851,461	)		(1,348	)		(9,086,852	)		(31,511	)
• Contract transfers		(1,237,734	)		288,070			198,514,971			635			18,352,852			(130,753	)
		(4,460,921	)		(85,794	)		334,361,231			(713	)		15,785,495			21,093
Annuity Reserves:
• Annuity Payments		(5,343	)		—			—			—			(17,146	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		11			—			—			—			(8,290	)		—
		(5,332	)		—			—			—			(25,436	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(4,466,253	)		(85,794	)		334,361,231			(713	)		15,760,059			21,093
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,581,807			85,903			349,251,724			426			27,777,073			84,997
NET ASSETS AT DECEMBER 31, 2016		116,828,253			2,922,167			584,411,163			33,484			135,752,026			615,616
Changes From Operations:
• Net investment income (loss)		(2,211,156	)		(47,451	)		1,440,617			330			(124,390	)		10,805
• Net realized gain (loss) on investments		8,713,280			269,732			14,653,449			686			6,345,041			18,425
• Net change in unrealized appreciation or depreciation on investments		21,257,903			458,563			76,539,509			3,735			20,642,347			134,253
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		27,760,027			680,844			92,633,575			4,751			26,862,998			163,483
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		18,625,107			767,873			129,007,710			—			33,825,663			319,204
• Contract withdrawals and transfers to annuity reserves		(11,601,879	)		(415,714	)		(37,148,288	)		(2,205	)		(9,677,246	)		(29,882	)
• Contract transfers		11,573,317			13,010			136,222,173			(759	)		11,933,268			300,864
		18,596,545			365,169			228,081,595			(2,964	)		36,081,685			590,186
Annuity Reserves:
• Annuity Payments		(5,964	)		—			—			—			(29,751	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		21			—			—			—			11			—
		(5,943	)		—			—			—			(29,740	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		18,590,602			365,169			228,081,595			(2,964	)		36,051,945			590,186
TOTAL INCREASE (DECREASE) IN NET ASSETS		46,350,629			1,046,013			320,715,170			1,787			62,914,943			753,669
NET ASSETS AT DECEMBER 31, 2017	$	163,178,882		$	3,968,180		$	905,126,333		$	35,271		$	198,666,969		$	1,369,285

N-85

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	LVIP Vanguard International Equity ETF Fund - Service Class Subaccount			LVIP VIP LVIP Vanguard International Equity ETF Fund - Standard Class Subaccount			LVIP VIP Mid Cap Managed Volatility Portfolio - Service Class Subaccount			Mid Cap Managed Volatility Portfolio - Standard Class Subaccount			LVIP Wellington Capital Growth Fund - Service Class Subaccount			LVIP Wellington Capital Growth Fund - Standard Class Subaccount			LVIP Wellington Mid-Cap Value Fund - Service Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	67,184,750		$	685,549		$	66,898,619		$	87,497		$	313,479,427		$	—		$	74,397,028
Changes From Operations:
• Net investment income (loss)		473,289			10,117			(1,139,629	)		(434	)		(3,199,088	)		(5	)		(1,020,272	)
• Net realized gain (loss) on investments		(674,085	)		(5,418	)		3,337,158			(2,038	)		33,221,774			(47	)		2,957,961
• Net change in unrealized appreciation or depreciation on investments		1,589,008			26,249			4,186,453			5,888			(32,961,975	)		—			6,687,144
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		1,388,212			30,948			6,383,982			3,416			(2,939,289	)		(52	)		8,624,833
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		4,792,450			90,937			3,435,040			—			4,442,512			6,340			4,475,446
• Contract withdrawals and transfers to annuity reserves		(3,734,555	)		(128,600	)		(3,142,727	)		(3,114	)		(21,993,287	)		—			(6,605,232	)
• Contract transfers		6,125,041			40,040			(73,574,914	)		(87,799	)		782,164			(6,288	)		4,523,514
		7,182,936			2,377			(73,282,601	)		(90,913	)		(16,768,611	)		52			2,393,728
Annuity Reserves:
• Annuity Payments		(4,670	)		—			—			—			(1,977	)		—			(6,525	)
• Receipt (reimbursement) of mortality guarantee adjustments		(2,877	)		—			—			—			—			—			—
		(7,547	)		—			—			—			(1,977	)		—			(6,525	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		7,175,389			2,377			(73,282,601	)		(90,913	)		(16,770,588	)		52			2,387,203
TOTAL INCREASE (DECREASE) IN NET ASSETS		8,563,601			33,325			(66,898,619	)		(87,497	)		(19,709,877	)		—			11,012,036
NET ASSETS AT DECEMBER 31, 2016		75,748,351			718,874			—			—			293,769,550			—			85,409,064
Changes From Operations:
• Net investment income (loss)		650,762			20,889			—			—			(3,441,702	)		(96	)		(1,281,527	)
• Net realized gain (loss) on investments		1,665,183			22,884			—			—			41,145,307			4,777			5,972,853
• Net change in unrealized appreciation or depreciation on investments		20,011,789			189,764			—			—			56,418,149			1,918			5,314,980
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		22,327,734			233,537			—			—			94,121,754			6,599			10,006,306
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		24,773,879			335,210			—			—			5,353,349			57			9,142,513
• Contract withdrawals and transfers to annuity reserves		(8,317,827	)		(97,101	)		—			—			(24,761,588	)		—			(8,184,509	)
• Contract transfers		17,666,050			345,957			—			—			(30,693,777	)		56,716			2,257,681
		34,122,102			584,066			—			—			(50,102,016	)		56,773			3,215,685
Annuity Reserves:
• Annuity Payments		(8,990	)		—			—			—			(12,043	)		—			(7,186	)
• Receipt (reimbursement) of mortality guarantee adjustments		3			—			—			—			(1,321	)		—			12
		(8,987	)		—			—			—			(13,364	)		—			(7,174	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		34,113,115			584,066			—			—			(50,115,380	)		56,773			3,208,511
TOTAL INCREASE (DECREASE) IN NET ASSETS		56,440,849			817,603			—			—			44,006,374			63,372			13,214,817
NET ASSETS AT DECEMBER 31, 2017	$	132,189,200		$	1,536,477		$	—		$	—		$	337,775,924		$	63,372		$	98,623,881

See accompanying notes.
N-86

	LVIP Wellington Mid-Cap Value Fund - Standard Class Subaccount			LVIP Western Asset Core Bond Fund - Service Class Subaccount			LVIP Western Asset Core Bond Fund - Standard Class Subaccount			MFS® VIT Growth Series - Initial Class Subaccount			MFS® VIT Growth Series - Service Class Subaccount			MFS® VIT Total Return Series - Initial Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	—		$	—		$	3,321,139		$	64,088,413		$	7,565,445
Changes From Operations:
• Net investment income (loss)		140			—			—			(43,501	)		(1,008,194	)		117,601
• Net realized gain (loss) on investments		229			—			—			276,392			5,660,267			1,657,237
• Net change in unrealized appreciation or depreciation on investments		8,797			—			—			(199,438	)		(3,802,973	)		(1,208,244	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		9,166			—			—			33,453			849,100			566,594
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		178,101			—			—			68,879			6,235,987			31,047
• Contract withdrawals and transfers to annuity reserves		—			—			—			(212,414	)		(6,036,791	)		(695,695	)
• Contract transfers		66,133			—			—			(30,158	)		14,077,558			110,990
		244,234			—			—			(173,693	)		14,276,754			(553,658	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			(840	)		(3,110	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			(145	)		89
		—			—			—			—			(985	)		(3,021	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		244,234			—			—			(173,693	)		14,275,769			(556,679	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		253,400			—			—			(140,240	)		15,124,869			9,915
NET ASSETS AT DECEMBER 31, 2016		253,400			—			—			3,180,899			79,213,282			7,575,360
Changes From Operations:
• Net investment income (loss)		160			299,664			8,815			(44,590	)		(1,291,157	)		57,376
• Net realized gain (loss) on investments		8,267			8,694			(5	)		1,436,307			6,953,549			576,313
• Net change in unrealized appreciation or depreciation on investments		28,361			(206,373	)		(3,945	)		(483,131	)		17,785,283			96,046
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		36,788			101,985			4,865			908,586			23,447,675			729,735
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		12,392			16,569,130			511,959			375,391			10,094,542			51,258
• Contract withdrawals and transfers to annuity reserves		(78	)		(1,049,178	)		(3,101	)		(575,693	)		(6,414,327	)		(1,264,052	)
• Contract transfers		38,485			22,620,969			108,378			(150,645	)		(328,196	)		(469,816	)
		50,799			38,140,921			617,236			(350,947	)		3,352,019			(1,682,610	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			(1,887	)		(3,268	)
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			(164	)		100
		—			—			—			—			(2,051	)		(3,168	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		50,799			38,140,921			617,236			(350,947	)		3,349,968			(1,685,778	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		87,587			38,242,906			622,101			557,639			26,797,643			(956,043	)
NET ASSETS AT DECEMBER 31, 2017	$	340,987		$	38,242,906		$	622,101		$	3,738,538		$	106,010,925		$	6,619,317

N-87

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

MFS® VIT Total Return Series - Service Class	MFS® VIT Utilities Series - Initial Class Subaccount			MFS® VIT Utilities Series - Service Class Subaccount			MFS® VIT II Core Equity Portfolio - Service Class Subaccount			MFS® VIT II International Value Portfolio - Initial Class Subaccount			MFS® VIT II International Value Portfolio - Service Class Subaccount			Morgan Stanley VIF Global Infrastructure Portfolio - Class I Subaccount			Morgan Stanley VIF Global Infrastructure Portfolio - Class II Subaccount
NET ASSETS AT JANUARY 1, 2016	$	4,724		$	7,611,161		$	187,475,679		$	2,350,101		$	156,900		$	10,588,129		$	44,586
Changes From Operations:
• Net investment income (loss)		107,383			196,524			4,134,960			(25,618	)		3,275			8,747			1,033
• Net realized gain (loss) on investments		211,912			289,475			2,749,302			139,508			6,863			310,416			2,411
• Net change in unrealized appreciation or depreciation on investments		(77,751	)		241,102			10,827,723			78,962			(5,819	)		(61,062	)		3,244
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		241,544			727,101			17,711,985			192,852			4,319			258,101			6,688
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		13,727,617			11,597			4,994,888			2,211			36,657			4,613,537			18,239
• Contract withdrawals and transfers to annuity reserves		(944,118	)		(679,837	)		(19,495,299	)		(108,465	)		(10,999	)		(712,351	)		(5,439	)
• Contract transfers		17,205,415			(410,724	)		4,701,191			(232,004	)		136,927			2,675,392			11,408
		29,988,914			(1,078,964	)		(9,799,220	)		(338,258	)		162,585			6,576,578			24,208
Annuity Reserves:
• Annuity Payments		—			(5,481	)		(16,955	)		—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			885			1,684			—			—			—			—
		—			(4,596	)		(15,271	)		—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		29,988,914			(1,083,560	)		(9,814,491	)		(338,258	)		162,585			6,576,578			24,208
TOTAL INCREASE (DECREASE) IN NET ASSETS		30,230,458			(356,459	)		7,897,494			(145,406	)		166,904			6,834,679			30,896
NET ASSETS AT DECEMBER 31, 2016		30,235,182			7,254,702			195,373,173			2,204,695			323,804			17,422,808			75,482
Changes From Operations:
• Net investment income (loss)		424,632			209,007			4,895,363			(22,181	)		5,514			47,942			2,427
• Net realized gain (loss) on investments		1,937,497			1,397,162			1,565,434			135,863			7,492			416,466			2,054
• Net change in unrealized appreciation or depreciation on investments		2,815,013			(693,296	)		17,358,723			354,765			118,738			4,713,601			5,992
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		5,177,142			912,873			23,819,520			468,447			131,744			5,178,009			10,473
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		18,792,490			75,060			4,330,088			6,970			480,559			3,776,430			73,051
• Contract withdrawals and transfers to annuity reserves		(3,488,197	)		(642,842	)		(21,494,574	)		(103,525	)		(34,326	)		(1,314,211	)		(964	)
• Contract transfers		18,809,845			(504,881	)		(7,566,539	)		(85,485	)		132,881			5,695,826			134,255
		34,114,138			(1,072,663	)		(24,731,025	)		(182,040	)		579,114			8,158,045			206,342
Annuity Reserves:
• Annuity Payments		—			(6,080	)		(19,041	)		—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			1,053			2,500			—			—			—			—
		—			(5,027	)		(16,541	)		—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		34,114,138			(1,077,690	)		(24,747,566	)		(182,040	)		579,114			8,158,045			206,342
TOTAL INCREASE (DECREASE) IN NET ASSETS		39,291,280			(164,817	)		(928,046	)		286,407			710,858			13,336,054			216,815
NET ASSETS AT DECEMBER 31, 2017	$	69,526,462		$	7,089,885		$	194,445,127		$	2,491,102		$	1,034,662		$	30,758,862		$	292,297

See accompanying notes.
N-88

MFS® VIT Total Return Series - Service Class	Morgan Stanley VIF Growth Portfolio - Class II Subaccount			Neuberger Berman AMT Mid Cap Growth Portfolio - I Class Subaccount			Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class Subaccount			Oppenheimer Global Fund/VA Service Shares Subaccount			Oppenheimer International Growth Fund/VA Non-Service Shares Subaccount			Subaccount
NET ASSETS AT JANUARY 1, 2016	$	3,211,909		$	1,801,323		$	—		$	29,139,938		$	7,985,822		$	554,988
Changes From Operations:
• Net investment income (loss)		42,989			(15,514	)		(3	)		(297,340	)		(14,866	)		3,784
• Net realized gain (loss) on investments		215,365			299,846			73			2,876,713			586,777			8,097
• Net change in unrealized appreciation or depreciation on investments		235,982			(332,465	)		—			1,140,597			(620,710	)		(27,283	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		494,336			(48,133	)		70			3,719,970			(48,799	)		(15,402	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		955,125			70			1			206,356			17,651			37,916
• Contract withdrawals and transfers to annuity reserves		(274,428	)		(138,006	)		(71	)		(3,353,524	)		(552,738	)		(36,790	)
• Contract transfers		1,529,842			(34,034	)		—			(1,509,862	)		361,683			(7,893	)
		2,210,539			(171,970	)		(70	)		(4,657,030	)		(173,404	)		(6,767	)
Annuity Reserves:
• Annuity Payments		—			—			—			(4,733	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			143			—			—
		—			—			—			(4,590	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,210,539			(171,970	)		(70	)		(4,661,620	)		(173,404	)		(6,767	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		2,704,875			(220,103	)		—			(941,650	)		(222,203	)		(22,169	)
NET ASSETS AT DECEMBER 31, 2016		5,916,784			1,581,220			—			28,198,288			7,763,619			532,819
Changes From Operations:
• Net investment income (loss)		51,113			(20,888	)		—			(243,958	)		(20,431	)		4,959
• Net realized gain (loss) on investments		275,126			293,753			—			1,305,591			423,238			302
• Net change in unrealized appreciation or depreciation on investments		344,492			417,618			—			2,800,430			2,148,652			158,933
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		670,731			690,483			—			3,862,063			2,551,459			164,194
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		1,134,958			7,799			—			171,503			28,070			779,621
• Contract withdrawals and transfers to annuity reserves		(1,214,098	)		(269,360	)		—			(3,591,544	)		(551,510	)		(15,832	)
• Contract transfers		432,910			382,266			—			(1,093,482	)		(743,823	)		(2,617	)
		353,770			120,705			—			(4,513,523	)		(1,267,263	)		761,172
Annuity Reserves:
• Annuity Payments		—			—			—			(1,060	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			187			—			—
		—			—			—			(873	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		353,770			120,705			—			(4,514,396	)		(1,267,263	)		761,172
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,024,501			811,188			—			(652,333	)		1,284,196			925,366
NET ASSETS AT DECEMBER 31, 2017	$	6,941,285		$	2,392,408		$	—		$	27,545,955		$	9,047,815		$	1,458,185

N-89

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Oppenheimer International Growth Fund/VA Service Shares Subaccount			Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares Subaccount			Oppenheimer Main Street Small Cap Fund®/VA Service Shares Subaccount			PIMCO VIT All Asset All Authority Portfolio - Advisor Class Subaccount			PIMCO VIT All Asset All Authority Portfolio - Institutional Class Subaccount			PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class Subaccount			PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class Subaccount
NET ASSETS AT JANUARY 1, 2016	$	5,928,744		$	36,248		$	4,495,929		$	891,058		$	195,479		$	9,729,125		$	28,443
Changes From Operations:
• Net investment income (loss)		(23,026	)		134			(58,483	)		25,408			3,944			(51,167	)		258
• Net realized gain (loss) on investments		19,327			3,565			172,445			(14,126	)		(7,429	)		(1,494,074	)		(152	)
• Net change in unrealized appreciation or depreciation on investments		(284,418	)		16,385			957,242			134,388			21,928			2,968,087			4,013
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(288,117	)		20,084			1,071,204			145,670			18,443			1,422,846			4,119
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		2,383,357			360,809			1,969,107			268,321			—			1,415,785			—
• Contract withdrawals and transfers to annuity reserves		(372,961	)		(782	)		(172,585	)		(94,081	)		(896	)		(1,043,347	)		(1,927	)
• Contract transfers		862,136			64,471			690,279			501,889			(114,811	)		1,380,568			(298	)
		2,872,532			424,498			2,486,801			676,129			(115,707	)		1,753,006			(2,225	)
Annuity Reserves:
• Annuity Payments		(1,952	)		—			(1,991	)		—			—			(5,806	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		80			—			84			—			—			1,703			—
		(1,872	)		—			(1,907	)		—			—			(4,103	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,870,660			424,498			2,484,894			676,129			(115,707	)		1,748,903			(2,225	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		2,582,543			444,582			3,556,098			821,799			(97,264	)		3,171,749			1,894
NET ASSETS AT DECEMBER 31, 2016		8,511,287			480,830			8,052,027			1,712,857			98,215			12,900,874			30,337
Changes From Operations:
• Net investment income (loss)		1,969			2,432			(56,004	)		98,325			5,242			1,227,836			3,343
• Net realized gain (loss) on investments		59,876			31,708			577,096			6,255			29			(1,206,126	)		(9	)
• Net change in unrealized appreciation or depreciation on investments		2,267,002			36,710			569,833			88,650			5,473			(19,334	)		(2,624	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		2,328,847			70,850			1,090,925			193,230			10,744			2,376			710
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		2,268,563			59,286			1,800,948			712,814			5,401			340,422			—
• Contract withdrawals and transfers to annuity reserves		(555,492	)		(218	)		(886,306	)		(137,431	)		(884	)		(928,649	)		—
• Contract transfers		1,199,481			(5,051	)		568,488			686,918			(33	)		173,490			2,039
		2,912,552			54,017			1,483,130			1,262,301			4,484			(414,737	)		2,039
Annuity Reserves:
• Annuity Payments		(2,100	)		—			(2,283	)		—			—			(5,665	)		—
• Receipt (reimbursement) of mortality guarantee adjustments		105			—			111			—			—			(133	)		—
		(1,995	)		—			(2,172	)		—			—			(5,798	)		—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		2,910,557			54,017			1,480,958			1,262,301			4,484			(420,535	)		2,039
TOTAL INCREASE (DECREASE) IN NET ASSETS		5,239,404			124,867			2,571,883			1,455,531			15,228			(418,159	)		2,749
NET ASSETS AT DECEMBER 31, 2017	$	13,750,691		$	605,697		$	10,623,910		$	3,168,388		$	113,443		$	12,482,715		$	33,086

See accompanying notes.
N-90

	PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class Subaccount			PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class Subaccount			PIMCO VIT Unconstrained Bond Portfolio - Advisor Class Subaccount			PIMCO VIT Unconstrained Bond Portfolio - Institutional Class Subaccount			Putnam VT Absolute Return 500 Fund - Class IA Subaccount			Putnam VT Absolute Return 500 Fund - Class IB Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,432,749		$	6,547		$	2,656,937		$	22,095		$	9,644		$	2,402,565
Changes From Operations:
• Net investment income (loss)		83,744			493			11,755			354			352			50,141
• Net realized gain (loss) on investments		(19,903	)		(6	)		(20,593	)		(53	)		(472	)		(27,333	)
• Net change in unrealized appreciation or depreciation on investments		104,369			401			124,498			809			9			(36,883	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		168,210			888			115,660			1,110			(111	)		(14,075	)
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		998,094			2,966			934,996			—			—			361,974
• Contract withdrawals and transfers to annuity reserves		(245,566	)		(33	)		(310,945	)		—			(30	)		(92,533	)
• Contract transfers		597,521			13,197			125,437			10,120			(9,503	)		(480,014	)
		1,350,049			16,130			749,488			10,120			(9,533	)		(210,573	)
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,350,049			16,130			749,488			10,120			(9,533	)		(210,573	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,518,259			17,018			865,148			11,230			(9,644	)		(224,648	)
NET ASSETS AT DECEMBER 31, 2016		2,951,008			23,565			3,522,085			33,325			—			2,177,917
Changes From Operations:
• Net investment income (loss)		124,949			1,717			13,652			570			(2	)		(30,166	)
• Net realized gain (loss) on investments		16,512			693			15,502			1			—			4,428
• Net change in unrealized appreciation or depreciation on investments		111,365			564			106,162			1,187			42			160,802
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		252,826			2,974			135,316			1,758			40			135,064
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		101,840			17,406			93,401			—			1,345			567,517
• Contract withdrawals and transfers to annuity reserves		(122,627	)		(201	)		(228,673	)		—			—			(121,919	)
• Contract transfers		421,726			(11,624	)		378,499			6,031			—			167,029
		400,939			5,581			243,227			6,031			1,345			612,627
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		400,939			5,581			243,227			6,031			1,345			612,627
TOTAL INCREASE (DECREASE) IN NET ASSETS		653,765			8,555			378,543			7,789			1,385			747,691
NET ASSETS AT DECEMBER 31, 2017	$	3,604,773		$	32,120		$	3,900,628		$	41,114		$	1,385		$	2,925,608

N-91

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Putnam VT Equity Income Fund - Class IB Subaccount			Putnam VT George Putnam Balanced Fund - Class IA Subaccount			Putnam VT George Putnam Balanced Fund - Class IB Subaccount			Putnam VT Global Health Care Fund - Class IA Subaccount			Putnam VT Global Health Care Fund - Class IB Subaccount			Putnam VT Growth &Income Fund - Class IB Subaccount			Putnam VT Income Fund - Class IB Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	—		$	—		$	19,563		$	9,761,142		$	1,229,146		$	2,051,661
Changes From Operations:
• Net investment income (loss)		—			—			—			(94	)		(121,458	)		1,177			79,318
• Net realized gain (loss) on investments		—			—			—			1,341			474,518			61,935			(9,173	)
• Net change in unrealized appreciation or depreciation on investments		—			—			—			(4,513	)		(1,596,605	)		83,254			(53,064	)
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			—			—			(3,266	)		(1,243,545	)		146,366			17,081
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			—			—			9,612			1,467,023			2,768			1,213,529
• Contract withdrawals and transfers to annuity reserves		—			—			—			(8,605	)		(581,350	)		(143,202	)		(148,260	)
• Contract transfers		—			—			—			1,907			(1,236,554	)		(14,258	)		900,422
		—			—			—			2,914			(350,881	)		(154,692	)		1,965,691
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			—			—			2,914			(350,881	)		(154,692	)		1,965,691
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			—			—			(352	)		(1,594,426	)		(8,326	)		1,982,772
NET ASSETS AT DECEMBER 31, 2016		—			—			—			19,211			8,166,716			1,220,820			4,034,433
Changes From Operations:
• Net investment income (loss)		(12,342	)		(219	)		(69,887	)		(144	)		(100,457	)		18,402			119,042
• Net realized gain (loss) on investments		6,384			15			50,361			1,353			855,375			296,458			(9,635	)
• Net change in unrealized appreciation or depreciation on investments		138,948			5,101			842,310			4,866			548,386			(259,762	)		81,926
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		132,990			4,897			822,784			6,075			1,303,304			55,098			191,333
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		22,957			232,390			4,522,474			60,194			2,008,254			600			1,751,893
• Contract withdrawals and transfers to annuity reserves		(72,800	)		(82	)		(396,982	)		(514	)		(737,462	)		(61,641	)		(386,463	)
• Contract transfers		1,135,719			(343	)		9,258,574			47,951			2,801,848			(1,214,877	)		547,827
		1,085,876			231,965			13,384,066			107,631			4,072,640			(1,275,918	)		1,913,257
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—			—
		—			—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,085,876			231,965			13,384,066			107,631			4,072,640			(1,275,918	)		1,913,257
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,218,866			236,862			14,206,850			113,706			5,375,944			(1,220,820	)		2,104,590
NET ASSETS AT DECEMBER 31, 2017	$	1,218,866		$	236,862		$	14,206,850		$	132,917		$	13,542,660		$	—		$	6,139,023

See accompanying notes.
N-92

	QS Variable Conservative Growth - Class II Subaccount			Rational Dividend Capture VA Fund Subaccount			SEI VP Market Growth Strategy Fund - Class III Subaccount			SEI VP Market Plus Strategy Fund - Class III Subaccount			Templeton Foreign VIP Fund - Class 1 Subaccount			Templeton Foreign VIP Fund - Class 4 Subaccount
NET ASSETS AT JANUARY 1, 2016	$	—		$	1,182,870		$	797,918		$	1,444,007		$	19,246		$	1,582,413
Changes From Operations:
• Net investment income (loss)		—			45,567			20,437			13,735			347			9,021
• Net realized gain (loss) on investments		—			25,062			18,277			53,897			177			(33,081	)
• Net change in unrealized appreciation or depreciation on investments		—			(4,776	)		18,604			41,181			903			198,220
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		—			65,853			57,318			108,813			1,427			174,160
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		—			5,747			982,186			237,693			—			586,717
• Contract withdrawals and transfers to annuity reserves		—			(109,574	)		(49,939	)		(84,758	)		—			(85,957	)
• Contract transfers		—			237,755			(27,532	)		81,132			116			325,879
		—			133,928			904,715			234,067			116			826,639
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		—			133,928			904,715			234,067			116			826,639
TOTAL INCREASE (DECREASE) IN NET ASSETS		—			199,781			962,033			342,880			1,543			1,000,799
NET ASSETS AT DECEMBER 31, 2016		—			1,382,651			1,759,951			1,786,887			20,789			2,583,212
Changes From Operations:
• Net investment income (loss)		16,983			26,633			5,709			4,588			665			14,343
• Net realized gain (loss) on investments		102,246			10,867			11,284			(3,116	)		(57	)		58,717
• Net change in unrealized appreciation or depreciation on investments		(95,633	)		(73,494	)		235,836			293,953			3,118			326,927
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		23,596			(35,994	)		252,829			295,425			3,726			399,987
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		408,470			770			911,038			55,853			5,399			428,174
• Contract withdrawals and transfers to annuity reserves		(7,348	)		(166,416	)		(86,945	)		(84,486	)		—			(295,732	)
• Contract transfers		546,100			87,070			(189,335	)		1,014			(169	)		20,138
		947,222			(78,576	)		634,758			(27,619	)		5,230			152,580
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		947,222			(78,576	)		634,758			(27,619	)		5,230			152,580
TOTAL INCREASE (DECREASE) IN NET ASSETS		970,818			(114,570	)		887,587			267,806			8,956			552,567
NET ASSETS AT DECEMBER 31, 2017	$	970,818		$	1,268,081		$	2,647,538		$	2,054,693		$	29,745		$	3,135,779

N-93

Lincoln Life Variable Annuity Account N

Statements of changes in net assets (continued)

Years Ended December 31, 2016 and 2017

	Templeton Global Bond VIP Fund - Class 1 Subaccount			Templeton Global Bond VIP Fund - Class 2 Subaccount			Templeton Global Bond VIP Fund - Class 4 Subaccount			Templeton Growth VIP Fund - Class 2 Subaccount			Transparent Value Directional Allocation VI Portfolio - Class I Subaccount			Transparent Value Directional Allocation VI Portfolio - Class II Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,555,040		$	396,170,672		$	12,874,602		$	30,914,559		$	33,213		$	7,738,723
Changes From Operations:
• Net investment income (loss)		(6,306	)		(5,790,335	)		(180,805	)		104,856			(39	)		(37,079	)
• Net realized gain (loss) on investments		(19,172	)		(8,914,831	)		(278,801	)		1,072,822			(876	)		63,593
• Net change in unrealized appreciation or depreciation on investments		63,028			18,233,573			855,479			972,861			1,667			213,127
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		37,550			3,528,407			395,873			2,150,539			752			239,641
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		57,146			4,415,084			4,332,324			245,458			—			18,635
• Contract withdrawals and transfers to annuity reserves		(46,303	)		(38,294,278	)		(1,053,766	)		(3,290,117	)		—			(48,645	)
• Contract transfers		(64,106	)		(11,085,318	)		1,405,034			(421,070	)		(33,965	)		(7,948,354	)
		(53,263	)		(44,964,512	)		4,683,592			(3,465,729	)		(33,965	)		(7,978,364	)
Annuity Reserves:
• Annuity Payments		—			(6,560	)		—			(11,944	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			137			—			13			—			—
		—			(6,423	)		—			(11,931	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		(53,263	)		(44,970,935	)		4,683,592			(3,477,660	)		(33,965	)		(7,978,364	)
TOTAL INCREASE (DECREASE) IN NET ASSETS		(15,713	)		(41,442,528	)		5,079,465			(1,327,121	)		(33,213	)		(7,738,723	)
NET ASSETS AT DECEMBER 31, 2016		1,539,327			354,728,144			17,954,067			29,587,438			—			—
Changes From Operations:
• Net investment income (loss)		(8,268	)		(5,523,496	)		(267,239	)		(20,465	)		—			—
• Net realized gain (loss) on investments		16,171			(848,040	)		91,298			1,268,184			—			—
• Net change in unrealized appreciation or depreciation on investments		4,765			7,917,616			133,891			3,348,344			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		12,668			1,546,080			(42,050	)		4,596,063			—			—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		859,925			2,350,648			4,946,241			212,158			—			—
• Contract withdrawals and transfers to annuity reserves		(68,359	)		(39,965,254	)		(1,123,802	)		(3,659,322	)		—			—
• Contract transfers		33,421			15,232,203			4,472,618			(669,664	)		—			—
		824,987			(22,382,403	)		8,295,057			(4,116,828	)		—			—
Annuity Reserves:
• Annuity Payments		—			(9,294	)		—			(13,534	)		—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			(168	)		—			432			—			—
		—			(9,462	)		—			(13,102	)		—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		824,987			(22,391,865	)		8,295,057			(4,129,930	)		—			—
TOTAL INCREASE (DECREASE) IN NET ASSETS		837,655			(20,845,785	)		8,253,007			466,133			—			—
NET ASSETS AT DECEMBER 31, 2017	$	2,376,982		$	333,882,359		$	26,207,074		$	30,053,571		$	—		$	—

See accompanying notes.
N-94

	VanEck VIP Global Hard Assets Fund - Class S Shares Subaccount			VanEck VIP Global Hard Assets Fund - Initial Class Shares Subaccount			Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares Subaccount			Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares Subaccount			Virtus Rampart Equity Trend Series - Class A Shares Subaccount			Virtus Rampart Equity Trend Series - Class I Shares Subaccount
NET ASSETS AT JANUARY 1, 2016	$	1,241,231		$	226,309		$	6,310,592		$	12,189		$	3,361,190		$	—
Changes From Operations:
• Net investment income (loss)		(17,526	)		(14	)		300,237			568			(19,383	)		—
• Net realized gain (loss) on investments		(22,153	)		(5,125	)		(17,945	)		(11	)		(397,007	)		—
• Net change in unrealized appreciation or depreciation on investments		726,933			99,580			265,663			547			261,711			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		687,254			94,441			547,955			1,104			(154,679	)		—
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		499,207			90			2,894,617			—			36,132			—
• Contract withdrawals and transfers to annuity reserves		(147,607	)		(21,748	)		(760,875	)		—			(42,768	)		—
• Contract transfers		755,902			—			1,388,265			—			(2,011,349	)		—
		1,107,502			(21,658	)		3,522,007			—			(2,017,985	)		—
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		1,107,502			(21,658	)		3,522,007			—			(2,017,985	)		—
TOTAL INCREASE (DECREASE) IN NET ASSETS		1,794,756			72,783			4,069,962			1,104			(2,172,664	)		—
NET ASSETS AT DECEMBER 31, 2016		3,035,987			299,092			10,380,554			13,293			1,188,526			—
Changes From Operations:
• Net investment income (loss)		(36,167	)		(1,120	)		398,678			47,861			(16,438	)		—
• Net realized gain (loss) on investments		(7,835	)		(10,794	)		21,158			2,336			29,618			1
• Net change in unrealized appreciation or depreciation on investments		(36,112	)		13,803			190,293			(10,335	)		212,164			6
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS		(80,114	)		1,889			610,129			39,862			225,344			7
Changes From Unit Transactions:
Accumulation Units:
• Contract purchases		578,399			162			1,800,567			686,341			62,241			44
• Contract withdrawals and transfers to annuity reserves		(250,589	)		(22,980	)		(929,355	)		(29,047	)		(42,033	)		—
• Contract transfers		320,529			105,440			1,650,096			503,311			11,572			—
		648,339			82,622			2,521,308			1,160,605			31,780			44
Annuity Reserves:
• Annuity Payments		—			—			—			—			—			—
• Receipt (reimbursement) of mortality guarantee adjustments		—			—			—			—			—			—
		—			—			—			—			—			—
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM UNIT TRANSACTIONS		648,339			82,622			2,521,308			1,160,605			31,780			44
TOTAL INCREASE (DECREASE) IN NET ASSETS		568,225			84,511			3,131,437			1,200,467			257,124			51
NET ASSETS AT DECEMBER 31, 2017	$	3,604,212		$	383,603		$	13,511,991		$	1,213,760		$	1,445,650		$	51

N-95

Lincoln Life Variable Annuity Account N

Notes to financial statements

December 31, 2017

1. Accounting Policies and Variable Account Information

The Variable Account: Lincoln Life Variable Annuity Account N (the Variable Account) is a segregated investment account of The Lincoln National Life Insurance Company (the Company) and is registered as a unit investment trust with the Securities and Exchange Commission under the Investment Company Act of 1940, as amended. The operations of the Variable Account, which commenced on November 24, 1998, are part of the operations of the Company. The Variable Account consists of thirty-six products as follows:

• Lincoln ChoicePlus
• Lincoln ChoicePlus Access
• Lincoln ChoicePlus Bonus
• Lincoln ChoicePlus II
• Lincoln ChoicePlus II Access
• Lincoln ChoicePlus II Advance
• Lincoln ChoicePlus II Bonus
• Lincoln ChoicePlus Design 1
• Lincoln ChoicePlus Design 2
• Lincoln ChoicePlus Design 3
• Lincoln ChoicePlus Assurance A Share
• Lincoln ChoicePlus Assurance A Share Fee-Based
• Lincoln ChoicePlus Assurance B Share
• Lincoln ChoicePlus Assurance Bonus
• Lincoln ChoicePlus Assurance C Share
• Lincoln ChoicePlus Assurance L Share
• Lincoln ChoicePlus Assurance A Class
• Lincoln ChoicePlus Assurance B Class
• Lincoln ChoicePlus Signature 1 • Lincoln ChoicePlus Signature 2
• Lincoln ChoicePlus Rollover
• Lincoln ChoicePlus Fusion
• Lincoln InvestmentSolutions
• Lincoln ChoicePlus Assurance Series B-Share
• Lincoln ChoicePlus Assurance Series C-Share
• Lincoln ChoicePlus Assurance Series L-Share
• Lincoln ChoicePlus Assurance (Prime)
• Lincoln ChoicePlus Advisory
• Lincoln Investor Advantage B-Share
• Lincoln Investor Advantage C-Share
• Lincoln Investor Advantage Fee-Based
• Lincoln Investor Advantage RIA
• Lincoln Investor Advantage Advisory
• Lincoln Investor Advantage RIA Class
• Lincoln Core Income
• Lincoln InvestmentSolutions RIA

The assets of the Variable Account are owned by the Company. The Variable Account's assets support the annuity contracts and may not be used to satisfy liabilities arising from any other business of the Company.

Basis of Presentation: The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for unit investment trusts.

Accounting Estimates: The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions affecting the reported amounts as of the date of the financial statements. Those estimates are inherently subject to change and actual results could differ from those estimates. Included among the material (or potentially material) reported amounts that require use of estimates is the fair value of certain assets.

Investments: The assets of the Variable Account are divided into variable subaccounts, each of which may be invested in shares of one of four hundred forty-one available mutual funds (the Funds) of thirty-five open-ended management investment companies, each Fund with its own investment objective. The Funds are:

AIM Variable Insurance Funds (Invesco Variable Insurance Funds):

Invesco V.I. American Franchise Fund - Series I Shares

Invesco V.I. American Franchise Fund - Series II Shares

Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares

Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares

Invesco V.I. Comstock Fund - Series I Shares

Invesco V.I. Comstock Fund - Series II Shares

Invesco V.I. Core Equity Fund - Series I Shares

Invesco V.I. Core Equity Fund - Series II Shares

Invesco V.I. Diversified Dividend Fund - Series I Shares

Invesco V.I. Diversified Dividend Fund - Series II Shares

Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares

Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares

Invesco V.I. Equity and Income Fund - Series I Shares

Invesco V.I. Equity and Income Fund - Series II Shares

Invesco V.I. International Growth Fund - Series I Shares

Invesco V.I. International Growth Fund - Series II Shares

AllianceBernstein Variable Products Series Fund:

AB VPS Global Thematic Growth Portfolio - Class A**

AB VPS Global Thematic Growth Portfolio - Class B

AB VPS Growth and Income Portfolio - Class A**

AB VPS Growth and Income Portfolio - Class B**

AB VPS International Value Portfolio - Class A**

N-96

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

AB VPS International Value Portfolio - Class B

AB VPS Large Cap Growth Portfolio - Class B

AB VPS Small/Mid Cap Value Portfolio - Class A

AB VPS Small/Mid Cap Value Portfolio - Class B

ALPS Variable Investment Trust:

ALPS/Alerian Energy Infrastructure Portfolio - Class I

ALPS/Alerian Energy Infrastructure Portfolio - Class III

ALPS/Red Rocks Listed Private Equity Portfolio - Class I

ALPS/Red Rocks Listed Private Equity Portfolio - Class III

ALPS/Stadion Core ETF Portfolio - Class I

ALPS/Stadion Core ETF Portfolio - Class III

ALPS/Stadion Tactical Growth Portfolio - Class I**

ALPS/Stadion Tactical Growth Portfolio - Class III

American Century Variable Portfolios, Inc.:

American Century VP Balanced Fund - Class I

American Century VP Balanced Fund - Class II

American Century VP Inflation Protection Fund - Class I**

American Century VP Inflation Protection Fund - Class II

American Century VP Large Company Value Fund - Class I

American Century VP Large Company Value Fund - Class II

American Funds Insurance Series^®:

American Funds Asset Allocation Fund - Class 1

American Funds Asset Allocation Fund - Class 1A

American Funds Asset Allocation Fund - Class 4

American Funds Blue Chip Income and Growth Fund - Class 1

American Funds Blue Chip Income and Growth Fund - Class 1A

American Funds Blue Chip Income and Growth Fund - Class 4

American Funds Bond Fund - Class 1

American Funds Bond Fund - Class 1A

American Funds Capital Income Builder^® - Class 1

American Funds Capital Income Builder^® - Class 1A

American Funds Capital Income Builder^® - Class 4

American Funds Global Balanced Fund - Class 1

American Funds Global Balanced Fund - Class 1A

American Funds Global Bond Fund - Class 1

American Funds Global Bond Fund - Class 1A

American Funds Global Growth and Income Fund - Class 1

American Funds Global Growth and Income Fund - Class 1A

American Funds Global Growth Fund - Class 1

American Funds Global Growth Fund - Class 1A

American Funds Global Growth Fund - Class 2

American Funds Global Growth Fund - Class 4

American Funds Global Small Capitalization Fund - Class 1

American Funds Global Small Capitalization Fund - Class 1A

American Funds Global Small Capitalization Fund - Class 2

American Funds Global Small Capitalization Fund - Class 4

American Funds Growth Fund - Class 1

American Funds Growth Fund - Class 1A

American Funds Growth Fund - Class 2

American Funds Growth Fund - Class 4

American Funds Growth-Income Fund - Class 1

American Funds Growth-Income Fund - Class 1A

American Funds Growth-Income Fund - Class 2

American Funds Growth-Income Fund - Class 4

American Funds High-Income Bond Fund - Class 1

American Funds High-Income Bond Fund - Class 1A

American Funds International Fund - Class 1

American Funds International Fund - Class 1A

American Funds International Fund - Class 2

American Funds International Fund - Class 4

American Funds International Growth and Income Fund - Class 1

American Funds International Growth and Income Fund - Class 1A

American Funds Managed Risk Asset Allocation Fund - Class P1

American Funds Managed Risk Asset Allocation Fund - Class P2

American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1

American Funds Managed Risk Growth Fund - Class P1

American Funds Managed Risk Growth-Income Fund - Class P1

American Funds Managed Risk International Fund - Class P1

American Funds Mortgage Fund - Class 1

American Funds Mortgage Fund - Class 1A

American Funds Mortgage Fund - Class 4

American Funds New World Fund^® - Class 1

American Funds New World Fund^® - Class 1A

American Funds New World Fund^® - Class 4

American Funds U.S. Government/AAA-Rated Securities Fund - Class 1

American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A

American Funds U.S. Government/AAA-Rated Securities Fund - Class 4**

BlackRock Variable Series Funds, Inc.:

BlackRock Global Allocation V.I. Fund - Class I

BlackRock Global Allocation V.I. Fund - Class III

N-97

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

BlackRock iShares^® Alternative Strategies V.I. Fund - Class I

BlackRock iShares^® Alternative Strategies V.I. Fund - Class III

Columbia Funds Variable Insurance Trust:

Columbia VP Strategic Income Fund - Class 1**

Columbia VP Strategic Income Fund - Class 2

Columbia Funds Variable Insurance Trust II:

Columbia VP Commodity Strategy Fund - Class 1

Columbia VP Commodity Strategy Fund - Class 2

Columbia VP Emerging Markets Bond Fund - Class 1

Columbia VP Emerging Markets Bond Fund - Class 2

Delaware VIP^® Trust:

Delaware VIP^® Diversified Income Series - Service Class

Delaware VIP^® Diversified Income Series - Standard Class

Delaware VIP^® Emerging Markets Series - Service Class

Delaware VIP^® Emerging Markets Series - Standard Class

Delaware VIP^® High Yield Series - Service Class

Delaware VIP^® High Yield Series - Standard Class

Delaware VIP^® International Value Equity Series - Standard Class

Delaware VIP^® Limited-Term Diversified Income Series - Service Class

Delaware VIP^® Limited-Term Diversified Income Series - Standard Class

Delaware VIP^® REIT Series - Service Class

Delaware VIP^® REIT Series - Standard Class

Delaware VIP^® Small Cap Value Series - Service Class

Delaware VIP^® Small Cap Value Series - Standard Class

Delaware VIP^® Smid Cap Core Series - Service Class

Delaware VIP^® Smid Cap Core Series - Standard Class

Delaware VIP^® U.S. Growth Series - Service Class

Delaware VIP^® U.S. Growth Series - Standard Class**

Delaware VIP^® Value Series - Service Class

Delaware VIP^® Value Series - Standard Class

Deutsche Investments VIT Funds:

Deutsche Equity 500 Index VIP Portfolio - Class A

Deutsche Equity 500 Index VIP Portfolio - Class B**

Deutsche Small Cap Index VIP Portfolio - Class A

Deutsche Small Cap Index VIP Portfolio - Class B**

Deutsche Variable Series II:

Deutsche Alternative Asset Allocation VIP Portfolio - Class A

Deutsche Alternative Asset Allocation VIP Portfolio - Class B

Eaton Vance Variable Trust:

Eaton Vance VT Floating-Rate Income Fund - ADV Class

Eaton Vance VT Floating-Rate Income Fund - Initial Class

Fidelity^® Variable Insurance Products:

Fidelity^® VIP Contrafund^® Portfolio - Initial Class

Fidelity^® VIP Contrafund^® Portfolio - Service Class**

Fidelity^® VIP Contrafund^® Portfolio - Service Class 2

Fidelity^® VIP Equity-Income Portfolio - Initial Class**

Fidelity^® VIP Equity-Income Portfolio - Service Class 2**

Fidelity^® VIP FundsManager^® 50% Portfolio - Investor Class**

Fidelity^® VIP FundsManager^® 50% Portfolio - Service Class 2

Fidelity^® VIP Growth Portfolio - Initial Class

Fidelity^® VIP Growth Portfolio - Service Class**

Fidelity^® VIP Growth Portfolio - Service Class 2

Fidelity^® VIP Mid Cap Portfolio - Initial Class

Fidelity^® VIP Mid Cap Portfolio - Service Class 2

Fidelity^® VIP Overseas Portfolio - Initial Class**

Fidelity^® VIP Overseas Portfolio - Service Class**

Fidelity^® VIP Overseas Portfolio - Service Class 2**

Fidelity^® VIP Strategic Income Portfolio - Initial Class

Fidelity^® VIP Strategic Income Portfolio - Service Class 2

First Trust Variable Insurance Trust:

First Trust Dorsey Wright Tactical Core Portfolio - Class I

First Trust Dorsey Wright Tactical Core Portfolio - Class II**

First Trust Multi Income Allocation Portfolio - Class I

First Trust Multi Income Allocation Portfolio - Class II

First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I

First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II

Franklin Templeton Variable Insurance Products Trust:

Franklin Founding Funds Allocation VIP Fund - Class 1**

Franklin Founding Funds Allocation VIP Fund - Class 4

Franklin Income VIP Fund - Class 1

Franklin Income VIP Fund - Class 2

Franklin Income VIP Fund - Class 4

Franklin Mutual Shares VIP Fund - Class 1

Franklin Mutual Shares VIP Fund - Class 2

Franklin Mutual Shares VIP Fund - Class 4

Franklin Rising Dividends VIP Fund - Class 1

Franklin Rising Dividends VIP Fund - Class 4

Franklin Small Cap Value VIP Fund - Class 1

Franklin Small Cap Value VIP Fund - Class 4

Franklin Small-Mid Cap Growth VIP Fund - Class 1

Franklin Small-Mid Cap Growth VIP Fund - Class 2**

Franklin Small-Mid Cap Growth VIP Fund - Class 4

Templeton Foreign VIP Fund - Class 1

N-98

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

Templeton Foreign VIP Fund - Class 4

Templeton Global Bond VIP Fund - Class 1

Templeton Global Bond VIP Fund - Class 2

Templeton Global Bond VIP Fund - Class 4

Templeton Growth VIP Fund - Class 1**

Templeton Growth VIP Fund - Class 2

Goldman Sachs Variable Insurance Trust:

Goldman Sachs VIT Government Money Market Fund - Institutional Shares

Goldman Sachs VIT Government Money Market Fund - Service Shares

Goldman Sachs VIT Large Cap Value Fund - Service Shares

Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares

Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares

Goldman Sachs VIT Strategic Income Fund - Advisor Shares

Goldman Sachs VIT Strategic Income Fund - Institutional Shares

Hartford Series Fund, Inc.:

Hartford Capital Appreciation HLS Fund - Class IA

Hartford Capital Appreciation HLS Fund - Class IC

Ivy Variable Insurance Portfolios:

Ivy VIP Asset Strategy Portfolio

Ivy VIP Asset Strategy Portfolio - Class I**

Ivy VIP Energy Portfolio

Ivy VIP Energy Portfolio - Class I**

Ivy VIP High Income Portfolio

Ivy VIP High Income Portfolio - Class I

Ivy VIP Micro Cap Growth Portfolio

Ivy VIP Micro Cap Growth Portfolio - Class I

Ivy VIP Mid Cap Growth Portfolio

Ivy VIP Mid Cap Growth Portfolio - Class I

Ivy VIP Science and Technology Portfolio

Ivy VIP Science and Technology Portfolio - Class I

Janus Aspen Series:

Janus Henderson Balanced Portfolio - Service Shares

Janus Henderson Enterprise Portfolio - Service Shares

Janus Henderson Global Research Portfolio - Service Shares

JPMorgan Insurance Trust:

JPMorgan Insurance Trust Core Bond Portfolio - Class 1

JPMorgan Insurance Trust Core Bond Portfolio - Class 2

JPMorgan Insurance Trust Global Allocation Portfolio - Class 1**

JPMorgan Insurance Trust Global Allocation Portfolio - Class 2

JPMorgan Insurance Trust Income Builder Portfolio - Class 1

JPMorgan Insurance Trust Income Builder Portfolio - Class 2

Legg Mason Partners Variable Equity Trust:

ClearBridge Variable Aggressive Growth Portfolio - Class I

ClearBridge Variable Aggressive Growth Portfolio - Class II

ClearBridge Variable Large Cap Growth Portfolio - Class I

ClearBridge Variable Large Cap Growth Portfolio - Class II

ClearBridge Variable Mid Cap Portfolio - Class I

ClearBridge Variable Mid Cap Portfolio - Class II

QS Variable Conservative Growth - Class I**

QS Variable Conservative Growth - Class II

Lincoln Variable Insurance Products Trust*:

Lincoln iShares^® Fixed Income Allocation Fund - Standard Class**

Lincoln iShares^® Global Growth Allocation Fund - Standard Class

Lincoln iShares^® U.S. Moderate Allocation Fund - Standard Class

LVIP American Balanced Allocation Fund - Service Class

LVIP American Balanced Allocation Fund - Standard Class

LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class

LVIP American Century Select Mid Cap Managed Volatility Fund - Standard Class**

LVIP American Global Balanced Allocation Managed Risk Fund - Service Class

LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class

LVIP American Global Growth Allocation Managed Risk Fund - Service Class

LVIP American Global Growth Allocation Managed Risk Fund - Standard Class

LVIP American Global Growth Fund - Service Class II

LVIP American Global Small Capitalization Fund - Service Class II

LVIP American Growth Allocation Fund - Service Class

LVIP American Growth Allocation Fund - Standard Class

LVIP American Growth Fund - Service Class II

LVIP American Growth-Income Fund - Service Class II

LVIP American Income Allocation Fund - Standard Class

LVIP American International Fund - Service Class II

LVIP American Preservation Fund - Service Class

LVIP American Preservation Fund - Standard Class

LVIP Baron Growth Opportunities Fund - Service Class

N-99

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

LVIP Baron Growth Opportunities Fund - Standard Class

LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class

LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class

LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class

LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class

LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class

LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Standard Class**

LVIP BlackRock Inflation Protected Bond Fund - Service Class

LVIP BlackRock Inflation Protected Bond Fund - Standard Class

LVIP BlackRock Multi-Asset Income Fund - Service Class

LVIP BlackRock Multi-Asset Income Fund - Standard Class

LVIP BlackRock Scientific Allocation Fund - Service Class

LVIP BlackRock Scientific Allocation Fund - Standard Class**

LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class

LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Standard Class**

LVIP Blended Core Equity Managed Volatility Fund - Service Class

LVIP Blended Core Equity Managed Volatility Fund - Standard Class

LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class

LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class

LVIP Blended Mid Cap Managed Volatility Fund - Service Class

LVIP Blended Mid Cap Managed Volatility Fund - Standard Class

LVIP Clarion Global Real Estate Fund - Service Class

LVIP Clarion Global Real Estate Fund - Standard Class

LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class

LVIP Delaware Bond Fund - Service Class

LVIP Delaware Bond Fund - Standard Class

LVIP Delaware Diversified Floating Rate Fund - Service Class

LVIP Delaware Diversified Floating Rate Fund - Standard Class

LVIP Delaware Social Awareness Fund - Service Class

LVIP Delaware Social Awareness Fund - Standard Class

LVIP Delaware Special Opportunities Fund - Service Class

LVIP Delaware Special Opportunities Fund - Standard Class**

LVIP Delaware Wealth Builder Fund - Service Class

LVIP Delaware Wealth Builder Fund - Standard Class

LVIP Dimensional International Core Equity Fund - Service Class

LVIP Dimensional International Core Equity Fund - Standard Class

LVIP Dimensional International Equity Managed Volatility Fund - Service Class

LVIP Dimensional International Equity Managed Volatility Fund - Standard Class

LVIP Dimensional U.S. Core Equity 1 Fund - Service Class

LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class

LVIP Dimensional U.S. Core Equity 2 Fund - Service Class

LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class

LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class

LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class

LVIP Dimensional/Vanguard Total Bond Fund - Service Class

LVIP Dimensional/Vanguard Total Bond Fund - Standard Class

LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class

LVIP Franklin Templeton Global Equity Managed Volatility Fund - Standard Class**

LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class

LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class

LVIP Franklin Templeton Value Managed Volatility Fund - Service Class

LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class

LVIP Global Conservative Allocation Managed Risk Fund - Service Class

LVIP Global Conservative Allocation Managed Risk Fund - Standard Class

LVIP Global Growth Allocation Managed Risk Fund - Service Class

LVIP Global Growth Allocation Managed Risk Fund - Standard Class

LVIP Global Income Fund - Service Class

LVIP Global Income Fund - Standard Class

N-100

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

LVIP Global Moderate Allocation Managed Risk Fund - Service Class

LVIP Global Moderate Allocation Managed Risk Fund - Standard Class

LVIP Goldman Sachs Income Builder Fund - Service Class

LVIP Goldman Sachs Income Builder Fund - Standard Class

LVIP Government Money Market Fund - Service Class

LVIP Government Money Market Fund - Standard Class

LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class

LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Standard Class**

LVIP Invesco Select Equity Managed Volatility Fund - Service Class

LVIP Invesco Select Equity Managed Volatility Fund - Standard Class

LVIP JPMorgan High Yield Fund - Service Class

LVIP JPMorgan High Yield Fund - Standard Class

LVIP JPMorgan Retirement Income Fund - Service Class

LVIP JPMorgan Retirement Income Fund - Standard Class

LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class

LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class

LVIP Managed Risk Profile 2010 Fund - Service Class

LVIP Managed Risk Profile 2010 Fund - Standard Class**

LVIP Managed Risk Profile 2020 Fund - Service Class

LVIP Managed Risk Profile 2020 Fund - Standard Class**

LVIP Managed Risk Profile 2030 Fund - Service Class

LVIP Managed Risk Profile 2030 Fund - Standard Class**

LVIP Managed Risk Profile 2040 Fund - Service Class

LVIP Managed Risk Profile 2040 Fund - Standard Class**

LVIP MFS International Equity Managed Volatility Fund - Service Class

LVIP MFS International Equity Managed Volatility Fund - Standard Class**

LVIP MFS International Growth Fund - Service Class

LVIP MFS International Growth Fund - Standard Class

LVIP MFS Value Fund - Service Class

LVIP MFS Value Fund - Standard Class

LVIP Mondrian International Value Fund - Service Class

LVIP Mondrian International Value Fund - Standard Class

LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class

LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class

LVIP PIMCO Low Duration Bond Fund - Service Class

LVIP PIMCO Low Duration Bond Fund - Standard Class

LVIP Select Core Equity Managed Volatility Fund - Service Class

LVIP Select Core Equity Managed Volatility Fund - Standard Class

LVIP SSGA Bond Index Fund - Service Class

LVIP SSGA Bond Index Fund - Standard Class

LVIP SSGA Conservative Index Allocation Fund - Service Class

LVIP SSGA Conservative Index Allocation Fund - Standard Class**

LVIP SSGA Conservative Structured Allocation Fund - Service Class

LVIP SSGA Conservative Structured Allocation Fund - Standard Class

LVIP SSGA Developed International 150 Fund - Service Class

LVIP SSGA Developed International 150 Fund - Standard Class

LVIP SSGA Emerging Markets 100 Fund - Service Class

LVIP SSGA Emerging Markets 100 Fund - Standard Class

LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class

LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class

LVIP SSGA International Index Fund - Service Class

LVIP SSGA International Index Fund - Standard Class

LVIP SSGA International Managed Volatility Fund - Service Class

LVIP SSGA International Managed Volatility Fund - Standard Class

LVIP SSGA Large Cap 100 Fund - Service Class

LVIP SSGA Large Cap 100 Fund - Standard Class

LVIP SSGA Large Cap Managed Volatility Fund - Service Class

LVIP SSGA Large Cap Managed Volatility Fund - Standard Class

LVIP SSGA Mid-Cap Index Fund - Service Class

LVIP SSGA Mid-Cap Index Fund - Standard Class

LVIP SSGA Moderate Index Allocation Fund - Service Class

LVIP SSGA Moderate Index Allocation Fund - Standard Class

LVIP SSGA Moderate Structured Allocation Fund - Service Class

N-101

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

LVIP SSGA Moderate Structured Allocation Fund - Standard Class

LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class

LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class

LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class

LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class

LVIP SSGA S&P 500 Index Fund - Service Class

LVIP SSGA S&P 500 Index Fund - Standard Class

LVIP SSGA Small-Cap Index Fund - Service Class

LVIP SSGA Small-Cap Index Fund - Standard Class

LVIP SSGA Small-Mid Cap 200 Fund - Service Class

LVIP SSGA Small-Mid Cap 200 Fund - Standard Class

LVIP SSGA SMID Cap Managed Volatility Fund - Service Class

LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class

LVIP T. Rowe Price Growth Stock Fund - Service Class

LVIP T. Rowe Price Growth Stock Fund - Standard Class

LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class

LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class

LVIP U.S. Growth Allocation Managed Risk Fund - Service Class

LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class

LVIP Vanguard Domestic Equity ETF Fund - Service Class

LVIP Vanguard Domestic Equity ETF Fund - Standard Class

LVIP Vanguard International Equity ETF Fund - Service Class

LVIP Vanguard International Equity ETF Fund - Standard Class

LVIP Wellington Capital Growth Fund - Service Class

LVIP Wellington Capital Growth Fund - Standard Class

LVIP Wellington Mid-Cap Value Fund - Service Class

LVIP Wellington Mid-Cap Value Fund - Standard Class

LVIP Western Asset Core Bond Fund - Service Class

LVIP Western Asset Core Bond Fund - Standard Class

Lord Abbett Series Fund, Inc.:

Lord Abbett Series Fund Bond Debenture Portfolio - Class VC

Lord Abbett Series Fund Developing Growth Portfolio - Class VC

Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC

Lord Abbett Series Fund Short Duration Income Portfolio - Class VC

MFS Variable Insurance Trust:

MFS^® VIT Growth Series - Initial Class

MFS^® VIT Growth Series - Service Class

MFS^® VIT Total Return Series - Initial Class

MFS^® VIT Total Return Series - Service Class

MFS^® VIT Utilities Series - Initial Class

MFS^® VIT Utilities Series - Service Class

MFS Variable Insurance Trust II:

MFS^® VIT II Core Equity Portfolio - Service Class

MFS^® VIT II International Value Portfolio - Initial Class

MFS^® VIT II International Value Portfolio - Service Class

Morgan Stanley Variable Insurance Fund, Inc. (VIF):

Morgan Stanley VIF Global Infrastructure Portfolio - Class I

Morgan Stanley VIF Global Infrastructure Portfolio - Class II

Morgan Stanley VIF Growth Portfolio - Class II

Mutual Fund and Variable Insurance Trust:

Rational Dividend Capture VA Fund

Neuberger Berman Advisers Management Trust:

Neuberger Berman AMT Mid Cap Growth Portfolio - I Class**

Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class

Oppenheimer Variable Account Funds:

Oppenheimer Global Fund/VA Service Shares

Oppenheimer International Growth Fund/VA Non-Service Shares

Oppenheimer International Growth Fund/VA Service Shares

Oppenheimer Main Street Small Cap Fund^®/VA Non-Service Shares

Oppenheimer Main Street Small Cap Fund^®/VA Service Shares

PIMCO Variable Insurance Trust:

PIMCO VIT All Asset All Authority Portfolio - Advisor Class

PIMCO VIT All Asset All Authority Portfolio - Institutional Class

PIMCO VIT CommodityRealReturn^® Strategy Portfolio - Administrative Class**

PIMCO VIT CommodityRealReturn^® Strategy Portfolio - Advisor Class

PIMCO VIT CommodityRealReturn^® Strategy Portfolio - Institutional Class

PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class

PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class

PIMCO VIT Unconstrained Bond Portfolio - Advisor Class

N-102

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

PIMCO VIT Unconstrained Bond Portfolio - Institutional Class

Putnam Variable Trust:

Putnam VT Absolute Return 500 Fund - Class IA

Putnam VT Absolute Return 500 Fund - Class IB

Putnam VT Equity Income Fund - Class IB

Putnam VT George Putnam Balanced Fund - Class IA

Putnam VT George Putnam Balanced Fund - Class IB

Putnam VT Global Health Care Fund - Class IA

Putnam VT Global Health Care Fund - Class IB

Putnam VT Income Fund - Class IA**

Putnam VT Income Fund - Class IB

Rydex Variable Trust:

Guggenheim VT Long Short Equity

Guggenheim VT Multi-Hedge Strategies

SEI Insurance Products Trust:

SEI VP Market Growth Strategy Fund - Class II**

SEI VP Market Growth Strategy Fund - Class III

SEI VP Market Plus Strategy Fund - Class II**

SEI VP Market Plus Strategy Fund - Class III

VanEck VIP Trust:

VanEck VIP Global Hard Assets Fund - Class S Shares

VanEck VIP Global Hard Assets Fund - Initial Class Shares

Virtus Variable Insurance Trust:

Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares

Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares

Virtus Rampart Equity Trend Series - Class A Shares

Virtus Rampart Equity Trend Series - Class I Shares

*  Denotes an affiliate of the Company

**  Available fund with no money invested at December 31, 2017

Each subaccount invests in shares of a single underlying Fund. The investment performance of each subaccount will reflect the investment performance of the underlying Fund less separate account expenses. There is no assurance that the investment objective of any underlying Fund will be met. A Fund calculates a daily net asset value per share ("NAV") which is based on the market value of its investment portfolio. The amount of risk varies significantly between subaccounts. Due to the level of risk associated with certain investment portfolios, it is at least reasonably possible that changes in the values of investment portfolios will occur in the near term and that such changes could materially affect

contract holders' investments in the Funds and the amounts reported in the financial statements. The contract holder assumes all of the investment performance risk for the subaccounts selected.

Investments in the Funds are stated at fair value as determined by the closing net asset value per share on December 31, 2017. Net asset value is quoted by the Funds as derived by the fair value of the Funds' underlying investments. The difference between cost and net asset value is reflected as unrealized appreciation or depreciation of investments. There are no redemption restrictions on investments in the Funds.

Investments for which the fair value is measured at NAV using the practical expedient (investments in investees measured at NAV) are excluded from the fair value hierarchy. Accordingly, the Variable Account's investments in the Funds have not been classified in the fair value hierarchy.

Investment transactions are accounted for on a trade-date basis. The cost of investments sold is determined by the average cost method.

ASC 946-10-15, "Financial Services - Investment Companies (Topic 946) - Scope and Scope Exceptions" provides accounting guidance for assessing whether an entity is an investment company. This guidance evaluates the entity's purpose and design to determine whether the entity is an investment company. The standard also adds additional disclosure requirements regarding contractually required commitments to investees. Management has evaluated the criteria in the standard and concluded that the Variable Account qualifies as an investment company and therefore applies the accounting requirements of ASC 946.

Dividends: Dividends paid to the Variable Account are automatically reinvested in shares of the Funds on the payable date. Dividend income is recorded on the ex-dividend date.

Federal Income Taxes: Operations of the Variable Account form a part of and are taxed with operations of the Company, which is taxed as a "life insurance company" under the Internal Revenue Code. The Variable Account will not be taxed as a regulated investment company under Subchapter M of the Internal Revenue Code, as amended. Under current federal income tax law, no federal income taxes are payable or receivable with respect to the Variable Account's net investment income and the net realized gain (loss) on investments.

Annuity Reserves: Reserves on contracts not involving life contingencies are calculated using an assumed investment return of 3%, 4%, 5% or 6%, as approved in each state. Reserves on contracts involving life contingencies are calculated using a modification of the 1983a Individual Mortality Table and an assumed investment return of 3%, 4%, 5% or 6%, as approved in each state.

N-103

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

Investment Fund Changes: During 2016, the following funds became available as investment options for account contract owners. Accordingly, for the subaccounts that commenced operations during 2016, the 2016 statements of changes in net assets and total return and investment income ratios in note 3 are for the period from the commencement of operations to December 31, 2016:

American Century VP Balanced Fund - Class I	JPMorgan Insurance Trust Core Bond Portfolio - Class 1
American Century VP Balanced Fund - Class II	JPMorgan Insurance Trust Core Bond Portfolio - Class 2
American Funds U.S. Government/AAA-Rated Securities Fund - Class 4	LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class
Columbia VP Commodity Strategy Fund - Class 1	LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Standard Class
Columbia VP Commodity Strategy Fund - Class 2	LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class
Columbia VP Emerging Markets Bond Fund - Class 1	LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Standard Class
Columbia VP Emerging Markets Bond Fund - Class 2	LVIP Managed Risk Profile 2010 Fund - Standard Class
Columbia VP Strategic Income Fund - Class 1	LVIP Managed Risk Profile 2020 Fund - Standard Class
Columbia VP Strategic Income Fund - Class 2	LVIP Managed Risk Profile 2030 Fund - Standard Class
Fidelity® VIP Contrafund® Portfolio - Service Class	LVIP Managed Risk Profile 2040 Fund - Standard Class
Fidelity® VIP FundsManager® 50% Portfolio - Investor Class	LVIP SSGA Mid-Cap Index Fund - Service Class
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2	LVIP SSGA Mid-Cap Index Fund - Standard Class
Fidelity® VIP Growth Portfolio - Service Class	Putnam VT George Putnam Balanced Fund - Class IA
Fidelity® VIP Overseas Portfolio - Service Class	Putnam VT George Putnam Balanced Fund - Class IB
First Trust Dorsey Wright Tactical Core Portfolio - Class II	Templeton Growth VIP Fund - Class 1

Also during 2016, the following funds changed their names:

Previous Fund Name	New Fund Name
Huntington VA Dividend Capture Fund	Catalyst Dividend Capture VA Fund
ClearBridge Variable Mid Cap Core Portfolio - Class I	ClearBridge Variable Mid Cap Portfolio - Class I
ClearBridge Variable Mid Cap Core Portfolio - Class II	ClearBridge Variable Mid Cap Portfolio - Class II
Goldman Sachs VIT Money Market Fund - Institutional Shares	Goldman Sachs VIT Government Money Market Fund - Institutional Shares
Goldman Sachs VIT Money Market Fund - Service Shares	Goldman Sachs VIT Government Money Market Fund - Service Shares
LVIP American Century VP Mid Cap Value Managed Volatility Fund - Service Class	LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class
LVIP American Century VP Mid Cap Value Managed Volatility Fund - Standard Class	LVIP American Century Select Mid Cap Managed Volatility Fund - Standard Class
LVIP BlackRock Equity Dividend Managed Volatility Fund - Service Class	LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class
LVIP BlackRock Equity Dividend Managed Volatility Fund - Standard Class	LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class
LVIP BlackRock Global Allocation V.I. Managed Volatility Fund - Service Class	LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class
LVIP BlackRock Global Allocation V.I. Managed Volatility Fund - Standard Class	LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class
LVIP ClearBridge Variable Appreciation Managed Volatility Fund - Service Class	LVIP Blended Core Equity Managed Volatility Fund - Service Class
LVIP ClearBridge Variable Appreciation Managed Volatility Fund - Standard Class	LVIP Blended Core Equity Managed Volatility Fund - Standard Class
LVIP UBS Large Cap Growth Managed Volatility Fund - Service Class	LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class
LVIP UBS Large Cap Growth Managed Volatility Fund - Standard Class	LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class
LVIP Ivy Mid Cap Growth Managed Volatility Fund - Service Class	LVIP Blended Mid Cap Managed Volatility Fund - Service Class
LVIP Ivy Mid Cap Growth Managed Volatility Fund - Standard Class	LVIP Blended Mid Cap Managed Volatility Fund - Standard Class
LVIP Dimensional International Core Equity Managed Volatility Fund - Service Class	LVIP Dimensional International Equity Managed Volatility Fund - Service Class
LVIP Dimensional International Core Equity Managed Volatility Fund - Standard Class	LVIP Dimensional International Equity Managed Volatility Fund - Standard Class
LVIP Dimensional U.S. Core Equity 2 Managed Volatility Fund - Service Class	LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class
LVIP Dimensional U.S. Core Equity 2 Managed Volatility Fund - Standard Class	LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class

N-104

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

Previous Fund Name	New Fund Name
LVIP Templeton Growth Managed Volatility Fund - Service Class	LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class
LVIP Templeton Growth Managed Volatility Fund - Standard Class	LVIP Franklin Templeton Global Equity Managed Volatility Fund - Standard Class
LVIP Franklin Mutual Shares Managed Volatility Fund - Service Class	LVIP Franklin Templeton Value Managed Volatility Fund - Service Class
LVIP Franklin Mutual Shares Managed Volatility Fund - Standard Class	LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class
LVIP Money Market Fund - Service Class	LVIP Government Money Market Fund - Service Class
LVIP Money Market Fund - Standard Class	LVIP Government Money Market Fund - Standard Class
LVIP Invesco V.I. Comstock Managed Volatility Fund - Service Class	LVIP Invesco Select Equity Managed Volatility Fund - Service Class
LVIP Invesco V.I. Comstock Managed Volatility Fund - Standard Class	LVIP Invesco Select Equity Managed Volatility Fund - Standard Class
LVIP JPMorgan Mid Cap Value Managed Volatility Fund - Service Class	LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class
LVIP JPMorgan Mid Cap Value Managed Volatility Fund - Standard Class	LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class
LVIP MFS International Growth Managed Volatility Fund - Service Class	LVIP MFS International Equity Managed Volatility Fund - Service Class
LVIP MFS International Growth Managed Volatility Fund - Standard Class	LVIP MFS International Equity Managed Volatility Fund - Standard Class
LVIP VIP Contrafund Managed Volatility Portfolio - Service Class	LVIP Select Core Equity Managed Volatility Fund - Service Class
LVIP VIP Contrafund Managed Volatility Portfolio - Standard Class	LVIP Select Core Equity Managed Volatility Fund - Standard Class
LVIP SSgA Bond Index Fund - Service Class	LVIP SSGA Bond Index Fund - Service Class
LVIP SSgA Bond Index Fund - Standard Class	LVIP SSGA Bond Index Fund - Standard Class
LVIP SSgA Conservative Index Allocation Fund - Service Class	LVIP SSGA Conservative Index Allocation Fund - Service Class
LVIP SSgA Conservative Index Allocation Fund - Standard Class	LVIP SSGA Conservative Index Allocation Fund - Standard Class
LVIP SSgA Conservative Structured Allocation Fund - Service Class	LVIP SSGA Conservative Structured Allocation Fund - Service Class
LVIP SSgA Conservative Structured Allocation Fund - Standard Class	LVIP SSGA Conservative Structured Allocation Fund - Standard Class
LVIP SSgA Developed International 150 Fund - Service Class	LVIP SSGA Developed International 150 Fund - Service Class
LVIP SSgA Developed International 150 Fund - Standard Class	LVIP SSGA Developed International 150 Fund - Standard Class
LVIP SSgA Emerging Markets 100 Fund - Service Class	LVIP SSGA Emerging Markets 100 Fund - Service Class
LVIP SSgA Emerging Markets 100 Fund - Standard Class	LVIP SSGA Emerging Markets 100 Fund - Standard Class
LVIP SSgA Global Tactical Allocation Managed Volatility Fund - Service Class	LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class
LVIP SSgA Global Tactical Allocation Managed Volatility Fund - Standard Class	LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class
LVIP SSgA International Index Fund - Service Class	LVIP SSGA International Index Fund - Service Class
LVIP SSgA International Index Fund - Standard Class	LVIP SSGA International Index Fund - Standard Class
LVIP SSgA International Managed Volatility Fund - Service Class	LVIP SSGA International Managed Volatility Fund - Service Class
LVIP SSgA International Managed Volatility Fund - Standard Class	LVIP SSGA International Managed Volatility Fund - Standard Class
LVIP SSgA Large Cap 100 Fund - Service Class	LVIP SSGA Large Cap 100 Fund - Service Class
LVIP SSgA Large Cap 100 Fund - Standard Class	LVIP SSGA Large Cap 100 Fund - Standard Class
LVIP SSgA Large Cap Managed Volatility Fund - Service Class	LVIP SSGA Large Cap Managed Volatility Fund - Service Class
LVIP SSgA Large Cap Managed Volatility Fund - Standard Class	LVIP SSGA Large Cap Managed Volatility Fund - Standard Class
LVIP SSgA Moderate Index Allocation Fund - Service Class	LVIP SSGA Moderate Index Allocation Fund - Service Class
LVIP SSgA Moderate Index Allocation Fund - Standard Class	LVIP SSGA Moderate Index Allocation Fund - Standard Class
LVIP SSgA Moderate Structured Allocation Fund - Standard Class	LVIP SSGA Moderate Structured Allocation Fund - Standard Class
LVIP SSgA Moderately Aggressive Index Allocation Fund - Service Class	LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class
LVIP SSgA Moderately Aggressive Index Allocation Fund - Standard Class	LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class
LVIP SSgA Moderately Aggressive Structured Allocation Fund - Service Class	LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class
LVIP SSgA Moderately Aggressive Structured Allocation Fund - Standard Class	LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class
LVIP SSgA S&P 500 Index Fund - Service Class	LVIP SSGA S&P 500 Index Fund - Service Class
LVIP SSgA S&P 500 Index Fund - Standard Class	LVIP SSGA S&P 500 Index Fund - Standard Class
LVIP SSgA Small-Cap Index Fund - Service Class	LVIP SSGA Small-Cap Index Fund - Service Class
LVIP SSgA Small-Cap Index Fund - Standard Class	LVIP SSGA Small-Cap Index Fund - Standard Class
LVIP SSgA Small-Mid Cap 200 Fund - Service Class	LVIP SSGA Small-Mid Cap 200 Fund - Service Class
LVIP SSgA Small-Mid Cap 200 Fund - Standard Class	LVIP SSGA Small-Mid Cap 200 Fund - Standard Class
LVIP SSgA Small-Cap Managed Volatility Fund - Service Class	LVIP SSGA SMID Cap Managed Volatility Fund - Service Class
LVIP SSgA Small-Cap Managed Volatility Fund - Standard Class	LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class

N-105

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

During 2016, the Ivy Funds Variable Insurance Portfolios fund family changed their name to Ivy Variable Insurance Portfolios and the Van Eck VIP Trust fund family changed their name to VanEck VIP Trust.

Also during 2016, the following funds ceased to be available as investment options to Variable Account contract owners:

LVIP AQR Enhanced Global Strategies Fund - Service Class	Transparent Value Directional Allocation VI Portfolio - Class I
LVIP AQR Enhanced Global Strategies Fund - Standard Class	Transparent Value Directional Allocation VI Portfolio - Class II
LVIP VIP Mid Cap Managed Volatility Portfolio - Standard Class

During 2016, the following fund mergers occurred:

Fund Acquired	Acquiring Fund
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Service Class	LVIP Blended Mid Cap Managed Volatility Fund - Service Class
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Standard Class	LVIP Blended Mid Cap Managed Volatility Fund - Standard Class
LVIP VIP Mid Cap Managed Volatility Portfolio - Service Class	LVIP Blended Mid Cap Managed Volatility Fund - Service Class
LVIP BlackRock Emerging Markets Managed Volatility Fund - Service Class	LVIP SSGA International Managed Volatility Fund - Service Class
LVIP BlackRock Emerging Markets Managed Volatility Fund - Standard Class	LVIP SSGA International Managed Volatility Fund - Standard Class

During 2017, the following funds became available as investment options for account contract owners. Accordingly, for the subaccounts that commenced operations during 2017, the 2017 statements of operations and statements of changes in net assets and total return and investment income ratios in note 3 are for the period from the commencement of operations to December 31, 2017:

American Century VP Large Company Value Fund - Class I American Century VP Large Company Value Fund - Class II	American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A
American Funds Asset Allocation Fund - Class 1A	ClearBridge Variable Large Cap Growth Portfolio - Class I
American Funds Blue Chip Income and Growth Fund - Class 1A	ClearBridge Variable Large Cap Growth Portfolio - Class II
American Funds Bond Fund - Class 1A	Ivy VIP Asset Strategy Portfolio - Class I
American Funds Capital Income Builder® - Class 1A	Ivy VIP Energy Portfolio - Class I
American Funds Global Balanced Fund - Class 1A	Ivy VIP High Income Portfolio - Class I
American Funds Global Bond Fund - Class 1A	Ivy VIP Micro Cap Growth Portfolio - Class I
American Funds Global Growth and Income Fund - Class 1A	Ivy VIP Mid Cap Growth Portfolio - Class I
American Funds Global Growth Fund - Class 1A	Ivy VIP Science and Technology Portfolio - Class I
American Funds Global Small Capitalization Fund - Class 1A	Lincoln iShares® Fixed Income Allocation Fund - Standard Class
American Funds Growth Fund - Class 1A	Lincoln iShares® Global Growth Allocation Fund - Standard Class
American Funds Growth-Income Fund - Class 1A	Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class
American Funds High-Income Bond Fund - Class 1A	LVIP Western Asset Core Bond Fund - Service Class
American Funds International Fund - Class 1A	LVIP Western Asset Core Bond Fund - Standard Class
American Funds International Growth and Income Fund - Class 1A	QS Variable Conservative Growth - Class I
American Funds Mortgage Fund - Class 1A	QS Variable Conservative Growth - Class II
American Funds New World Fund® - Class 1A

Also during 2017, the following funds changed their names:

Previous Fund Name	New Fund Name
ALPS/Stadion Tactical Defensive Portfolio - Class I	ALPS/Stadion Core ETF Portfolio - Class I
ALPS/Stadion Tactical Defensive Portfolio - Class III	ALPS/Stadion Core ETF Portfolio - Class III
Delaware VIP® Smid Cap Growth Series - Service Class	Delaware VIP® Smid Cap Core Series - Service Class
Delaware VIP® Smid Cap Growth Series - Standard Class	Delaware VIP® Smid Cap Core Series - Standard Class
Janus Aspen Balanced Portfolio - Service Shares	Janus Henderson Balanced Portfolio - Service Shares
Janus Aspen Enterprise Portfolio - Service Shares	Janus Henderson Enterprise Portfolio - Service Shares
Janus Aspen Global Research Portfolio - Service Shares	Janus Henderson Global Research Portfolio - Service Shares
LVIP Delaware Foundation Moderate Allocation Fund - Service Class	LVIP BlackRock Scientific Allocation Fund - Service Class
LVIP Delaware Foundation Moderate Allocation Fund - Standard Class	LVIP BlackRock Scientific Allocation Fund - Standard Class
LVIP Delaware Foundation Aggressive Allocation Fund - Service Class	LVIP Delaware Wealth Builder Fund - Service Class
LVIP Delaware Foundation Aggressive Allocation Fund - Standard Class	LVIP Delaware Wealth Builder Fund - Standard Class
LVIP Delaware Foundation Conservative Allocation Fund - Service Class	LVIP JPMorgan Retirement Income Fund - Service Class
LVIP Delaware Foundation Conservative Allocation Fund - Standard Class	LVIP JPMorgan Retirement Income Fund - Standard Class
Virtus Multi-Sector Fixed Income Series - Class A Shares	Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares
Virtus Multi-Sector Fixed Income Series - Class I Shares	Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares
Virtus Equity Trend Series - Class A Shares	Virtus Rampart Equity Trend Series - Class A Shares
Virtus Equity Trend Series - Class I Shares	Virtus Rampart Equity Trend Series - Class I Shares

N-106

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

1. Accounting Policies and Variable Account Information (continued)

Also during 2017, the following fund families changed their names:

Previous Fund Family Name	New Fund Family Name
Morgan Stanley Universal Institutional Funds	Morgan Stanley Variable Insurance Fund, Inc. (VIF)
Huntington VA Funds	Mutual Fund and Variable Insurance Trust

Also during 2017, the following fund merger occurred:

Fund Acquired	Acquiring Fund
Putnam VT Growth & Income Fund - Class IB	Putnam VT Equity Income Fund - Class IB

Also during 2017, the following funds ceased to be available as investment options to Variable Account contract owners:

JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1 JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2

2. Mortality and Expense Guarantees and Other Transactions with Affiliates

Amounts are paid to the Company for mortality and expense guarantees at a percentage of the current value of the Variable Account each day. The mortality and expense risk charges for each of the variable subaccounts are reported in the statements of operations. The ranges of rates are as follows for the thirty-six contract types within the Variable Account:

•  Lincoln ChoicePlus at a daily rate of .0038356% to .0082192% (1.40% to 3.00% on an annual basis).

•  Lincoln ChoicePlus Access at a daily rate of .0038356% to .0089041% (1.40% to 3.25% on an annual basis).

•  Lincoln ChoicePlus Bonus at a daily rate of .0038356% to .0087671% (1.40% to 3.20% on an annual basis).

•  Lincoln ChoicePlus II at a daily rate of .0035616% to .0082192% (1.30% to 3.00% on an annual basis).

•  Lincoln ChoicePlus II Access at a daily rate of .0038356% to .0089041% (1.40% to 3.25% on an annual basis).

•  Lincoln ChoicePlus II Advance at a daily rate of .0038356% to .0090411% (1.40% to 3.30% on an annual basis).

•  Lincoln ChoicePlus II Bonus at a daily rate of .0038356% to .0087671% (1.40% to 3.20% on an annual basis).

•  Lincoln ChoicePlus Design 1 at a daily rate of .0030137% to .0080822% (1.10% to 2.95% on an annual basis).

•  Lincoln ChoicePlus Design 2 at a daily rate of .0030137% to .0093151% (1.10% to 3.40% on an annual basis).

•  Lincoln ChoicePlus Design 3 at a daily rate of .0030137% to .0093151% (1.10% to 3.40% on an annual basis).

•  Lincoln ChoicePlus Assurance A Share at a daily rate of .0016438% to .0071233% (.60% to 2.60% on an annual basis).

•  Lincoln ChoicePlus Assurance A Share Fee-Based at a daily rate of .0016438% to .0067123% (.60% to 2.45% on an annual basis).

  For policies issued on or after to 5/22/17 at a daily rate of .0005479% to .0057534% (0.20% to 2.10% on an annual basis).

•  Lincoln ChoicePlus Assurance B Share at a daily rate of .0034247% to .0084932% (1.25% to 3.10% on an annual basis).

•  Lincoln ChoicePlus Assurance Bonus at a daily rate of .0038356% to .0091781% (1.40% to 3.35% on an annual basis).

•  Lincoln ChoicePlus Assurance C Share at a daily rate of .0038356% to .0095890% (1.40% to 3.50% on an annual basis).

•  Lincoln ChoicePlus Assurance L Share at a daily rate of .0038356% to .0095890% (1.40% to 3.50% on an annual basis).

•  Lincoln ChoicePlus Assurance A Class at a daily rate of .0016438% to .0063014% (.60% to 2.30% on an annual basis).

•  Lincoln ChoicePlus Assurance B Class at a daily rate of .0034247% to .0076712% (1.25% to 2.80% on an annual basis).

•  Lincoln ChoicePlus Signature 1 at a daily rate of .0034247% to .0084932% (1.25% to 3.10% on an annual basis).

•  Lincoln ChoicePlus Signature 2 at a daily rate of .0038356% to .0094521% (1.40% to 3.45% on an annual basis).

•  Lincoln ChoicePlus Rollover at a daily rate of .0027397% to .0078082% (1.00% to 2.85% on an annual basis).

•  Lincoln ChoicePlus Fusion at a daily rate of .0021918% to .0064384% (.80% to 2.35% on an annual basis).

N-107

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

2. Mortality and Expense Guarantees and Other Transactions with Affiliates (continued)

•  Lincoln InvestmentSolutions at a daily rate of .0016438% to .0067123% (.60% to 2.45% on an annual basis).

•  Lincoln ChoicePlus Assurance Series B-Share at a daily rate of .0034247% to .0084932% (1.25% to 3.10% on an annual basis).

•  Lincoln ChoicePlus Assurance Series C-Share at a daily rate of .0038356% to .0095890% (1.40% to 3.50% on an annual basis).

•  Lincoln ChoicePlus Assurance Series L-Share at a daily rate of .0038356% to .0095890% (1.40% to 3.50% on an annual basis).

•  Lincoln ChoicePlus Assurance (Prime) at a daily rate of .0034247% to .0084932% (1.25% to 3.10% on an annual basis).

•  Lincoln ChoicePlus Advisory at a daily rate of .0005479% to .0056164% (0.20% to 2.05% on an annual basis).

•  Lincoln Investor Advantage B-Share at a daily rate of .0026027% to .0041096% (.95% to 1.50% on an annual basis).

•  Lincoln Investor Advantage C-Share at a daily rate of .0026027% to .0045205% (.95% to 1.65% on an annual basis).

•  Lincoln Investor Advantage Fee-Based at a daily rate of .0004110% to .0019178% (.15% to .70% on an annual basis).

•  Lincoln Investor Advantage RIA at a daily rate of .0006849% to .0021918% (.25% to .80% on an annual basis).

•  Lincoln Investor Advantage Advisory at a daily rate of .0002739% to .0013699% (.10% to .50% on an annual basis).

•  Lincoln Investor Advantage RIA Class at a daily rate of .0009589% to .0019178% (.35% to .70% on an annual basis).

•  Lincoln Core Income at a daily rate of .0015068% to .0031506% (.55% to 1.15% on an annual basis).

•  Lincoln InvestmentSolutions RIA at a daily rate of .0010959% to .0061644% (.40% to 2.25% on an annual basis).

During May, 2013, the fund replacements listed below occurred in certain products. The replacement funds have higher fund expenses than the funds they replaced, so the Company enacted a mortality and expense guarantee (M&E) reduction to ensure that overall fund expenses were the same after the replacement. The M&E reduction ended during May, 2016. The fund replacement was as follows:

Previous Fund Name	Replacement Fund Name	M&E Reduction
AB VPS International Value Portfolio - Class B	LVIP Mondrian International Value Fund - Service Class		0.02	%
American Century VP Inflation Protection Fund - Class II	LVIP BlackRock Inflation Protected Bond Fund - Service Class		0.06	%

The Company charges an annual account fee which varies by product. Refer to the product prospectus for the account fee rate. The account fees are for items such as processing applications, issuing contracts, policy value calculation, confirmations and periodic reports. The Company, upon surrender of a policy, may assess a surrender charge. Amounts retained by the Company for account fees and surrender charges for 2017 and 2016 were $450,697,529 and $438,762,490, respectively.

For the Lincoln ChoicePlus Assurance A Share, Lincoln ChoicePlus Assurance A Share Fee-Based and Lincoln ChoicePlus Assurance A Class products, a front-end load or sales charge is applied as a percentage (5.75% maximum) to all gross purchase payments. For the Lincoln ChoicePlus Fusion product, a premium based charge or sales charge is applied on a quarterly basis over a seven year period as a percentage (.175% maximum per quarter) of all purchase payments received. For the years ending December 31, 2017 and 2016, sales charges amounted to $543,355 and $1,477,396, respectively.

Surrender, contract and all other charges are included within Contract withdrawals on the Statements of Changes in Net Assets.

N-108

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights

A summary of the fee rates, unit values, units outstanding, net assets and total return and investment income ratios for variable annuity contracts as of and for each year or period in the five years ended December 31, 2017, follows:

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
AB VPS Global Thematic Growth Portfolio - Class B
		2017			0.30	%		3.20	%	$	6.38	$	25.07		2,049,491	$	31,775,509		32.07	%		35.41	%		0.28	%
		2016			0.65	%		3.15	%		4.77		18.73		2,134,613		24,562,976		-3.76	%		-1.52	%		0.00	%
		2015			0.65	%		2.95	%		4.90		19.25		2,488,790		29,135,815		-0.34	%		1.98	%		0.00	%
		2014			0.65	%		2.95	%		4.86		19.11		2,705,522		28,692,905		1.76	%		4.13	%		0.00	%
		2013			0.65	%		2.95	%		4.72		18.57		3,028,771		30,284,841		19.36	%		22.13	%		0.02	%
AB VPS Growth and Income Portfolio - Class B
		2014			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		1.11	%
		2013			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		1.48	%
AB VPS International Value Portfolio - Class B
		2017			1.25	%		1.25	%		9.60		9.60		128		1,232		23.56	%		23.56	%		1.23	%
		2016			1.55	%		1.55	%		7.53		7.53		326		2,454		-2.31	%		-2.31	%		0.74	%
		2015			1.55	%		1.90	%		7.45		7.71		666		5,045		0.47	%		0.82	%		1.70	%
		2014			1.55	%		1.90	%		7.41		7.64		678		5,099		-8.21	%		-7.88	%		3.17	%
		2013			1.30	%		1.30	%		8.45		8.45		15		128		21.14	%		21.14	%		2.73	%
AB VPS Large Cap Growth Portfolio - Class B
		2017			1.30	%		2.80	%		13.36		32.00		579,076		10,225,500		28.04	%		29.97	%		0.00	%
		2016			1.30	%		2.80	%		10.33		24.62		698,118		9,426,032		-0.47	%		1.03	%		0.00	%
		2015			1.30	%		2.80	%		10.27		24.37		772,531		10,319,207		7.79	%		9.42	%		0.00	%
		2014			1.30	%		2.80	%		9.44		22.27		848,639		10,433,388		10.70	%		12.37	%		0.00	%
		2013			1.30	%		2.80	%		8.44		19.82		909,766		10,154,434		33.22	%		35.23	%		0.00	%
AB VPS Small/Mid Cap Value Portfolio - Class A
		2017			0.35	%		0.80	%		13.66		13.86		33,383		458,767		12.25	%		12.70	%		0.46	%
		2016			0.40	%		0.80	%		12.30		12.30		31,088		382,005		24.59	%		24.59	%		0.71	%
		2015			0.40	%		0.40	%		9.87		9.87		7,880		77,770		-5.86	%		-5.86	%		0.80	%
		2014	7/24/14		0.40	%		0.80	%		10.46		10.48		5,516		57,825		1.02	%		1.76	%		0.31	%
AB VPS Small/Mid Cap Value Portfolio - Class B
		2017			0.10	%		3.25	%		13.59		46.14		6,451,753		212,389,129		9.30	%		12.51	%		0.24	%
		2016			0.30	%		3.20	%		12.25		41.47		6,394,531		191,725,194		20.86	%		24.42	%		0.32	%
		2015			0.30	%		3.20	%		14.11		33.70		6,850,862		167,462,421		-8.67	%		-6.26	%		0.51	%
		2014			0.60	%		3.20	%		15.45		36.24		7,291,406		194,269,675		5.51	%		8.24	%		0.46	%
		2013			0.65	%		3.20	%		14.64		33.83		8,139,879		205,119,410		33.30	%		36.74	%		0.44	%
ALPS/Alerian Energy Infrastructure Portfolio - Class I
		2017			0.35	%		0.80	%		8.83		8.96		54,209		546,169		-1.28	%		-0.88	%		4.31	%
		2016			0.40	%		0.80	%		8.95		9.04		26,684		241,029		40.26	%		40.83	%		2.24	%
		2015			0.40	%		0.80	%		6.42		6.42		28,281		181,504		-37.96	%		-37.96	%		0.85	%
		2014	7/24/14		0.40	%		0.40	%		10.35		10.35		11,325		117,205		-6.09	%		-6.09	%		0.92	%
ALPS/Alerian Energy Infrastructure Portfolio - Class III
		2017			0.10	%		1.65	%		8.44		8.87		647,095		5,663,293		-2.46	%		-1.14	%		1.93	%
		2016			0.30	%		1.65	%		8.65		8.97		624,350		5,468,502		38.49	%		40.37	%		2.41	%
		2015			0.30	%		1.65	%		6.25		6.39		379,465		2,388,413		-38.94	%		-38.11	%		0.93	%
		2014	7/2/14		0.30	%		1.65	%		10.23		10.32		187,200		1,921,367		-6.49	%		-0.84	%		0.21	%
ALPS/Red Rocks Listed Private Equity Portfolio - Class I
		2017			0.35	%		0.80	%		12.31		12.45		4,379		54,484		24.50	%		25.00	%		3.09	%
		2016	3/7/16		0.40	%		0.80	%		9.89		9.96		2,705		26,876		7.06	%		12.99	%		3.90	%
ALPS/Red Rocks Listed Private Equity Portfolio - Class III
		2017			0.10	%		1.65	%		11.94		12.38		768,031		9,257,493		22.92	%		24.58	%		2.78	%
		2016			0.30	%		1.65	%		9.72		9.94		556,329		5,435,000		6.21	%		7.65	%		0.82	%
		2015	5/26/15		0.30	%		1.65	%		9.15		9.23		373,631		3,424,521		-10.07	%		-8.81	%		0.16	%

N-109

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
ALPS/Stadion Core ETF Portfolio - Class I
		2017			0.40	%		0.80	%	$	11.84	$	12.01		5,042	$	59,905		12.93	%		13.38	%		0.27	%
		2016			0.40	%		0.80	%		10.59		10.59		5,276		55,445		11.01	%		11.01	%		0.00	%
		2015			0.40	%		0.40	%		9.54		9.54		870		8,312		-9.71	%		-9.71	%		0.20	%
		2014	12/26/14		0.40	%		0.40	%		10.57		10.57		7,749		81,904		-1.30	%		-1.30	%		0.00	%
ALPS/Stadion Core ETF Portfolio - Class III
		2017			0.10	%		2.85	%		11.35		11.93		917,171		10,143,127		11.71	%		13.23	%		0.19	%
		2016			0.30	%		1.65	%		10.16		10.33		439,298		4,509,989		9.00	%		9.60	%		0.00	%
		2015			1.10	%		1.65	%		9.32		9.43		566,375		5,324,167		-10.83	%		-10.34	%		0.12	%
		2014	7/17/14		1.10	%		1.65	%		10.46		10.51		72,836		764,872		-0.67	%		2.46	%		0.00	%
ALPS/Stadion Tactical Growth Portfolio - Class III
		2017			0.10	%		1.65	%		11.15		11.56		439,837		4,962,374		10.35	%		11.85	%		0.30	%
		2016			0.30	%		1.65	%		10.10		10.33		390,479		3,972,301		7.43	%		8.89	%		0.33	%
		2015	5/27/15		0.30	%		1.65	%		9.41		9.49		145,628		1,373,696		-6.37	%		-2.92	%		0.00	%
American Century VP Balanced Fund - Class I
		2017	3/28/17		0.35	%		0.35	%		11.40		11.40		6,291		71,687		9.44	%		9.44	%		1.24	%
American Century VP Balanced Fund - Class II
		2017			0.10	%		3.30	%		11.35		11.87		4,327,370		50,309,821		10.21	%		13.28	%		1.41	%
		2016	5/25/16		0.30	%		3.05	%		10.29		10.48		1,761,279		18,291,592		-1.16	%		6.73	%		0.79	%
American Century VP Inflation Protection Fund - Class II
		2017			2.15	%		2.15	%		12.10		12.10		2,133		25,803		1.47	%		1.47	%		2.51	%
		2016	1/22/16		2.15	%		2.15	%		11.92		11.92		2,283		27,225		-2.86	%		-2.86	%		1.66	%
		2014			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		1.34	%
		2013			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.66	%
American Century VP Large Company Value Fund - Class I
		2017	6/27/17		0.35	%		0.70	%		10.61		10.63		33,184		352,509		2.34	%		6.58	%		0.65	%
American Century VP Large Company Value Fund - Class II
		2017	6/7/17		0.10	%		3.00	%		10.45		10.64		358,793		3,784,362		-0.34	%		7.74	%		0.89	%
American Funds Asset Allocation Fund - Class 1
		2017			0.40	%		1.95	%		13.34		18.35		1,175,826		18,849,926		14.26	%		16.04	%		1.78	%
		2016			0.40	%		1.95	%		11.49		15.84		944,992		13,813,111		7.57	%		9.25	%		3.09	%
		2015			0.40	%		1.95	%		10.52		14.53		284,659		3,379,682		-0.32	%		1.24	%		2.84	%
		2014			0.40	%		1.95	%		13.69		14.22		81,493		1,083,366		3.62	%		4.72	%		1.91	%
		2013	5/28/13		0.90	%		1.95	%		13.21		13.58		44,228		597,313		8.28	%		8.96	%		1.64	%
American Funds Asset Allocation Fund - Class 1A
		2017	4/13/17		0.35	%		0.75	%		11.39		11.44		358,300		4,093,365		1.37	%		10.40	%		2.05	%
American Funds Asset Allocation Fund - Class 4
		2017			0.10	%		1.65	%		12.52		13.15		9,854,185		125,099,749		14.01	%		15.56	%		1.45	%
		2016			0.30	%		1.65	%		10.98		11.38		7,898,429		87,672,209		7.38	%		8.84	%		1.58	%
		2015			0.30	%		1.65	%		10.22		10.45		4,522,223		46,560,007		-0.51	%		0.84	%		3.01	%
		2014	7/11/14		0.30	%		1.65	%		10.28		10.37		488,562		5,036,627		0.73	%		2.37	%		2.97	%
American Funds Blue Chip Income and Growth Fund - Class 1
		2017			0.40	%		2.25	%		14.54		21.75		245,762		4,489,873		15.09	%		16.83	%		2.26	%
		2016			0.40	%		1.90	%		12.63		18.66		215,617		3,345,018		16.82	%		18.58	%		2.32	%
		2015			0.40	%		1.90	%		10.65		15.77		183,536		2,465,234		-4.55	%		-3.11	%		2.26	%
		2014			0.40	%		1.90	%		15.55		16.30		168,673		2,328,817		13.51	%		15.00	%		4.84	%
		2013			0.60	%		1.90	%		13.70		14.18		69,801		971,653		30.75	%		32.46	%		2.55	%
American Funds Blue Chip Income and Growth Fund - Class 1A
		2017	2/24/17		0.35	%		1.85	%		11.31		11.48		53,961		618,727		5.58	%		11.54	%		3.87	%
American Funds Blue Chip Income and Growth Fund - Class 4
		2017			0.10	%		1.65	%		13.86		14.55		2,122,791		29,875,527		14.79	%		16.35	%		2.05	%
		2016			0.30	%		1.65	%		12.07		12.51		1,606,020		19,617,556		16.56	%		18.14	%		2.14	%
		2015			0.30	%		1.65	%		10.36		10.59		952,751		9,935,928		-4.79	%		-3.50	%		2.57	%
		2014	6/27/14		0.30	%		1.65	%		10.88		10.97		270,432		2,949,193		-0.94	%		7.83	%		6.32	%

N-110

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
American Funds Bond Fund - Class 1
		2017			0.60	%		2.25	%	$	10.77	$	11.74		549,238	$	6,361,687		1.92	%		3.26	%		2.29	%
		2016			0.60	%		1.90	%		10.57		11.37		323,939		3,654,693		1.33	%		2.65	%		2.06	%
		2015			0.60	%		1.90	%		10.43		11.08		219,347		2,408,720		-1.44	%		-0.16	%		2.03	%
		2014			0.60	%		1.90	%		10.59		11.10		184,166		2,028,548		3.60	%		4.95	%		2.53	%
		2013			0.60	%		1.90	%		10.27		10.57		78,093		818,840		-3.54	%		-2.47	%		4.51	%
American Funds Bond Fund - Class 1A
		2017	3/20/17		0.50	%		1.85	%		10.16		10.29		103,217		1,061,558		-0.11	%		2.77	%		4.05	%
American Funds Capital Income Builder® - Class 1
		2017			0.40	%		0.90	%		11.25		11.46		87,875		1,004,071		12.28	%		12.84	%		3.02	%
		2016			0.40	%		1.70	%		9.81		10.15		90,463		916,505		2.41	%		3.75	%		3.55	%
		2015			0.40	%		1.70	%		9.75		9.78		36,108		352,892		-1.82	%		-1.62	%		3.01	%
		2014	8/13/14		0.40	%		0.60	%		9.93		9.95		11,785		117,203		-0.92	%		-0.63	%		1.21	%
American Funds Capital Income Builder® - Class 1A
		2017	2/24/17		0.35	%		0.70	%		11.10		11.13		40,881		454,380		2.13	%		9.22	%		2.86	%
American Funds Capital Income Builder® - Class 4
		2017			0.10	%		1.65	%		10.75		11.29		3,196,968		34,882,122		10.81	%		12.31	%		2.57	%
		2016			0.30	%		1.65	%		9.70		10.05		2,709,830		26,593,272		2.09	%		3.47	%		2.92	%
		2015			0.30	%		1.65	%		9.50		9.71		1,345,855		12,866,136		-3.40	%		-2.09	%		2.72	%
		2014	7/11/14		0.30	%		1.65	%		9.83		9.92		331,104		3,264,170		-2.81	%		2.10	%		1.46	%
American Funds Global Balanced Fund - Class 1
		2017			0.60	%		0.65	%		14.92		14.97		37,258		556,175		19.14	%		19.20	%		1.11	%
		2016			0.60	%		0.65	%		12.53		12.56		44,349		555,860		4.05	%		4.11	%		2.23	%
		2015			0.60	%		1.70	%		11.47		12.07		26,192		314,361		-2.36	%		-1.28	%		1.25	%
		2014			0.60	%		1.70	%		11.75		12.22		28,351		344,386		0.15	%		1.26	%		1.55	%
		2013			0.60	%		1.70	%		12.06		12.07		19,898		236,081		11.84	%		11.89	%		3.54	%
American Funds Global Balanced Fund - Class 1A
		2017	7/25/17		0.50	%		0.50	%		11.81		11.81		20,221		238,878		5.60	%		5.60	%		2.40	%
American Funds Global Bond Fund - Class 1
		2017			0.60	%		2.15	%		9.85		10.91		263,558		2,829,781		4.84	%		6.47	%		0.58	%
		2016			0.60	%		2.15	%		9.39		10.25		219,952		2,222,585		0.73	%		2.31	%		0.82	%
		2015			0.60	%		2.15	%		9.32		10.02		180,752		1,783,495		-5.79	%		-4.32	%		0.09	%
		2014			0.60	%		2.15	%		9.90		10.47		159,471		1,649,036		-0.45	%		1.10	%		1.84	%
		2013			0.60	%		2.15	%		10.06		10.35		107,161		1,097,950		-4.05	%		-2.99	%		0.00	%
American Funds Global Bond Fund - Class 1A
		2017	6/27/17		0.50	%		0.50	%		10.65		10.65		6,006		63,963		1.31	%		1.31	%		0.96	%
American Funds Global Discovery Fund - Class 1
		2013			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.49	%
American Funds Global Growth and Income Fund - Class 1
		2017			0.60	%		1.90	%		16.74		18.25		79,422		1,415,352		24.03	%		25.65	%		2.18	%
		2016			0.60	%		1.90	%		13.50		14.53		102,601		1,471,459		5.59	%		6.97	%		2.57	%
		2015			0.60	%		1.90	%		12.79		13.58		61,907		828,333		-3.00	%		-1.73	%		2.46	%
		2014			0.60	%		1.90	%		13.18		13.82		39,804		541,529		4.00	%		5.36	%		4.40	%
		2013	5/31/13		0.60	%		1.90	%		12.68		13.12		13,187		169,168		3.15	%		11.86	%		7.06	%
American Funds Global Growth and Income Fund - Class 1A
		2017	7/28/17		0.50	%		0.50	%		12.39		12.39		9,631		119,368		6.84	%		6.84	%		2.20	%
American Funds Global Growth Fund - Class 1
		2017			0.40	%		1.95	%		14.39		29.17		100,452		2,230,705		29.37	%		31.28	%		0.87	%
		2016			0.40	%		1.90	%		11.00		22.26		120,828		2,168,663		-1.03	%		0.47	%		1.14	%
		2015			0.40	%		1.90	%		11.00		22.20		103,598		1,966,526		5.22	%		6.81	%		1.54	%
		2014			0.40	%		1.90	%		16.32		20.76		53,456		929,867		0.84	%		1.85	%		1.74	%
		2013			0.65	%		1.65	%		20.38		20.38		9,962		180,670		28.67	%		28.67	%		2.64	%
American Funds Global Growth Fund - Class 1A
		2017	2/24/17		0.35	%		1.75	%		12.69		12.87		134,709		1,729,281		0.00	%		23.46	%		1.69	%

N-111

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
American Funds Global Growth Fund - Class 2
		2017			0.65	%		3.45	%	$	17.26	$	30.77		11,616,271	$	308,500,828		27.40	%		30.62	%		0.64	%
		2016			0.65	%		3.15	%		13.55		23.71		13,247,007		273,063,601		-2.50	%		-0.03	%		0.83	%
		2015			0.65	%		3.15	%		13.90		23.87		14,297,446		299,327,181		3.62	%		6.24	%		1.01	%
		2014			0.65	%		3.15	%		13.41		22.62		15,062,955		300,070,833		-0.86	%		1.65	%		1.13	%
		2013			0.65	%		3.15	%		13.53		22.40		16,531,915		328,814,702		25.17	%		28.34	%		1.22	%
American Funds Global Growth Fund - Class 4
		2017			0.10	%		1.65	%		13.69		14.38		2,754,870		37,676,270		28.97	%		30.72	%		0.73	%
		2016			0.30	%		1.65	%		10.62		11.00		1,566,169		16,824,684		-1.27	%		0.07	%		0.69	%
		2015			0.30	%		1.65	%		10.75		11.00		1,199,771		12,998,542		4.94	%		6.37	%		1.81	%
		2014	7/7/14		0.30	%		1.65	%		10.25		10.34		166,172		1,707,623		-2.09	%		6.92	%		1.88	%
American Funds Global Small Capitalization Fund - Class 1
		2017			0.40	%		1.90	%		12.85		25.81		74,101		1,447,426		23.84	%		25.71	%		0.67	%
		2016			0.40	%		1.90	%		10.26		20.57		72,209		1,145,718		0.42	%		1.94	%		0.61	%
		2015			0.40	%		1.90	%		10.18		20.22		43,539		713,056		-1.39	%		0.10	%		0.00	%
		2014			0.40	%		1.90	%		12.12		20.24		38,850		647,274		0.43	%		1.74	%		0.56	%
		2013	3/18/13		0.60	%		1.90	%		12.07		19.90		9,572		171,321		3.23	%		18.71	%		0.36	%
American Funds Global Small Capitalization Fund - Class 1A
		2017	2/24/17		0.35	%		0.50	%		12.26		12.28		14,797		181,646		9.37	%		17.98	%		0.59	%
American Funds Global Small Capitalization Fund - Class 2
		2017			0.60	%		3.15	%		13.36		41.54		18,496,006		407,453,214		21.99	%		25.14	%		0.43	%
		2016			0.60	%		3.15	%		10.95		33.61		21,300,578		378,822,041		-1.07	%		1.49	%		0.22	%
		2015			0.60	%		3.15	%		11.07		33.54		22,851,469		407,238,808		-2.84	%		-0.38	%		0.00	%
		2014			0.65	%		3.15	%		11.39		34.07		24,595,417		444,106,901		-1.04	%		1.46	%		0.12	%
		2013			0.65	%		3.15	%		11.51		33.99		25,652,712		468,775,881		24.30	%		27.45	%		0.86	%
American Funds Global Small Capitalization Fund - Class 4
		2017			0.10	%		1.65	%		12.24		12.86		819,439		10,114,015		23.57	%		25.25	%		0.41	%
		2016			0.30	%		1.65	%		9.91		10.26		505,637		5,070,326		0.18	%		1.54	%		0.10	%
		2015			0.30	%		1.65	%		9.89		9.98		449,566		4,478,298		-1.66	%		-1.11	%		0.00	%
		2014	7/10/14		1.10	%		1.65	%		10.05		10.09		109,654		1,105,353		-3.11	%		0.33	%		0.15	%
American Funds Growth Fund - Class 1
		2017			0.40	%		2.15	%		15.91		34.52		385,667		10,602,163		25.89	%		28.11	%		0.77	%
		2016			0.40	%		2.15	%		12.47		27.00		385,511		8,098,393		7.43	%		9.32	%		1.04	%
		2015			0.40	%		2.15	%		11.53		24.75		295,072		5,907,860		4.84	%		6.69	%		0.88	%
		2014			0.40	%		2.15	%		15.57		23.24		265,323		5,209,877		6.47	%		8.14	%		1.77	%
		2013			0.60	%		2.15	%		20.43		21.43		95,918		1,854,888		28.24	%		29.59	%		2.17	%
American Funds Growth Fund - Class 1A
		2017	2/24/17		0.35	%		1.85	%		12.32		12.51		224,696		2,802,955		-0.44	%		19.14	%		1.04	%
American Funds Growth Fund - Class 2
		2017			0.60	%		3.45	%		19.59		39.51		51,003,242		1,493,960,160		24.26	%		27.51	%		0.49	%
		2016			0.60	%		3.20	%		15.70		31.38		59,105,003		1,372,744,558		6.04	%		8.83	%		0.70	%
		2015			0.60	%		3.20	%		14.74		29.19		66,210,229		1,430,702,928		3.49	%		6.22	%		0.58	%
		2014			0.60	%		3.20	%		14.09		27.83		77,008,391		1,582,205,164		5.09	%		7.86	%		0.76	%
		2013			0.60	%		3.20	%		13.22		26.12		88,916,417		1,713,280,045		26.01	%		29.26	%		0.91	%
American Funds Growth Fund - Class 4
		2017			0.10	%		1.65	%		15.15		15.91		6,957,967		105,324,817		25.89	%		27.60	%		0.51	%
		2016			0.30	%		1.65	%		12.03		12.47		4,279,096		52,085,976		7.43	%		8.89	%		0.62	%
		2015			0.30	%		1.65	%		11.20		11.45		2,619,327		29,556,538		4.84	%		6.26	%		1.19	%
		2014	7/11/14		0.30	%		1.65	%		10.68		10.78		689,230		7,385,095		1.48	%		8.58	%		1.88	%
American Funds Growth-Income Fund - Class 1
		2017			0.40	%		1.90	%		14.81		31.58		235,978		6,646,314		20.38	%		22.20	%		1.68	%
		2016			0.40	%		1.90	%		12.12		25.89		192,831		4,355,827		9.70	%		11.36	%		1.80	%
		2015			0.40	%		1.90	%		10.88		23.30		144,584		2,966,116		-0.20	%		1.31	%		1.56	%
		2014			0.40	%		1.90	%		16.68		23.04		136,191		2,917,443		8.82	%		10.24	%		1.91	%
		2013			0.60	%		1.90	%		20.84		20.84		42,509		857,590		32.95	%		32.95	%		4.20	%
American Funds Growth-Income Fund - Class 1A
		2017	2/24/17		0.35	%		1.75	%		11.78		11.94		181,077		2,157,415		-0.18	%		15.03	%		3.36	%

N-112

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
American Funds Growth-Income Fund - Class 2
		2017			0.60	%		3.45	%	$	18.01	$	33.05		77,508,047	$	1,952,345,244		18.53	%		21.65	%		1.36	%
		2016			0.60	%		3.20	%		15.13		27.51		88,817,914		1,856,720,868		8.01	%		10.86	%		1.33	%
		2015			0.60	%		3.20	%		13.95		25.13		97,917,131		1,864,034,886		-1.74	%		0.85	%		1.27	%
		2014			0.60	%		3.20	%		14.13		25.23		108,518,744		2,071,195,590		7.15	%		9.98	%		1.25	%
		2013			0.60	%		3.20	%		13.13		23.23		123,574,320		2,169,089,785		29.30	%		32.71	%		1.32	%
American Funds Growth-Income Fund - Class 4
		2017			0.10	%		1.65	%		13.89		14.59		5,017,789		69,160,604		20.08	%		21.71	%		1.56	%
		2016			0.30	%		1.65	%		11.57		11.99		2,971,117		34,742,603		9.44	%		10.92	%		1.38	%
		2015			0.30	%		1.65	%		10.57		10.81		1,933,530		20,582,982		-0.45	%		0.91	%		2.25	%
		2014	7/11/14		0.30	%		1.65	%		10.62		10.71		429,293		4,572,408		1.70	%		7.62	%		2.87	%
American Funds High-Income Bond Fund - Class 1
		2017			0.60	%		1.90	%		12.30		13.41		130,925		1,732,060		5.23	%		6.61	%		6.92	%
		2016			0.60	%		1.90	%		11.69		12.58		105,363		1,306,921		15.61	%		17.13	%		6.43	%
		2015			0.60	%		1.90	%		10.11		10.74		84,527		894,088		-8.70	%		-7.50	%		6.45	%
		2014			0.60	%		1.90	%		11.07		11.61		67,751		777,749		-1.09	%		0.20	%		7.05	%
		2013			0.60	%		1.90	%		11.19		11.58		30,666		350,547		4.88	%		6.26	%		9.56	%
American Funds High-Income Bond Fund - Class 1A
		2017	2/10/17		0.50	%		1.75	%		10.42		10.55		36,971		387,351		0.13	%		4.49	%		8.90	%
American Funds International Fund - Class 1
		2017			0.40	%		2.25	%		12.30		20.88		359,096		6,189,789		29.97	%		31.93	%		1.59	%
		2016			0.40	%		1.90	%		9.36		15.86		275,577		3,500,191		2.03	%		3.37	%		1.63	%
		2015			0.40	%		1.70	%		9.09		15.37		250,441		3,084,558		-5.87	%		-4.64	%		2.18	%
		2014			0.40	%		1.70	%		15.19		16.15		150,309		2,008,634		-4.05	%		-2.99	%		2.73	%
		2013			0.60	%		1.70	%		15.83		15.83		28,752		466,616		19.85	%		19.85	%		2.40	%
American Funds International Fund - Class 1A
		2017	2/21/17		0.35	%		1.85	%		12.71		12.90		126,000		1,624,060		1.94	%		23.39	%		2.38	%
American Funds International Fund - Class 2
		2017			0.65	%		3.30	%		12.71		32.08		34,577,849		706,147,538		28.05	%		31.29	%		1.22	%
		2016			0.65	%		3.15	%		9.93		24.73		40,061,459		629,030,458		0.32	%		2.86	%		1.24	%
		2015			0.65	%		3.15	%		9.89		24.33		43,059,631		664,730,962		-7.49	%		-5.14	%		1.49	%
		2014			0.65	%		3.15	%		10.69		25.96		44,124,291		729,574,567		-5.67	%		-3.28	%		1.38	%
		2013			0.65	%		3.15	%		11.34		27.16		44,360,488		778,437,194		17.86	%		20.85	%		1.36	%
American Funds International Fund - Class 4
		2017			0.10	%		1.65	%		11.71		12.30		2,685,612		31,981,989		29.74	%		31.50	%		1.61	%
		2016			0.30	%		1.65	%		9.03		9.35		1,691,788		15,447,183		1.53	%		2.91	%		1.33	%
		2015			0.30	%		1.65	%		8.89		9.09		1,206,889		10,804,545		-6.31	%		-5.04	%		2.06	%
		2014	7/8/14		0.30	%		1.65	%		9.49		9.57		318,221		3,027,225		-6.56	%		2.94	%		3.02	%
American Funds International Growth and Income Fund - Class 1
		2017			0.60	%		2.25	%		12.49		13.85		128,565		1,740,107		22.64	%		24.56	%		2.41	%
		2016			0.60	%		2.15	%		10.19		11.12		129,412		1,418,750		-0.45	%		1.10	%		2.55	%
		2015			0.60	%		2.15	%		10.23		10.99		138,132		1,501,645		-7.35	%		-5.91	%		2.33	%
		2014			0.60	%		2.15	%		11.05		11.68		132,517		1,533,911		-4.99	%		-3.51	%		3.51	%
		2013	3/18/13		0.60	%		2.15	%		11.63		12.11		68,436		818,062		2.18	%		14.51	%		5.76	%
American Funds International Growth and Income Fund - Class 1A
		2017	3/30/17		0.50	%		0.70	%		12.25		12.28		54,088		663,781		2.35	%		15.58	%		7.59	%
American Funds Managed Risk Asset Allocation Fund - Class P1
		2017			0.50	%		1.85	%		15.16		15.20		65,270		883,305		14.32	%		14.37	%		0.27	%
		2016			0.60	%		1.70	%		12.70		13.26		91,744		1,208,325		5.76	%		6.87	%		1.52	%
		2015			0.65	%		1.70	%		12.41		12.41		71,784		889,748		-1.48	%		-1.48	%		1.89	%
		2014			0.65	%		0.65	%		12.59		12.59		59,551		749,950		2.58	%		2.58	%		0.31	%
		2013	5/20/13		0.65	%		0.65	%		12.28		12.28		31,059		381,308		7.24	%		7.24	%		2.06	%
American Funds Managed Risk Asset Allocation Fund - Class P2
		2017			1.30	%		2.85	%		13.37		14.47		7,435,798		106,572,503		11.58	%		13.32	%		0.76	%
		2016			1.30	%		2.85	%		12.00		12.77		5,432,934		68,793,798		4.31	%		5.89	%		1.22	%
		2015			1.30	%		2.80	%		11.60		12.06		2,593,237		31,081,934		-3.56	%		-2.35	%		1.73	%
		2014	8/20/14		1.30	%		2.55	%		12.03		12.35		511,562		6,299,380		-1.32	%		3.75	%		0.10	%

N-113

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1
		2017			0.60	%		1.70	%	$	13.47	$	14.18		6,120	$	84,409		13.54	%		14.79	%		1.28	%
		2016			0.60	%		1.70	%		11.87		12.35		12,154		147,587		11.86	%		13.09	%		1.74	%
		2015			0.60	%		1.70	%		10.61		10.92		6,877		73,829		-8.64	%		-7.63	%		0.56	%
		2014			0.60	%		1.70	%		11.82		11.82		8,638		101,228		7.93	%		7.93	%		4.48	%
		2013	9/9/13		0.60	%		0.60	%		10.96		10.96		1,111		12,177		9.23	%		9.23	%		1.52	%
American Funds Managed Risk Growth Fund - Class P1
		2017			0.60	%		0.90	%		14.35		14.55		7,301		105,305		25.10	%		25.47	%		0.59	%
		2016			0.60	%		0.90	%		11.60		11.60		10,212		117,497		2.27	%		2.27	%		0.49	%
		2015			0.60	%		0.60	%		11.34		11.34		1,886		21,404		0.45	%		0.45	%		0.00	%
		2014			0.60	%		1.70	%		11.09		11.09		6,172		68,833		0.46	%		0.46	%		1.05	%
		2013	11/14/13		1.70	%		1.70	%		11.04		11.04		4,637		51,202		3.51	%		3.51	%		0.65	%
American Funds Managed Risk Growth-Income Fund - Class P1
		2017			0.65	%		1.70	%		13.59		14.27		1,895		26,139		18.61	%		19.86	%		1.03	%
		2016			0.65	%		1.70	%		11.46		11.91		2,079		24,076		4.70	%		5.81	%		1.34	%
		2015			0.65	%		1.70	%		10.95		11.25		2,157		23,786		-4.90	%		-3.90	%		0.32	%
		2014			0.65	%		1.70	%		11.71		11.71		2,307		26,676		4.18	%		4.18	%		2.58	%
		2013	12/16/13		0.65	%		0.65	%		11.24		11.24		558		6,275		3.40	%		3.40	%		0.98	%
American Funds Managed Risk International Fund - Class P1
		2017			0.60	%		0.60	%		11.66		11.66		1,359		15,845		28.52	%		28.52	%		0.36	%
		2016			0.60	%		0.90	%		9.07		9.07		4,732		42,593		-3.17	%		-3.17	%		1.03	%
		2015			0.60	%		0.65	%		9.37		9.37		5,906		55,274		-6.68	%		-6.68	%		0.01	%
		2014	3/10/14		0.60	%		0.60	%		10.04		10.04		1,359		13,648		-4.08	%		-4.08	%		1.37	%
American Funds Mortgage Fund - Class 1
		2017			0.40	%		1.90	%		10.40		11.33		38,322		417,491		-0.43	%		1.07	%		1.72	%
		2016			0.40	%		1.90	%		10.44		11.20		34,430		373,841		0.57	%		2.09	%		2.10	%
		2015			0.40	%		1.90	%		10.38		11.00		23,448		250,122		0.16	%		1.68	%		1.55	%
		2014			0.40	%		1.90	%		10.37		10.85		26,208		276,226		3.56	%		4.86	%		0.90	%
		2013			0.65	%		1.90	%		10.01		10.34		31,044		314,793		-3.26	%		-2.05	%		1.29	%
American Funds Mortgage Fund - Class 1A
		2017	2/10/17		0.70	%		0.70	%		10.06		10.06		9,313		93,723		0.12	%		0.12	%		1.52	%
American Funds Mortgage Fund - Class 4
		2017			1.10	%		1.65	%		10.06		10.27		497,409		5,067,464		-0.68	%		-0.13	%		1.29	%
		2016			0.30	%		1.65	%		10.13		10.50		450,667		4,621,446		0.34	%		1.70	%		1.19	%
		2015			0.30	%		1.65	%		10.10		10.19		471,125		4,794,465		-0.04	%		0.51	%		3.90	%
		2014	7/24/14		1.10	%		1.65	%		10.10		10.14		5,213		52,828		0.65	%		0.94	%		1.37	%
American Funds New World Fund® - Class 1
		2017			0.40	%		2.15	%		11.84		13.35		324,197		4,162,323		26.98	%		29.22	%		1.17	%
		2016			0.40	%		2.15	%		9.20		10.35		297,012		2,941,699		3.35	%		5.17	%		1.07	%
		2015			0.40	%		2.15	%		8.79		9.86		217,610		2,068,339		-5.02	%		-3.34	%		0.87	%
		2014			0.40	%		2.15	%		9.67		10.23		165,600		1,645,697		-9.60	%		-8.19	%		1.59	%
		2013			0.60	%		2.15	%		10.76		11.12		62,079		681,495		9.56	%		10.94	%		3.86	%
American Funds New World Fund® - Class 1A
		2017	2/10/17		0.35	%		0.75	%		12.58		12.63		51,429		649,430		0.43	%		21.86	%		2.28	%
American Funds New World Fund® - Class 4
		2017			0.10	%		1.65	%		11.28		11.85		2,096,083		24,088,587		26.95	%		28.67	%		0.89	%
		2016			0.30	%		1.65	%		8.88		9.21		1,618,886		14,556,375		3.32	%		4.73	%		0.66	%
		2015			0.30	%		1.65	%		8.60		8.79		1,131,422		9,799,068		-4.96	%		-3.66	%		0.68	%
		2014	6/30/14		0.30	%		1.65	%		9.05		9.13		229,661		2,083,507		-13.72	%		-2.61	%		2.44	%
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1
		2017			0.60	%		1.90	%		10.26		11.18		17,147		188,333		-0.08	%		1.22	%		1.41	%
		2016			0.60	%		1.90	%		10.27		11.04		22,590		246,784		-0.47	%		0.83	%		1.69	%
		2015			0.60	%		1.90	%		10.32		10.95		11,804		127,303		0.01	%		1.32	%		1.29	%
		2014			0.60	%		1.90	%		10.31		10.81		17,594		186,388		3.26	%		4.61	%		1.14	%
		2013			0.60	%		1.90	%		9.99		10.33		26,690		270,577		-4.70	%		-3.45	%		1.34	%
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A
		2017	5/30/17		0.50	%		1.75	%		10.00		10.12		29,181		292,918		-0.64	%		-0.06	%		1.23	%

N-114

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
BlackRock Global Allocation V.I. Fund - Class I
		2017			0.35	%		1.90	%	$	11.70	$	17.95		327,723	$	4,965,721		11.72	%		13.40	%		1.43	%
		2016			0.40	%		1.90	%		10.32		15.86		264,557		3,731,880		2.15	%		3.70	%		1.34	%
		2015			0.40	%		1.90	%		9.95		15.33		211,287		2,832,358		-2.58	%		-1.11	%		1.40	%
		2014			0.40	%		1.90	%		11.85		15.53		95,187		1,443,873		0.19	%		1.50	%		2.77	%
		2013			0.60	%		1.90	%		15.10		15.30		61,891		937,866		13.73	%		14.07	%		2.74	%
BlackRock Global Allocation V.I. Fund - Class III
		2017			0.10	%		3.45	%		10.56		17.52		72,296,105		1,146,566,986		10.13	%		13.37	%		1.26	%
		2016			0.30	%		3.20	%		10.28		15.51		78,755,721		1,118,809,230		0.54	%		3.49	%		1.10	%
		2015			0.30	%		3.20	%		9.93		15.03		86,148,478		1,199,215,935		-4.12	%		-1.30	%		1.03	%
		2014			0.30	%		3.20	%		11.12		15.29		91,977,049		1,314,829,729		-1.28	%		1.27	%		2.17	%
		2013			0.60	%		3.20	%		11.26		15.13		97,802,754		1,396,151,367		10.81	%		13.73	%		1.06	%
BlackRock iShares® Alternative Strategies V.I. Fund - Class I
		2017			0.35	%		0.40	%		11.25		11.25		1,340		14,954		12.29	%		12.29	%		3.32	%
		2016	3/16/16		0.40	%		0.40	%		10.02		10.02		931		9,323		2.07	%		2.07	%		2.49	%
BlackRock iShares® Alternative Strategies V.I. Fund - Class III
		2017			0.30	%		1.65	%		10.81		11.21		407,399		4,445,200		10.61	%		12.11	%		2.80	%
		2016			0.30	%		1.65	%		9.77		10.00		338,852		3,328,776		4.48	%		5.90	%		4.59	%
		2015	5/26/15		0.30	%		1.65	%		9.35		9.44		54,935		515,429		-5.32	%		-3.32	%		6.31	%
ClearBridge Variable Aggressive Growth Portfolio - Class I
		2017			0.35	%		0.40	%		12.82		12.82		24,945		309,595		15.83	%		15.83	%		0.58	%
		2016			0.40	%		0.40	%		11.07		11.07		17,917		198,293		0.80	%		0.80	%		0.61	%
		2015			0.40	%		0.40	%		10.98		10.98		17,166		188,486		-2.13	%		-2.13	%		0.33	%
		2014	7/24/14		0.40	%		0.40	%		11.22		11.22		17,600		197,454		2.42	%		2.42	%		0.24	%
ClearBridge Variable Aggressive Growth Portfolio - Class II
		2017			0.10	%		1.65	%		12.14		12.75		1,803,465		22,255,867		14.09	%		15.64	%		0.27	%
		2016			0.30	%		1.65	%		10.64		11.02		1,769,468		19,053,014		-0.72	%		0.63	%		0.40	%
		2015			0.30	%		1.65	%		10.71		10.95		1,645,147		17,765,237		-3.54	%		-2.23	%		0.11	%
		2014	6/27/14		0.30	%		1.65	%		11.11		11.20		423,885		4,723,066		1.61	%		4.95	%		0.00	%
ClearBridge Variable Large Cap Growth Portfolio - Class I
		2017	7/6/17		0.50	%		0.70	%		11.37		11.39		29,520		336,085		3.70	%		13.04	%		0.32	%
ClearBridge Variable Large Cap Growth Portfolio - Class II
		2017	5/25/17		0.10	%		2.90	%		11.20		11.40		1,230,082		13,890,453		-0.61	%		12.40	%		0.30	%
ClearBridge Variable Mid Cap Portfolio - Class I
		2017			0.35	%		0.65	%		13.15		13.27		41,864		533,192		12.07	%		12.35	%		0.50	%
		2016			0.40	%		0.65	%		11.73		11.81		26,700		313,621		8.63	%		8.90	%		1.03	%
		2015			0.40	%		0.65	%		10.84		10.84		16,347		176,720		1.89	%		1.89	%		0.07	%
		2014	7/24/14		0.40	%		0.40	%		10.64		10.64		241		2,559		2.40	%		2.40	%		0.28	%
ClearBridge Variable Mid Cap Portfolio - Class II
		2017			0.10	%		3.05	%		12.11		13.19		2,463,944		31,264,072		9.61	%		12.21	%		0.22	%
		2016			0.30	%		2.80	%		11.01		11.76		1,886,352		21,578,620		6.09	%		8.78	%		0.37	%
		2015			0.30	%		2.80	%		10.37		10.81		1,626,343		17,287,110		-0.85	%		1.68	%		0.05	%
		2014	5/19/14		0.30	%		3.00	%		10.45		10.63		1,357,176		14,307,002		-0.52	%		9.15	%		0.20	%
Columbia VP Commodity Strategy Fund - Class 1
		2017	2/16/17		0.35	%		0.35	%		10.57		10.57		15,610		165,052		4.15	%		4.15	%		1.62	%
Columbia VP Commodity Strategy Fund - Class 2
		2017	2/6/17		0.10	%		1.50	%		10.41		10.58		46,856		490,574		0.10	%		6.64	%		4.03	%
Columbia VP Emerging Markets Bond Fund - Class 1
		2017	4/6/17		0.35	%		0.35	%		10.82		10.82		23,667		256,096		0.54	%		0.54	%		3.34	%
Columbia VP Emerging Markets Bond Fund - Class 2
		2017	1/12/17		0.10	%		1.65	%		10.64		10.83		108,726		1,163,501		0.58	%		8.87	%		4.81	%
Columbia VP Strategic Income Fund - Class 2
		2017	1/11/17		0.10	%		1.65	%		10.39		10.58		280,373		2,922,021		1.59	%		4.10	%		3.12	%

N-115

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Delaware VIP® Diversified Income Series - Service Class
		2017			0.10	%		3.45	%	$	9.96	$	17.23		130,151,769	$	2,015,655,856		1.59	%		4.58	%		2.40	%
		2016			0.30	%		3.20	%		9.80		16.64		117,428,902		1,764,684,263		0.03	%		2.97	%		2.85	%
		2015			0.30	%		3.20	%		9.80		16.32		114,243,405		1,691,750,437		-4.45	%		-1.64	%		2.78	%
		2014			0.30	%		3.20	%		10.25		16.76		110,189,860		1,681,645,917		1.68	%		4.36	%		1.97	%
		2013			0.60	%		3.20	%		10.08		16.18		96,298,898		1,420,559,454		-4.53	%		-2.06	%		2.15	%
Delaware VIP® Diversified Income Series - Standard Class
		2017			0.35	%		2.15	%		10.63		15.61		524,734		6,538,451		2.98	%		4.80	%		2.47	%
		2016			0.40	%		2.15	%		10.19		14.92		354,250		4,519,408		1.32	%		3.11	%		2.67	%
		2015			0.40	%		2.15	%		9.98		14.50		249,569		3,257,476		-3.19	%		-1.48	%		3.00	%
		2014			0.40	%		2.15	%		10.81		14.75		85,063		1,143,589		3.08	%		4.69	%		1.88	%
		2013			0.60	%		2.15	%		14.05		14.05		43,579		563,170		-1.90	%		-1.90	%		0.88	%
Delaware VIP® Emerging Markets Series - Service Class
		2017			0.10	%		3.20	%		10.46		57.28		15,125,947		340,675,270		35.82	%		39.81	%		0.39	%
		2016			0.30	%		3.20	%		7.70		41.61		16,679,830		275,922,577		10.10	%		13.00	%		0.78	%
		2015			0.60	%		3.20	%		6.99		37.29		18,736,964		277,740,382		-17.46	%		-15.29	%		0.59	%
		2014			0.60	%		3.20	%		8.47		44.57		18,418,834		325,412,353		-11.15	%		-8.82	%		0.41	%
		2013			0.60	%		3.20	%		9.54		49.49		18,654,260		366,304,797		6.40	%		9.15	%		1.47	%
Delaware VIP® Emerging Markets Series - Standard Class
		2017			0.35	%		0.80	%		12.11		12.29		41,673		522,700		39.43	%		39.99	%		0.55	%
		2016	1/5/16		0.40	%		0.80	%		8.68		8.78		27,744		243,307		0.43	%		16.93	%		0.10	%
		2014	9/17/14		0.80	%		0.80	%		9.06		9.06		347		3,141		-14.13	%		-14.13	%		0.00	%
Delaware VIP® High Yield Series - Service Class
		2017			0.65	%		3.15	%		11.79		27.70		5,990,655		129,079,479		3.92	%		6.56	%		5.79	%
		2016			0.65	%		3.15	%		11.34		26.19		6,863,398		140,179,193		9.41	%		12.18	%		6.42	%
		2015			0.65	%		3.15	%		10.37		23.52		7,724,858		141,996,806		-9.76	%		-7.48	%		6.65	%
		2014			0.65	%		3.15	%		11.49		26.04		9,085,188		183,036,976		-3.62	%		-1.18	%		6.66	%
		2013			0.65	%		3.15	%		11.92		26.67		10,902,384		224,761,227		5.60	%		8.27	%		7.38	%
Delaware VIP® High Yield Series - Standard Class
		2017			1.40	%		2.35	%		20.83		28.78		136,190		2,886,230		4.99	%		5.99	%		4.76	%
		2016			1.40	%		2.35	%		19.65		27.28		268,686		5,329,426		10.53	%		11.59	%		6.80	%
		2015			1.40	%		2.35	%		17.61		24.56		188,579		3,371,137		-8.77	%		-7.90	%		6.42	%
		2014			1.40	%		2.35	%		19.12		26.78		223,892		4,346,695		-2.60	%		-1.67	%		6.44	%
		2013			1.40	%		2.35	%		19.44		26.46		259,899		5,122,924		6.68	%		7.70	%		10.17	%
Delaware VIP® International Value Equity Series - Standard Class
		2017			1.40	%		1.65	%		22.10		23.59		5,355		118,444		20.50	%		20.81	%		1.56	%
		2016			1.40	%		1.65	%		18.29		19.57		6,600		120,819		2.45	%		2.74	%		1.70	%
		2015			1.40	%		1.65	%		17.80		19.11		8,520		151,785		-1.16	%		-0.91	%		1.87	%
		2014			1.40	%		1.65	%		17.97		17.97		8,854		159,204		-9.94	%		-9.94	%		1.34	%
		2013			1.40	%		2.15	%		19.95		22.16		10,844		217,780		20.18	%		21.08	%		1.56	%
Delaware VIP® Limited-Term Diversified Income Series - Service Class
		2017			0.20	%		3.30	%		8.71		12.56		112,070,194		1,262,196,657		-1.29	%		1.31	%		1.80	%
		2016			0.60	%		3.20	%		8.83		12.39		113,723,592		1,274,183,683		-1.47	%		1.12	%		1.30	%
		2015			0.60	%		3.20	%		8.96		12.26		118,427,400		1,323,115,458		-2.54	%		0.04	%		1.45	%
		2014			0.60	%		3.20	%		9.19		12.25		120,406,279		1,356,387,266		-1.75	%		0.84	%		1.33	%
		2013			0.60	%		3.20	%		9.36		12.15		114,924,314		1,296,360,971		-4.43	%		-1.92	%		1.28	%
Delaware VIP® Limited-Term Diversified Income Series - Standard Class
		2017			0.40	%		2.15	%		9.57		11.91		135,319		1,446,066		0.00	%		1.56	%		2.05	%
		2016			0.60	%		2.15	%		9.57		11.73		103,856		1,115,783		-0.08	%		1.48	%		1.52	%
		2015			0.60	%		2.15	%		9.58		11.56		106,508		1,136,777		-1.36	%		0.19	%		1.70	%
		2014			0.60	%		2.15	%		9.71		11.53		115,875		1,237,024		-0.47	%		1.09	%		1.60	%
		2013			0.60	%		2.15	%		9.83		11.41		86,433		902,812		-2.92	%		-1.65	%		1.42	%
Delaware VIP® REIT Series - Service Class
		2017			0.10	%		3.20	%		12.08		38.68		6,667,910		155,232,449		-1.92	%		0.96	%		1.35	%
		2016			0.30	%		3.20	%		12.14		38.74		7,211,037		171,756,550		2.29	%		5.30	%		0.93	%
		2015			0.30	%		3.20	%		11.53		37.20		6,981,859		163,379,321		0.26	%		3.21	%		1.00	%
		2014			0.30	%		3.20	%		13.04		36.44		7,537,961		176,163,124		25.06	%		28.35	%		1.12	%
		2013			0.60	%		3.20	%		10.27		28.62		7,541,026		140,346,986		-1.29	%		1.26	%		1.31	%

N-116

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Delaware VIP® REIT Series - Standard Class
		2017			0.35	%		2.35	%	$	12.15	$	47.27		99,492	$	3,127,670		-0.82	%		1.13	%		1.60	%
		2016			0.40	%		2.35	%		12.19		47.22		93,339		3,461,597		3.41	%		5.45	%		1.46	%
		2015			0.40	%		2.35	%		11.56		45.23		98,252		3,944,404		1.34	%		3.33	%		1.22	%
		2014			0.40	%		2.35	%		30.35		44.21		141,768		5,926,515		26.46	%		27.66	%		1.33	%
		2013			1.40	%		2.35	%		24.00		34.63		126,712		4,258,904		-0.23	%		0.72	%		1.53	%
Delaware VIP® Small Cap Value Series - Service Class
		2017			0.10	%		3.30	%		13.89		52.05		12,995,334		399,897,769		8.24	%		11.42	%		0.63	%
		2016			0.30	%		3.20	%		12.47		47.23		12,790,973		364,314,405		26.96	%		30.69	%		0.68	%
		2015			0.30	%		3.20	%		9.54		36.54		13,594,728		301,130,775		-9.41	%		-6.74	%		0.47	%
		2014			0.30	%		3.20	%		14.99		39.61		14,687,106		355,732,262		2.29	%		4.93	%		0.34	%
		2013			0.65	%		3.20	%		14.66		38.03		15,896,125		372,923,143		28.98	%		32.31	%		0.52	%
Delaware VIP® Small Cap Value Series - Standard Class
		2017			0.35	%		2.80	%		13.77		52.40		162,616		7,202,342		9.45	%		11.60	%		0.86	%
		2016			0.40	%		2.35	%		12.39		47.43		171,918		7,337,236		28.36	%		30.88	%		0.90	%
		2015			0.40	%		2.35	%		9.57		36.60		179,747		6,367,026		-8.40	%		-6.60	%		0.73	%
		2014			0.40	%		2.35	%		32.00		39.58		195,050		7,559,965		3.40	%		4.39	%		0.56	%
		2013			1.40	%		2.35	%		30.95		37.91		213,991		8,057,362		30.41	%		31.65	%		0.74	%
Delaware VIP® Smid Cap Core Series - Service Class
		2017			0.10	%		3.20	%		14.89		42.18		6,009,878		189,006,646		14.65	%		18.03	%		0.09	%
		2016			0.30	%		3.20	%		12.80		36.29		6,538,038		176,907,561		4.67	%		7.69	%		0.00	%
		2015			0.30	%		3.15	%		11.89		34.23		6,674,093		170,242,554		3.98	%		6.99	%		0.16	%
		2014			0.30	%		3.15	%		15.00		32.49		6,122,012		147,642,377		-0.32	%		2.21	%		0.00	%
		2013			0.65	%		3.15	%		14.85		32.18		7,136,137		169,924,221		36.61	%		40.06	%		0.00	%
Delaware VIP® Smid Cap Core Series - Standard Class
		2017			0.35	%		2.50	%		14.97		46.91		164,897		7,246,071		15.72	%		18.17	%		0.32	%
		2016			0.40	%		2.50	%		12.71		40.10		191,484		7,381,828		5.62	%		7.86	%		0.22	%
		2015			0.40	%		2.50	%		11.91		37.55		216,769		7,913,109		5.04	%		7.11	%		0.38	%
		2014			0.40	%		2.35	%		28.00		35.41		238,939		8,365,583		0.75	%		1.71	%		0.07	%
		2013			1.40	%		2.35	%		27.58		34.81		271,774		9,429,179		38.05	%		39.36	%		0.03	%
Delaware VIP® U.S. Growth Series - Service Class
		2017			0.30	%		3.15	%		14.16		28.78		13,731,531		329,367,419		24.13	%		27.72	%		0.00	%
		2016			0.30	%		3.15	%		11.09		22.76		16,337,364		309,410,670		-8.43	%		-5.78	%		0.38	%
		2015			0.30	%		3.20	%		16.62		24.50		17,287,587		351,628,194		1.82	%		4.40	%		0.35	%
		2014			0.65	%		3.15	%		16.27		23.75		18,204,155		356,087,453		9.00	%		11.76	%		0.01	%
		2013			0.65	%		3.15	%		14.89		21.51		19,086,029		335,409,773		30.28	%		33.57	%		0.12	%
Delaware VIP® Value Series - Service Class
		2017			0.10	%		3.20	%		13.76		33.25		12,651,706		315,482,010		9.96	%		13.19	%		1.49	%
		2016			0.30	%		3.20	%		12.33		29.83		13,979,863		313,973,328		10.72	%		13.98	%		1.55	%
		2015			0.30	%		3.20	%		10.82		26.58		13,027,705		262,215,467		-3.77	%		-0.94	%		1.51	%
		2014			0.30	%		3.20	%		14.77		27.25		13,857,245		287,864,246		10.12	%		12.96	%		1.42	%
		2013			0.65	%		3.20	%		13.30		24.42		13,475,411		250,120,711		29.18	%		32.51	%		1.53	%
Delaware VIP® Value Series - Standard Class
		2017			0.35	%		2.80	%		13.84		34.50		301,625		6,859,946		11.16	%		13.34	%		1.66	%
		2016			0.40	%		2.35	%		12.26		30.88		298,300		6,917,723		11.98	%		14.19	%		1.74	%
		2015			0.40	%		2.35	%		10.85		27.44		287,275		6,159,729		-2.73	%		-0.81	%		1.75	%
		2014			0.40	%		2.35	%		22.18		28.07		321,113		7,091,505		11.35	%		12.41	%		1.71	%
		2013			1.40	%		2.35	%		19.73		25.08		370,671		7,405,602		30.59	%		31.84	%		1.76	%
Deutsche Alternative Asset Allocation VIP Portfolio - Class A
		2017			0.35	%		2.15	%		10.23		14.64		100,462		1,263,779		5.13	%		6.98	%		2.27	%
		2016			0.40	%		2.15	%		9.71		13.71		82,784		1,023,156		3.06	%		4.88	%		2.07	%
		2015			0.40	%		2.15	%		9.45		13.10		78,294		920,543		-8.29	%		-6.86	%		2.87	%
		2014			0.60	%		2.15	%		10.30		14.06		67,124		852,273		1.30	%		2.88	%		1.78	%
		2013			0.60	%		2.15	%		10.25		13.67		52,526		637,444		-0.97	%		0.34	%		0.67	%
Deutsche Alternative Asset Allocation VIP Portfolio - Class B
		2017			0.10	%		3.20	%		9.31		14.23		4,202,999		54,822,983		3.67	%		6.69	%		2.05	%
		2016			0.30	%		3.20	%		8.98		13.39		4,305,326		53,342,762		1.68	%		4.68	%		1.80	%
		2015			0.30	%		3.20	%		8.83		12.84		4,501,518		53,959,007		-9.49	%		-6.83	%		2.71	%
		2014			0.30	%		3.20	%		9.76		13.91		4,275,328		55,634,524		-0.02	%		2.57	%		1.56	%
		2013			0.65	%		3.20	%		9.76		13.67		4,140,319		52,997,930		-2.42	%		0.10	%		1.80	%

N-117

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Deutsche Equity 500 Index VIP Portfolio - Class A
		2017			1.30	%		2.65	%	$	17.93	$	31.22		251,209	$	5,802,183		18.36	%		19.97	%		1.82	%
		2016			1.30	%		2.65	%		15.02		26.02		314,478		5,985,795		8.70	%		10.17	%		1.93	%
		2015			1.30	%		2.65	%		13.70		23.62		362,823		6,242,087		-1.51	%		-0.18	%		1.67	%
		2014			1.30	%		2.65	%		13.79		23.66		400,529		7,058,427		10.43	%		11.93	%		1.88	%
		2013			1.30	%		2.65	%		12.39		21.14		540,134		8,249,499		28.48	%		30.22	%		2.77	%
Deutsche Equity 500 Index VIP Portfolio - Class B
		2013			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		1.57	%
Deutsche Small Cap Index VIP Portfolio - Class A
		2017			1.30	%		2.70	%		19.53		39.00		104,861		3,639,672		11.28	%		12.85	%		0.94	%
		2016			1.30	%		2.70	%		17.51		34.75		117,462		3,623,104		17.86	%		19.46	%		1.02	%
		2015			1.30	%		2.65	%		14.83		29.25		135,242		3,512,931		-7.09	%		-5.83	%		1.05	%
		2014			1.30	%		2.65	%		15.94		31.23		157,921		4,366,578		2.00	%		3.39	%		0.98	%
		2013			1.30	%		2.65	%		15.61		30.37		197,615		5,316,825		35.02	%		36.85	%		1.67	%
Deutsche Small Cap Index VIP Portfolio - Class B
		2013			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		1.47	%
Eaton Vance VT Floating-Rate Income Fund - ADV Class
		2017			0.35	%		0.80	%		10.92		11.08		323,395		3,542,426		2.86	%		3.27	%		3.53	%
		2016			0.40	%		0.80	%		10.62		10.73		207,642		2,228,046		8.34	%		8.77	%		3.42	%
		2015			0.40	%		0.80	%		9.80		9.87		208,187		2,053,882		-1.42	%		-1.03	%		3.62	%
		2014	9/22/14		0.40	%		0.80	%		9.94		9.97		44,060		439,056		-0.62	%		-0.23	%		1.00	%
Eaton Vance VT Floating-Rate Income Fund - Initial Class
		2017			0.10	%		1.65	%		10.48		11.01		1,635,116		17,392,170		1.73	%		3.12	%		3.28	%
		2016			0.30	%		1.65	%		10.31		10.68		1,106,306		11,525,735		7.16	%		8.62	%		3.15	%
		2015			0.30	%		1.65	%		9.62		9.70		697,430		6,754,584		-2.61	%		-2.08	%		3.35	%
		2014	7/8/14		1.10	%		1.65	%		9.88		9.91		142,143		1,407,375		-1.51	%		-1.22	%		1.61	%
Fidelity® VIP Contrafund® Portfolio - Initial Class
		2017			0.35	%		0.80	%		14.10		14.31		124,900		1,754,755		20.90	%		21.39	%		1.03	%
		2016			0.40	%		0.80	%		11.66		11.78		113,901		1,341,965		7.14	%		7.57	%		0.95	%
		2015			0.40	%		0.80	%		10.95		10.95		26,396		288,974		0.27	%		0.27	%		1.17	%
		2014	9/12/14		0.40	%		0.40	%		10.93		10.93		11,580		126,513		3.23	%		3.23	%		2.01	%
Fidelity® VIP Contrafund® Portfolio - Service Class 2
		2017			0.10	%		3.25	%		14.23		35.42		40,386,161		1,133,923,370		17.76	%		21.22	%		0.78	%
		2016			0.30	%		3.20	%		11.74		29.51		42,901,310		1,016,765,625		4.34	%		7.41	%		0.56	%
		2015			0.30	%		3.20	%		10.93		27.75		46,418,773		1,042,372,893		-2.75	%		0.11	%		0.79	%
		2014			0.30	%		3.20	%		14.47		28.00		49,380,506		1,129,791,103		8.14	%		10.99	%		0.72	%
		2013			0.60	%		3.20	%		13.23		25.41		54,960,895		1,147,842,954		26.83	%		30.10	%		0.82	%
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2
		2017	1/17/17		0.30	%		2.85	%		11.16		11.49		535,374		6,058,541		3.45	%		11.03	%		1.78	%
Fidelity® VIP Growth Portfolio - Initial Class
		2017			0.35	%		2.50	%		15.67		32.93		216,809		4,933,313		31.81	%		34.59	%		0.22	%
		2016			0.40	%		2.50	%		11.64		24.82		220,923		3,955,951		-1.69	%		0.40	%		0.03	%
		2015			0.40	%		2.50	%		11.60		25.09		283,603		5,172,442		4.68	%		6.75	%		0.25	%
		2014			0.40	%		2.35	%		17.25		23.84		312,379		5,379,425		8.71	%		9.75	%		0.18	%
		2013			1.40	%		2.35	%		15.72		21.82		344,916		5,449,720		33.17	%		34.44	%		0.28	%
Fidelity® VIP Growth Portfolio - Service Class 2
		2017			0.10	%		3.15	%		14.33		31.70		8,868,563		221,914,221		30.65	%		34.41	%		0.08	%
		2016			0.30	%		3.15	%		10.82		23.95		8,568,945		161,344,919		-2.57	%		0.25	%		0.00	%
		2015			0.30	%		3.15	%		10.96		24.26		8,766,814		165,705,481		3.59	%		6.59	%		0.03	%
		2014			0.30	%		3.15	%		10.43		23.12		8,743,528		157,076,821		7.57	%		10.29	%		0.00	%
		2013			0.65	%		3.15	%		9.57		21.21		9,844,980		160,663,201		31.79	%		35.12	%		0.05	%
Fidelity® VIP Mid Cap Portfolio - Initial Class
		2017			0.35	%		0.80	%		13.71		13.90		139,425		1,896,503		19.85	%		20.33	%		0.79	%
		2016			0.40	%		0.80	%		11.44		11.56		98,925		1,142,422		11.34	%		11.79	%		0.52	%
		2015			0.40	%		0.80	%		10.27		10.34		60,944		629,561		-2.18	%		-1.78	%		0.50	%
		2014	7/24/14		0.40	%		0.80	%		10.50		10.53		55,948		588,669		0.58	%		0.70	%		0.73	%

N-118

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Fidelity® VIP Mid Cap Portfolio - Service Class 2
		2017			0.10	%		3.30	%	$	13.63	$	27.41		23,254,716	$	583,214,185		16.74	%		20.18	%		0.49	%
		2016			0.30	%		3.20	%		11.39		23.02		24,449,161		518,501,410		8.40	%		11.59	%		0.29	%
		2015			0.30	%		3.20	%		10.32		20.83		26,015,626		502,064,436		-4.73	%		-1.92	%		0.25	%
		2014			0.30	%		3.20	%		13.33		21.44		27,773,055		554,863,646		2.69	%		5.40	%		0.02	%
		2013			0.60	%		3.20	%		12.98		20.48		29,593,175		567,793,371		31.59	%		34.99	%		0.27	%
Fidelity® VIP Strategic Income Portfolio - Initial Class
		2017			0.35	%		0.75	%		11.05		11.05		55,269		605,430		7.36	%		7.36	%		3.40	%
		2016			0.40	%		0.40	%		10.29		10.29		44,522		458,257		7.84	%		7.84	%		5.29	%
		2015	8/20/15		0.40	%		0.40	%		9.54		9.54		17,775		169,676		-2.39	%		-2.39	%		3.54	%
Fidelity® VIP Strategic Income Portfolio - Service Class 2
		2017			0.10	%		1.65	%		10.61		11.00		1,452,008		15,571,124		5.79	%		7.22	%		3.81	%
		2016			0.30	%		1.65	%		10.03		10.26		777,159		7,854,444		6.25	%		7.69	%		4.74	%
		2015	6/2/15		0.30	%		1.65	%		9.44		9.53		201,175		1,905,317		-4.80	%		0.08	%		4.76	%
First Trust Dorsey Wright Tactical Core Portfolio - Class I
		2017			0.10	%		1.65	%		11.32		11.61		420,699		4,797,488		15.74	%		17.14	%		0.68	%
		2016	3/11/16		0.30	%		1.50	%		9.78		9.91		196,582		1,928,167		4.03	%		6.04	%		0.85	%
First Trust Multi Income Allocation Portfolio - Class I
		2017			0.10	%		1.65	%		10.99		11.54		502,593		5,591,237		4.31	%		5.74	%		2.63	%
		2016			0.30	%		1.65	%		10.53		10.92		477,982		5,078,137		7.51	%		8.96	%		2.29	%
		2015			0.30	%		1.65	%		9.80		10.02		294,772		2,903,830		-4.82	%		-3.51	%		2.92	%
		2014	7/11/14		0.30	%		1.65	%		10.30		10.39		41,113		424,568		-0.28	%		1.38	%		1.45	%
First Trust Multi Income Allocation Portfolio - Class II
		2017			0.80	%		0.80	%		11.43		11.43		4,292		49,057		5.38	%		5.38	%		2.78	%
		2016	11/28/16		0.80	%		0.80	%		10.84		10.84		4,551		49,364		1.79	%		1.79	%		1.46	%
		2015			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.24	%
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I
		2017			0.20	%		3.30	%		12.77		13.41		7,202,721		86,187,711		11.62	%		13.13	%		1.75	%
		2016			0.30	%		1.65	%		11.44		11.85		1,449,656		16,730,278		9.91	%		11.40	%		1.03	%
		2015			0.30	%		1.65	%		10.41		10.64		846,252		8,848,494		-1.55	%		-0.21	%		3.79	%
		2014	7/16/14		0.30	%		1.65	%		10.57		10.66		146,866		1,555,694		3.49	%		4.96	%		0.17	%
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II
		2017			0.40	%		0.70	%		13.49		13.49		16,142		190,458		13.30	%		13.30	%		7.14	%
		2016			0.40	%		0.40	%		11.91		11.91		514		6,136		11.63	%		11.63	%		1.14	%
		2015	8/4/15		0.40	%		0.40	%		10.66		10.66		554		5,917		-1.62	%		-1.62	%		2.04	%
Franklin Founding Funds Allocation VIP Fund - Class 4
		2017			0.30	%		1.65	%		10.92		11.47		732,709		8,112,121		9.95	%		11.45	%		2.47	%
		2016			0.30	%		1.65	%		9.93		10.29		624,012		6,262,072		11.07	%		12.58	%		3.36	%
		2015			0.30	%		1.65	%		8.94		9.02		433,559		3,901,773		-7.77	%		-7.27	%		3.28	%
		2014	7/7/14		1.10	%		1.65	%		9.69		9.73		664,782		6,459,585		-5.07	%		-3.68	%		0.00	%
Franklin Income VIP Fund - Class 1
		2017			0.35	%		0.40	%		11.35		11.35		14,320		162,608		9.50	%		9.50	%		4.11	%
		2016			0.40	%		0.40	%		10.37		10.37		10,100		104,717		13.88	%		13.88	%		4.48	%
		2015	8/20/15		0.40	%		0.40	%		9.10		9.10		6,237		56,787		-3.19	%		-3.19	%		0.00	%
Franklin Income VIP Fund - Class 2
		2017			0.60	%		3.20	%		12.99		17.77		34,344,379		567,940,664		6.22	%		9.01	%		4.14	%
		2016			0.60	%		3.20	%		12.23		16.69		37,309,015		571,348,724		10.43	%		13.34	%		4.55	%
		2015			0.60	%		3.20	%		11.08		15.07		40,053,489		546,576,674		-9.98	%		-7.66	%		4.65	%
		2014			0.65	%		3.20	%		12.31		16.70		42,936,639		640,251,249		1.32	%		3.94	%		4.95	%
		2013			0.65	%		3.20	%		12.14		16.44		44,017,116		637,025,857		10.35	%		13.20	%		6.33	%
Franklin Income VIP Fund - Class 4
		2017			0.10	%		2.90	%		10.71		11.25		4,684,359		51,699,616		7.76	%		9.22	%		3.70	%
		2016			0.30	%		1.65	%		9.94		10.30		2,486,241		24,996,694		12.01	%		13.53	%		4.24	%
		2015			0.30	%		1.65	%		8.87		9.07		1,871,191		16,724,357		-8.67	%		-7.42	%		4.36	%
		2014	7/2/14		0.30	%		1.65	%		9.71		9.80		799,422		7,785,150		-5.16	%		-4.05	%		0.00	%
Franklin Mutual Shares VIP Fund - Class 1
		2017			0.35	%		0.40	%		12.18		12.18		71,025		860,472		8.20	%		8.20	%		2.52	%
		2016			0.40	%		0.40	%		11.25		11.25		56,610		637,050		15.89	%		15.89	%		2.89	%
		2015	2/12/15		0.40	%		0.80	%		9.65		9.71		4,409		42,696		-8.56	%		-7.14	%		4.45	%

N-119

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Franklin Mutual Shares VIP Fund - Class 2
		2017			0.60	%		3.25	%	$	13.59	$	19.64		44,497,302	$	728,816,598		4.94	%		7.70	%		2.24	%
		2016			0.60	%		3.20	%		12.90		18.67		47,911,586		732,978,896		12.40	%		15.36	%		1.83	%
		2015			0.60	%		3.20	%		11.42		16.57		54,160,493		722,209,227		-7.93	%		-5.50	%		3.06	%
		2014			0.60	%		3.20	%		12.35		17.95		57,601,956		816,349,869		3.75	%		6.48	%		1.99	%
		2013			0.60	%		3.20	%		11.85		17.26		61,488,681		821,308,773		24.23	%		27.49	%		2.05	%
Franklin Mutual Shares VIP Fund - Class 4
		2017			0.10	%		3.10	%		11.48		12.06		1,435,367		16,484,322		6.48	%		7.93	%		2.42	%
		2016			0.30	%		1.65	%		10.79		11.18		504,067		5,503,180		14.04	%		15.59	%		1.71	%
		2015			0.30	%		1.65	%		9.46		9.54		361,025		3,439,996		-6.60	%		-6.09	%		3.76	%
		2014	6/27/14		1.10	%		1.65	%		10.13		10.16		80,873		821,201		-2.00	%		0.38	%		1.09	%
Franklin Rising Dividends VIP Fund - Class 1
		2017			0.35	%		0.40	%		14.25		14.25		49,056		693,179		20.37	%		20.37	%		1.76	%
		2016			0.40	%		0.80	%		11.84		11.84		54,805		648,697		15.86	%		15.86	%		1.41	%
		2015			0.40	%		0.40	%		10.22		10.22		39,479		403,470		-3.80	%		-3.80	%		1.79	%
		2014	12/26/14		0.40	%		0.40	%		10.62		10.62		8,072		85,754		-1.37	%		-1.37	%		0.00	%
Franklin Rising Dividends VIP Fund - Class 4
		2017			0.10	%		1.65	%		13.45		14.13		1,650,892		22,517,549		18.43	%		20.04	%		1.48	%
		2016			0.30	%		1.65	%		11.35		11.77		1,393,866		16,009,437		14.04	%		15.59	%		1.12	%
		2015			0.30	%		1.65	%		9.96		10.18		812,411		8,143,641		-5.33	%		-4.03	%		1.44	%
		2014	7/8/14		0.30	%		1.65	%		10.52		10.61		247,836		2,612,458		3.35	%		9.47	%		0.00	%
Franklin Small Cap Value VIP Fund - Class 1
		2017			0.35	%		0.80	%		12.98		13.17		47,120		616,408		10.03	%		10.47	%		0.79	%
		2016			0.40	%		0.80	%		11.92		11.92		32,106		382,591		30.02	%		30.02	%		0.96	%
		2015			0.40	%		0.40	%		9.17		9.17		29,834		273,520		-7.55	%		-7.55	%		0.91	%
		2014	7/24/14		0.40	%		0.80	%		9.89		9.92		28,306		280,716		-1.64	%		-0.06	%		0.00	%
Franklin Small Cap Value VIP Fund - Class 4
		2017			0.10	%		1.65	%		12.43		13.05		570,206		7,200,733		8.75	%		10.23	%		0.43	%
		2016			0.30	%		1.65	%		11.43		11.84		515,803		5,963,669		27.99	%		29.73	%		0.56	%
		2015			0.30	%		1.65	%		8.93		9.13		256,182		2,302,665		-9.03	%		-7.79	%		0.57	%
		2014	6/30/14		0.30	%		1.65	%		9.81		9.90		74,120		729,615		-4.40	%		2.72	%		0.00	%
Franklin Small-Mid Cap Growth VIP Fund - Class 1
		2017			0.35	%		0.80	%		13.03		13.22		18,010		234,958		20.78	%		21.26	%		0.00	%
		2016			0.40	%		0.80	%		10.90		10.90		18,342		199,812		3.99	%		3.99	%		0.00	%
		2015	2/12/15		0.40	%		0.40	%		10.48		10.48		499		5,227		-6.30	%		-6.30	%		0.00	%
Franklin Small-Mid Cap Growth VIP Fund - Class 2
		2013			1.30	%		1.30	%		18.34		18.34		8		153		36.36	%		36.36	%		0.00	%
Franklin Small-Mid Cap Growth VIP Fund - Class 4
		2017			0.10	%		1.65	%		12.47		13.10		431,083		5,462,010		19.32	%		20.94	%		0.00	%
		2016			0.30	%		1.65	%		10.45		10.83		305,816		3,236,354		2.33	%		3.72	%		0.00	%
		2015			0.30	%		1.65	%		10.21		10.31		203,997		2,101,188		-4.36	%		-3.83	%		0.00	%
		2014	6/27/14		1.10	%		1.65	%		10.68		10.72		59,006		631,684		1.72	%		11.79	%		0.00	%
Goldman Sachs VIT Government Money Market Fund - Institutional Shares
		2017			0.40	%		0.80	%		9.82		9.96		45,870		456,074		-0.04	%		0.36	%		0.75	%
		2016			0.40	%		0.80	%		9.93		9.93		145,114		1,434,296		-0.11	%		-0.11	%		0.29	%
		2015			0.40	%		0.40	%		9.94		9.94		83,411		829,040		-0.37	%		-0.37	%		0.02	%
		2014	8/13/14		0.40	%		0.40	%		9.98		9.98		33,096		330,156		-0.15	%		-0.15	%		0.01	%
Goldman Sachs VIT Government Money Market Fund - Service Shares
		2017			0.30	%		1.65	%		9.47		9.95		3,611,288		34,978,630		-1.13	%		0.21	%		0.49	%
		2016			0.30	%		1.65	%		9.58		9.93		4,889,010		47,465,080		-1.60	%		-0.26	%		0.04	%
		2015			0.30	%		1.65	%		9.73		9.95		3,667,090		35,943,941		-1.63	%		-0.30	%		0.01	%
		2014	6/27/14		0.30	%		1.65	%		9.90		9.98		696,493		6,913,327		-0.62	%		-0.15	%		0.00	%
Goldman Sachs VIT Large Cap Value Fund - Service Shares
		2017			0.60	%		2.60	%		16.96		24.59		6,809,713		154,363,612		6.76	%		8.85	%		1.40	%
		2016			0.65	%		2.60	%		15.88		22.59		7,309,129		152,708,651		8.43	%		10.56	%		1.70	%
		2015			0.65	%		2.60	%		14.64		20.44		8,058,914		152,745,824		-7.03	%		-5.20	%		1.17	%
		2014			0.65	%		2.60	%		15.74		21.56		8,521,063		170,988,409		9.72	%		11.88	%		1.08	%
		2013			0.65	%		2.60	%		14.33		19.27		9,859,446		177,640,451		29.52	%		32.07	%		0.93	%

N-120

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares
		2017			1.10	%		1.65	%	$	9.28	$	9.47		257,412	$	2,427,961		3.42	%		3.99	%		2.03	%
		2016			0.30	%		1.65	%		8.97		9.10		282,396		2,561,128		-1.37	%		-0.82	%		0.72	%
		2015			1.10	%		1.65	%		9.09		9.18		273,286		2,503,876		-6.44	%		-5.93	%		2.33	%
		2014	7/17/14		0.30	%		1.65	%		9.72		9.81		78,046		761,056		-3.44	%		-0.96	%		2.70	%
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares
		2017			0.35	%		0.80	%		9.70		9.84		10,683		107,351		4.76	%		5.18	%		3.00	%
		2016			0.40	%		0.80	%		9.36		9.36		6,083		56,608		0.12	%		0.12	%		1.90	%
		2015			0.40	%		0.40	%		9.35		9.35		3,042		28,443		-4.89	%		-4.89	%		2.10	%
		2014	7/25/14		0.40	%		0.40	%		9.83		9.83		2,951		29,011		-2.79	%		-2.79	%		1.62	%
Goldman Sachs VIT Strategic Income Fund - Advisor Shares
		2017			0.10	%		1.65	%		8.96		9.41		536,343		4,879,730		-3.92	%		-2.62	%		0.77	%
		2016			0.30	%		1.65	%		9.33		9.46		536,717		5,058,570		-0.91	%		-0.36	%		1.96	%
		2015			1.10	%		1.65	%		9.41		9.50		393,476		3,727,127		-3.85	%		-3.32	%		2.81	%
		2014	6/30/14		1.10	%		1.65	%		9.79		9.82		73,914		725,079		-2.50	%		-1.46	%		3.93	%
Goldman Sachs VIT Strategic Income Fund - Institutional Shares
		2017			0.40	%		0.40	%		9.52		9.52		2,368		22,542		-2.43	%		-2.43	%		1.04	%
		2016	9/28/16		0.40	%		0.40	%		9.75		9.75		2,517		24,556		0.75	%		0.75	%		1.14	%
Guggenheim VT Long Short Equity
		2017			0.10	%		1.65	%		11.67		12.25		405,110		4,812,811		12.97	%		14.51	%		0.34	%
		2016			0.30	%		1.65	%		10.33		10.70		323,154		3,383,496		-0.99	%		0.35	%		0.00	%
		2015			0.30	%		1.65	%		10.46		10.65		331,382		3,484,473		-0.25	%		0.86	%		0.00	%
		2014	7/8/14		0.40	%		1.50	%		10.48		10.56		32,127		337,506		3.47	%		7.33	%		0.00	%
Guggenheim VT Multi-Hedge Strategies
		2017			0.30	%		1.65	%		10.33		10.85		448,100		4,707,985		1.98	%		3.37	%		0.00	%
		2016			0.30	%		1.65	%		10.13		10.47		403,607		4,142,436		-2.11	%		-0.88	%		0.08	%
		2015			0.40	%		1.65	%		10.38		10.57		335,852		3,504,194		0.33	%		1.44	%		0.65	%
		2014	7/17/14		0.40	%		1.50	%		10.34		10.42		48,619		504,099		3.03	%		3.22	%		0.00	%
Hartford Capital Appreciation HLS Fund - Class IA
		2017			0.40	%		0.40	%		13.52		13.52		7,331		99,163		21.65	%		21.65	%		1.12	%
		2016			0.40	%		0.40	%		11.12		11.12		7,326		81,462		5.10	%		5.10	%		1.06	%
		2015			0.40	%		0.40	%		10.58		10.58		7,552		79,900		0.62	%		0.62	%		1.08	%
		2014	7/24/14		0.40	%		0.40	%		10.51		10.51		4,695		49,359		0.91	%		0.91	%		1.01	%
Hartford Capital Appreciation HLS Fund - Class IC
		2017			0.10	%		1.65	%		12.69		13.33		926,942		11,917,596		19.52	%		21.14	%		0.73	%
		2016			0.30	%		1.65	%		10.62		11.00		806,703		8,649,304		3.27	%		4.67	%		0.76	%
		2015			0.30	%		1.65	%		10.28		10.37		590,300		6,107,986		-1.12	%		-0.57	%		0.83	%
		2014	7/7/14		1.10	%		1.65	%		10.40		10.43		151,210		1,575,774		0.55	%		9.77	%		1.81	%
Huntington VA Balanced Fund
		2014			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		3.01	%
		2013			1.10	%		2.75	%		11.50		11.98		255,104		3,020,057		12.13	%		13.88	%		2.00	%
Invesco V.I. American Franchise Fund - Series I Shares
		2017			1.40	%		1.80	%		7.83		13.24		217,758		2,712,314		25.07	%		25.57	%		0.08	%
		2016			1.40	%		1.80	%		6.26		10.54		247,786		2,457,377		0.44	%		0.85	%		0.00	%
		2015			1.40	%		1.80	%		6.23		10.45		259,703		2,552,845		3.13	%		3.55	%		0.00	%
		2014			1.40	%		1.80	%		6.04		10.09		277,239		2,631,394		6.51	%		6.93	%		0.04	%
		2013			1.40	%		1.80	%		5.68		9.44		318,698		2,811,844		37.64	%		38.19	%		0.43	%
Invesco V.I. American Franchise Fund - Series II Shares
		2017			1.35	%		2.45	%		17.23		23.55		83,516		1,494,190		24.33	%		25.36	%		0.00	%
		2016			1.35	%		2.15	%		13.82		18.79		88,012		1,262,042		-0.15	%		0.65	%		0.00	%
		2015			1.30	%		2.15	%		13.81		18.79		97,067		1,394,206		2.52	%		3.41	%		0.00	%
		2014			1.30	%		2.15	%		13.35		18.17		82,287		1,160,140		5.87	%		6.77	%		0.00	%
		2013			1.30	%		2.15	%		12.58		17.02		101,689		1,350,336		36.83	%		37.99	%		0.25	%
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares
		2017			0.35	%		0.40	%		11.93		11.93		66,358		741,488		9.72	%		9.72	%		6.19	%
		2016			0.40	%		0.40	%		10.88		10.88		16,502		179,469		11.19	%		11.19	%		0.39	%
		2015			0.40	%		0.80	%		9.72		9.78		18,541		181,221		-4.86	%		-4.48	%		4.38	%
		2014	10/6/14		0.40	%		0.80	%		10.21		10.24		15,983		163,613		1.17	%		1.64	%		0.00	%

N-121

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares
		2017			0.30	%		1.65	%	$	11.30	$	11.87		1,218,734	$	13,988,224		8.03	%		9.50	%		4.05	%
		2016			0.30	%		1.65	%		10.46		10.84		1,087,000		11,500,595		9.69	%		11.18	%		0.19	%
		2015			0.30	%		1.65	%		9.54		9.75		629,069		6,040,193		-5.97	%		-4.68	%		5.22	%
		2014	7/17/14		0.30	%		1.65	%		10.14		10.23		138,690		1,409,936		-1.41	%		0.72	%		0.00	%
Invesco V.I. Comstock Fund - Series I Shares
		2017			0.40	%		0.40	%		13.60		13.60		8,926		121,431		17.38	%		17.38	%		2.19	%
		2016			0.40	%		0.40	%		11.59		11.59		10,970		127,171		16.83	%		16.83	%		1.75	%
		2015	1/20/15		0.40	%		0.40	%		9.92		9.92		7,665		76,058		-3.10	%		-3.10	%		2.59	%
Invesco V.I. Comstock Fund - Series II Shares
		2017			0.10	%		1.65	%		12.88		13.54		409,711		5,376,964		15.65	%		17.22	%		2.15	%
		2016			0.30	%		1.65	%		11.19		11.55		319,390		3,609,131		15.25	%		16.64	%		1.29	%
		2015			0.30	%		1.50	%		9.71		9.90		230,234		2,250,576		-7.59	%		-6.46	%		2.16	%
		2014	6/27/14		0.30	%		1.50	%		10.50		10.58		106,746		1,123,603		0.33	%		2.02	%		1.00	%
Invesco V.I. Core Equity Fund - Series I Shares
		2017			1.40	%		2.35	%		12.18		24.02		375,246		6,275,565		10.55	%		11.60	%		1.01	%
		2016			1.40	%		2.35	%		10.96		21.68		439,891		6,615,056		7.70	%		8.73	%		0.70	%
		2015			1.40	%		2.35	%		10.12		20.09		491,817		6,827,267		-7.96	%		-7.08	%		1.10	%
		2014			1.40	%		2.35	%		10.93		21.78		561,170		8,378,083		5.63	%		6.64	%		0.84	%
		2013			1.40	%		2.35	%		10.29		20.58		649,963		9,093,922		26.25	%		27.45	%		1.36	%
Invesco V.I. Core Equity Fund - Series II Shares
		2017			1.30	%		2.55	%		17.74		24.23		75,828		1,453,158		10.04	%		11.42	%		0.78	%
		2016			1.30	%		2.55	%		16.03		21.75		91,692		1,584,442		7.25	%		8.60	%		0.45	%
		2015			1.30	%		2.55	%		14.86		20.03		109,222		1,779,813		-8.37	%		-7.22	%		0.85	%
		2014			1.30	%		2.55	%		16.12		21.93		132,515		2,328,434		5.13	%		6.45	%		0.67	%
		2013			1.30	%		2.55	%		15.24		20.71		151,110		2,492,738		25.69	%		27.27	%		1.20	%
Invesco V.I. Diversified Dividend Fund - Series I Shares
		2017			0.35	%		0.40	%		13.37		13.37		8,895		106,527		8.14	%		8.14	%		1.48	%
		2016			0.40	%		0.40	%		12.36		12.36		2,580		31,899		14.36	%		14.36	%		0.84	%
		2015			0.40	%		0.40	%		10.81		10.81		2,670		28,870		1.66	%		1.66	%		1.74	%
		2014	9/25/14		0.40	%		0.40	%		10.63		10.63		1,891		20,112		6.02	%		6.02	%		0.00	%
Invesco V.I. Diversified Dividend Fund - Series II Shares
		2017			0.10	%		1.65	%		12.66		13.30		1,528,267		19,649,940		6.57	%		8.02	%		1.54	%
		2016			0.30	%		1.65	%		11.88		12.31		1,337,202		16,087,887		12.66	%		14.19	%		1.29	%
		2015			0.30	%		1.65	%		10.55		10.78		500,906		5,324,096		0.15	%		1.52	%		1.95	%
		2014	7/10/14		0.30	%		1.65	%		10.53		10.62		66,573		703,253		0.40	%		9.67	%		1.58	%
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares
		2017			0.35	%		0.40	%		14.20		14.20		4,928		69,192		18.11	%		18.11	%		0.80	%
		2016			0.40	%		0.40	%		12.02		12.02		2,387		28,707		13.79	%		13.79	%		0.88	%
		2015	1/20/15		0.40	%		0.40	%		10.57		10.57		894		9,448		-0.71	%		-0.71	%		1.91	%
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares
		2017			0.10	%		3.30	%		13.45		14.13		5,966,643		75,567,257		16.39	%		17.97	%		0.92	%
		2016			0.30	%		1.65	%		11.56		11.98		1,336,793		15,623,413		12.08	%		13.60	%		0.41	%
		2015			0.30	%		1.65	%		10.31		10.55		851,935		8,844,073		-4.51	%		-3.21	%		1.64	%
		2014	7/9/14		0.30	%		1.65	%		10.80		10.90		136,960		1,483,592		4.07	%		11.61	%		0.81	%
Invesco V.I. Equity and Income Fund - Series I Shares
		2017			0.35	%		0.35	%		12.01		12.01		3,875		46,538		10.65	%		10.65	%		1.89	%
		2016	11/11/16		0.40	%		0.40	%		11.79		11.79		1,537		18,139		3.99	%		3.99	%		0.00	%
Invesco V.I. Equity and Income Fund - Series II Shares
		2017			0.10	%		1.65	%		12.35		12.97		1,254,798		15,729,297		8.97	%		10.45	%		1.69	%
		2016			0.30	%		1.65	%		11.33		11.74		658,431		7,539,819		12.96	%		14.51	%		1.59	%
		2015			0.30	%		1.65	%		10.03		10.12		443,458		4,477,860		-4.18	%		-3.65	%		3.30	%
		2014	7/8/14		1.10	%		1.65	%		10.47		10.51		123,483		1,296,474		0.74	%		2.15	%		1.09	%
Invesco V.I. International Growth Fund - Series I Shares
		2017			0.40	%		2.70	%		10.93		26.72		130,870		2,274,702		19.73	%		22.51	%		1.41	%
		2016			0.40	%		2.70	%		9.04		22.09		129,560		1,937,875		-3.10	%		-0.85	%		1.23	%
		2015			0.40	%		2.70	%		9.40		22.56		149,912		2,279,644		-4.18	%		-2.73	%		1.47	%
		2014			0.40	%		2.15	%		13.09		26.44		143,078		2,385,899		-1.80	%		-1.06	%		1.50	%
		2013			1.40	%		2.15	%		13.29		26.92		156,767		2,842,158		16.48	%		17.36	%		1.20	%

N-122

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Invesco V.I. International Growth Fund - Series II Shares
		2017			0.10	%		3.25	%	$	11.01	$	30.31		2,328,323	$	48,910,426		19.16	%		22.36	%		1.36	%
		2016			0.30	%		2.95	%		9.09		25.02		1,858,589		31,241,116		-3.58	%		-0.99	%		1.14	%
		2015			0.30	%		3.00	%		9.27		25.52		1,393,853		24,503,635		-5.45	%		-2.91	%		1.56	%
		2014			0.30	%		2.95	%		21.82		26.40		596,520		11,617,442		-2.52	%		-1.25	%		2.05	%
		2013			1.35	%		2.65	%		22.23		26.73		96,272		2,294,969		15.61	%		17.13	%		1.02	%
Ivy VIP Asset Strategy Portfolio
		2017			0.30	%		1.65	%		9.76		10.25		915,038		9,072,599		16.34	%		17.92	%		1.56	%
		2016			0.30	%		1.65	%		8.39		8.70		1,016,225		8,628,074		-4.16	%		-2.87	%		0.56	%
		2015			0.30	%		1.65	%		8.76		8.95		1,097,627		9,680,546		-9.85	%		-8.62	%		0.35	%
		2014	7/8/14		0.30	%		1.65	%		9.71		9.80		423,661		4,127,237		-5.27	%		-3.27	%		0.00	%
Ivy VIP Energy Portfolio
		2017			0.30	%		1.65	%		7.04		7.39		920,785		6,592,006		-14.07	%		-12.91	%		0.81	%
		2016			0.30	%		1.65	%		8.19		8.49		885,207		7,342,074		32.35	%		34.15	%		0.11	%
		2015			0.30	%		1.65	%		6.19		6.33		638,180		3,978,380		-23.42	%		-22.38	%		0.04	%
		2014	7/9/14		0.30	%		1.65	%		8.08		8.15		108,849		882,727		-25.22	%		-10.48	%		0.00	%
Ivy VIP High Income Portfolio
		2017			0.10	%		1.65	%		10.71		11.25		1,733,883		18,863,644		4.93	%		6.36	%		5.23	%
		2016			0.30	%		1.65	%		10.21		10.58		1,227,172		12,676,987		14.29	%		15.84	%		6.26	%
		2015			0.30	%		1.65	%		8.93		9.01		839,949		7,556,617		-8.04	%		-7.53	%		5.25	%
		2014	6/30/14		1.10	%		1.65	%		9.71		9.75		239,799		2,334,101		-3.71	%		-2.63	%		0.00	%
Ivy VIP High Income Portfolio - Class I
		2017	7/21/17		0.35	%		1.85	%		10.93		11.16		9,557		106,102		0.29	%		1.40	%		0.00	%
Ivy VIP Micro Cap Growth Portfolio
		2017			0.10	%		1.65	%		11.27		11.84		348,136		4,000,567		7.05	%		8.50	%		0.00	%
		2016			0.30	%		1.65	%		10.53		10.91		288,852		3,081,159		11.44	%		12.95	%		0.00	%
		2015			0.30	%		1.65	%		9.45		9.66		159,405		1,517,813		-10.65	%		-9.43	%		0.00	%
		2014	7/8/14		0.30	%		1.65	%		10.58		10.67		37,742		400,406		1.78	%		8.97	%		0.00	%
Ivy VIP Micro Cap Growth Portfolio - Class I
		2017	8/22/17		0.35	%		0.35	%		11.64		11.64		9,220		107,335		7.69	%		7.69	%		0.00	%
Ivy VIP Mid Cap Growth Portfolio
		2017			0.10	%		1.70	%		12.77		13.50		603,080		7,888,739		24.76	%		26.52	%		0.00	%
		2016			0.30	%		1.70	%		10.23		10.67		437,303		4,559,877		4.33	%		5.80	%		0.00	%
		2015			0.30	%		1.70	%		9.89		9.96		298,128		2,963,011		-7.18	%		-6.34	%		0.00	%
		2014	7/8/14		0.60	%		1.50	%		10.63		10.68		63,050		672,504		1.50	%		5.85	%		0.00	%
Ivy VIP Mid Cap Growth Portfolio - Class I
		2017	7/24/17		0.50	%		0.50	%		12.50		12.50		30,953		386,773		10.48	%		10.48	%		0.00	%
Ivy VIP Science and Technology Portfolio
		2017			0.10	%		1.65	%		12.96		13.62		1,597,622		21,104,987		29.96	%		31.72	%		0.00	%
		2016			0.30	%		1.65	%		9.98		10.34		1,117,303		11,286,325		-0.12	%		1.24	%		0.00	%
		2015			0.30	%		1.65	%		9.99		10.21		958,066		9,642,947		-4.47	%		-3.17	%		0.00	%
		2014	7/7/14		0.30	%		1.65	%		10.46		10.55		172,676		1,810,902		-2.84	%		9.91	%		0.00	%
Ivy VIP Science and Technology Portfolio - Class I
		2017	9/11/17		0.35	%		0.35	%		13.50		13.50		11,446		154,563		4.71	%		4.71	%		0.00	%
Janus Henderson Balanced Portfolio - Service Shares
		2017			1.30	%		2.75	%		16.33		27.02		552,754		14,184,144		14.99	%		16.61	%		1.37	%
		2016			1.30	%		2.70	%		14.20		23.18		607,858		13,427,070		1.54	%		2.98	%		1.79	%
		2015			1.30	%		2.70	%		13.98		22.53		640,870		13,858,969		-2.26	%		-0.89	%		1.36	%
		2014			1.30	%		2.70	%		16.63		22.76		776,151		16,990,797		5.41	%		6.84	%		1.51	%
		2013			1.30	%		2.65	%		15.73		21.32		899,833		18,533,143		16.67	%		18.26	%		1.33	%
Janus Henderson Enterprise Portfolio - Service Shares
		2017			1.30	%		2.65	%		27.62		49.49		165,010		6,869,000		23.79	%		25.45	%		0.14	%
		2016			1.30	%		2.65	%		22.28		39.45		188,437		6,272,489		9.17	%		10.66	%		0.02	%
		2015			1.30	%		2.65	%		20.38		35.65		184,452		5,621,941		1.05	%		2.43	%		0.53	%
		2014			1.30	%		2.65	%		20.14		34.81		191,245		5,735,064		9.31	%		10.79	%		0.03	%
		2013			1.30	%		2.65	%		18.40		31.42		214,172		5,821,920		28.59	%		30.33	%		0.36	%

N-123

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Janus Henderson Global Research Portfolio - Service Shares
		2017			1.30	%		2.20	%	$	17.16	$	22.66		36,620	$	680,597		23.93	%		25.14	%		0.67	%
		2016			1.30	%		2.20	%		13.81		18.11		46,108		685,329		-0.39	%		0.49	%		0.88	%
		2015			1.30	%		2.35	%		13.83		18.02		51,793		768,416		-4.66	%		-3.83	%		0.53	%
		2014			1.30	%		2.20	%		14.47		18.74		62,180		960,519		4.85	%		5.86	%		0.95	%
		2013			1.30	%		2.20	%		13.77		17.70		77,993		1,145,170		25.29	%		26.40	%		1.05	%
JPMorgan Insurance Trust Core Bond Portfolio - Class 1
		2017	4/4/17		0.35	%		0.70	%		10.03		10.07		82,448		829,860		0.32	%		2.08	%		2.00	%
JPMorgan Insurance Trust Core Bond Portfolio - Class 2
		2017	1/9/17		0.10	%		3.45	%		9.69		10.07		4,769,037		47,244,356		-1.34	%		2.35	%		1.73	%
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2
		2017			0.30	%		2.80	%		10.93		11.68		524,453		5,931,871		13.63	%		16.49	%		1.52	%
		2016			0.30	%		2.80	%		9.62		10.03		373,705		3,671,654		2.91	%		5.53	%		3.03	%
		2015	5/27/15		0.30	%		2.80	%		9.35		9.51		211,175		1,992,066		-7.28	%		1.05	%		3.60	%
JPMorgan Insurance Trust Income Builder Portfolio - Class 1
		2017	5/10/17		0.35	%		0.35	%		11.15		11.15		5,016		55,956		6.39	%		6.39	%		3.73	%
JPMorgan Insurance Trust Income Builder Portfolio - Class 2
		2017			0.10	%		1.65	%		10.93		11.33		190,873		2,108,619		9.88	%		11.37	%		4.30	%
		2016			0.30	%		1.65	%		9.95		10.18		118,680		1,187,403		4.46	%		5.88	%		3.93	%
		2015	6/15/15		0.30	%		1.65	%		9.52		9.61		26,561		253,706		-3.06	%		1.01	%		5.80	%
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1
		2016			0.40	%		0.40	%		11.64		11.64		13,142		152,944		11.58	%		11.58	%		0.43	%
		2015			0.40	%		0.40	%		10.43		10.43		6,432		67,093		-6.25	%		-6.25	%		0.59	%
		2014	7/24/14		0.40	%		0.40	%		11.12		11.12		4,661		51,852		6.21	%		6.21	%		0.00	%
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2
		2016			0.30	%		1.65	%		11.18		11.59		830,614		9,397,107		9.91	%		11.40	%		0.51	%
		2015			0.30	%		1.65	%		10.20		10.40		540,453		5,539,019		-7.52	%		-6.40	%		0.56	%
		2014	6/30/14		0.30	%		1.50	%		11.03		11.11		143,019		1,581,231		5.93	%		12.45	%		0.00	%
Lincoln iShares® Global Growth Allocation Fund - Standard Class
		2017	5/30/17		0.75	%		0.75	%		11.44		11.44		45,978		525,864		8.32	%		8.32	%		1.98	%
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class
		2017	5/18/17		0.75	%		0.75	%		11.19		11.19		71,254		797,154		8.71	%		8.71	%		1.36	%
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC
		2017			0.10	%		1.65	%		11.44		12.02		1,942,368		22,552,589		7.42	%		8.88	%		5.00	%
		2016			0.30	%		1.65	%		10.65		11.04		1,302,693		14,064,799		10.30	%		11.80	%		5.41	%
		2015			0.30	%		1.65	%		9.66		9.86		735,945		7,172,203		-3.14	%		-1.92	%		6.41	%
		2014	7/8/14		0.40	%		1.65	%		9.97		10.05		157,782		1,579,707		-1.68	%		-0.05	%		9.97	%
Lord Abbett Series Fund Developing Growth Portfolio - Class VC
		2017			0.10	%		1.65	%		12.09		12.70		575,740		7,089,100		27.80	%		29.53	%		0.00	%
		2016			0.30	%		1.65	%		9.46		9.81		445,510		4,270,483		-4.20	%		-2.90	%		0.00	%
		2015			0.30	%		1.65	%		9.88		10.10		358,101		3,564,305		-9.71	%		-8.48	%		0.00	%
		2014	7/8/14		0.30	%		1.65	%		10.94		11.03		81,316		892,992		0.88	%		6.22	%		0.00	%
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC
		2017			0.65	%		2.55	%		17.10		29.40		570,223		14,973,371		9.81	%		11.85	%		1.04	%
		2016			0.65	%		2.55	%		15.57		26.28		616,910		14,504,456		12.83	%		14.99	%		1.04	%
		2015			0.65	%		2.55	%		13.80		22.86		708,620		14,585,552		-5.88	%		-4.07	%		1.13	%
		2014			0.65	%		2.55	%		14.66		23.83		767,451		16,471,424		4.44	%		6.45	%		0.44	%
		2013			0.65	%		2.55	%		14.04		22.38		850,301		17,237,836		32.34	%		34.88	%		0.23	%
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC
		2017			0.10	%		1.65	%		10.02		10.52		2,327,055		23,717,626		0.52	%		1.88	%		3.96	%
		2016			0.30	%		1.65	%		9.97		10.33		1,718,707		17,339,498		1.78	%		3.16	%		2.90	%
		2015			0.30	%		1.65	%		9.79		10.01		1,336,246		13,185,468		-1.07	%		0.28	%		3.95	%
		2014	7/8/14		0.30	%		1.65	%		9.90		9.98		265,058		2,631,988		-1.03	%		-0.55	%		3.98	%
LVIP American Balanced Allocation Fund - Service Class
		2017			0.10	%		1.65	%		11.57		12.15		3,969,287		46,618,136		12.54	%		14.07	%		2.50	%
		2016			0.30	%		1.65	%		10.28		10.65		2,397,182		24,891,285		4.10	%		5.51	%		2.17	%
		2015			0.30	%		1.65	%		9.87		9.96		1,245,806		12,378,996		-2.65	%		-2.11	%		4.57	%
		2014	7/21/14		1.10	%		1.65	%		10.14		10.18		257,979		2,624,183		-0.71	%		1.70	%		5.19	%

N-124

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP American Balanced Allocation Fund - Standard Class
		2017			0.35	%		1.70	%	$	12.08	$	15.11		492,146	$	6,910,683		12.86	%		14.34	%		2.48	%
		2016			0.40	%		1.70	%		10.61		13.29		431,415		5,508,061		4.41	%		5.78	%		1.09	%
		2015			0.40	%		1.70	%		10.14		12.56		756,193		9,397,360		-2.35	%		-1.07	%		3.03	%
		2014			0.40	%		1.70	%		12.25		12.72		718,032		9,024,440		3.96	%		5.06	%		2.37	%
		2013			0.65	%		1.70	%		12.03		12.03		695,070		8,409,493		13.95	%		13.95	%		2.66	%
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		12.76		14.16		24,892,800		338,312,266		9.82	%		12.71	%		0.96	%
		2016			0.60	%		3.20	%		11.62		12.57		19,746,245		240,375,458		13.74	%		16.73	%		1.41	%
		2015			0.60	%		3.20	%		10.22		10.76		14,100,392		148,581,982		-7.26	%		-4.82	%		1.83	%
		2014	1/7/14		0.60	%		3.20	%		11.02		11.31		7,508,948		84,015,445		1.36	%		13.56	%		0.70	%
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class
		2017			1.30	%		2.80	%		10.46		11.00		2,331,383		25,476,512		8.61	%		10.25	%		1.87	%
		2016			1.30	%		2.80	%		9.63		9.98		2,208,790		21,928,177		1.39	%		2.92	%		1.88	%
		2015			1.30	%		2.80	%		9.52		9.70		1,471,731		14,213,210		-4.96	%		-3.71	%		4.02	%
		2014	8/13/14		1.30	%		2.60	%		10.02		10.07		386,653		3,890,820		-1.15	%		2.81	%		3.84	%
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class
		2017			0.65	%		0.90	%		13.42		13.61		53,487		718,787		11.08	%		11.35	%		2.19	%
		2016			0.65	%		0.90	%		12.08		12.22		54,114		654,522		3.70	%		3.96	%		1.90	%
		2015			0.65	%		0.90	%		11.65		11.76		48,002		559,801		-2.98	%		-2.73	%		3.39	%
		2014			0.65	%		0.90	%		12.00		12.00		46,000		552,545		4.55	%		4.55	%		1.72	%
		2013	4/29/13		0.90	%		0.90	%		11.48		11.48		57,213		656,928		5.56	%		5.56	%		1.88	%
LVIP American Global Growth Allocation Managed Risk Fund - Service Class
		2017			1.30	%		2.85	%		10.49		11.04		6,591,782		72,361,912		13.15	%		14.86	%		1.41	%
		2016			1.30	%		2.80	%		9.27		9.61		6,605,037		63,222,610		0.10	%		1.61	%		1.36	%
		2015			1.30	%		2.80	%		9.29		9.46		5,697,113		53,755,700		-5.97	%		-4.74	%		3.99	%
		2014	8/18/14		1.30	%		2.60	%		9.88		9.93		1,928,498		19,140,578		-2.93	%		2.40	%		4.13	%
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class
		2017			0.65	%		1.70	%		13.22		14.05		29,311		409,997		14.80	%		16.01	%		1.59	%
		2016			0.65	%		1.70	%		11.52		12.11		55,099		665,837		1.57	%		2.64	%		1.29	%
		2015			0.65	%		1.70	%		11.34		11.80		77,207		909,822		-4.79	%		-3.79	%		4.17	%
		2014			0.65	%		1.70	%		11.91		12.26		70,567		860,217		0.83	%		1.90	%		2.32	%
		2013	4/18/13		0.65	%		1.70	%		11.81		12.04		39,102		466,881		1.84	%		11.61	%		3.49	%
LVIP American Global Growth Fund - Service Class II
		2017			0.20	%		3.30	%		16.73		24.22		8,541,589		189,479,395		26.87	%		30.21	%		0.37	%
		2016			0.60	%		3.20	%		13.19		18.60		6,768,250		117,321,554		-2.92	%		-0.37	%		0.85	%
		2015			0.60	%		3.20	%		13.59		18.67		6,603,420		116,266,383		3.22	%		5.99	%		1.61	%
		2014			0.60	%		3.20	%		13.16		17.62		5,379,314		90,301,665		-1.34	%		1.26	%		0.99	%
		2013			0.60	%		3.20	%		13.34		17.37		4,463,816		74,678,162		24.64	%		27.86	%		0.94	%
LVIP American Global Small Capitalization Fund - Service Class II
		2017			0.30	%		3.15	%		12.98		19.28		4,219,426		75,228,776		21.53	%		24.67	%		0.02	%
		2016			0.60	%		3.15	%		10.68		15.46		4,400,791		63,532,834		-1.47	%		1.07	%		0.11	%
		2015			0.60	%		3.15	%		10.84		15.26		4,755,786		68,593,027		-3.25	%		-0.79	%		0.22	%
		2014			0.65	%		3.15	%		11.20		15.38		4,607,468		67,612,887		-1.46	%		1.03	%		0.00	%
		2013			0.65	%		3.15	%		11.37		15.22		4,496,644		65,952,218		23.83	%		26.96	%		0.24	%
LVIP American Growth Allocation Fund - Service Class
		2017			0.10	%		1.65	%		11.85		12.45		2,766,360		33,355,228		15.23	%		16.80	%		1.80	%
		2016			0.30	%		1.65	%		10.29		10.44		1,939,868		20,197,313		4.34	%		4.92	%		1.94	%
		2015			1.10	%		1.65	%		9.88		9.95		1,326,973		13,171,250		-2.70	%		-2.31	%		3.87	%
		2014	7/8/14		1.10	%		1.50	%		10.16		10.18		310,305		3,156,759		-0.69	%		-0.13	%		5.62	%
LVIP American Growth Allocation Fund - Standard Class
		2017			0.35	%		1.70	%		12.56		15.85		98,042		1,336,809		15.58	%		17.09	%		2.01	%
		2016			0.40	%		1.70	%		10.73		13.56		163,494		2,122,250		4.66	%		6.03	%		2.18	%
		2015			0.40	%		1.70	%		12.18		12.82		98,140		1,242,794		-2.56	%		-1.48	%		3.20	%
		2014			0.60	%		1.70	%		12.50		13.01		56,849		732,076		3.84	%		4.99	%		2.44	%
		2013			0.60	%		1.70	%		12.37		12.37		52,998		651,795		17.18	%		17.18	%		2.84	%

N-125

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP American Growth Fund - Service Class II
		2017			0.20	%		3.30	%	$	19.60	$	28.03		21,103,350	$	543,233,094		23.80	%		27.06	%		0.42	%
		2016			0.60	%		3.20	%		15.83		22.06		16,929,026		348,379,865		5.67	%		8.45	%		0.41	%
		2015			0.60	%		3.20	%		14.98		20.34		16,800,673		321,970,300		3.11	%		5.83	%		0.26	%
		2014			0.60	%		3.20	%		14.53		19.22		16,598,196		303,438,686		4.73	%		7.48	%		0.99	%
		2013			0.60	%		3.20	%		13.87		17.85		15,625,430		268,413,384		25.57	%		28.81	%		0.61	%
LVIP American Growth-Income Fund - Service Class II
		2017			0.20	%		3.30	%		19.19		26.96		18,700,432		463,148,709		18.12	%		21.23	%		1.28	%
		2016			0.60	%		3.20	%		16.25		22.17		14,615,380		303,742,739		7.66	%		10.43	%		1.59	%
		2015			0.65	%		3.20	%		15.09		20.08		14,377,572		273,014,519		-2.07	%		0.46	%		1.40	%
		2014			0.60	%		3.20	%		15.41		20.03		13,133,949		250,402,210		6.79	%		9.60	%		1.11	%
		2013			0.60	%		3.20	%		14.43		18.24		12,555,756		220,496,857		28.84	%		32.16	%		1.07	%
LVIP American Income Allocation Fund - Standard Class
		2017			0.65	%		1.85	%		12.94		13.87		6,344		82,336		8.41	%		9.55	%		2.59	%
		2016			0.65	%		1.70	%		12.66		12.66		4,752		57,078		4.94	%		4.94	%		7.02	%
		2015			0.65	%		0.65	%		12.06		12.06		512		6,182		-1.34	%		-1.34	%		3.08	%
		2014			0.65	%		0.65	%		12.23		12.23		522		6,381		5.52	%		5.52	%		10.93	%
		2013	7/2/13		0.65	%		0.65	%		11.59		11.59		116		1,344		5.92	%		5.92	%		2.37	%
LVIP American International Fund - Service Class II
		2017			0.20	%		3.25	%		12.32		18.05		11,645,093		192,818,815		27.51	%		30.86	%		1.00	%
		2016			0.60	%		3.20	%		9.66		13.79		10,513,716		135,114,710		-0.10	%		2.53	%		0.95	%
		2015			0.60	%		3.20	%		9.67		13.45		10,872,612		137,660,329		-7.84	%		-5.41	%		1.39	%
		2014			0.60	%		3.20	%		10.49		14.19		10,256,151		138,656,243		-6.06	%		-3.63	%		0.88	%
		2013			0.65	%		3.20	%		11.17		14.72		9,651,334		136,697,384		17.34	%		20.37	%		1.03	%
LVIP American Preservation Fund - Service Class
		2017			0.10	%		1.65	%		9.49		10.21		748,104		7,257,311		-0.33	%		1.02	%		1.20	%
		2016			0.30	%		1.65	%		9.52		10.10		745,043		7,237,995		-0.09	%		1.26	%		1.27	%
		2015			0.30	%		1.65	%		9.53		9.70		340,599		3,307,550		-1.68	%		-1.13	%		2.23	%
		2014	8/25/14		1.10	%		1.65	%		9.69		9.82		15,494		151,898		-0.59	%		-0.13	%		1.21	%
LVIP American Preservation Fund - Standard Class
		2017			0.60	%		1.90	%		9.54		10.22		13,101		127,785		-0.22	%		1.08	%		1.56	%
		2016			0.60	%		1.90	%		9.56		10.11		12,117		118,019		0.00	%		1.31	%		2.38	%
		2015			0.60	%		1.90	%		9.56		9.98		8,177		81,310		-1.58	%		-0.29	%		1.25	%
		2014			0.60	%		1.90	%		9.71		10.01		12,906		127,957		0.22	%		1.53	%		0.84	%
		2013	1/25/13		0.60	%		1.90	%		9.69		9.86		21,962		214,542		-1.48	%		0.07	%		3.73	%
LVIP AQR Enhanced Global Strategies Fund - Service Class
		2016			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.90	%
		2015			0.30	%		1.65	%		10.31		10.51		247,690		2,566,129		0.18	%		1.39	%		1.84	%
		2014	7/17/14		0.30	%		1.50	%		10.29		10.37		125,959		1,298,239		0.94	%		3.25	%		4.27	%
LVIP AQR Enhanced Global Strategies Fund - Standard Class
		2015			0.40	%		0.40	%		10.54		10.54		1,350		14,227		1.55	%		1.55	%		1.53	%
		2014	7/25/14		0.40	%		0.40	%		10.38		10.38		1,429		14,825		0.34	%		0.34	%		1.85	%
LVIP Baron Growth Opportunities Fund - Service Class
		2017			0.10	%		3.30	%		13.62		28.39		8,384,298		187,355,105		23.23	%		26.86	%		0.00	%
		2016			0.30	%		3.20	%		10.74		22.98		8,462,121		151,579,853		2.25	%		5.25	%		0.45	%
		2015			0.30	%		3.20	%		10.20		22.42		9,602,526		165,654,313		-7.77	%		-5.06	%		0.00	%
		2014			0.30	%		3.20	%		16.68		24.24		9,552,708		175,923,220		1.55	%		4.18	%		0.18	%
		2013			0.65	%		3.20	%		16.36		23.81		10,317,699		184,552,492		35.66	%		39.16	%		0.45	%
LVIP Baron Growth Opportunities Fund - Standard Class
		2017			0.35	%		0.80	%		13.50		13.70		61,063		834,199		26.54	%		27.05	%		0.00	%
		2016			0.40	%		0.80	%		10.67		10.78		59,546		641,310		4.99	%		5.41	%		0.75	%
		2015			0.40	%		0.80	%		10.16		10.23		47,774		488,196		-5.29	%		-4.91	%		0.00	%
		2014	9/22/14		0.40	%		0.80	%		10.73		10.76		48,824		524,975		5.18	%		5.52	%		0.75	%
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class
		2017			0.10	%		3.20	%		12.38		19.37		59,354,687		891,999,703		12.49	%		15.44	%		1.66	%
		2016			0.60	%		3.20	%		10.96		17.18		56,514,717		741,763,728		8.16	%		11.01	%		1.73	%
		2015			0.60	%		3.20	%		10.09		15.84		45,976,859		547,885,035		-8.08	%		-5.66	%		1.68	%
		2014			0.60	%		3.20	%		10.92		17.19		35,940,252		459,214,185		-0.02	%		2.61	%		1.41	%
		2013			0.60	%		3.20	%		10.88		17.16		24,406,648		307,536,644		14.26	%		17.16	%		2.10	%

N-126

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class
		2017			0.60	%		0.75	%	$	24.10	$	24.21		24,394	$	547,290		15.67	%		15.73	%		2.06	%
		2016			0.60	%		0.65	%		20.83		20.92		17,937		374,870		11.24	%		11.30	%		2.66	%
		2015			0.60	%		0.65	%		18.73		18.80		5,893		110,478		-5.48	%		-5.43	%		0.84	%
		2014			0.60	%		0.65	%		19.81		19.88		17,740		351,615		2.82	%		2.87	%		2.46	%
		2013	10/30/13		0.60	%		0.65	%		19.27		19.32		5,234		100,976		2.22	%		4.63	%		2.77	%
LVIP BlackRock Emerging Markets Managed Volatility Fund - Service Class
		2016			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		3.66	%
		2015			0.30	%		3.20	%		7.33		7.99		27,622,413		212,918,114		-17.89	%		-15.47	%		1.59	%
		2014			0.30	%		3.20	%		8.92		9.48		18,013,586		166,516,334		-8.12	%		-5.70	%		1.22	%
		2013			0.60	%		3.20	%		9.71		10.05		9,192,141		91,068,793		-11.02	%		-8.72	%		1.02	%
LVIP BlackRock Emerging Markets Managed Volatility Fund - Standard Class
		2016			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		3.68	%
		2015			0.65	%		1.90	%		7.71		8.04		17,770		139,424		-16.61	%		-15.56	%		1.59	%
		2014			0.60	%		1.90	%		9.25		9.54		13,176		123,192		-6.68	%		-5.46	%		1.66	%
		2013	4/18/13		0.60	%		1.90	%		9.91		10.09		6,337		63,377		-2.57	%		4.75	%		1.93	%
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class
		2017			0.30	%		3.45	%		9.94		11.21		88,951,594		946,920,205		9.26	%		12.13	%		0.74	%
		2016			0.60	%		3.20	%		9.10		9.98		94,897,830		910,479,083		-0.73	%		1.84	%		0.70	%
		2015			0.65	%		3.20	%		9.16		9.80		95,115,923		905,299,405		-7.66	%		-5.27	%		0.78	%
		2014			0.65	%		3.20	%		9.92		10.35		74,198,915		753,659,786		-3.69	%		-1.20	%		0.90	%
		2013	5/20/13		0.65	%		3.20	%		10.30		10.47		29,999,735		311,901,805		1.26	%		9.06	%		0.00	%
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class
		2017			0.60	%		1.70	%		10.83		11.39		15,773		176,623		11.29	%		12.52	%		1.06	%
		2016			0.60	%		1.70	%		9.73		10.13		16,019		159,954		1.12	%		2.24	%		0.52	%
		2015			0.60	%		1.70	%		9.62		9.90		26,009		255,285		-5.93	%		-4.89	%		1.05	%
		2014			0.60	%		1.70	%		10.23		10.41		28,334		292,902		-1.89	%		-0.81	%		0.99	%
		2013	9/17/13		0.60	%		1.70	%		10.42		10.50		26,759		279,805		1.48	%		4.71	%		0.00	%
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class
		2017			0.30	%		3.25	%		11.08		11.54		17,324,993		196,900,660		10.41	%		13.21	%		1.60	%
		2016	6/14/16		0.65	%		3.15	%		10.03		10.20		6,656,287		67,444,230		-1.95	%		1.66	%		1.90	%
LVIP BlackRock Inflation Protected Bond Fund - Service Class
		2017			0.10	%		3.25	%		8.98		11.09		77,086,771		789,456,865		-1.27	%		1.63	%		1.66	%
		2016			0.30	%		3.20	%		9.10		10.95		73,298,727		748,802,675		0.07	%		2.66	%		0.74	%
		2015			0.59	%		3.14	%		9.09		10.66		73,741,592		741,288,073		-6.07	%		-3.64	%		1.19	%
		2014			0.59	%		3.14	%		9.68		11.07		74,918,783		789,620,892		-0.36	%		2.21	%		0.95	%
		2013			0.59	%		3.14	%		9.62		10.83		72,358,284		753,786,479		-11.45	%		-8.33	%		0.33	%
LVIP BlackRock Inflation Protected Bond Fund - Standard Class
		2017			0.35	%		2.25	%		10.02		11.32		186,517		1,969,942		0.26	%		1.77	%		1.91	%
		2016			0.40	%		1.90	%		9.99		11.15		77,400		846,379		1.62	%		2.95	%		1.25	%
		2015			0.60	%		1.90	%		9.83		10.83		61,202		653,809		-4.65	%		-3.40	%		1.06	%
		2014			0.60	%		1.90	%		10.66		11.21		45,430		500,779		1.33	%		2.45	%		1.58	%
		2013			0.60	%		1.70	%		10.52		10.94		42,520		457,685		-9.92	%		-8.92	%		0.43	%
LVIP BlackRock Multi-Asset Income Fund - Service Class
		2017			0.10	%		1.65	%		10.08		10.58		780,213		7,973,058		3.94	%		5.35	%		3.39	%
		2016			0.30	%		1.65	%		9.69		10.05		643,274		6,299,800		4.99	%		6.42	%		3.12	%
		2015			0.30	%		1.65	%		9.23		9.32		379,203		3,524,117		-5.73	%		-5.21	%		4.81	%
		2014	7/17/14		1.10	%		1.65	%		9.80		9.83		97,900		961,740		-2.80	%		-1.52	%		6.05	%
LVIP BlackRock Multi-Asset Income Fund - Standard Class
		2017			0.35	%		0.80	%		10.49		10.64		20,304		215,941		5.08	%		5.51	%		3.21	%
		2016			0.40	%		0.80	%		10.09		10.09		25,501		257,188		6.58	%		6.58	%		2.72	%
		2015			0.40	%		0.40	%		9.47		9.47		23,295		220,487		-4.31	%		-4.31	%		1.44	%
		2014	10/22/14		0.40	%		0.40	%		9.89		9.89		21,018		207,896		-0.07	%		-0.07	%		38.76	%
LVIP BlackRock Scientific Allocation Fund - Service Class
		2017	5/30/17		0.30	%		3.45	%		10.73		13.63		131,268		1,703,651		0.14	%		6.72	%		4.69	%
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class
		2017			0.30	%		3.20	%		11.33		11.78		20,458,354		237,050,490		9.75	%		12.36	%		1.24	%
		2016	6/13/16		0.65	%		3.00	%		10.33		10.48		11,369,232		118,376,390		-0.20	%		4.03	%		1.09	%

N-127

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Service Class
		2016			0.00	%		0.00	%	$	—	$	—		—	$	—		0.00	%		0.00	%		0.46	%
		2015	5/19/15		0.65	%		3.00	%		8.91		9.05		2,965,601		26,647,714		-13.35	%		-1.64	%		0.22	%
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Standard Class
		2016			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.05	%
		2015	8/25/15		0.65	%		0.65	%		9.06		9.06		33,610		304,560		-0.26	%		-0.26	%		0.37	%
LVIP Blended Core Equity Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		11.70		12.98		21,202,247		264,309,319		16.81	%		19.89	%		1.12	%
		2016			0.60	%		3.20	%		10.02		10.81		20,459,234		214,840,338		5.23	%		7.95	%		1.10	%
		2015			0.65	%		3.20	%		9.52		10.02		12,493,072		122,709,888		-7.26	%		-4.86	%		1.02	%
		2014	1/8/14		0.65	%		3.20	%		10.26		10.53		5,878,451		61,310,738		-1.30	%		9.14	%		2.28	%
LVIP Blended Core Equity Managed Volatility Fund - Standard Class
		2017			0.65	%		1.70	%		12.60		13.14		5,965		77,335		19.00	%		20.25	%		1.39	%
		2016			0.65	%		1.70	%		10.59		10.92		6,499		70,270		7.19	%		8.32	%		1.17	%
		2015			0.65	%		1.70	%		9.88		10.09		6,889		68,980		-5.52	%		-4.52	%		1.25	%
		2014	12/18/14		0.65	%		1.70	%		10.45		10.56		6,259		65,848		-0.99	%		-0.09	%		1.61	%
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		14.82		23.63		29,637,789		582,314,071		21.86	%		25.11	%		0.45	%
		2016			0.60	%		3.20	%		12.16		19.04		27,841,251		443,437,385		-4.66	%		-2.15	%		0.23	%
		2015			0.60	%		3.20	%		12.76		19.60		21,622,553		358,222,133		-2.10	%		0.48	%		0.00	%
		2014			0.60	%		3.20	%		13.03		19.65		13,936,492		234,535,641		1.78	%		4.46	%		0.00	%
		2013			0.60	%		3.20	%		12.80		18.96		9,802,967		160,591,468		21.24	%		24.37	%		0.00	%
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class
		2017			1.30	%		2.80	%		16.81		24.69		114,999		2,421,970		22.65	%		24.50	%		0.63	%
		2016			1.30	%		2.80	%		13.66		19.83		134,037		2,271,920		-4.04	%		-2.59	%		0.44	%
		2015			1.30	%		2.80	%		14.20		20.36		132,967		2,331,556		-1.46	%		0.03	%		0.00	%
		2014			1.30	%		2.80	%		14.36		20.35		126,910		2,252,518		2.49	%		3.99	%		0.00	%
		2013			1.30	%		2.75	%		13.98		19.57		142,373		2,446,788		22.22	%		23.88	%		0.00	%
LVIP Blended Mid Cap Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		10.68		18.19		41,804,878		509,481,841		21.30	%		24.49	%		0.00	%
		2016			0.60	%		3.20	%		8.78		14.96		44,642,154		441,131,535		-1.21	%		1.39	%		0.00	%
		2015			0.60	%		3.20	%		8.85		15.11		29,066,347		285,610,686		-7.45	%		-5.01	%		0.00	%
		2014			0.60	%		3.20	%		9.53		16.28		23,713,219		248,098,513		-10.46	%		-8.14	%		0.00	%
		2013			0.65	%		3.20	%		10.61		18.14		14,636,851		168,724,647		20.60	%		23.72	%		0.00	%
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class
		2017			0.65	%		0.90	%		22.17		22.63		3,774		83,992		24.44	%		24.75	%		0.00	%
		2016	1/29/16		0.65	%		0.90	%		17.82		18.14		4,436		79,489		8.24	%		10.21	%		0.00	%
LVIP Clarion Global Real Estate Fund - Service Class
		2017			0.10	%		3.20	%		8.37		18.76		10,742,974		103,522,831		7.10	%		10.25	%		4.08	%
		2016			0.30	%		3.20	%		7.79		17.47		11,133,444		98,412,635		-2.24	%		0.64	%		3.57	%
		2015			0.30	%		3.20	%		7.94		17.83		11,895,797		105,644,091		-4.57	%		-2.06	%		2.84	%
		2014			0.60	%		3.20	%		8.29		18.63		11,604,961		105,950,000		10.02	%		12.92	%		2.23	%
		2013			0.60	%		3.20	%		7.51		16.89		12,385,268		101,071,326		-0.21	%		2.37	%		0.00	%
LVIP Clarion Global Real Estate Fund - Standard Class
		2017			0.35	%		0.40	%		11.47		11.47		56,559		619,695		10.42	%		10.42	%		5.04	%
		2016			0.40	%		0.40	%		10.39		10.39		31,155		323,593		0.78	%		0.78	%		3.85	%
		2015			0.40	%		0.40	%		10.31		10.31		29,765		306,765		-1.62	%		-1.62	%		3.05	%
		2014	9/22/14		0.40	%		0.40	%		10.48		10.48		27,800		291,225		5.78	%		5.78	%		2.84	%
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class
		2017			0.65	%		3.15	%		10.45		11.17		11,186,695		121,841,446		13.98	%		16.87	%		0.77	%
		2016			0.65	%		3.15	%		9.17		9.56		8,814,090		82,886,555		0.22	%		2.75	%		0.83	%
		2015	5/18/15		0.65	%		3.15	%		9.15		9.30		5,489,986		50,734,955		-9.06	%		0.74	%		1.28	%
LVIP Delaware Bond Fund - Service Class
		2017			0.10	%		3.45	%		9.87		15.33		247,917,303		3,404,290,566		0.73	%		3.69	%		2.61	%
		2016			0.30	%		3.20	%		9.79		14.88		228,604,065		3,059,974,255		-0.86	%		2.06	%		2.27	%
		2015			0.30	%		3.20	%		9.88		14.69		213,372,807		2,823,625,874		-3.12	%		-0.56	%		2.08	%
		2014			0.60	%		3.20	%		10.20		14.83		197,607,072		2,647,516,142		2.28	%		4.97	%		1.75	%
		2013			0.60	%		3.20	%		9.97		14.24		189,824,697		2,446,199,219		-5.71	%		-3.28	%		1.53	%

N-128

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP Delaware Bond Fund - Standard Class
		2017			0.35	%		3.00	%	$	10.26	$	20.46		4,405,773	$	76,539,858		1.29	%		3.96	%		2.74	%
		2016			0.40	%		3.00	%		10.13		19.88		4,909,179		84,517,844		-0.31	%		2.31	%		2.41	%
		2015			0.40	%		3.00	%		10.16		19.62		5,497,881		94,155,133		-2.58	%		-0.01	%		2.26	%
		2014			0.40	%		3.00	%		10.43		19.82		6,086,602		106,592,128		2.84	%		4.61	%		1.91	%
		2013			1.30	%		3.00	%		10.14		18.97		7,178,428		121,752,782		-5.20	%		-3.57	%		1.68	%
LVIP Delaware Diversified Floating Rate Fund - Service Class
		2017			0.10	%		3.30	%		8.59		10.40		79,945,295		768,776,356		-0.94	%		1.97	%		0.86	%
		2016			0.30	%		3.20	%		8.67		10.27		73,387,272		701,113,998		-1.21	%		1.70	%		0.00	%
		2015			0.30	%		3.20	%		8.78		10.13		75,927,711		723,155,146		-4.09	%		-1.56	%		1.32	%
		2014			0.60	%		3.20	%		9.15		10.29		76,869,743		751,796,586		-2.80	%		-0.24	%		1.15	%
		2013			0.60	%		3.20	%		9.42		10.30		67,745,589		671,179,345		-2.66	%		-0.15	%		0.83	%
LVIP Delaware Diversified Floating Rate Fund - Standard Class
		2017			0.35	%		2.15	%		9.42		10.65		192,061		1,963,139		0.36	%		2.13	%		1.20	%
		2016			0.40	%		2.15	%		9.39		10.45		133,277		1,346,836		0.07	%		1.91	%		0.00	%
		2015			0.40	%		2.15	%		9.38		10.28		174,165		1,749,425		-2.82	%		-1.31	%		2.02	%
		2014			0.60	%		2.15	%		9.66		10.41		126,128		1,279,012		-1.52	%		0.01	%		1.50	%
		2013			0.60	%		2.15	%		10.01		10.41		97,323		988,536		-0.94	%		0.15	%		2.00	%
LVIP Delaware Social Awareness Fund - Service Class
		2017			0.30	%		3.15	%		17.44		31.17		2,465,434		59,997,330		16.06	%		19.00	%		0.92	%
		2016			0.65	%		3.15	%		14.97		26.38		2,769,135		57,545,387		2.97	%		5.57	%		1.08	%
		2015			0.65	%		3.15	%		14.48		25.16		3,033,071		60,575,856		-3.94	%		-1.66	%		1.08	%
		2014			0.65	%		3.00	%		15.03		25.76		3,110,764		64,510,306		11.40	%		14.05	%		1.21	%
		2013			0.65	%		3.00	%		13.46		22.75		3,317,344		61,218,438		31.21	%		34.34	%		0.97	%
LVIP Delaware Social Awareness Fund - Standard Class
		2017			0.35	%		2.70	%		19.56		33.64		258,441		7,562,373		16.99	%		18.64	%		1.24	%
		2016			0.40	%		2.70	%		16.68		28.51		300,322		7,450,235		3.80	%		5.26	%		1.38	%
		2015			1.30	%		2.80	%		16.04		27.23		345,403		8,181,511		-3.41	%		-1.95	%		1.38	%
		2014			1.30	%		2.80	%		16.56		27.93		380,182		9,350,606		12.02	%		13.71	%		1.46	%
		2013			1.30	%		2.80	%		14.73		23.88		451,153		9,794,822		31.95	%		33.94	%		1.19	%
LVIP Delaware Special Opportunities Fund - Service Class
		2017			0.20	%		3.25	%		15.86		27.58		4,321,647		78,489,021		13.72	%		16.58	%		1.05	%
		2016			0.65	%		3.15	%		13.91		24.21		3,768,454		59,555,277		16.27	%		19.21	%		1.27	%
		2015			0.65	%		3.15	%		11.93		20.78		3,788,707		50,665,570		-3.19	%		-0.74	%		0.91	%
		2014			0.65	%		3.15	%		12.28		21.42		3,774,984		51,324,683		3.93	%		6.56	%		0.99	%
		2013			0.65	%		3.15	%		11.79		20.57		3,943,413		50,793,495		29.19	%		32.45	%		0.79	%
LVIP Delaware Wealth Builder Fund - Service Class
		2017			0.30	%		3.05	%		13.21		21.68		714,939		13,256,234		8.87	%		11.18	%		2.03	%
		2016			0.75	%		2.85	%		13.09		19.62		774,824		13,171,941		2.40	%		4.57	%		1.28	%
		2015			0.75	%		2.85	%		12.79		18.87		900,203		14,777,248		-4.35	%		-2.31	%		1.33	%
		2014			0.65	%		2.85	%		13.37		19.44		1,085,243		18,532,982		1.15	%		3.40	%		1.94	%
		2013			0.65	%		2.85	%		13.21		18.93		1,304,751		21,722,483		16.57	%		19.16	%		1.26	%
LVIP Delaware Wealth Builder Fund - Standard Class
		2017			0.50	%		2.65	%		14.94		22.65		218,079		4,613,632		9.36	%		10.84	%		2.24	%
		2016			1.30	%		2.65	%		13.64		20.43		228,894		4,422,339		2.86	%		4.26	%		1.53	%
		2015			1.30	%		2.65	%		13.24		19.60		258,273		4,810,124		-3.91	%		-2.61	%		1.56	%
		2014			1.30	%		2.65	%		13.76		20.12		323,940		6,233,953		1.61	%		3.00	%		2.22	%
		2013			1.30	%		2.65	%		13.52		19.54		426,362		7,980,316		17.21	%		18.68	%		1.37	%
LVIP Dimensional International Core Equity Fund - Service Class
		2017			0.10	%		3.15	%		11.04		11.91		3,604,821		41,630,401		23.07	%		26.63	%		2.41	%
		2016			0.30	%		3.15	%		9.00		9.40		1,118,761		10,303,692		1.21	%		3.93	%		2.12	%
		2015	5/19/15		0.30	%		2.95	%		8.89		9.05		598,280		5,366,591		-12.59	%		3.19	%		1.57	%
LVIP Dimensional International Core Equity Fund - Standard Class
		2017			0.35	%		1.95	%		11.74		11.96		293,223		3,572,657		25.97	%		26.86	%		2.30	%
		2016			0.40	%		1.10	%		9.39		9.43		159,195		1,499,132		3.83	%		4.09	%		3.31	%
		2015	6/30/15		0.40	%		0.65	%		9.04		9.06		37,724		341,341		-7.33	%		0.76	%		1.90	%

N-129

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP Dimensional International Equity Managed Volatility Fund - Service Class
		2017			0.10	%		3.20	%	$	10.44	$	13.36		31,059,947	$	360,153,651		21.88	%		25.47	%		2.21	%
		2016			0.30	%		3.20	%		8.56		10.71		27,310,098		255,372,817		-1.48	%		1.11	%		2.01	%
		2015			0.60	%		3.20	%		8.69		10.62		25,143,655		234,564,080		-7.23	%		-4.78	%		0.82	%
		2014			0.60	%		3.20	%		9.37		11.18		17,282,606		171,228,521		-10.64	%		-8.29	%		2.38	%
		2013			0.60	%		3.20	%		10.49		12.22		8,871,404		96,814,879		11.22	%		14.09	%		2.74	%
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class
		2017			0.40	%		1.90	%		11.10		12.61		116,992		1,457,945		23.80	%		25.66	%		2.21	%
		2016			0.40	%		1.90	%		8.83		10.05		134,949		1,340,711		0.05	%		1.57	%		1.84	%
		2015			0.40	%		1.90	%		8.70		9.92		182,420		1,794,623		-5.78	%		-4.35	%		0.84	%
		2014			0.40	%		1.90	%		9.91		10.39		264,344		2,731,923		-9.24	%		-8.05	%		2.51	%
		2013			0.60	%		1.90	%		10.92		11.30		152,261		1,718,117		12.96	%		14.43	%		2.79	%
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class
		2017			0.10	%		3.45	%		13.07		25.11		4,428,948		89,522,313		16.72	%		20.10	%		1.29	%
		2016			0.30	%		3.15	%		11.54		21.47		3,051,355		52,633,212		10.69	%		13.33	%		1.26	%
		2015			0.60	%		2.95	%		13.93		19.40		2,534,588		39,639,227		-5.18	%		-2.99	%		1.28	%
		2014			0.65	%		2.95	%		14.68		20.46		2,602,579		42,493,002		9.50	%		12.04	%		1.55	%
		2013			0.65	%		2.95	%		13.39		18.68		3,082,752		45,481,537		28.94	%		31.94	%		1.45	%
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class
		2017			0.35	%		1.85	%		13.15		31.66		231,772		4,175,636		19.92	%		20.39	%		1.79	%
		2016			0.40	%		0.80	%		10.93		26.24		75,952		1,576,732		13.67	%		13.95	%		1.87	%
		2015	7/13/15		0.40	%		0.65	%		9.59		23.08		44,751		942,332		-4.91	%		1.67	%		3.20	%
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class
		2017			0.10	%		3.15	%		12.02		12.89		2,944,958		36,713,343		14.58	%		17.65	%		1.20	%
		2016			0.30	%		2.95	%		10.49		10.96		1,404,206		15,056,208		13.09	%		16.02	%		1.85	%
		2015	5/20/15		0.30	%		2.95	%		9.28		9.45		372,458		3,485,776		-8.68	%		2.19	%		1.22	%
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class
		2017			0.35	%		1.95	%		12.87		12.95		254,296		3,256,479		17.54	%		17.84	%		1.46	%
		2016			0.40	%		0.65	%		10.95		10.99		115,458		1,267,876		16.00	%		16.29	%		1.74	%
		2015	9/8/15		0.40	%		0.65	%		9.44		9.45		54,721		516,873		0.38	%		2.18	%		1.06	%
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class
		2017			0.10	%		3.20	%		12.50		19.07		41,366,501		673,761,572		15.13	%		18.52	%		0.96	%
		2016			0.30	%		3.20	%		10.55		16.18		35,793,467		497,404,950		7.37	%		10.52	%		1.05	%
		2015			0.30	%		3.20	%		9.55		14.72		29,811,348		378,661,197		-10.75	%		-8.12	%		1.05	%
		2014			0.30	%		3.20	%		13.26		16.11		21,410,663		300,277,840		1.15	%		3.81	%		0.90	%
		2013			0.60	%		3.20	%		13.18		15.56		12,170,990		166,034,802		25.05	%		28.02	%		1.22	%
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class
		2017			0.40	%		1.90	%		12.57		17.67		139,149		2,346,796		16.93	%		18.69	%		0.97	%
		2016			0.40	%		1.90	%		10.59		14.92		245,471		3,454,035		9.04	%		10.69	%		1.00	%
		2015			0.40	%		1.90	%		9.57		13.50		352,952		4,437,665		-9.35	%		-7.98	%		1.18	%
		2014			0.40	%		1.90	%		14.03		14.70		332,493		4,813,792		2.73	%		4.07	%		1.26	%
		2013			0.60	%		1.90	%		13.65		14.13		162,325		2,289,505		26.74	%		28.40	%		1.66	%
LVIP Dimensional/Vanguard Total Bond Fund - Service Class
		2017			0.10	%		3.20	%		9.27		11.01		55,525,545		570,913,243		-0.55	%		2.38	%		1.75	%
		2016			0.30	%		3.20	%		9.32		10.79		46,575,970		473,481,546		-1.37	%		1.52	%		1.36	%
		2015			0.30	%		3.20	%		9.45		10.66		40,323,253		408,799,837		-3.09	%		-0.53	%		1.49	%
		2014			0.60	%		3.20	%		9.75		10.71		32,833,097		338,067,481		1.11	%		3.77	%		1.65	%
		2013			0.60	%		3.20	%		9.64		10.31		21,685,649		217,354,625		-6.06	%		-3.63	%		1.40	%
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class
		2017			0.35	%		1.90	%		10.27		11.19		794,837		8,443,753		1.01	%		2.53	%		2.21	%
		2016			0.40	%		1.90	%		10.17		10.94		510,152		5,443,570		0.19	%		1.70	%		2.04	%
		2015			0.40	%		1.90	%		10.15		10.78		330,344		3,514,167		-1.57	%		-0.09	%		1.49	%
		2014			0.40	%		1.90	%		10.31		10.81		459,743		4,935,666		2.67	%		4.01	%		2.15	%
		2013			0.60	%		1.90	%		10.04		10.39		221,441		2,289,428		-4.59	%		-3.34	%		2.10	%

N-130

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class
		2017			0.30	%		3.20	%	$	9.57	$	16.53		76,900,455	$	842,703,383		17.29	%		20.74	%		1.15	%
		2016			0.30	%		3.20	%		8.13		13.95		78,982,769		725,286,082		-1.06	%		1.86	%		1.22	%
		2015			0.30	%		3.20	%		8.19		13.73		74,921,702		683,969,015		-11.15	%		-8.80	%		1.27	%
		2014			0.60	%		3.20	%		9.18		15.36		58,481,505		593,312,037		-5.31	%		-2.82	%		1.47	%
		2013			0.60	%		3.20	%		9.66		16.18		35,895,869		379,146,347		15.86	%		18.86	%		1.49	%
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class
		2017			0.30	%		2.85	%		10.25		10.46		687,730		7,423,670		8.66	%		9.26	%		3.30	%
		2016			0.30	%		1.65	%		9.44		9.58		223,180		2,126,674		-0.57	%		-0.02	%		0.77	%
		2015			1.10	%		1.65	%		9.49		9.58		218,147		2,083,712		-4.59	%		-4.06	%		1.84	%
		2014	8/11/14		1.10	%		1.65	%		9.95		9.98		59,280		591,623		-1.44	%		0.36	%		3.93	%
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class
		2017	12/19/17		0.50	%		0.50	%		11.15		11.15		1,204		13,429		0.00	%		0.00	%		2.14	%
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		10.38		11.52		28,088,590		310,357,024		7.33	%		10.16	%		3.19	%
		2016			0.60	%		3.20	%		9.67		10.46		25,533,930		258,576,706		7.46	%		10.29	%		2.42	%
		2015			0.60	%		3.20	%		9.00		9.48		17,970,955		166,643,018		-10.93	%		-8.58	%		3.14	%
		2014	1/9/14		0.60	%		3.20	%		10.10		10.37		8,583,610		87,998,782		-4.39	%		8.31	%		2.44	%
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class
		2017			0.65	%		0.65	%		11.66		11.66		992		11,582		10.49	%		10.49	%		3.52	%
		2016			0.65	%		0.65	%		10.55		10.55		979		10,336		10.64	%		10.64	%		2.61	%
		2015			0.65	%		0.65	%		9.54		9.54		1,014		9,674		-8.31	%		-8.31	%		1.64	%
		2014	9/22/14		0.65	%		0.65	%		10.40		10.40		1,900		19,769		-2.92	%		-2.92	%		1.56	%
LVIP Global Conservative Allocation Managed Risk Fund - Service Class
		2017			0.30	%		3.20	%		11.91		17.63		74,111,633		1,187,595,457		6.75	%		9.56	%		1.97	%
		2016			0.60	%		3.25	%		11.16		16.16		84,921,037		1,255,511,370		1.45	%		4.13	%		1.81	%
		2015			0.60	%		3.20	%		11.00		15.17		86,710,812		1,244,285,799		-5.31	%		-2.82	%		1.89	%
		2014			0.60	%		3.20	%		11.62		15.72		82,528,356		1,231,323,568		2.11	%		4.75	%		1.84	%
		2013			0.65	%		3.20	%		11.38		15.09		76,136,302		1,095,714,114		6.03	%		8.76	%		1.86	%
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class
		2017			0.65	%		0.65	%		18.52		18.52		10,262		190,014		9.78	%		9.78	%		2.30	%
		2016			0.65	%		0.65	%		16.87		16.87		10,403		175,465		4.34	%		4.34	%		2.26	%
		2015			0.65	%		0.65	%		16.17		16.17		7,033		113,698		-2.63	%		-2.63	%		4.16	%
		2014	8/25/14		0.65	%		0.65	%		16.60		16.60		2,012		33,410		-0.15	%		-0.15	%		1.98	%
LVIP Global Growth Allocation Managed Risk Fund - Service Class
		2017			0.20	%		3.20	%		12.03		16.18		577,677,484		8,675,652,133		11.71	%		14.65	%		2.06	%
		2016			0.30	%		3.20	%		10.08		14.21		620,705,979		8,206,660,387		1.20	%		4.17	%		1.55	%
		2015			0.30	%		3.20	%		9.68		13.77		654,613,205		8,408,274,523		-6.96	%		-4.22	%		1.76	%
		2014			0.30	%		3.20	%		11.44		14.69		608,030,501		8,257,330,275		-0.05	%		2.54	%		2.01	%
		2013			0.65	%		3.20	%		11.45		14.66		458,530,041		6,143,754,716		9.70	%		12.53	%		2.07	%
LVIP Global Growth Allocation Managed Risk Fund - Standard Class
		2017			0.35	%		1.75	%		17.70		19.46		454,223		7,078,462		13.69	%		14.94	%		3.55	%
		2016			0.60	%		1.70	%		15.57		16.93		238,437		4,010,369		2.98	%		4.12	%		1.79	%
		2015			0.60	%		1.70	%		15.12		16.26		247,590		4,002,312		-5.31	%		-4.27	%		1.98	%
		2014			0.60	%		1.70	%		15.97		16.98		241,037		4,067,734		1.72	%		2.85	%		2.19	%
		2013	1/10/13		0.60	%		1.70	%		15.70		16.51		222,966		3,659,166		5.21	%		9.34	%		3.44	%
LVIP Global Income Fund - Service Class
		2017			0.10	%		3.20	%		8.76		12.23		58,319,128		651,725,297		1.49	%		4.47	%		0.00	%
		2016			0.30	%		3.20	%		8.63		11.74		54,819,986		594,206,023		-2.90	%		-0.04	%		0.00	%
		2015			0.30	%		3.20	%		8.89		11.79		54,548,202		599,143,037		-5.35	%		-2.85	%		2.97	%
		2014			0.60	%		3.20	%		9.39		12.14		51,337,307		586,449,226		-1.52	%		1.08	%		0.37	%
		2013			0.60	%		3.20	%		9.54		12.05		44,409,424		507,160,913		-6.12	%		-3.66	%		0.26	%
LVIP Global Income Fund - Standard Class
		2017			0.35	%		0.75	%		10.20		10.20		71,455		728,688		4.63	%		4.63	%		0.00	%
		2016			0.40	%		0.40	%		9.75		9.75		63,816		622,192		0.11	%		0.11	%		0.00	%
		2015	12/14/15		0.40	%		0.40	%		9.74		9.74		5,445		53,033		0.28	%		0.28	%		0.00	%

N-131

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP Global Moderate Allocation Managed Risk Fund - Service Class
		2017			0.30	%		3.45	%	$	11.92	$	16.81		437,659,078	$	6,740,595,886		10.45	%		13.36	%		1.99	%
		2016			0.30	%		3.20	%		10.10		14.92		474,208,425		6,512,157,024		0.80	%		3.76	%		1.45	%
		2015			0.30	%		3.20	%		9.74		14.52		494,104,981		6,624,070,189		-6.65	%		-3.90	%		1.79	%
		2014			0.30	%		3.20	%		11.47		15.25		462,756,704		6,543,502,598		0.61	%		3.26	%		1.88	%
		2013			0.60	%		3.20	%		11.40		14.87		374,792,206		5,192,083,585		8.07	%		10.86	%		1.88	%
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class
		2017			0.35	%		1.70	%		11.38		18.98		77,338		1,243,353		12.39	%		13.58	%		2.70	%
		2016			0.65	%		1.70	%		15.43		16.71		54,491		854,670		2.58	%		3.67	%		1.76	%
		2015			0.65	%		1.70	%		15.05		16.12		49,475		767,170		-5.00	%		-4.00	%		2.46	%
		2014			0.65	%		1.70	%		15.84		15.84		36,624		583,356		2.39	%		2.39	%		3.93	%
		2013	11/14/13		1.70	%		1.70	%		15.47		15.47		3,252		50,305		1.72	%		1.72	%		1.69	%
LVIP Goldman Sachs Income Builder Fund - Service Class
		2017			0.10	%		3.00	%		10.60		11.13		890,967		9,632,896		5.89	%		7.32	%		3.45	%
		2016			0.30	%		1.65	%		10.01		10.16		387,317		3,924,522		6.89	%		7.48	%		3.28	%
		2015			1.10	%		1.65	%		9.36		9.45		261,456		2,467,548		-5.66	%		-5.14	%		5.42	%
		2014	7/17/14		1.10	%		1.65	%		9.93		9.96		59,236		589,544		-2.73	%		-1.55	%		6.10	%
LVIP Goldman Sachs Income Builder Fund - Standard Class
		2017			0.40	%		0.50	%		11.19		11.19		4,122		45,899		7.50	%		7.50	%		3.23	%
		2016			0.40	%		0.40	%		10.41		10.41		2,806		29,222		8.51	%		8.51	%		3.24	%
		2015			0.40	%		0.40	%		9.60		9.60		1,998		19,182		-4.24	%		-4.24	%		3.26	%
		2014	9/25/14		0.40	%		0.40	%		10.02		10.02		1,998		20,030		-0.68	%		-0.68	%		2.54	%
LVIP Government Money Market Fund - Service Class
		2017			0.10	%		3.20	%		7.79		10.04		22,932,493		212,678,122		-2.98	%		-0.42	%		0.18	%
		2016			0.60	%		3.20	%		8.01		10.09		23,824,249		221,280,316		-3.12	%		-0.58	%		0.02	%
		2015			0.60	%		3.20	%		8.25		10.15		25,821,065		243,717,501		-3.13	%		-0.60	%		0.02	%
		2014			0.60	%		3.20	%		8.49		10.22		27,288,172		261,892,224		-3.12	%		-0.57	%		0.03	%
		2013			0.60	%		3.20	%		8.73		10.31		28,577,156		279,399,807		-3.13	%		-0.59	%		0.02	%
LVIP Government Money Market Fund - Standard Class
		2017			0.35	%		2.70	%		7.94		10.68		2,366,605		22,815,993		-2.26	%		-0.24	%		0.40	%
		2016			0.65	%		2.80	%		8.11		10.78		2,704,726		26,325,639		-2.73	%		-0.62	%		0.03	%
		2015			0.65	%		2.80	%		8.33		10.93		2,909,749		28,823,142		-2.64	%		-0.63	%		0.02	%
		2014			0.65	%		2.70	%		8.55		11.09		3,254,385		32,987,039		-2.64	%		-0.62	%		0.03	%
		2013			0.65	%		2.70	%		8.78		11.24		3,896,189		40,141,761		-2.64	%		-0.63	%		0.02	%
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		10.73		11.79		27,278,604		309,727,672		7.25	%		10.06	%		1.08	%
		2016			0.60	%		3.20	%		10.00		10.70		24,266,484		252,720,561		7.27	%		10.04	%		0.98	%
		2015			0.65	%		3.20	%		9.36		9.72		11,727,842		112,125,691		-7.98	%		-5.79	%		2.34	%
		2014	5/21/14		0.65	%		3.00	%		10.16		10.32		2,962,723		30,368,858		-1.27	%		5.42	%		1.21	%
LVIP Invesco Select Equity Managed Volatility Fund - Service Class
		2017			0.65	%		3.20	%		10.43		11.55		12,523,103		139,194,685		13.96	%		16.90	%		1.47	%
		2016			0.65	%		3.20	%		9.21		9.88		13,120,151		125,918,995		2.73	%		5.18	%		0.61	%
		2015			0.60	%		3.00	%		8.96		9.40		12,266,560		112,987,141		-11.60	%		-9.45	%		1.76	%
		2014	1/8/14		0.60	%		3.00	%		10.14		10.39		6,726,601		69,143,345		-2.64	%		6.66	%		1.51	%
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class
		2017			0.65	%		1.70	%		11.23		11.71		6,995		80,392		16.09	%		17.31	%		1.75	%
		2016			0.65	%		1.70	%		9.68		9.99		7,486		73,649		4.45	%		5.55	%		0.88	%
		2015			0.65	%		1.70	%		9.26		9.46		7,824		73,270		-10.13	%		-9.18	%		1.80	%
		2014	12/18/14		0.65	%		1.70	%		10.31		10.42		7,645		79,229		-0.55	%		0.20	%		1.38	%
LVIP JPMorgan High Yield Fund - Service Class
		2017			0.10	%		3.20	%		11.12		15.41		12,727,012		181,491,008		3.16	%		6.19	%		5.79	%
		2016			0.30	%		3.20	%		10.63		14.55		12,636,264		171,948,352		9.42	%		12.64	%		4.85	%
		2015			0.30	%		3.20	%		10.44		12.96		11,845,097		144,644,651		-7.19	%		-4.75	%		4.76	%
		2014			0.60	%		3.20	%		11.25		13.61		11,221,017		145,022,804		-0.65	%		1.97	%		4.03	%
		2013			0.60	%		3.20	%		11.32		13.32		11,062,730		141,403,669		2.95	%		5.61	%		4.78	%
LVIP JPMorgan High Yield Fund - Standard Class
		2017			0.35	%		0.50	%		11.34		11.34		27,781		306,541		6.35	%		6.35	%		7.35	%
		2016			0.40	%		0.40	%		10.67		10.67		12,688		135,347		12.81	%		12.81	%		6.53	%
		2015	3/16/15		0.40	%		0.40	%		9.46		9.46		3,650		34,516		-5.90	%		-5.90	%		6.27	%

N-132

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP JPMorgan Retirement Income Fund - Service Class
		2017	6/7/17		0.30	%		2.80	%	$	10.45	$	12.66		128,472	$	1,516,322		0.25	%		4.32	%		5.72	%
LVIP JPMorgan Retirement Income Fund - Standard Class
		2017	7/6/17		0.50	%		0.70	%		10.94		11.29		70,347		769,846		1.22	%		5.17	%		5.89	%
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class
		2017			0.10	%		3.20	%		12.08		21.08		44,152,217		619,609,616		10.80	%		14.06	%		0.82	%
		2016			0.30	%		3.20	%		10.59		18.98		42,499,005		528,788,436		6.27	%		9.39	%		0.53	%
		2015			0.30	%		3.20	%		10.30		17.81		33,655,363		386,903,796		-10.86	%		-8.51	%		0.58	%
		2014			0.60	%		3.20	%		11.52		19.93		24,046,021		305,870,193		4.45	%		7.20	%		0.67	%
		2013			0.60	%		3.20	%		11.02		19.04		15,748,040		189,103,437		19.96	%		23.06	%		0.42	%
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class
		2017			0.60	%		1.70	%		23.96		26.34		15,058		300,920		12.76	%		14.00	%		1.00	%
		2016			0.60	%		1.70	%		21.25		23.11		11,443		261,009		8.16	%		9.35	%		0.67	%
		2015			0.60	%		1.70	%		20.73		21.13		9,667		202,679		-8.57	%		-8.29	%		0.78	%
		2014	3/11/14		0.60	%		0.90	%		22.67		23.04		3,485		80,064		2.19	%		6.57	%		1.70	%
LVIP Managed Risk Profile 2010 Fund - Service Class
		2017			0.75	%		2.80	%		11.39		14.15		448,516		5,814,930		6.34	%		8.55	%		1.71	%
		2016			0.75	%		2.80	%		10.71		13.04		430,449		5,156,296		1.30	%		3.39	%		1.70	%
		2015			0.75	%		2.80	%		10.57		12.61		412,768		4,819,910		-4.56	%		-2.58	%		1.52	%
		2014			0.75	%		2.80	%		11.08		12.95		466,189		5,629,418		1.63	%		3.73	%		1.55	%
		2013			0.75	%		2.80	%		10.90		12.48		550,183		6,458,866		5.66	%		7.85	%		0.99	%
LVIP Managed Risk Profile 2020 Fund - Service Class
		2017			0.75	%		2.80	%		11.16		13.88		806,673		10,174,646		8.66	%		10.91	%		1.63	%
		2016			0.75	%		2.80	%		10.27		12.51		903,261		10,363,985		1.32	%		3.42	%		1.63	%
		2015			0.75	%		2.80	%		10.14		12.10		962,889		10,787,116		-5.15	%		-3.18	%		1.38	%
		2014			0.75	%		2.80	%		10.69		12.50		1,237,075		14,457,969		1.25	%		3.35	%		1.53	%
		2013			0.75	%		2.80	%		10.56		12.09		1,483,685		16,908,022		7.79	%		10.02	%		1.13	%
LVIP Managed Risk Profile 2030 Fund - Service Class
		2017			0.75	%		2.85	%		10.98		13.72		414,963		5,122,956		10.01	%		12.35	%		1.69	%
		2016			0.75	%		2.85	%		9.98		12.21		451,618		5,018,195		0.55	%		2.68	%		1.39	%
		2015			0.75	%		2.85	%		9.92		11.89		570,149		6,240,374		-5.63	%		-3.63	%		1.42	%
		2014			0.75	%		2.85	%		10.52		12.34		643,512		7,396,794		0.98	%		3.12	%		1.59	%
		2013			0.75	%		2.85	%		10.41		11.97		866,126		9,728,805		10.27	%		12.61	%		1.06	%
LVIP Managed Risk Profile 2040 Fund - Service Class
		2017			1.15	%		2.85	%		10.46		12.52		394,944		4,703,122		11.13	%		13.04	%		1.85	%
		2016			1.15	%		2.85	%		9.41		11.08		372,684		3,943,414		0.64	%		2.36	%		1.15	%
		2015			1.15	%		2.85	%		9.35		10.82		529,161		5,465,955		-6.18	%		-4.57	%		1.44	%
		2014			1.15	%		2.85	%		9.96		11.34		551,697		6,008,028		0.32	%		2.04	%		1.99	%
		2013			1.15	%		2.85	%		9.93		11.12		568,319		6,093,933		12.99	%		14.92	%		1.03	%
LVIP MFS International Equity Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		10.25		11.57		26,368,211		290,445,820		24.56	%		27.85	%		1.22	%
		2016			0.60	%		3.20	%		8.23		9.03		22,793,487		198,252,903		-4.65	%		-2.19	%		1.05	%
		2015			0.65	%		3.20	%		8.63		9.23		18,835,776		169,165,297		-3.28	%		-0.78	%		0.88	%
		2014			0.65	%		3.20	%		8.93		9.31		9,592,942		87,740,296		-10.27	%		-7.95	%		0.77	%
		2013	5/20/13		0.65	%		3.20	%		9.95		10.11		3,467,430		34,818,787		-0.83	%		7.53	%		1.28	%
LVIP MFS International Growth Fund - Service Class
		2017			0.10	%		3.15	%		10.03		18.40		15,586,440		189,669,952		27.46	%		31.14	%		0.91	%
		2016			0.30	%		3.15	%		7.85		13.89		16,044,331		151,467,517		-1.74	%		1.10	%		1.21	%
		2015			0.30	%		3.15	%		7.96		13.81		16,027,294		151,468,387		-2.09	%		0.44	%		0.94	%
		2014			0.60	%		3.15	%		8.11		13.77		16,020,823		152,281,315		-8.09	%		-5.86	%		0.81	%
		2013			0.60	%		3.00	%		8.81		14.66		15,179,658		154,127,586		9.97	%		12.64	%		0.58	%
LVIP MFS International Growth Fund - Standard Class
		2017			0.35	%		0.40	%		12.53		12.53		655		8,271		31.35	%		31.35	%		0.33	%
		2016			0.40	%		0.40	%		9.54		9.54		3,226		30,783		1.26	%		1.26	%		1.31	%
		2015			0.40	%		0.40	%		9.42		9.42		2,315		21,813		0.89	%		0.89	%		1.04	%
		2014	12/26/14		0.40	%		0.40	%		9.34		9.34		1,030		9,625		-1.20	%		-1.20	%		0.00	%

N-133

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP MFS Value Fund - Service Class
		2017			0.10	%		3.30	%	$	13.91	$	24.00		52,202,443	$	977,449,408		13.64	%		16.98	%		1.53	%
		2016			0.30	%		3.20	%		12.06		20.74		53,858,219		875,717,211		10.20	%		13.44	%		1.58	%
		2015			0.30	%		3.20	%		10.63		18.77		56,764,141		823,905,112		-3.92	%		-1.09	%		1.79	%
		2014			0.30	%		3.20	%		12.38		19.49		59,468,552		879,626,819		6.76	%		9.52	%		2.18	%
		2013			0.65	%		3.20	%		11.55		18.21		62,841,073		850,091,010		31.35	%		34.74	%		1.47	%
LVIP MFS Value Fund - Standard Class
		2017			0.35	%		0.75	%		14.18		14.18		125,807		1,528,474		17.16	%		17.16	%		4.52	%
		2016			0.40	%		0.40	%		12.11		12.11		4,009		48,535		13.60	%		13.60	%		5.43	%
		2015			0.40	%		0.40	%		10.66		10.66		819		8,726		-0.94	%		-0.94	%		2.11	%
		2014	12/11/14		0.40	%		0.40	%		10.76		10.76		635		6,835		0.95	%		0.95	%		2.30	%
LVIP Mondrian International Value Fund - Service Class
		2017			0.10	%		3.45	%		10.32		24.72		18,524,542		283,807,930		17.23	%		20.68	%		3.00	%
		2016			0.30	%		3.20	%		8.67		20.70		21,180,600		272,429,401		0.49	%		3.44	%		2.49	%
		2015			0.30	%		3.18	%		8.51		20.22		22,114,744		278,699,287		-7.04	%		-4.64	%		2.70	%
		2014			0.63	%		3.18	%		9.51		21.36		22,620,521		301,725,103		-5.83	%		-3.40	%		3.72	%
		2013			0.63	%		3.18	%		10.05		22.26		23,262,285		323,304,014		17.74	%		20.78	%		2.88	%
LVIP Mondrian International Value Fund - Standard Class
		2017			0.40	%		2.70	%		10.90		26.51		489,746		12,000,558		18.11	%		20.86	%		3.26	%
		2016			0.40	%		2.70	%		9.02		22.26		563,743		11,558,237		1.24	%		3.60	%		2.65	%
		2015			0.40	%		2.70	%		8.70		21.80		628,928		12,634,030		-6.36	%		-4.18	%		2.78	%
		2014			0.40	%		2.70	%		11.90		23.08		718,501		15,332,417		-5.14	%		-3.80	%		3.77	%
		2013			1.30	%		2.70	%		12.52		23.46		794,784		17,910,281		18.60	%		20.27	%		2.50	%
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class
		2017			0.65	%		3.20	%		10.48		11.40		3,854,785		42,403,471		16.69	%		19.40	%		1.53	%
		2016			0.65	%		2.95	%		8.98		9.55		2,966,496		27,561,808		2.47	%		4.85	%		1.34	%
		2015			0.65	%		2.95	%		8.77		9.08		2,123,933		19,025,104		-9.80	%		-7.84	%		1.63	%
		2014	5/19/14		0.80	%		2.95	%		9.72		9.85		516,390		5,056,784		-5.26	%		2.70	%		3.04	%
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class
		2017			0.65	%		0.90	%		11.44		11.54		19,155		219,290		19.53	%		19.83	%		1.69	%
		2016	10/20/16		0.65	%		0.90	%		9.57		9.63		19,155		183,420		3.51	%		6.60	%		1.56	%
LVIP PIMCO Low Duration Bond Fund - Service Class
		2017			0.10	%		3.25	%		9.37		10.42		40,527,858		402,456,330		-1.76	%		1.13	%		1.56	%
		2016			0.30	%		3.20	%		9.54		10.30		35,691,768		354,904,492		-0.85	%		2.07	%		1.46	%
		2015			0.30	%		3.20	%		9.62		10.09		22,297,255		220,065,680		-1.88	%		1.01	%		1.71	%
		2014	5/19/14		0.30	%		3.20	%		9.81		9.99		5,401,272		53,510,888		-1.61	%		-0.19	%		0.98	%
LVIP PIMCO Low Duration Bond Fund - Standard Class
		2017			0.35	%		1.90	%		9.99		10.47		608,010		6,280,671		-0.03	%		1.27	%		2.07	%
		2016			0.40	%		1.70	%		9.99		10.34		421,166		4,329,929		0.90	%		2.22	%		2.08	%
		2015			0.40	%		1.70	%		10.05		10.12		149,857		1,512,236		0.76	%		1.16	%		3.08	%
		2014	9/2/14		0.40	%		0.80	%		9.98		10.00		8,434		84,176		-0.60	%		-0.33	%		0.60	%
LVIP Select Core Equity Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		12.18		13.73		33,438,646		436,900,060		14.89	%		17.91	%		2.16	%
		2016			0.60	%		3.20	%		10.60		11.65		37,192,600		416,362,394		2.87	%		5.58	%		0.70	%
		2015			0.60	%		3.20	%		10.30		11.03		38,465,190		412,240,126		-8.14	%		-5.72	%		1.51	%
		2014			0.60	%		3.20	%		11.21		11.70		23,523,972		270,309,819		2.48	%		5.18	%		3.57	%
		2013	5/20/13		0.60	%		3.20	%		10.94		11.13		8,656,233		95,635,695		4.63	%		14.23	%		1.77	%
LVIP Select Core Equity Managed Volatility Fund - Standard Class
		2017			0.60	%		1.70	%		13.27		13.96		9,642		133,178		17.03	%		18.32	%		2.38	%
		2016			0.60	%		1.70	%		11.34		11.80		17,550		205,847		4.80	%		5.95	%		0.54	%
		2015			0.60	%		1.70	%		10.82		11.13		55,938		621,392		-6.42	%		-5.38	%		2.25	%
		2014			0.60	%		1.70	%		11.56		11.76		37,183		436,118		4.39	%		5.49	%		4.51	%
		2013	11/14/13		0.65	%		1.70	%		11.07		11.15		10,150		112,800		2.47	%		3.36	%		1.67	%
LVIP SSGA Bond Index Fund - Service Class
		2017			0.10	%		3.45	%		9.44		13.12		84,121,596		990,620,741		-0.32	%		2.61	%		2.20	%
		2016			0.30	%		3.20	%		9.47		12.77		83,509,614		973,288,022		-1.18	%		1.42	%		1.88	%
		2015			0.60	%		3.20	%		9.57		12.59		80,405,273		934,380,829		-3.10	%		-0.60	%		2.21	%
		2014			0.60	%		3.15	%		9.87		12.68		83,120,936		981,948,234		2.21	%		4.85	%		1.59	%
		2013			0.60	%		3.15	%		9.64		12.10		87,085,679		992,038,834		-5.83	%		-3.44	%		1.73	%

N-134

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP SSGA Bond Index Fund - Standard Class
		2017			0.35	%		1.85	%	$	10.58	$	12.69		240,908	$	2,641,603		1.29	%		2.77	%		3.81	%
		2016			0.40	%		1.85	%		10.44		12.37		97,988		1,137,611		0.55	%		1.87	%		2.25	%
		2015			0.40	%		1.70	%		10.25		12.17		63,453		741,796		-1.44	%		-0.15	%		3.31	%
		2014			0.40	%		1.70	%		11.48		12.21		37,055		423,147		3.97	%		5.12	%		3.37	%
		2013			0.60	%		1.70	%		11.04		11.58		14,497		164,424		-4.21	%		-3.20	%		4.11	%
LVIP SSGA Conservative Index Allocation Fund - Service Class
		2017			0.65	%		3.10	%		11.93		14.20		5,468,134		72,050,831		7.17	%		9.72	%		1.98	%
		2016			0.65	%		3.00	%		11.13		12.94		5,673,438		68,792,985		1.65	%		4.06	%		1.68	%
		2015			0.65	%		3.00	%		10.95		12.44		5,459,576		64,280,361		-4.11	%		-1.83	%		1.86	%
		2014			0.65	%		3.00	%		11.42		12.67		5,037,227		61,012,308		1.38	%		3.79	%		1.59	%
		2013			0.65	%		3.00	%		11.27		12.21		4,858,768		57,187,856		3.38	%		5.84	%		1.31	%
LVIP SSGA Conservative Structured Allocation Fund - Service Class
		2017			0.10	%		3.00	%		11.54		14.19		14,275,446		188,332,607		6.19	%		9.10	%		3.10	%
		2016			0.30	%		3.00	%		10.58		13.05		15,154,704		185,475,352		3.42	%		6.25	%		1.87	%
		2015			0.30	%		3.00	%		10.85		12.32		15,209,136		177,202,319		-5.00	%		-2.74	%		2.29	%
		2014			0.65	%		3.15	%		11.07		12.67		15,729,078		189,999,017		2.01	%		4.59	%		2.21	%
		2013			0.65	%		3.15	%		10.85		12.11		16,283,286		189,828,966		3.49	%		6.11	%		1.73	%
LVIP SSGA Conservative Structured Allocation Fund - Standard Class
		2017			0.35	%		0.80	%		11.44		11.60		58,990		678,713		8.82	%		9.26	%		3.28	%
		2016			0.40	%		0.80	%		10.62		10.62		55,420		588,244		6.41	%		6.41	%		2.16	%
		2015			0.40	%		0.40	%		9.98		9.98		56,256		561,459		-2.25	%		-2.25	%		2.98	%
		2014	11/17/14		0.40	%		0.40	%		10.21		10.21		16,276		166,185		0.41	%		0.41	%		3.83	%
LVIP SSGA Developed International 150 Fund - Service Class
		2017			0.10	%		3.45	%		11.49		17.19		12,699,387		163,216,281		19.61	%		22.89	%		4.13	%
		2016			0.30	%		3.00	%		9.59		14.06		12,907,507		136,821,705		6.23	%		9.14	%		3.24	%
		2015			0.30	%		3.00	%		8.89		13.02		13,881,988		136,712,693		-7.36	%		-4.82	%		2.69	%
		2014			0.30	%		3.00	%		9.72		14.04		13,887,185		145,571,689		-2.33	%		-0.01	%		2.97	%
		2013			0.65	%		3.00	%		9.93		14.37		14,069,224		149,031,537		16.47	%		19.24	%		2.40	%
LVIP SSGA Developed International 150 Fund - Standard Class
		2017			0.35	%		1.90	%		11.82		20.69		38,516		589,596		21.25	%		23.08	%		4.71	%
		2016			0.40	%		1.90	%		9.64		16.85		31,097		410,684		7.66	%		9.29	%		3.96	%
		2015			0.40	%		1.90	%		8.92		15.44		23,110		284,992		-6.10	%		-4.68	%		3.27	%
		2014			0.40	%		1.90	%		11.38		16.18		18,936		253,336		-0.99	%		0.26	%		6.42	%
		2013	2/8/13		0.65	%		1.90	%		11.49		16.14		1,864		24,964		14.46	%		15.32	%		5.33	%
LVIP SSGA Emerging Markets 100 Fund - Service Class
		2017			0.10	%		3.45	%		8.80		14.86		14,293,707		187,818,258		19.68	%		23.14	%		2.43	%
		2016			0.30	%		3.15	%		7.35		12.39		14,979,878		161,977,817		11.59	%		14.81	%		2.32	%
		2015			0.30	%		3.15	%		6.59		11.08		16,052,711		153,201,469		-19.82	%		-17.79	%		4.26	%
		2014			0.65	%		3.15	%		8.22		13.79		14,465,410		169,702,676		-6.60	%		-4.24	%		2.73	%
		2013			0.65	%		3.15	%		8.80		14.74		14,368,529		177,864,010		-6.08	%		-3.70	%		2.04	%
LVIP SSGA Emerging Markets 100 Fund - Standard Class
		2017			0.35	%		1.90	%		9.79		18.57		104,709		1,455,002		21.51	%		23.34	%		3.66	%
		2016			0.40	%		1.90	%		8.06		15.09		46,544		613,567		13.26	%		14.97	%		2.64	%
		2015			0.40	%		1.90	%		7.11		13.15		43,400		514,809		-18.60	%		-17.38	%		4.93	%
		2014			0.40	%		1.90	%		8.74		15.95		30,189		462,463		-5.19	%		-3.95	%		3.72	%
		2013			0.60	%		1.90	%		9.22		16.60		17,442		279,682		-4.66	%		-3.41	%		3.07	%
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class
		2017			0.10	%		3.25	%		10.19		15.01		64,699,507		876,608,907		10.92	%		13.84	%		3.73	%
		2016			0.60	%		3.20	%		9.65		13.16		69,737,202		837,564,233		2.04	%		4.68	%		1.56	%
		2015			0.65	%		3.20	%		9.41		12.86		74,854,612		866,175,460		-9.69	%		-7.35	%		2.83	%
		2014			0.65	%		3.20	%		10.37		14.21		70,165,415		885,053,206		0.44	%		3.04	%		2.19	%
		2013			0.65	%		3.20	%		10.28		14.11		59,096,862		732,112,426		6.09	%		8.82	%		2.28	%
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class
		2017			0.35	%		1.85	%		11.20		18.20		45,251		746,498		13.78	%		14.07	%		4.70	%
		2016			0.60	%		0.90	%		15.67		16.02		35,235		541,568		4.68	%		4.99	%		1.77	%
		2015			0.60	%		0.90	%		14.97		15.26		32,703		497,007		-7.36	%		-7.08	%		5.91	%
		2014			0.60	%		1.70	%		15.44		16.42		13,756		222,653		2.22	%		3.34	%		3.08	%
		2013			0.60	%		1.70	%		15.68		15.89		13,034		200,129		8.82	%		9.15	%		5.24	%

N-135

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP SSGA International Index Fund - Service Class
		2017			0.10	%		3.45	%	$	9.65	$	16.40		27,441,468	$	297,443,272		20.71	%		24.01	%		2.39	%
		2016			0.30	%		3.00	%		7.98		13.27		29,233,587		258,367,811		-2.24	%		0.44	%		2.67	%
		2015			0.30	%		3.00	%		8.15		13.25		28,875,632		257,372,034		-4.38	%		-2.05	%		2.22	%
		2014			0.60	%		3.00	%		8.51		13.40		29,861,518		274,485,051		-8.86	%		-6.69	%		2.42	%
		2013			0.65	%		3.00	%		9.33		14.51		30,268,833		301,347,579		17.13	%		19.91	%		1.51	%
LVIP SSGA International Index Fund - Standard Class
		2017			0.35	%		1.90	%		11.23		18.69		184,593		2,430,775		22.35	%		24.19	%		4.13	%
		2016			0.40	%		1.90	%		9.04		15.08		78,843		884,263		-0.90	%		0.59	%		3.11	%
		2015			0.40	%		1.90	%		8.99		15.02		73,618		794,436		-3.08	%		-1.61	%		3.25	%
		2014			0.40	%		1.90	%		14.38		15.29		32,119		416,234		-7.43	%		-6.41	%		3.97	%
		2013			0.60	%		1.70	%		16.30		16.34		10,493		170,136		20.20	%		20.26	%		1.97	%
LVIP SSGA International Managed Volatility Fund - Service Class
		2017			0.30	%		3.20	%		9.41		12.55		37,807,569		378,840,654		20.05	%		23.59	%		1.97	%
		2016			0.30	%		3.20	%		7.85		8.47		40,902,999		335,913,199		-6.79	%		-4.38	%		2.07	%
		2015			0.60	%		3.15	%		8.45		8.86		9,188,993		79,614,522		-6.60	%		-4.33	%		3.26	%
		2014	1/7/14		0.60	%		3.00	%		9.04		9.26		1,647,011		15,091,764		-12.34	%		-4.71	%		4.04	%
LVIP SSGA International Managed Volatility Fund - Standard Class
		2017			0.65	%		1.90	%		10.01		10.52		15,347		156,282		21.93	%		23.46	%		2.15	%
		2016	11/15/16		0.65	%		1.90	%		8.21		8.52		17,317		143,926		-0.49	%		2.33	%		1.29	%
LVIP SSGA Large Cap 100 Fund - Service Class
		2017			0.10	%		3.45	%		14.76		30.40		14,865,283		350,328,436		14.79	%		18.11	%		2.66	%
		2016			0.30	%		3.15	%		12.68		26.43		15,129,275		306,974,425		17.47	%		20.86	%		2.01	%
		2015			0.30	%		3.15	%		10.49		22.46		16,840,070		286,594,249		-7.86	%		-5.20	%		2.37	%
		2014			0.30	%		3.15	%		16.62		24.32		17,880,867		325,179,992		12.83	%		15.68	%		2.22	%
		2013			0.65	%		3.15	%		14.73		21.51		19,935,882		316,760,013		31.30	%		34.62	%		1.93	%
LVIP SSGA Large Cap 100 Fund - Standard Class
		2017			0.35	%		2.15	%		14.84		37.99		132,109		2,975,978		16.23	%		18.28	%		3.00	%
		2016			0.40	%		2.15	%		12.73		32.18		102,562		2,268,617		18.94	%		21.04	%		2.27	%
		2015			0.40	%		2.15	%		10.52		26.64		79,295		1,674,464		-6.70	%		-5.05	%		2.91	%
		2014			0.40	%		2.15	%		17.50		28.02		73,723		1,636,051		14.24	%		15.97	%		3.30	%
		2013			0.65	%		2.15	%		24.16		24.16		43,459		791,897		34.97	%		34.97	%		5.67	%
LVIP SSGA Large Cap Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		12.42		14.01		27,776,939		371,051,510		16.99	%		20.06	%		1.68	%
		2016			0.60	%		3.20	%		10.62		11.65		23,551,490		264,499,043		4.53	%		7.23	%		1.64	%
		2015			0.65	%		3.20	%		10.16		10.86		16,332,756		172,633,442		-8.37	%		-6.00	%		1.76	%
		2014			0.65	%		3.20	%		11.12		11.56		8,699,562		98,855,910		3.09	%		5.54	%		3.16	%
		2013	5/21/13		0.65	%		3.00	%		10.79		10.95		2,385,134		25,947,518		2.68	%		10.29	%		2.63	%
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class
		2017			0.90	%		0.90	%		13.98		13.98		2,732		38,211		20.01	%		20.01	%		1.77	%
		2016			0.65	%		0.90	%		11.65		11.77		2,856		33,289		7.23	%		7.56	%		1.64	%
		2015			0.65	%		0.90	%		10.94		10.94		2,858		31,051		-5.78	%		-5.78	%		4.75	%
		2014			0.65	%		0.65	%		11.61		11.61		122		1,417		5.82	%		5.82	%		1.92	%
		2013	7/2/13		0.65	%		0.65	%		10.97		10.97		129		1,412		11.12	%		11.12	%		1.50	%
LVIP SSGA Mid-Cap Index Fund - Service Class
		2017	1/10/17		0.10	%		3.20	%		12.27		12.72		2,684,939		33,602,055		3.93	%		13.37	%		1.91	%
LVIP SSGA Mid-Cap Index Fund - Standard Class
		2017	1/31/17		0.35	%		2.25	%		12.44		12.71		98,808		1,251,408		4.01	%		13.56	%		2.01	%
LVIP SSGA Moderate Index Allocation Fund - Service Class
		2017			0.30	%		3.25	%		12.55		15.88		15,573,508		228,699,375		10.67	%		13.58	%		1.97	%
		2016			0.60	%		3.20	%		11.34		13.98		15,471,018		201,980,295		3.02	%		5.74	%		1.71	%
		2015			0.60	%		3.20	%		11.01		13.22		15,160,769		189,010,996		-4.81	%		-2.30	%		1.56	%
		2014			0.60	%		3.20	%		11.56		13.53		14,787,994		190,721,763		0.87	%		3.53	%		1.85	%
		2013			0.60	%		3.20	%		11.46		13.07		13,875,395		174,568,913		8.65	%		11.51	%		1.29	%
LVIP SSGA Moderate Index Allocation Fund - Standard Class
		2017	11/10/17		0.40	%		0.40	%		11.45		11.45		2,534		29,013		0.10	%		0.10	%		0.78	%

N-136

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP SSGA Moderate Structured Allocation Fund - Service Class
		2017			0.10	%		3.20	%	$	10.88	$	15.80		54,924,113	$	805,056,033		9.31	%		12.52	%		3.64	%
		2016			0.30	%		3.20	%		10.73		14.14		58,020,140		765,659,421		5.57	%		8.68	%		1.91	%
		2015			0.30	%		3.20	%		10.89		13.05		61,184,827		752,630,226		-6.00	%		-3.53	%		2.52	%
		2014			0.60	%		3.20	%		11.58		13.53		64,486,754		830,390,736		1.98	%		4.66	%		2.42	%
		2013			0.60	%		3.20	%		11.36		12.90		69,297,730		861,705,250		8.99	%		11.80	%		2.34	%
LVIP SSGA Moderate Structured Allocation Fund - Standard Class
		2017			0.35	%		0.50	%		12.14		12.14		15,542		186,952		12.69	%		12.69	%		3.59	%
		2016			0.40	%		0.40	%		10.77		10.77		17,127		184,448		8.83	%		8.83	%		2.20	%
		2015	1/20/15		0.40	%		0.40	%		9.90		9.90		17,102		169,228		-3.04	%		-3.04	%		5.24	%
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class
		2017			0.30	%		3.25	%		12.96		16.44		12,510,291		191,068,011		13.00	%		15.92	%		1.95	%
		2016			0.65	%		3.20	%		11.47		14.18		12,371,754		164,534,401		3.73	%		6.41	%		1.74	%
		2015			0.65	%		3.20	%		11.06		13.33		12,525,058		158,020,143		-5.36	%		-2.91	%		1.59	%
		2014			0.65	%		3.20	%		11.69		13.73		12,652,800		166,055,729		0.48	%		3.08	%		1.91	%
		2013			0.65	%		3.20	%		11.63		13.32		12,507,329		160,686,710		10.92	%		13.78	%		1.31	%
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class
		2017	6/6/17		0.50	%		0.70	%		11.71		12.06		23,825		280,660		5.16	%		5.25	%		8.08	%
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class
		2017			0.30	%		3.15	%		12.29		16.63		29,879,947		460,977,499		11.06	%		14.27	%		3.89	%
		2016			0.30	%		3.15	%		10.75		14.60		30,504,640		416,609,301		6.78	%		9.87	%		2.00	%
		2015			0.30	%		3.20	%		9.79		13.34		32,056,760		403,797,689		-6.76	%		-4.01	%		2.85	%
		2014			0.30	%		3.20	%		11.89		13.94		32,084,393		426,551,480		1.71	%		4.34	%		2.70	%
		2013			0.65	%		3.20	%		11.69		13.36		31,418,682		404,618,283		11.26	%		14.14	%		2.21	%
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class
		2017			0.35	%		0.75	%		12.35		12.35		197,527		2,352,949		14.44	%		14.44	%		8.28	%
		2016	3/28/16		0.40	%		0.40	%		10.79		10.79		59,649		643,902		9.35	%		9.35	%		2.17	%
LVIP SSGA S&P 500 Index Fund - Service Class
		2017			0.10	%		3.45	%		14.59		26.20		53,968,245		1,097,923,484		17.45	%		20.90	%		1.69	%
		2016			0.30	%		3.20	%		12.12		22.25		53,129,556		911,586,037		7.97	%		11.14	%		1.67	%
		2015			0.30	%		3.20	%		11.02		20.56		54,705,403		855,810,465		-2.26	%		0.61	%		1.64	%
		2014			0.30	%		3.20	%		13.72		20.98		54,354,571		857,087,479		9.58	%		12.41	%		1.65	%
		2013			0.65	%		3.20	%		12.46		19.10		59,168,258		838,667,663		27.60	%		30.82	%		1.44	%
LVIP SSGA S&P 500 Index Fund - Standard Class
		2017			0.35	%		2.80	%		14.88		32.74		2,171,477		46,493,445		18.29	%		21.09	%		1.98	%
		2016			0.40	%		2.75	%		12.29		27.09		2,040,659		38,550,462		8.72	%		11.31	%		2.00	%
		2015			0.40	%		2.75	%		11.04		24.39		1,975,673		32,697,167		-1.43	%		0.77	%		1.83	%
		2014			0.40	%		2.60	%		14.85		24.25		2,174,940		36,149,470		10.52	%		12.75	%		1.88	%
		2013			0.60	%		2.60	%		13.44		21.45		2,441,004		36,194,110		28.61	%		31.15	%		2.35	%
LVIP SSGA Small-Cap Index Fund - Service Class
		2017			0.10	%		3.45	%		13.59		25.53		18,697,055		311,264,760		10.34	%		13.58	%		0.78	%
		2016			0.30	%		3.20	%		12.01		23.08		18,469,172		274,904,324		16.59	%		20.02	%		1.06	%
		2015			0.30	%		3.20	%		10.12		19.75		20,044,094		251,759,365		-7.95	%		-5.24	%		0.69	%
		2014			0.30	%		3.20	%		12.25		21.40		20,318,198		272,886,482		1.12	%		3.77	%		0.58	%
		2013			0.60	%		3.20	%		12.07		21.11		22,742,885		297,575,702		33.24	%		36.67	%		0.62	%
LVIP SSGA Small-Cap Index Fund - Standard Class
		2017			0.35	%		1.90	%		13.86		31.91		335,888		6,541,645		12.06	%		13.75	%		1.29	%
		2016			0.40	%		1.90	%		12.19		28.11		139,819		3,132,109		18.41	%		20.20	%		1.51	%
		2015			0.40	%		1.90	%		10.14		23.43		118,255		2,000,553		-6.51	%		-5.10	%		1.09	%
		2014			0.40	%		1.90	%		16.08		24.74		66,149		1,427,063		2.70	%		4.05	%		1.00	%
		2013			0.60	%		1.90	%		15.66		23.77		28,036		625,775		35.31	%		37.08	%		1.75	%
LVIP SSGA Small-Mid Cap 200 Fund - Service Class
		2017			0.10	%		3.45	%		12.98		26.86		6,080,391		142,582,271		2.73	%		5.75	%		2.33	%
		2016			0.30	%		3.20	%		12.46		26.08		5,867,521		132,384,924		25.93	%		29.37	%		1.87	%
		2015			0.30	%		3.15	%		9.63		20.70		6,127,104		108,191,274		-9.96	%		-7.36	%		2.31	%
		2014			0.30	%		3.15	%		14.46		22.94		5,695,923		110,563,563		0.82	%		3.37	%		3.13	%
		2013			0.65	%		3.15	%		14.35		22.71		5,835,284		110,745,734		30.00	%		33.29	%		2.37	%

N-137

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class
		2017			0.35	%		2.15	%	$	13.24	$	33.56		181,410	$	3,360,719		4.07	%		5.90	%		2.98	%
		2016			0.40	%		2.15	%		12.51		31.75		90,681		2,178,215		27.32	%		29.57	%		2.13	%
		2015			0.40	%		2.15	%		9.65		24.56		87,536		1,642,914		-8.82	%		-7.21	%		2.78	%
		2014			0.40	%		2.15	%		15.23		26.52		75,395		1,469,320		2.08	%		3.68	%		4.59	%
		2013			0.60	%		2.15	%		25.50		25.50		38,577		792,799		33.62	%		33.62	%		7.43	%
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class
		2017			0.60	%		3.20	%		11.41		12.87		29,932,926		366,876,336		10.29	%		13.19	%		1.21	%
		2016			0.60	%		3.20	%		10.34		11.37		24,557,411		268,442,037		11.48	%		14.42	%		1.04	%
		2015			0.60	%		3.20	%		9.28		9.94		18,004,358		173,814,321		-11.78	%		-9.45	%		0.70	%
		2014			0.60	%		3.20	%		10.52		10.96		8,275,647		89,207,699		-4.73	%		-2.27	%		1.30	%
		2013	5/20/13		0.65	%		3.20	%		11.04		11.22		2,436,000		27,146,121		2.73	%		11.29	%		2.08	%
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class
		2017			0.65	%		1.70	%		12.37		12.99		7,334		94,376		12.23	%		13.42	%		1.34	%
		2016			0.65	%		1.70	%		11.02		11.45		11,735		133,709		13.46	%		14.66	%		0.99	%
		2015			0.65	%		1.70	%		9.71		9.99		15,652		155,922		-10.23	%		-9.28	%		0.82	%
		2014			0.65	%		1.70	%		11.01		11.01		7,373		80,913		-2.04	%		-2.04	%		1.29	%
		2013	12/19/13		0.65	%		0.65	%		11.24		11.24		3,565		40,066		3.04	%		3.04	%		1.09	%
LVIP T. Rowe Price Growth Stock Fund - Service Class
		2017			0.10	%		3.20	%		16.14		29.81		14,256,459		302,611,791		29.17	%		32.96	%		0.00	%
		2016			0.30	%		3.20	%		12.18		23.02		14,466,377		233,936,283		-2.04	%		0.84	%		0.00	%
		2015			0.30	%		3.20	%		12.21		23.44		15,980,655		258,976,178		7.18	%		10.12	%		0.00	%
		2014			0.30	%		3.00	%		13.54		21.86		11,919,254		177,584,848		5.24	%		7.74	%		0.00	%
		2013			0.65	%		3.00	%		12.85		20.76		13,530,291		188,596,407		34.61	%		37.81	%		0.00	%
LVIP T. Rowe Price Growth Stock Fund - Standard Class
		2017			0.35	%		0.75	%		16.46		16.46		95,197		1,451,246		33.16	%		33.16	%		0.30	%
		2016			0.40	%		0.40	%		12.36		12.36		55,369		684,497		0.99	%		0.99	%		0.13	%
		2015			0.40	%		0.40	%		12.24		12.24		9,393		114,980		10.29	%		10.29	%		0.00	%
		2014	7/24/14		0.40	%		0.40	%		11.10		11.10		4,568		50,706		3.89	%		3.89	%		0.00	%
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class
		2017			0.10	%		3.45	%		14.77		37.85		5,555,963		163,178,882		20.52	%		24.06	%		0.00	%
		2016			0.30	%		3.20	%		12.08		30.83		4,745,656		116,828,253		3.91	%		6.97	%		0.05	%
		2015			0.30	%		3.20	%		15.54		29.13		4,884,187		115,246,446		-1.36	%		1.19	%		0.00	%
		2014			0.65	%		3.20	%		15.75		28.99		3,954,096		93,424,091		7.80	%		10.58	%		0.00	%
		2013			0.65	%		3.20	%		14.64		26.40		4,027,389		87,518,859		30.29	%		33.59	%		0.00	%
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class
		2017			0.35	%		3.10	%		14.85		39.54		161,317		3,968,180		21.06	%		24.25	%		0.22	%
		2016			0.40	%		3.00	%		12.13		32.11		109,223		2,922,167		4.37	%		7.13	%		0.27	%
		2015			0.40	%		3.00	%		15.90		30.25		109,041		2,836,264		-0.92	%		0.78	%		0.13	%
		2014			1.30	%		3.00	%		16.05		30.01		103,895		2,726,197		8.29	%		10.15	%		0.22	%
		2013			1.30	%		3.00	%		14.82		27.25		112,290		2,692,674		30.82	%		33.06	%		0.00	%
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class
		2017			0.30	%		3.20	%		10.54		11.28		81,839,204		905,126,333		11.32	%		14.20	%		1.63	%
		2016			0.65	%		3.20	%		9.50		9.88		59,973,879		584,411,163		0.75	%		3.14	%		1.32	%
		2015	5/18/15		0.65	%		3.00	%		9.43		9.58		24,692,694		235,159,439		-6.26	%		-0.07	%		2.32	%
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class
		2017			0.65	%		0.65	%		11.36		11.36		3,106		35,271		14.47	%		14.47	%		1.59	%
		2016			0.65	%		0.65	%		9.92		9.92		3,375		33,484		3.40	%		3.40	%		1.18	%
		2015	11/5/15		0.65	%		0.65	%		9.59		9.59		3,446		33,058		-1.90	%		-1.90	%		1.36	%
LVIP Vanguard Domestic Equity ETF Fund - Service Class
		2017			0.10	%		3.20	%		14.33		22.15		10,582,715		198,666,969		16.10	%		19.52	%		1.45	%
		2016			0.30	%		3.20	%		11.99		18.64		8,417,562		135,752,026		8.34	%		11.52	%		1.41	%
		2015			0.30	%		3.20	%		13.56		16.80		7,371,010		107,974,953		-3.69	%		-1.20	%		1.45	%
		2014			0.65	%		3.20	%		14.08		17.04		6,643,364		99,287,489		8.41	%		11.21	%		1.69	%
		2013			0.65	%		3.20	%		12.99		15.35		5,998,517		81,252,076		26.10	%		29.36	%		1.12	%

N-138

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
LVIP Vanguard Domestic Equity ETF Fund - Standard Class
		2017			0.40	%		1.90	%	$	14.41	$	20.60		79,446	$	1,369,285		17.91	%		19.69	%		2.06	%
		2016			0.40	%		1.90	%		12.04		17.24		37,903		615,616		10.03	%		11.69	%		1.63	%
		2015			0.40	%		1.90	%		10.78		15.47		36,788		530,619		-2.19	%		-0.71	%		1.74	%
		2014			0.40	%		1.90	%		14.89		15.61		31,272		451,338		10.10	%		11.54	%		2.01	%
		2013			0.60	%		1.90	%		13.53		13.99		27,270		375,037		28.07	%		29.74	%		1.36	%
LVIP Vanguard International Equity ETF Fund - Service Class
		2017			0.10	%		3.25	%		11.32		14.36		10,455,499		132,189,200		23.96	%		27.61	%		2.19	%
		2016			0.30	%		3.20	%		9.14		11.32		7,548,952		75,748,351		0.20	%		3.06	%		2.05	%
		2015			0.30	%		3.20	%		9.12		11.03		6,828,594		67,184,750		-6.24	%		-3.81	%		2.26	%
		2014			0.65	%		3.20	%		9.72		11.49		5,333,936		55,028,501		-7.88	%		-5.50	%		2.05	%
		2013			0.65	%		3.20	%		10.56		12.18		3,780,849		41,605,443		10.86	%		13.72	%		2.24	%
LVIP Vanguard International Equity ETF Fund - Standard Class
		2017			0.40	%		1.90	%		11.92		13.68		119,058		1,536,477		25.89	%		27.80	%		2.80	%
		2016			0.40	%		1.90	%		9.33		10.73		69,716		718,874		1.77	%		3.30	%		2.04	%
		2015			0.40	%		1.90	%		9.03		10.40		67,448		685,549		-4.78	%		-3.34	%		3.30	%
		2014			0.40	%		1.90	%		10.29		10.79		36,374		384,735		-6.44	%		-5.21	%		2.13	%
		2013			0.60	%		1.90	%		11.00		11.38		32,064		359,162		12.59	%		14.08	%		4.76	%
LVIP VIP Mid Cap Managed Volatility Portfolio - Service Class
		2015			0.60	%		3.20	%		9.28		9.65		7,058,558		66,898,619		-7.60	%		-5.36	%		0.41	%
		2014	5/23/14		0.60	%		3.00	%		10.04		10.19		1,133,185		11,470,979		-3.04	%		8.82	%		2.02	%
LVIP VIP Mid Cap Managed Volatility Portfolio - Standard Class
		2015	2/20/15		0.65	%		0.90	%		9.66		9.70		9,027		87,497		-8.13	%		0.22	%		0.85	%
LVIP Wellington Capital Growth Fund - Service Class
		2017			0.10	%		3.15	%		16.10		27.42		15,188,254		337,775,924		31.33	%		35.12	%		0.00	%
		2016			0.30	%		3.15	%		11.92		20.84		17,647,143		293,769,550		-3.24	%		-0.45	%		0.00	%
		2015			0.30	%		3.15	%		14.01		21.49		18,605,082		313,479,427		5.77	%		8.44	%		0.00	%
		2014			0.65	%		3.15	%		13.20		20.28		20,181,591		316,319,544		7.65	%		10.37	%		0.00	%
		2013			0.65	%		3.15	%		12.22		18.80		22,655,444		323,041,540		31.66	%		34.79	%		0.00	%
LVIP Wellington Capital Growth Fund - Standard Class
		2017	1/26/17		0.35	%		0.40	%		12.96		16.19		4,143		63,372		0.78	%		29.13	%		0.00	%
LVIP Wellington Mid-Cap Value Fund - Service Class
		2017			0.10	%		3.45	%		12.77		25.64		6,261,878		98,623,881		9.59	%		12.81	%		0.17	%
		2016			0.30	%		3.20	%		11.32		23.34		6,051,525		85,409,064		9.23	%		12.45	%		0.25	%
		2015			0.30	%		3.20	%		10.07		21.31		5,875,292		74,397,028		-4.85	%		-2.05	%		0.17	%
		2014			0.30	%		3.20	%		11.81		22.35		10,536,038		137,001,352		4.62	%		7.32	%		0.14	%
		2013			0.65	%		3.20	%		11.25		21.31		5,852,727		71,933,341		29.60	%		32.95	%		0.23	%
LVIP Wellington Mid-Cap Value Fund - Standard Class
		2017			0.35	%		0.40	%		12.84		12.84		26,709		340,987		12.98	%		12.98	%		0.46	%
		2016	1/19/16		0.40	%		0.40	%		11.37		11.37		22,294		253,400		27.63	%		27.63	%		0.56	%
LVIP Western Asset Core Bond Fund - Service Class
		2017	5/22/17		0.10	%		3.45	%		10.01		10.23		3,774,989		38,242,906		-0.77	%		1.72	%		2.93	%
LVIP Western Asset Core Bond Fund - Standard Class
		2017	6/5/17		0.35	%		1.85	%		10.13		10.23		60,907		622,101		0.26	%		1.38	%		2.61	%
MFS® VIT Core Equity Series - Service Class
		2015			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		0.63	%
		2014			1.30	%		2.65	%		16.11		23.66		128,539		2,602,187		8.07	%		9.54	%		0.53	%
		2013			1.30	%		2.65	%		14.89		21.60		150,821		2,787,669		30.72	%		32.50	%		0.79	%
MFS® VIT Growth Series - Initial Class
		2017			0.35	%		2.35	%		15.59		38.94		141,818		3,738,538		28.37	%		30.86	%		0.10	%
		2016			0.40	%		2.35	%		21.90		30.29		147,407		3,180,899		0.06	%		1.02	%		0.04	%
		2015			1.40	%		2.35	%		21.68		30.21		152,724		3,321,139		5.06	%		6.06	%		0.16	%
		2014			1.40	%		2.35	%		20.44		28.70		158,635		3,260,919		6.42	%		7.43	%		0.10	%
		2013			1.40	%		2.35	%		19.03		26.91		178,292		3,411,475		33.68	%		34.95	%		0.23	%

N-139

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
MFS® VIT Growth Series - Service Class
		2017			0.10	%		3.25	%	$	13.41	$	39.24		4,374,619	$	106,010,925		26.95	%		30.69	%		0.00	%
		2016			0.30	%		3.20	%		10.42		30.49		4,182,290		79,213,282		-0.79	%		1.87	%		0.00	%
		2015			0.30	%		2.95	%		10.38		30.40		3,425,811		64,088,413		4.18	%		6.61	%		0.00	%
		2014			0.65	%		3.15	%		9.85		28.86		2,896,838		50,741,615		5.31	%		7.98	%		0.00	%
		2013			0.65	%		3.15	%		9.23		27.05		2,388,555		39,011,618		32.26	%		35.61	%		0.13	%
MFS® VIT Total Return Series - Initial Class
		2017			0.35	%		2.35	%		20.44		24.73		278,559		6,619,317		9.68	%		10.74	%		2.22	%
		2016			1.40	%		2.35	%		18.64		22.33		342,775		7,575,360		6.56	%		7.57	%		2.59	%
		2015			1.40	%		2.35	%		17.49		20.76		368,176		7,565,445		-2.69	%		-1.76	%		2.55	%
		2014			1.40	%		2.35	%		17.97		21.13		434,113		9,082,276		5.97	%		6.99	%		1.83	%
		2013			1.40	%		2.35	%		16.96		19.75		523,192		10,232,408		16.28	%		17.39	%		1.72	%
MFS® VIT Total Return Series - Service Class
		2017			0.10	%		3.30	%		10.87		21.72		3,994,646		69,526,462		8.44	%		11.69	%		2.38	%
		2016			0.30	%		3.25	%		15.36		15.36		1,895,002		30,235,182		8.00	%		8.00	%		2.60	%
		2015			0.75	%		0.75	%		14.23		14.23		332		4,724		-1.33	%		-1.33	%		0.83	%
		2014	1/10/14		0.75	%		1.95	%		14.42		17.38		794		13,179		2.11	%		7.29	%		2.59	%
MFS® VIT Utilities Series - Initial Class
		2017			0.35	%		2.35	%		11.04		48.67		193,421		7,089,885		12.17	%		14.37	%		4.24	%
		2016			0.40	%		2.35	%		9.65		43.31		219,048		7,254,702		8.88	%		11.03	%		3.56	%
		2015			0.40	%		2.35	%		8.69		39.69		252,468		7,611,161		-16.51	%		-14.86	%		4.09	%
		2014			0.40	%		2.35	%		31.76		47.45		297,483		10,684,081		10.11	%		11.17	%		2.07	%
		2013			1.40	%		2.35	%		28.63		43.00		329,869		10,793,626		17.72	%		18.84	%		2.31	%
MFS® VIT Utilities Series - Service Class
		2017			0.10	%		3.20	%		10.97		49.05		7,073,394		194,445,127		10.89	%		14.15	%		4.04	%
		2016			0.30	%		3.20	%		9.61		43.64		7,967,828		195,373,173		7.73	%		10.90	%		3.37	%
		2015			0.30	%		3.20	%		12.12		39.96		8,343,493		187,475,679		-17.44	%		-15.31	%		3.95	%
		2014			0.65	%		3.20	%		14.69		47.76		8,596,870		233,370,004		8.92	%		11.74	%		1.91	%
		2013			0.65	%		3.20	%		13.48		43.26		8,857,378		217,755,613		16.43	%		19.44	%		2.07	%
MFS® VIT II Core Equity Portfolio - Service Class
		2017			1.30	%		2.65	%		20.58		31.33		95,676		2,491,102		21.26	%		22.90	%		0.71	%
		2016			1.30	%		2.65	%		16.95		25.50		103,555		2,204,695		8.17	%		9.63	%		0.44	%
		2015	3/27/15		1.30	%		2.65	%		15.65		23.26		118,784		2,350,101		-4.66	%		-3.67	%		0.29	%
MFS® VIT II International Value Portfolio - Initial Class
		2017			0.35	%		0.80	%		13.63		13.63		81,405		1,034,662		26.64	%		26.64	%		1.33	%
		2016			0.40	%		0.40	%		10.76		10.76		30,083		323,804		3.63	%		3.63	%		1.44	%
		2015			0.40	%		0.40	%		10.39		10.39		15,106		156,900		6.23	%		6.23	%		2.21	%
		2014	12/26/14		0.40	%		0.40	%		9.78		9.78		7,060		69,032		-1.37	%		-1.37	%		0.00	%
MFS® VIT II International Value Portfolio - Service Class
		2017			0.10	%		1.65	%		12.91		13.56		2,344,915		30,758,862		24.74	%		26.44	%		1.39	%
		2016			0.30	%		1.65	%		10.35		10.72		1,663,316		17,422,808		2.14	%		3.53	%		1.14	%
		2015			0.30	%		1.65	%		10.13		10.36		1,036,935		10,588,129		4.58	%		6.00	%		2.28	%
		2014	6/27/14		0.30	%		1.65	%		9.69		9.77		179,168		1,740,765		-4.68	%		-0.41	%		1.13	%
Morgan Stanley VIF Global Infrastructure Portfolio - Class I
		2017			0.35	%		0.75	%		11.80		11.80		26,362		292,297		12.51	%		12.51	%		2.31	%
		2016			0.40	%		0.40	%		10.49		10.49		7,195		75,482		14.81	%		14.81	%		1.99	%
		2015			0.40	%		0.40	%		9.14		9.14		4,879		44,586		-14.10	%		-14.10	%		1.79	%
		2014	7/24/14		0.40	%		0.40	%		10.64		10.64		4,651		49,489		-1.02	%		-1.02	%		0.00	%
Morgan Stanley VIF Global Infrastructure Portfolio - Class II
		2017			0.10	%		1.65	%		11.15		11.72		612,519		6,941,285		10.70	%		12.21	%		2.00	%
		2016			0.30	%		1.65	%		10.08		10.44		580,374		5,916,784		13.09	%		14.62	%		1.92	%
		2015			0.30	%		1.65	%		8.91		8.99		357,756		3,211,909		-15.30	%		-14.83	%		1.69	%
		2014	6/30/14		1.10	%		1.65	%		10.52		10.56		152,233		1,606,202		-0.23	%		1.01	%		0.00	%
Morgan Stanley VIF Growth Portfolio - Class II
		2017			0.65	%		2.55	%		23.48		53.68		56,773		2,392,408		39.23	%		41.89	%		0.00	%
		2016			0.65	%		2.55	%		21.51		37.83		51,141		1,581,220		-4.06	%		-2.56	%		0.00	%
		2015			0.65	%		2.30	%		18.10		38.83		54,729		1,801,323		9.42	%		11.24	%		0.00	%
		2014			0.65	%		2.30	%		19.90		34.90		59,632		1,743,735		3.68	%		5.40	%		0.00	%
		2013			0.65	%		2.30	%		18.74		33.11		70,080		1,998,069		44.51	%		46.76	%		0.21	%

N-140

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class
		2017			1.15	%		3.15	%	$	17.61	$	35.80		842,037	$	27,545,955		13.12	%		15.40	%		0.81	%
		2016			1.15	%		3.15	%		15.51		31.10		994,823		28,198,288		12.57	%		14.84	%		0.59	%
		2015			1.15	%		3.15	%		13.72		27.17		1,170,110		29,139,938		-10.96	%		-9.38	%		0.74	%
		2014			1.15	%		2.90	%		15.38		30.19		1,351,272		37,598,861		10.58	%		12.54	%		1.04	%
		2013			1.15	%		2.90	%		14.70		27.02		1,643,558		40,691,909		33.14	%		35.48	%		1.15	%
Oppenheimer Global Fund/VA Service Shares
		2017			0.65	%		2.20	%		18.15		34.20		304,884		9,047,815		33.36	%		35.44	%		0.73	%
		2016			0.65	%		2.20	%		13.59		25.25		354,127		7,763,619		-2.33	%		-0.80	%		0.72	%
		2015			0.65	%		2.20	%		13.89		25.45		360,739		7,985,822		1.42	%		3.00	%		1.06	%
		2014			0.65	%		2.20	%		13.68		24.71		396,094		8,514,677		-0.17	%		1.39	%		0.86	%
		2013			0.65	%		2.20	%		13.68		24.37		413,888		8,792,629		24.35	%		26.17	%		1.17	%
Oppenheimer International Growth Fund/VA Non-Service Shares
		2017			0.35	%		0.80	%		11.26		11.42		123,723		1,458,185		25.29	%		25.79	%		1.02	%
		2016			0.40	%		0.80	%		8.99		9.08		58,733		532,819		-2.90	%		-2.51	%		1.04	%
		2015			0.40	%		0.80	%		9.26		9.32		59,618		554,988		2.61	%		3.02	%		1.19	%
		2014	9/22/14		0.40	%		0.80	%		9.02		9.04		58,349		527,486		-3.86	%		2.07	%		0.00	%
Oppenheimer International Growth Fund/VA Service Shares
		2017			0.10	%		1.65	%		10.85		11.39		1,242,004		13,750,691		24.38	%		26.07	%		1.19	%
		2016			0.30	%		1.65	%		8.72		9.04		964,138		8,511,287		-4.31	%		-3.01	%		0.77	%
		2015			0.30	%		1.65	%		9.11		9.20		645,587		5,928,744		1.42	%		1.99	%		0.70	%
		2014	6/30/14		1.10	%		1.65	%		8.98		9.02		133,741		1,204,995		-9.94	%		-5.22	%		0.00	%
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares
		2017			0.35	%		0.40	%		13.93		13.93		43,802		605,697		13.70	%		13.70	%		0.84	%
		2016			0.40	%		0.40	%		12.25		12.25		39,236		480,830		17.58	%		17.58	%		0.49	%
		2015	1/20/15		0.40	%		0.40	%		10.42		10.42		3,478		36,248		-2.86	%		-2.86	%		1.20	%
Oppenheimer Main Street Small Cap Fund®/VA Service Shares
		2017			0.10	%		1.65	%		13.19		13.86		793,691		10,623,910		12.05	%		13.57	%		0.62	%
		2016			0.30	%		1.65	%		11.77		12.20		676,356		8,052,027		15.75	%		17.32	%		0.23	%
		2015			0.30	%		1.65	%		10.17		10.26		438,963		4,495,929		-7.63	%		-7.12	%		0.68	%
		2014	6/27/14		1.10	%		1.65	%		11.01		11.05		78,643		868,036		6.41	%		11.95	%		0.00	%
PIMCO VIT All Asset All Authority Portfolio - Advisor Class
		2017			0.10	%		1.65	%		9.72		9.91		319,974		3,168,388		9.16	%		9.76	%		5.59	%
		2016			0.30	%		1.65	%		8.94		9.03		190,951		1,712,857		11.86	%		12.31	%		2.97	%
		2015			1.10	%		1.50	%		7.99		8.04		111,256		891,058		-13.71	%		-13.36	%		2.96	%
		2014	7/10/14		1.10	%		1.65	%		9.25		9.28		80,259		744,225		-8.62	%		-6.62	%		6.83	%
PIMCO VIT All Asset All Authority Portfolio - Institutional Class
		2017			0.40	%		0.80	%		10.11		10.25		11,085		113,443		10.34	%		10.78	%		5.36	%
		2016			0.40	%		0.80	%		9.16		9.25		10,628		98,215		12.88	%		13.33	%		3.20	%
		2015			0.40	%		0.80	%		8.17		8.17		23,948		195,479		-12.52	%		-12.52	%		3.50	%
		2014	9/15/14		0.40	%		0.40	%		9.33		9.33		10,366		96,766		-6.31	%		-6.31	%		7.83	%
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class
		2017			0.30	%		2.75	%		6.40		8.72		1,540,717		12,482,715		-0.72	%		1.74	%		10.86	%
		2016			0.30	%		2.75	%		7.18		8.60		1,603,051		12,900,874		11.76	%		14.13	%		0.93	%
		2015			0.65	%		2.75	%		6.32		7.54		1,365,622		9,729,125		-27.68	%		-26.14	%		4.22	%
		2014			0.65	%		2.80	%		8.67		10.20		1,160,090		11,263,973		-20.83	%		-19.15	%		0.27	%
		2013			0.65	%		2.75	%		10.58		12.62		1,018,149		12,296,157		-16.86	%		-15.27	%		1.67	%
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class
		2017			0.40	%		0.40	%		6.43		6.43		5,141		33,086		1.99	%		1.99	%		11.28	%
		2016			0.40	%		0.40	%		6.31		6.31		4,810		30,337		14.76	%		14.76	%		1.15	%
		2015			0.40	%		0.40	%		5.50		5.50		5,175		28,443		-25.88	%		-25.88	%		1.79	%
		2014	9/12/14		0.40	%		0.40	%		7.41		7.41		556		4,126		-16.96	%		-16.96	%		0.28	%
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class
		2017			0.30	%		1.65	%		11.01		11.57		321,804		3,604,773		7.99	%		9.46	%		4.97	%
		2016			0.30	%		1.65	%		10.20		10.35		285,943		2,951,008		11.38	%		11.99	%		4.71	%
		2015			1.10	%		1.65	%		9.16		9.24		155,282		1,432,749		-3.94	%		-3.41	%		5.26	%
		2014	7/8/14		1.10	%		1.65	%		9.53		9.56		87,196		833,472		-7.47	%		-5.25	%		2.55	%

N-141

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class
		2017			0.40	%		0.40	%	$	11.63	$	11.63		2,762	$	32,120		9.62	%		9.62	%		5.24	%
		2016			0.40	%		0.40	%		10.61		10.61		2,220		23,565		13.06	%		13.06	%		5.06	%
		2015	5/11/15		0.40	%		0.40	%		9.39		9.39		697		6,547		-6.68	%		-6.68	%		3.63	%
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class
		2017			0.30	%		1.65	%		10.25		10.77		375,455		3,900,628		3.19	%		4.59	%		1.62	%
		2016			0.30	%		1.65	%		9.93		10.08		351,061		3,522,085		2.92	%		3.49	%		1.51	%
		2015			1.10	%		1.65	%		9.65		9.74		273,509		2,656,937		-3.39	%		-2.86	%		4.55	%
		2014	7/18/14		0.30	%		1.65	%		9.99		10.08		55,732		558,170		-0.62	%		0.23	%		0.62	%
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class
		2017			0.40	%		0.40	%		10.82		10.82		3,798		41,114		4.75	%		4.75	%		1.87	%
		2016			0.40	%		0.40	%		10.33		10.33		3,225		33,325		4.48	%		4.48	%		1.70	%
		2015	1/9/15		0.40	%		0.40	%		9.89		9.89		2,234		22,095		-1.86	%		-1.86	%		4.23	%
Putnam VT Absolute Return 500 Fund - Class IA
		2017	7/24/17		0.35	%		0.35	%		10.72		10.72		129		1,385		3.01	%		3.01	%		0.00	%
		2016			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		2.39	%
		2015	9/30/15		0.40	%		0.40	%		10.22		10.22		943		9,644		-0.20	%		-0.20	%		0.00	%
Putnam VT Absolute Return 500 Fund - Class IB
		2017			0.10	%		1.65	%		10.38		10.59		276,983		2,925,608		5.23	%		5.81	%		0.00	%
		2016			0.30	%		1.65	%		9.87		10.01		218,153		2,177,917		-0.95	%		-0.40	%		3.21	%
		2015			1.10	%		1.65	%		9.99		10.05		239,428		2,402,565		-2.02	%		-1.63	%		0.05	%
		2014	7/17/14		1.10	%		1.50	%		10.19		10.22		80,141		818,364		1.70	%		2.31	%		0.00	%
Putnam VT Equity Income Fund - Class IB
		2017	5/12/17		1.40	%		2.45	%		20.53		24.84		55,697		1,218,866		11.45	%		12.20	%		0.00	%
Putnam VT George Putnam Balanced Fund - Class IA
		2017	7/17/17		0.50	%		0.50	%		11.78		11.78		20,106		236,862		5.67	%		5.67	%		0.00	%
Putnam VT George Putnam Balanced Fund - Class IB
		2017	1/12/17		0.30	%		2.90	%		11.43		11.77		1,224,855		14,206,850		0.60	%		11.84	%		0.65	%
Putnam VT Global Health Care Fund - Class IA
		2017			0.35	%		0.40	%		10.27		10.27		12,688		132,917		15.14	%		15.14	%		0.20	%
		2016			0.40	%		0.40	%		8.92		8.92		2,153		19,211		-11.50	%		-11.50	%		0.00	%
		2015	8/20/15		0.40	%		0.40	%		10.08		10.08		1,939		19,563		-3.44	%		-3.44	%		0.00	%
Putnam VT Global Health Care Fund - Class IB
		2017			0.10	%		2.45	%		9.97		29.29		1,009,021		13,542,660		12.79	%		14.95	%		0.51	%
		2016			0.30	%		2.20	%		8.76		25.73		643,384		8,166,716		-13.28	%		-11.62	%		0.00	%
		2015			0.30	%		2.20	%		23.67		29.41		610,533		9,761,142		5.44	%		6.39	%		0.00	%
		2014			1.30	%		2.65	%		22.39		27.64		280,068		6,660,175		24.31	%		25.99	%		0.27	%
		2013			1.30	%		2.65	%		17.89		21.94		214,575		4,055,822		37.97	%		39.84	%		1.22	%
Putnam VT Growth & Income Fund - Class IB
		2017			0.00	%		0.00	%		—		—		—		—		0.00	%		0.00	%		2.06	%
		2016			1.40	%		2.45	%		17.59		21.62		65,333		1,220,820		12.35	%		13.42	%		1.61	%
		2015			1.30	%		2.35	%		15.59		19.24		74,485		1,229,146		-9.68	%		-8.73	%		1.90	%
		2014			1.30	%		2.35	%		14.04		21.30		96,045		1,738,887		8.16	%		9.30	%		1.33	%
		2013			1.30	%		2.35	%		12.97		19.70		105,381		1,744,914		32.53	%		33.93	%		1.56	%
Putnam VT Income Fund - Class IB
		2017			0.10	%		1.65	%		9.96		10.32		609,805		6,139,023		3.87	%		5.28	%		3.64	%
		2016			0.30	%		1.65	%		9.59		9.81		417,684		4,034,433		0.33	%		1.69	%		3.38	%
		2015	6/23/15		0.30	%		1.65	%		9.56		9.64		214,052		2,051,661		-2.97	%		-1.13	%		0.00	%
QS Variable Conservative Growth - Class II
		2017	6/26/17		0.30	%		2.65	%		10.62		10.78		90,766		970,818		2.28	%		5.70	%		5.25	%
Rational Dividend Capture VA Fund
		2017			1.10	%		2.20	%		12.87		13.84		92,981		1,268,081		-3.73	%		-2.68	%		3.36	%
		2016			1.10	%		2.20	%		13.37		14.22		98,442		1,382,651		4.64	%		5.80	%		4.43	%
		2015			1.10	%		2.20	%		12.77		13.44		89,058		1,182,870		-5.17	%		-4.11	%		4.15	%
		2014			1.10	%		2.20	%		13.47		14.02		100,138		1,389,923		7.76	%		8.95	%		5.21	%
		2013			1.10	%		2.20	%		12.50		12.87		104,189		1,331,206		17.35	%		18.65	%		3.04	%

N-142

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
SEI VP Market Growth Strategy Fund - Class III
		2017			1.10	%		1.65	%	$	11.22	$	11.45		233,687	$	2,647,538		11.90	%		12.52	%		1.58	%
		2016			1.10	%		1.65	%		10.03		10.17		174,241		1,759,951		5.68	%		6.26	%		3.15	%
		2015			1.10	%		1.65	%		9.55		9.58		83,604		797,918		-4.87	%		-4.72	%		1.43	%
		2014	7/16/14		1.10	%		1.25	%		10.04		10.05		25,852		259,802		-1.91	%		-0.84	%		5.61	%
SEI VP Market Plus Strategy Fund - Class III
		2017			0.30	%		1.50	%		11.89		12.42		170,795		2,054,693		16.59	%		18.00	%		1.42	%
		2016			0.30	%		1.50	%		10.20		10.53		173,755		1,786,887		6.55	%		7.83	%		1.86	%
		2015			0.30	%		1.50	%		9.61		9.76		150,117		1,444,007		-5.02	%		-4.11	%		0.96	%
		2014	7/2/14		0.30	%		1.25	%		10.12		10.18		109,455		1,107,606		-2.30	%		3.98	%		8.11	%
Templeton Foreign VIP Fund - Class 1
		2017			0.40	%		0.40	%		10.13		10.13		2,938		29,745		16.55	%		16.55	%		3.01	%
		2016			0.40	%		0.40	%		8.69		8.69		2,393		20,789		7.06	%		7.06	%		1.98	%
		2015			0.40	%		0.40	%		8.11		8.11		2,372		19,246		-6.68	%		-6.68	%		3.42	%
		2014	9/25/14		0.40	%		0.40	%		8.70		8.70		2,307		20,057		-9.49	%		-9.49	%		0.00	%
Templeton Foreign VIP Fund - Class 4
		2017			0.10	%		1.65	%		9.55		10.04		321,266		3,135,779		14.71	%		16.27	%		1.72	%
		2016			0.30	%		1.65	%		8.33		8.63		306,726		2,583,212		5.34	%		6.77	%		1.50	%
		2015			0.30	%		1.65	%		7.93		8.08		198,634		1,582,413		-8.04	%		-6.93	%		2.88	%
		2014	7/11/14		0.30	%		1.50	%		8.62		8.69		81,880		707,406		-13.21	%		-4.86	%		0.00	%
Templeton Global Bond VIP Fund - Class 1
		2017			0.35	%		0.80	%		9.84		9.98		233,204		2,376,982		1.34	%		1.75	%		0.00	%
		2016			0.40	%		0.80	%		9.70		9.81		157,097		1,539,327		2.38	%		2.80	%		0.00	%
		2015			0.40	%		0.80	%		9.54		9.54		163,072		1,555,040		-4.48	%		-4.48	%		7.78	%
		2014	9/15/14		0.40	%		0.40	%		9.99		9.99		96,642		965,253		-1.71	%		-1.71	%		0.00	%
Templeton Global Bond VIP Fund - Class 2
		2017			0.60	%		3.15	%		9.55		18.23		19,516,962		333,882,359		-1.24	%		1.32	%		0.00	%
		2016			0.60	%		3.15	%		9.54		18.11		20,761,360		354,728,144		-0.25	%		2.32	%		0.00	%
		2015			0.60	%		3.15	%		9.43		17.81		23,440,742		396,170,672		-7.27	%		-4.88	%		7.86	%
		2014			0.60	%		3.15	%		10.46		18.85		25,988,750		467,006,812		-1.33	%		1.17	%		5.08	%
		2013			0.65	%		3.15	%		10.60		18.74		29,046,516		521,571,310		-1.52	%		0.97	%		4.79	%
Templeton Global Bond VIP Fund - Class 4
		2017			0.10	%		1.65	%		9.41		9.89		2,739,153		26,207,074		0.10	%		1.46	%		0.00	%
		2016			0.30	%		1.65	%		9.40		9.74		1,888,622		17,954,067		1.19	%		2.56	%		0.00	%
		2015			0.30	%		1.65	%		9.29		9.50		1,375,882		12,874,602		-5.96	%		-4.68	%		7.03	%
		2014	6/30/14		0.30	%		1.65	%		9.88		9.97		398,338		3,945,389		-2.52	%		-1.89	%		0.00	%
Templeton Growth VIP Fund - Class 2
		2017			1.10	%		3.05	%		11.81		23.58		1,534,741		30,053,571		14.94	%		17.20	%		1.63	%
		2016			1.10	%		3.05	%		11.67		20.27		1,761,584		29,587,438		6.49	%		8.42	%		1.88	%
		2015			1.10	%		2.90	%		10.95		18.83		1,979,364		30,914,559		-9.16	%		-7.51	%		2.62	%
		2014			1.10	%		2.90	%		12.05		20.52		2,321,118		39,440,270		-5.60	%		-3.88	%		1.35	%
		2013			1.10	%		2.90	%		12.56		21.51		2,795,534		49,561,031		27.15	%		29.39	%		2.67	%
Transparent Value Directional Allocation VI Portfolio - Class I
		2015			0.40	%		0.40	%		9.67		9.67		3,434		33,213		-2.95	%		-2.95	%		0.00	%
		2014	7/25/14		0.40	%		0.40	%		9.96		9.96		3,511		34,995		-3.23	%		-3.23	%		0.00	%
Transparent Value Directional Allocation VI Portfolio - Class II
		2015			1.10	%		1.65	%		9.48		9.54		813,132		7,738,723		-4.21	%		-3.82	%		0.00	%
		2014	7/11/14		1.10	%		1.50	%		9.89		9.92		1,117,078		11,078,510		-3.44	%		6.83	%		0.00	%
VanEck VIP Global Hard Assets Fund - Class S Shares
		2017			0.30	%		1.65	%		6.66		7.00		532,159		3,604,212		-3.58	%		-2.27	%		0.00	%
		2016			0.30	%		1.65	%		6.91		7.16		433,003		3,035,987		41.07	%		42.98	%		0.26	%
		2015			0.30	%		1.65	%		4.90		5.01		251,082		1,241,231		-34.72	%		-33.82	%		0.02	%
		2014	7/10/14		0.30	%		1.65	%		7.50		7.57		81,965		616,806		-28.81	%		-22.40	%		0.00	%
VanEck VIP Global Hard Assets Fund - Initial Class Shares
		2017			0.35	%		0.40	%		7.04		7.04		49,305		383,603		-2.09	%		-2.09	%		0.00	%
		2016			0.40	%		0.40	%		7.19		7.19		41,596		299,092		43.14	%		43.14	%		0.36	%
		2015			0.40	%		0.40	%		5.02		5.02		45,049		226,309		-33.71	%		-33.71	%		0.02	%
		2014	7/24/14		0.40	%		0.80	%		7.56		7.58		25,206		191,019		-29.20	%		-24.78	%		0.00	%

N-143

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

3. Financial Highlights (continued)

Subaccount	Year		Commencement Date(1)	Minimum Fee Rate(2)			Maximum Fee Rate(2)			Minimum Unit Value(3)		Maximum Unit Value(3)		Units Outstanding		Net Assets		Minimum Total Return(4)			Maximum Total Return(4)			Investment Income Ratio(5)
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares
		2017			0.10	%		1.65	%	$	10.62	$	11.15		1,255,777	$	13,511,991		4.98	%		6.40	%		4.53	%
		2016			0.30	%		1.65	%		10.11		10.48		1,016,832		10,380,554		7.50	%		8.96	%		4.56	%
		2015			0.30	%		1.65	%		9.41		9.49		666,746		6,310,592		-2.87	%		-2.34	%		5.90	%
		2014	7/2/14		1.10	%		1.65	%		9.69		9.72		138,168		1,341,749		-4.16	%		-3.20	%		6.12	%
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares
		2017			0.35	%		0.75	%		11.22		11.22		111,639		1,213,760		6.57	%		6.57	%		6.18	%
		2016			0.40	%		0.40	%		10.52		10.52		1,263		13,293		9.15	%		9.15	%		4.41	%
		2015	6/25/15		0.40	%		0.40	%		9.64		9.64		1,263		12,189		-3.61	%		-3.61	%		2.92	%
Virtus Rampart Equity Trend Series - Class A Shares
		2017			1.10	%		1.65	%		10.09		10.30		141,275		1,445,650		18.47	%		19.12	%		0.00	%
		2016			1.10	%		1.65	%		8.52		8.64		138,067		1,188,526		-2.59	%		-2.05	%		0.00	%
		2015			1.10	%		1.65	%		8.75		8.83		381,314		3,361,190		-10.81	%		-10.32	%		0.00	%
		2014	7/15/14		0.30	%		1.65	%		9.81		9.89		267,587		2,631,015		-4.62	%		2.50	%		0.00	%
Virtus Rampart Equity Trend Series - Class I Shares
		2017	4/4/17		0.40	%		0.40	%		10.66		10.66		5		51		14.72	%		14.72	%		0.00	%
		2014	9/22/14		0.40	%		0.40	%		9.89		9.89		14,402		142,489		-3.90	%		-3.90	%		0.00	%

(1)  Reflects less than a full year of activity. Funds were first received in this option on the commencement date noted or the option was inactive at the date funds were received thereby a succeeding commencement date is disclosed.

(2)  These amounts represent the annualized minimum and maximum contract expenses of the separate account, consisting primarily of mortality and expense charges, for only those subaccounts which contain investments as of the respective year end. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts through the redemption of units and expenses of the underlying funds have been excluded.

(3)  As the unit value is presented as a range of minimum to maximum values for only those subaccounts which existed for the entire year, some individual contract unit values may not be within the ranges presented as a result of partial year activity.

(4)  These amounts represent the total return, including changes in value of mutual funds, and reflect deductions for all items included in the fee rate. The total return does not include contract charges deducted directly from policy account values. The total return is not annualized. As the total return is presented as a range of minimum to maximum values, for only those subaccounts which existed for the entire year, some individual contract total returns may not be within the ranges presented as a result of partial year activity.

(5)  These amounts represent the dividends, excluding distributions of capital gains, received by the subaccount from the underlying mutual fund, net of management fees assessed by the fund manager, divided by the average net assets. These ratios exclude those expenses, such as mortality and expense guarantee charges, that result in direct reductions in the unit values. The recognition of investment income by the subaccount is affected by the timing of the declaration of dividends by the underlying fund in which the subaccounts invest. Investment income ratios are not annualized.

Note: Fee rate, unit value and total return minimum and maximum are the same where there is only one active contract level charge for the subaccount.

N-144

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments

The aggregate cost of investments purchased and the aggregate proceeds from investments sold were as follows for 2017:

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
AB VPS Global Thematic Growth Portfolio - Class B	$	4,258,449	$	5,552,453
AB VPS Growth and Income Portfolio - Class B		9,546		9,512
AB VPS International Value Portfolio - Class B		1,811		3,551
AB VPS Large Cap Growth Portfolio - Class B		1,126,250		2,540,887
AB VPS Small/Mid Cap Value Portfolio - Class A		101,489		55,811
AB VPS Small/Mid Cap Value Portfolio - Class B		26,779,855		20,454,747
ALPS/Alerian Energy Infrastructure Portfolio - Class I		364,144		49,041
ALPS/Alerian Energy Infrastructure Portfolio - Class III		2,593,341		2,260,539
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		120,309		100,967
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		3,582,166		1,108,361
ALPS/Stadion Core ETF Portfolio - Class I		160		3,156
ALPS/Stadion Core ETF Portfolio - Class III		5,748,026		1,007,933
ALPS/Stadion Tactical Growth Portfolio - Class III		1,362,964		893,960
American Century VP Balanced Fund - Class I		91,496		22,438
American Century VP Balanced Fund - Class II		34,668,963		5,219,028
American Century VP Inflation Protection Fund - Class II		49,932		51,568
American Century VP Large Company Value Fund - Class I		368,551		22,834
American Century VP Large Company Value Fund - Class II		3,890,551		266,563
American Funds Asset Allocation Fund - Class 1		5,171,133		1,708,126
American Funds Asset Allocation Fund - Class 1A		4,254,310		251,237
American Funds Asset Allocation Fund - Class 4		37,647,021		8,855,406
American Funds Blue Chip Income and Growth Fund - Class 1		1,422,333		690,059
American Funds Blue Chip Income and Growth Fund - Class 1A		599,363		14,942
American Funds Blue Chip Income and Growth Fund - Class 4		12,907,844		5,177,072
American Funds Bond Fund - Class 1		2,873,101		174,259
American Funds Bond Fund - Class 1A		1,348,056		271,764
American Funds Capital Income Builder® - Class 1		111,853		115,639
American Funds Capital Income Builder® - Class 1A		810,373		364,394
American Funds Capital Income Builder® - Class 4		10,451,891		4,883,793
American Funds Global Balanced Fund - Class 1		22,831		101,712
American Funds Global Balanced Fund - Class 1A		242,236		250
American Funds Global Bond Fund - Class 1		619,651		162,523
American Funds Global Bond Fund - Class 1A		63,854		124
American Funds Global Growth and Income Fund - Class 1		250,109		599,016
American Funds Global Growth and Income Fund - Class 1A		117,603		3,271
American Funds Global Growth Fund - Class 1		376,403		874,955
American Funds Global Growth Fund - Class 1A		1,776,328		125,104
American Funds Global Growth Fund - Class 2		17,068,206		51,626,442
American Funds Global Growth Fund - Class 4		16,897,795		1,631,896
American Funds Global Small Capitalization Fund - Class 1		100,776		96,120
American Funds Global Small Capitalization Fund - Class 1A		159,676		446
American Funds Global Small Capitalization Fund - Class 2		4,788,627		65,668,452
American Funds Global Small Capitalization Fund - Class 4		4,182,690		718,430
American Funds Growth Fund - Class 1		2,424,105		1,314,191
American Funds Growth Fund - Class 1A		2,774,290		92,871
American Funds Growth Fund - Class 2		157,565,282		250,825,822
American Funds Growth Fund - Class 4		45,227,285		3,129,452
American Funds Growth-Income Fund - Class 1		2,074,647		497,359
American Funds Growth-Income Fund - Class 1A		2,099,600		22,954
American Funds Growth-Income Fund - Class 2		151,673,300		292,653,723
American Funds Growth-Income Fund - Class 4		30,759,183		2,450,199
American Funds High-Income Bond Fund - Class 1		568,578		142,874
American Funds High-Income Bond Fund - Class 1A		400,164		6,779
American Funds International Fund - Class 1		1,963,966		545,331
American Funds International Fund - Class 1A		1,648,038		118,414
American Funds International Fund - Class 2		21,032,198		116,362,836
American Funds International Fund - Class 4		13,765,035		2,521,703

N-145

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
American Funds International Growth and Income Fund - Class 1	$	318,650	$	327,630
American Funds International Growth and Income Fund - Class 1A		655,770		1,208
American Funds Managed Risk Asset Allocation Fund - Class P1		748,312		1,134,822
American Funds Managed Risk Asset Allocation Fund - Class P2		31,542,543		4,880,107
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		61,932		136,465
American Funds Managed Risk Growth Fund - Class P1		87,684		133,007
American Funds Managed Risk Growth-Income Fund - Class P1		73,528		74,458
American Funds Managed Risk International Fund - Class P1		130,650		166,529
American Funds Mortgage Fund - Class 1		57,583		10,162
American Funds Mortgage Fund - Class 1A		100,710		5,711
American Funds Mortgage Fund - Class 4		2,798,924		2,301,960
American Funds New World Fund® - Class 1		828,699		544,449
American Funds New World Fund® - Class 1A		625,070		13,005
American Funds New World Fund® - Class 4		7,415,639		2,414,682
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		16,351		76,589
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A		1,007,827		713,629
BlackRock Global Allocation V.I. Fund - Class I		984,666		188,516
BlackRock Global Allocation V.I. Fund - Class III		39,534,513		130,306,783
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		4,867		187
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		1,198,036		415,895
ClearBridge Variable Aggressive Growth Portfolio - Class I		130,801		35,824
ClearBridge Variable Aggressive Growth Portfolio - Class II		4,631,959		2,961,385
ClearBridge Variable Large Cap Growth Portfolio - Class I		326,616		905
ClearBridge Variable Large Cap Growth Portfolio - Class II		13,838,429		411,888
ClearBridge Variable Mid Cap Portfolio - Class I		229,959		30,801
ClearBridge Variable Mid Cap Portfolio - Class II		11,044,893		2,704,087
Columbia VP Commodity Strategy Fund - Class 1		164,104		2,127
Columbia VP Commodity Strategy Fund - Class 2		494,415		18,214
Columbia VP Emerging Markets Bond Fund - Class 1		375,350		116,954
Columbia VP Emerging Markets Bond Fund - Class 2		1,245,677		91,295
Columbia VP Strategic Income Fund - Class 1		43,099		43,310
Columbia VP Strategic Income Fund - Class 2		3,081,702		177,510
Delaware VIP® Diversified Income Series - Service Class		232,685,287		25,682,720
Delaware VIP® Diversified Income Series - Standard Class		2,778,320		894,882
Delaware VIP® Emerging Markets Series - Service Class		15,270,661		54,832,054
Delaware VIP® Emerging Markets Series - Standard Class		322,771		159,182
Delaware VIP® High Yield Series - Service Class		13,114,975		26,074,734
Delaware VIP® High Yield Series - Standard Class		2,714,079		5,214,006
Delaware VIP® International Value Equity Series - Standard Class		2,302		29,046
Delaware VIP® Limited-Term Diversified Income Series - Service Class		63,741,271		77,527,921
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		449,775		119,780
Delaware VIP® REIT Series - Service Class		31,599,170		25,647,365
Delaware VIP® REIT Series - Standard Class		749,255		631,698
Delaware VIP® Small Cap Value Series - Service Class		46,771,612		39,143,698
Delaware VIP® Small Cap Value Series - Standard Class		518,044		1,160,818
Delaware VIP® Smid Cap Core Series - Service Class		21,547,229		27,540,134
Delaware VIP® Smid Cap Core Series - Standard Class		344,951		1,196,650
Delaware VIP® U.S. Growth Series - Service Class		4,251,209		61,555,208
Delaware VIP® U.S. Growth Series - Standard Class		113,936		116,555
Delaware VIP® Value Series - Service Class		27,358,986		50,097,810
Delaware VIP® Value Series - Standard Class		1,135,477		1,740,552
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		354,636		166,937
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		5,755,980		6,860,564
Deutsche Equity 500 Index VIP Portfolio - Class A		654,670		1,584,324
Deutsche Small Cap Index VIP Portfolio - Class A		493,371		786,065
Eaton Vance VT Floating-Rate Income Fund - ADV Class		1,420,904		107,396
Eaton Vance VT Floating-Rate Income Fund - Initial Class		10,553,771		4,797,881
Fidelity® VIP Contrafund® Portfolio - Initial Class		364,781		165,305
Fidelity® VIP Contrafund® Portfolio - Service Class 2		84,259,547		110,105,805
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		6,506,172		718,646
Fidelity® VIP Growth Portfolio - Initial Class		804,229		838,643

N-146

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
Fidelity® VIP Growth Portfolio - Service Class 2	$	45,487,987	$	27,855,213
Fidelity® VIP Mid Cap Portfolio - Initial Class		804,439		266,873
Fidelity® VIP Mid Cap Portfolio - Service Class 2		53,075,072		63,379,454
Fidelity® VIP Overseas Portfolio - Service Class 2		9,034		9,031
Fidelity® VIP Strategic Income Portfolio - Initial Class		238,663		109,550
Fidelity® VIP Strategic Income Portfolio - Service Class 2		9,733,603		2,343,315
First Trust Dorsey Wright Tactical Core Portfolio - Class I		2,676,393		429,412
First Trust Multi Income Allocation Portfolio - Class I		1,406,485		1,061,735
First Trust Multi Income Allocation Portfolio - Class II		1,406		3,336
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		70,225,942		3,252,872
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		190,701		310
Franklin Founding Funds Allocation VIP Fund - Class 4		2,287,659		456,743
Franklin Income VIP Fund - Class 1		65,041		14,134
Franklin Income VIP Fund - Class 2		39,552,312		72,304,975
Franklin Income VIP Fund - Class 4		27,698,706		2,906,955
Franklin Mutual Shares VIP Fund - Class 1		247,108		32,317
Franklin Mutual Shares VIP Fund - Class 2		56,323,655		73,500,682
Franklin Mutual Shares VIP Fund - Class 4		11,680,397		732,720
Franklin Rising Dividends VIP Fund - Class 1		114,027		158,480
Franklin Rising Dividends VIP Fund - Class 4		5,974,968		2,045,576
Franklin Small Cap Value VIP Fund - Class 1		259,151		45,167
Franklin Small Cap Value VIP Fund - Class 4		2,722,651		1,682,450
Franklin Small-Mid Cap Growth VIP Fund - Class 1		111,531		97,743
Franklin Small-Mid Cap Growth VIP Fund - Class 4		2,580,223		754,384
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		1,336,702		2,331,943
Goldman Sachs VIT Government Money Market Fund - Service Shares		8,240,510		20,602,071
Goldman Sachs VIT Large Cap Value Fund - Service Shares		30,217,351		13,784,645
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		273,904		460,331
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		55,402		5,994
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		1,260,326		1,288,196
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		243		1,543
Guggenheim VT Long Short Equity		1,614,199		688,399
Guggenheim VT Multi-Hedge Strategies		1,221,787		863,617
Hartford Capital Appreciation HLS Fund - Class IA		34,006		29,065
Hartford Capital Appreciation HLS Fund - Class IC		3,064,145		1,287,412
Invesco V.I. American Franchise Fund - Series I Shares		274,169		451,637
Invesco V.I. American Franchise Fund - Series II Shares		126,118		111,806
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		592,495		21,238
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		4,720,116		2,218,996
Invesco V.I. Comstock Fund - Series I Shares		64,328		81,646
Invesco V.I. Comstock Fund - Series II Shares		1,708,607		457,657
Invesco V.I. Core Equity Fund - Series I Shares		404,112		1,150,562
Invesco V.I. Core Equity Fund - Series II Shares		132,036		359,496
Invesco V.I. Diversified Dividend Fund - Series I Shares		108,925		36,864
Invesco V.I. Diversified Dividend Fund - Series II Shares		6,008,453		2,986,941
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		173,939		139,964
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		57,746,268		4,140,108
Invesco V.I. Equity and Income Fund - Series I Shares		46,526		20,285
Invesco V.I. Equity and Income Fund - Series II Shares		8,314,546		910,797
Invesco V.I. International Growth Fund - Series I Shares		319,891		370,887
Invesco V.I. International Growth Fund - Series II Shares		14,449,249		3,628,912
Ivy VIP Asset Strategy Portfolio		832,479		1,758,761
Ivy VIP Energy Portfolio		3,659,536		3,501,204
Ivy VIP High Income Portfolio		8,985,548		2,949,060
Ivy VIP High Income Portfolio - Class I		110,572		5,148
Ivy VIP Micro Cap Growth Portfolio		1,898,507		1,256,033
Ivy VIP Micro Cap Growth Portfolio - Class I		103,236		96
Ivy VIP Mid Cap Growth Portfolio		2,482,791		447,831
Ivy VIP Mid Cap Growth Portfolio - Class I		370,325		8,440
Ivy VIP Science and Technology Portfolio		8,442,407		1,395,684
Ivy VIP Science and Technology Portfolio - Class I		185,742		28,929

N-147

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
Janus Henderson Balanced Portfolio - Service Shares	$	1,039,146	$	2,326,833
Janus Henderson Enterprise Portfolio - Service Shares		794,338		1,331,686
Janus Henderson Global Research Portfolio - Service Shares		15,905		182,407
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		889,380		60,247
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		47,641,250		660,823
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		2,762,488		850,622
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		55,345		394
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		1,035,691		231,012
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1		51,987		211,355
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2		2,001,828		11,841,001
Lincoln iShares® Global Growth Allocation Fund - Standard Class		602,708		96,514
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		763,592		16,126
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		10,262,826		2,339,820
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		2,206,643		846,930
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		1,716,964		1,722,800
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		13,234,156		6,440,484
LVIP American Balanced Allocation Fund - Service Class		22,494,912		3,370,010
LVIP American Balanced Allocation Fund - Standard Class		1,885,664		903,566
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		84,433,149		17,564,545
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		5,199,634		3,856,597
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		15,106		14,080
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		10,232,099		10,442,119
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		7,008		325,827
LVIP American Global Growth Fund - Service Class II		48,997,046		6,112,067
LVIP American Global Small Capitalization Fund - Service Class II		14,815,824		8,105,343
LVIP American Growth Allocation Fund - Service Class		12,380,460		2,195,852
LVIP American Growth Allocation Fund - Standard Class		566,794		1,496,974
LVIP American Growth Fund - Service Class II		127,486,942		8,454,969
LVIP American Growth-Income Fund - Service Class II		124,340,266		5,461,854
LVIP American Income Allocation Fund - Standard Class		26,908		5,550
LVIP American International Fund - Service Class II		37,996,574		11,243,969
LVIP American Preservation Fund - Service Class		2,262,960		2,260,898
LVIP American Preservation Fund - Standard Class		18,002		8,336
LVIP Baron Growth Opportunities Fund - Service Class		23,282,500		20,787,401
LVIP Baron Growth Opportunities Fund - Standard Class		117,273		75,246
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		81,963,720		42,450,987
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		133,250		21,976
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		34,294,009		101,523,181
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		2,995		5,401
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		116,359,618		1,357,923
LVIP BlackRock Inflation Protected Bond Fund - Service Class		76,896,543		37,944,996
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		1,180,987		63,260
LVIP BlackRock Multi-Asset Income Fund - Service Class		2,661,117		1,060,770
LVIP BlackRock Multi-Asset Income Fund - Standard Class		21,306		68,659
LVIP BlackRock Scientific Allocation Fund - Service Class		2,076,310		332,669
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		109,629,242		10,573,984
LVIP Blended Core Equity Managed Volatility Fund - Service Class		25,932,587		19,052,216
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		1,040		7,254
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		70,446,866		31,121,042
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class		206,869		526,489
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		14,663,359		52,416,357
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		72,243		85,392
LVIP Clarion Global Real Estate Fund - Service Class		10,308,007		11,162,293
LVIP Clarion Global Real Estate Fund - Standard Class		276,990		9,007
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		30,058,272		3,728,166
LVIP Delaware Bond Fund - Service Class		354,087,770		53,781,522
LVIP Delaware Bond Fund - Standard Class		5,199,575		14,427,637
LVIP Delaware Diversified Floating Rate Fund - Service Class		89,708,531		32,285,736
LVIP Delaware Diversified Floating Rate Fund - Standard Class		1,327,002		734,150
LVIP Delaware Social Awareness Fund - Service Class		9,171,245		10,603,657
LVIP Delaware Social Awareness Fund - Standard Class		990,400		1,358,750

N-148

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
LVIP Delaware Special Opportunities Fund - Service Class	$	21,143,997	$	6,528,416
LVIP Delaware Wealth Builder Fund - Service Class		4,729,097		5,204,684
LVIP Delaware Wealth Builder Fund - Standard Class		563,763		561,937
LVIP Dimensional International Core Equity Fund - Service Class		27,774,524		1,392,274
LVIP Dimensional International Core Equity Fund - Standard Class		1,923,946		405,928
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		59,754,848		17,051,070
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		137,885		309,293
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		34,383,493		8,810,242
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		3,218,340		1,164,483
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		23,969,470		6,542,386
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		2,055,547		449,306
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		102,607,843		24,830,661
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		281,722		1,834,684
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		107,826,054		14,459,522
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		4,665,217		1,696,558
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		40,820,524		62,953,475
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		5,945,622		957,351
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		13,716		—
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		47,685,366		16,412,724
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		476		12
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		40,153,684		193,905,323
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		6,256		4,509
LVIP Global Growth Allocation Managed Risk Fund - Service Class		268,401,287		825,761,679
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		2,752,795		171,572
LVIP Global Income Fund - Service Class		52,938,170		21,292,211
LVIP Global Income Fund - Standard Class		124,328		47,847
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		204,195,334		707,337,057
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		333,757		50,708
LVIP Goldman Sachs Income Builder Fund - Service Class		6,329,632		952,052
LVIP Goldman Sachs Income Builder Fund - Standard Class		23,841		8,642
LVIP Government Money Market Fund - Service Class		122,307,218		131,906,603
LVIP Government Money Market Fund - Standard Class		16,295,981		19,808,188
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		49,159,636		13,454,210
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		7,988,939		14,136,443
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		1,851		6,796
LVIP JPMorgan High Yield Fund - Service Class		38,036,662		29,156,101
LVIP JPMorgan High Yield Fund - Standard Class		237,330		63,106
LVIP JPMorgan Retirement Income Fund - Service Class		1,598,349		43,198
LVIP JPMorgan Retirement Income Fund - Standard Class		788,446		872
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		48,202,998		30,779,002
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		177,955		176,485
LVIP Managed Risk Profile 2010 Fund - Service Class		1,468,947		1,135,510
LVIP Managed Risk Profile 2020 Fund - Service Class		569,874		1,399,803
LVIP Managed Risk Profile 2030 Fund - Service Class		555,252		892,038
LVIP Managed Risk Profile 2040 Fund - Service Class		1,468,097		1,117,596
LVIP MFS International Equity Managed Volatility Fund - Service Class		52,060,959		15,252,230
LVIP MFS International Growth Fund - Service Class		13,480,733		20,481,027
LVIP MFS International Growth Fund - Standard Class		82,369		113,445
LVIP MFS Value Fund - Service Class		54,264,204		69,415,842
LVIP MFS Value Fund - Standard Class		1,477,531		64,620
LVIP Mondrian International Value Fund - Service Class		15,416,492		48,678,710
LVIP Mondrian International Value Fund - Standard Class		626,636		2,056,632
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		12,744,075		3,407,489
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		4,567		1,755
LVIP PIMCO Low Duration Bond Fund - Service Class		84,677,543		36,402,283
LVIP PIMCO Low Duration Bond Fund - Standard Class		2,616,167		639,023
LVIP Select Core Equity Managed Volatility Fund - Service Class		18,413,061		58,728,088
LVIP Select Core Equity Managed Volatility Fund - Standard Class		4,057		97,906
LVIP SSGA Bond Index Fund - Service Class		72,433,016		60,857,402
LVIP SSGA Bond Index Fund - Standard Class		1,602,872		84,182
LVIP SSGA Conservative Index Allocation Fund - Service Class		8,478,503		10,516,706

N-149

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
LVIP SSGA Conservative Structured Allocation Fund - Service Class	$	15,782,169	$	21,895,337
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		117,150		58,831
LVIP SSGA Developed International 150 Fund - Service Class		20,957,790		19,670,498
LVIP SSGA Developed International 150 Fund - Standard Class		196,861		96,343
LVIP SSGA Emerging Markets 100 Fund - Service Class		19,569,995		26,860,833
LVIP SSGA Emerging Markets 100 Fund - Standard Class		1,031,432		339,363
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		47,501,015		92,179,322
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		176,388		27,026
LVIP SSGA International Index Fund - Service Class		23,129,396		38,385,489
LVIP SSGA International Index Fund - Standard Class		1,978,763		665,682
LVIP SSGA International Managed Volatility Fund - Service Class		20,418,039		47,158,485
LVIP SSGA International Managed Volatility Fund - Standard Class		37,131		54,073
LVIP SSGA Large Cap 100 Fund - Service Class		74,574,005		34,860,823
LVIP SSGA Large Cap 100 Fund - Standard Class		1,116,780		429,581
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		67,662,157		15,165,120
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		628		1,861
LVIP SSGA Mid-Cap Index Fund - Service Class		32,714,888		1,322,847
LVIP SSGA Mid-Cap Index Fund - Standard Class		1,278,051		122,145
LVIP SSGA Moderate Index Allocation Fund - Service Class		25,078,700		21,965,558
LVIP SSGA Moderate Index Allocation Fund - Standard Class		185,952		156,624
LVIP SSGA Moderate Structured Allocation Fund - Service Class		60,563,809		75,025,187
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		40,801		52,339
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		20,428,796		16,805,231
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		281,879		359
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		50,748,751		42,041,909
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		1,689,671		29,111
LVIP SSGA S&P 500 Index Fund - Service Class		96,828,162		75,657,030
LVIP SSGA S&P 500 Index Fund - Standard Class		7,125,362		6,048,099
LVIP SSGA Small-Cap Index Fund - Service Class		34,682,809		27,343,263
LVIP SSGA Small-Cap Index Fund - Standard Class		3,272,111		354,380
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		32,880,639		16,428,488
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		1,708,106		370,443
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		71,274,297		12,095,309
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		5,421		56,248
LVIP T. Rowe Price Growth Stock Fund - Service Class		30,271,192		32,033,365
LVIP T. Rowe Price Growth Stock Fund - Standard Class		672,340		159,778
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		30,178,634		9,046,284
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		1,135,671		714,903
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		258,252,100		19,068,144
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		929		3,190
LVIP Vanguard Domestic Equity ETF Fund - Service Class		51,862,464		16,114,952
LVIP Vanguard Domestic Equity ETF Fund - Standard Class		698,318		95,445
LVIP Vanguard International Equity ETF Fund - Service Class		41,392,984		6,390,148
LVIP Vanguard International Equity ETF Fund - Standard Class		906,376		300,979
LVIP Wellington Capital Growth Fund - Service Class		23,576,104		55,542,151
LVIP Wellington Capital Growth Fund - Standard Class		187,378		129,221
LVIP Wellington Mid-Cap Value Fund - Service Class		13,674,332		9,830,667
LVIP Wellington Mid-Cap Value Fund - Standard Class		91,458		34,334
LVIP Western Asset Core Bond Fund - Service Class		38,985,698		643,359
LVIP Western Asset Core Bond Fund - Standard Class		628,258		1,869
MFS® VIT Growth Series - Initial Class		733,042		988,062
MFS® VIT Growth Series - Service Class		16,186,237		10,234,485
MFS® VIT Total Return Series - Initial Class		549,642		1,991,980
MFS® VIT Total Return Series - Service Class		41,689,492		5,427,212
MFS® VIT Utilities Series - Initial Class		461,890		1,329,778
MFS® VIT Utilities Series - Service Class		13,284,609		33,194,848
MFS® VIT II Core Equity Portfolio - Service Class		176,085		243,519
MFS® VIT II International Value Portfolio - Initial Class		690,386		105,225
MFS® VIT II International Value Portfolio - Service Class		10,959,365		2,701,044
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		252,723		38,078
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		2,534,102		1,847,580

N-150

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

4. Purchases and Sales of Investments (continued)

Subaccount	Aggregate Cost of Purchases		Aggregate Proceeds from Sales
Morgan Stanley VIF Growth Portfolio - Class II	$	868,317	$	588,556
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		804,394		5,561,320
Oppenheimer Global Fund/VA Service Shares		459,741		1,745,715
Oppenheimer International Growth Fund/VA Non-Service Shares		803,577		37,409
Oppenheimer International Growth Fund/VA Service Shares		4,901,482		1,993,197
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		149,804		64,966
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		3,223,356		1,229,778
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		1,656,899		296,039
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		11,882		2,154
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		5,227,007		4,396,975
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		5,510		128
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		1,593,054		1,042,509
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		78,821		71,523
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		908,659		651,471
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		6,624		23
Putnam VT Absolute Return 500 Fund - Class IA		1,345		2
Putnam VT Absolute Return 500 Fund - Class IB		962,254		379,412
Putnam VT Equity Income Fund - Class IB		1,277,319		203,619
Putnam VT George Putnam Balanced Fund - Class IA		232,340		584
Putnam VT George Putnam Balanced Fund - Class IB		14,499,296		1,232,943
Putnam VT Global Health Care Fund - Class IA		178,200		68,930
Putnam VT Global Health Care Fund - Class IB		8,501,670		3,802,260
Putnam VT Growth & Income Fund - Class IB		202,843		1,319,611
Putnam VT Income Fund - Class IB		2,448,810		412,518
QS Variable Conservative Growth - Class II		1,083,716		15,916
Rational Dividend Capture VA Fund		152,334		205,362
SEI VP Market Growth Strategy Fund - Class III		1,915,073		1,274,436
SEI VP Market Plus Strategy Fund - Class III		89,138		112,086
Templeton Foreign VIP Fund - Class 1		6,587		691
Templeton Foreign VIP Fund - Class 4		898,291		669,390
Templeton Global Bond VIP Fund - Class 1		1,143,364		319,726
Templeton Global Bond VIP Fund - Class 2		9,055,061		36,076,593
Templeton Global Bond VIP Fund - Class 4		9,429,857		1,335,981
Templeton Growth VIP Fund - Class 2		2,641,523		6,751,223
VanEck VIP Global Hard Assets Fund - Class S Shares		1,872,534		1,191,636
VanEck VIP Global Hard Assets Fund - Initial Class Shares		167,864		86,357
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		3,919,854		1,005,637
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares		1,454,443		245,939
Virtus Rampart Equity Trend Series - Class A Shares		144,290		94,364
Virtus Rampart Equity Trend Series - Class I Shares		45		—

5. Investments

The following is a summary of investments owned at December 31, 2017:

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
AB VPS Global Thematic Growth Portfolio - Class B		1,086,905	$	29.25	$	31,791,974	$	22,706,338
AB VPS International Value Portfolio - Class B		76		16.15		1,232		1,137
AB VPS Large Cap Growth Portfolio - Class B		190,457		53.70		10,227,533		7,783,089
AB VPS Small/Mid Cap Value Portfolio - Class A		21,162		21.68		458,783		405,745
AB VPS Small/Mid Cap Value Portfolio - Class B		9,897,366		21.48		212,595,435		183,514,838
ALPS/Alerian Energy Infrastructure Portfolio - Class I		57,192		9.55		546,186		571,204
ALPS/Alerian Energy Infrastructure Portfolio - Class III		594,890		9.53		5,669,303		5,657,650
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		4,224		12.90		54,487		49,924
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		685,822		13.50		9,258,599		7,901,486
ALPS/Stadion Core ETF Portfolio - Class I		5,064		11.83		59,908		51,678
ALPS/Stadion Core ETF Portfolio - Class III		830,782		12.09		10,044,151		9,110,372
ALPS/Stadion Tactical Growth Portfolio - Class III		428,637		11.59		4,967,899		4,297,478

N-151

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
American Century VP Balanced Fund - Class I		9,520	$	7.53	$	71,689	$	69,180
American Century VP Balanced Fund - Class II		6,673,814		7.53		50,253,819		48,119,934
American Century VP Inflation Protection Fund - Class II		2,528		10.21		25,808		26,318
American Century VP Large Company Value Fund - Class I		22,354		15.77		352,524		346,130
American Century VP Large Company Value Fund - Class II		235,054		16.00		3,760,866		3,632,775
American Funds Asset Allocation Fund - Class 1		795,058		23.71		18,850,822		17,231,537
American Funds Asset Allocation Fund - Class 1A		172,855		23.69		4,094,939		4,007,323
American Funds Asset Allocation Fund - Class 4		5,362,700		23.40		125,487,181		115,642,307
American Funds Blue Chip Income and Growth Fund - Class 1		300,145		14.96		4,490,177		4,014,960
American Funds Blue Chip Income and Growth Fund - Class 1A		41,417		14.94		618,777		584,535
American Funds Blue Chip Income and Growth Fund - Class 4		2,023,685		14.77		29,889,830		27,444,307
American Funds Bond Fund - Class 1		587,262		10.82		6,354,179		6,431,597
American Funds Bond Fund - Class 1A		98,324		10.80		1,061,900		1,073,938
American Funds Capital Income Builder® - Class 1		96,526		10.40		1,003,868		931,986
American Funds Capital Income Builder® - Class 1A		43,751		10.39		454,571		446,352
American Funds Capital Income Builder® - Class 4		3,357,475		10.38		34,850,589		32,882,218
American Funds Global Balanced Fund - Class 1		43,624		12.75		556,205		492,530
American Funds Global Balanced Fund - Class 1A		18,752		12.74		238,904		241,988
American Funds Global Bond Fund - Class 1		238,052		11.88		2,828,055		2,799,025
American Funds Global Bond Fund - Class 1A		5,393		11.87		64,019		63,732
American Funds Global Growth and Income Fund - Class 1		89,530		15.81		1,415,463		1,180,687
American Funds Global Growth and Income Fund - Class 1A		7,550		15.81		119,373		114,498
American Funds Global Growth Fund - Class 1		73,118		30.51		2,230,836		1,989,198
American Funds Global Growth Fund - Class 1A		56,777		30.46		1,729,428		1,654,141
American Funds Global Growth Fund - Class 2		10,207,424		30.24		308,672,518		241,107,811
American Funds Global Growth Fund - Class 4		1,250,172		30.13		37,667,688		33,577,791
American Funds Global Small Capitalization Fund - Class 1		57,034		25.38		1,447,519		1,292,492
American Funds Global Small Capitalization Fund - Class 1A		7,163		25.36		181,654		159,266
American Funds Global Small Capitalization Fund - Class 2		16,495,860		24.72		407,777,664		333,899,807
American Funds Global Small Capitalization Fund - Class 4		405,453		24.91		10,099,844		9,333,446
American Funds Growth Fund - Class 1		136,268		77.85		10,608,494		9,689,590
American Funds Growth Fund - Class 1A		36,062		77.74		2,803,489		2,682,374
American Funds Growth Fund - Class 2		19,328,742		77.35		1,495,078,161		1,159,370,427
American Funds Growth Fund - Class 4		1,371,020		76.56		104,965,253		95,646,166
American Funds Growth-Income Fund - Class 1		132,435		50.22		6,650,910		6,213,779
American Funds Growth-Income Fund - Class 1A		43,035		50.15		2,158,202		2,077,809
American Funds Growth-Income Fund - Class 2		39,299,081		49.71		1,953,557,336		1,549,100,584
American Funds Growth-Income Fund - Class 4		1,401,917		49.31		69,128,536		64,758,801
American Funds High-Income Bond Fund - Class 1		169,837		10.19		1,730,644		1,802,222
American Funds High-Income Bond Fund - Class 1A		38,054		10.18		387,389		393,444
American Funds International Fund - Class 1		285,268		21.71		6,193,159		5,402,017
American Funds International Fund - Class 1A		74,968		21.67		1,624,555		1,535,011
American Funds International Fund - Class 2		32,669,467		21.63		706,640,566		588,364,265
American Funds International Fund - Class 4		1,492,091		21.42		31,960,600		28,588,383
American Funds International Growth and Income Fund - Class 1		98,207		17.72		1,740,232		1,640,638
American Funds International Growth and Income Fund - Class 1A		37,508		17.70		663,897		654,587
American Funds Managed Risk Asset Allocation Fund - Class P1		65,005		13.59		883,412		850,662
American Funds Managed Risk Asset Allocation Fund - Class P2		7,807,022		13.55		105,785,147		95,090,690
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		6,474		13.04		84,417		73,700
American Funds Managed Risk Growth Fund - Class P1		7,966		13.22		105,312		87,227
American Funds Managed Risk Growth-Income Fund - Class P1		2,065		12.66		26,142		24,197
American Funds Managed Risk International Fund - Class P1		1,409		11.25		15,846		14,852
American Funds Mortgage Fund - Class 1		39,878		10.47		417,527		425,044
American Funds Mortgage Fund - Class 1A		8,961		10.46		93,728		95,018
American Funds Mortgage Fund - Class 4		488,248		10.38		5,068,017		5,178,892
American Funds New World Fund® - Class 1		164,628		25.30		4,165,079		3,522,906
American Funds New World Fund® - Class 1A		25,722		25.25		649,475		612,534
American Funds New World Fund® - Class 4		964,503		24.99		24,102,936		19,994,645
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		15,544		12.08		187,775		192,945
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A		24,254		12.08		292,991		294,397
BlackRock Global Allocation V.I. Fund - Class I		287,715		17.26		4,965,963		4,695,625

N-152

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
BlackRock Global Allocation V.I. Fund - Class III		77,282,882	$	14.84	$	1,146,877,979	$	1,094,403,432
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		1,343		11.14		14,959		14,065
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		400,504		11.10		4,445,593		4,281,184
ClearBridge Variable Aggressive Growth Portfolio - Class I		11,391		27.18		309,605		324,385
ClearBridge Variable Aggressive Growth Portfolio - Class II		833,121		26.78		22,310,972		23,533,266
ClearBridge Variable Large Cap Growth Portfolio - Class I		13,650		24.63		336,206		325,752
ClearBridge Variable Large Cap Growth Portfolio - Class II		557,966		24.58		13,714,813		13,460,756
ClearBridge Variable Mid Cap Portfolio - Class I		26,358		20.23		533,232		515,474
ClearBridge Variable Mid Cap Portfolio - Class II		1,553,589		20.12		31,258,208		29,653,768
Columbia VP Commodity Strategy Fund - Class 1		27,285		6.05		165,074		161,941
Columbia VP Commodity Strategy Fund - Class 2		81,769		6.00		490,615		476,205
Columbia VP Emerging Markets Bond Fund - Class 1		25,232		10.15		256,103		259,736
Columbia VP Emerging Markets Bond Fund - Class 2		114,641		10.15		1,163,607		1,155,499
Columbia VP Strategic Income Fund - Class 2		705,883		4.14		2,922,354		2,904,766
Delaware VIP® Diversified Income Series - Service Class		192,704,667		10.46		2,015,690,814		2,030,676,436
Delaware VIP® Diversified Income Series - Standard Class		620,321		10.54		6,538,179		6,511,068
Delaware VIP® Emerging Markets Series - Service Class		13,662,348		24.97		341,148,828		262,863,175
Delaware VIP® Emerging Markets Series - Standard Class		20,859		25.06		522,718		422,515
Delaware VIP® High Yield Series - Service Class		24,925,974		5.18		129,116,550		134,530,689
Delaware VIP® High Yield Series - Standard Class		555,110		5.20		2,886,572		2,859,256
Delaware VIP® International Value Equity Series - Standard Class		8,847		13.39		118,458		110,376
Delaware VIP® Limited-Term Diversified Income Series - Service Class		129,321,467		9.76		1,262,177,517		1,279,683,336
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		147,089		9.83		1,445,890		1,452,952
Delaware VIP® REIT Series - Service Class		11,542,976		13.46		155,368,450		156,798,108
Delaware VIP® REIT Series - Standard Class		231,876		13.49		3,128,002		3,106,356
Delaware VIP® Small Cap Value Series - Service Class		9,407,883		42.52		400,023,182		319,765,661
Delaware VIP® Small Cap Value Series - Standard Class		168,574		42.73		7,203,155		6,336,195
Delaware VIP® Smid Cap Core Series - Service Class		6,428,849		29.41		189,072,441		166,187,982
Delaware VIP® Smid Cap Core Series - Standard Class		233,922		30.98		7,246,904		5,483,931
Delaware VIP® U.S. Growth Series - Service Class		29,953,929		11.00		329,493,224		284,630,690
Delaware VIP® Value Series - Service Class		10,029,975		31.46		315,543,007		248,514,263
Delaware VIP® Value Series - Standard Class		217,319		31.57		6,860,767		6,123,380
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		92,861		13.61		1,263,843		1,247,644
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		4,034,988		13.59		54,835,493		54,288,740
Deutsche Equity 500 Index VIP Portfolio - Class A		261,515		22.19		5,803,015		4,070,630
Deutsche Small Cap Index VIP Portfolio - Class A		199,024		18.29		3,640,154		2,711,224
Eaton Vance VT Floating-Rate Income Fund - ADV Class		381,735		9.28		3,542,544		3,505,416
Eaton Vance VT Floating-Rate Income Fund - Initial Class		1,864,889		9.27		17,287,541		17,162,011
Fidelity® VIP Contrafund® Portfolio - Initial Class		46,254		37.94		1,754,864		1,552,106
Fidelity® VIP Contrafund® Portfolio - Service Class 2		30,619,154		37.05		1,134,439,654		852,477,468
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		449,541		13.48		6,059,816		5,815,736
Fidelity® VIP Growth Portfolio - Initial Class		66,629		74.05		4,933,873		4,536,327
Fidelity® VIP Growth Portfolio - Service Class 2		3,042,669		72.86		221,688,859		170,389,997
Fidelity® VIP Mid Cap Portfolio - Initial Class		48,706		38.94		1,896,595		1,690,550
Fidelity® VIP Mid Cap Portfolio - Service Class 2		15,450,148		37.79		583,861,080		485,087,880
Fidelity® VIP Strategic Income Portfolio - Initial Class		52,650		11.50		605,475		600,111
Fidelity® VIP Strategic Income Portfolio - Service Class 2		1,358,014		11.40		15,481,363		15,380,929
First Trust Dorsey Wright Tactical Core Portfolio - Class I		405,552		11.41		4,627,349		4,198,721
First Trust Multi Income Allocation Portfolio - Class I		513,484		10.89		5,591,837		5,378,411
First Trust Multi Income Allocation Portfolio - Class II		4,509		10.88		49,060		47,382
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		6,260,541		13.73		85,957,226		83,447,776
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		13,852		13.75		190,467		196,299
Franklin Founding Funds Allocation VIP Fund - Class 4		1,109,871		7.53		8,357,329		8,002,820
Franklin Income VIP Fund - Class 1		9,726		16.72		162,613		150,485
Franklin Income VIP Fund - Class 2		35,132,779		16.17		568,097,041		529,646,003
Franklin Income VIP Fund - Class 4		3,125,320		16.53		51,661,547		49,458,752
Franklin Mutual Shares VIP Fund - Class 1		41,550		20.71		860,500		836,293
Franklin Mutual Shares VIP Fund - Class 2		35,817,877		20.36		729,251,982		632,164,590
Franklin Mutual Shares VIP Fund - Class 4		802,900		20.53		16,483,526		16,613,819
Franklin Rising Dividends VIP Fund - Class 1		23,732		29.21		693,213		634,021
Franklin Rising Dividends VIP Fund - Class 4		789,061		28.54		22,519,799		20,426,789

N-153

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
Franklin Small Cap Value VIP Fund - Class 1		30,173	$	20.43	$	616,431	$	607,318
Franklin Small Cap Value VIP Fund - Class 4		356,099		20.22		7,200,313		6,829,353
Franklin Small-Mid Cap Growth VIP Fund - Class 1		11,921		19.71		234,967		220,638
Franklin Small-Mid Cap Growth VIP Fund - Class 4		295,750		18.47		5,462,498		5,411,387
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		456,100		1.00		456,100		456,100
Goldman Sachs VIT Government Money Market Fund - Service Shares		35,105,257		1.00		35,105,257		35,105,257
Goldman Sachs VIT Large Cap Value Fund - Service Shares		17,046,712		9.06		154,443,213		168,978,555
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		261,406		9.36		2,446,762		2,494,032
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		11,433		9.39		107,356		108,049
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		552,062		8.84		4,880,224		5,120,000
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		2,542		8.87		22,543		23,352
Guggenheim VT Long Short Equity		273,634		17.59		4,813,218		4,296,436
Guggenheim VT Multi-Hedge Strategies		189,421		24.83		4,703,327		4,547,551
Hartford Capital Appreciation HLS Fund - Class IA		2,059		48.16		99,166		105,680
Hartford Capital Appreciation HLS Fund - Class IC		243,579		47.76		11,633,333		11,486,540
Invesco V.I. American Franchise Fund - Series I Shares		43,078		62.97		2,712,634		1,805,075
Invesco V.I. American Franchise Fund - Series II Shares		24,579		60.80		1,494,402		1,112,782
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		65,563		11.31		741,515		759,557
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		1,249,555		11.17		13,957,524		14,087,326
Invesco V.I. Comstock Fund - Series I Shares		5,889		20.62		121,435		110,012
Invesco V.I. Comstock Fund - Series II Shares		259,319		20.54		5,326,418		4,814,386
Invesco V.I. Core Equity Fund - Series I Shares		170,925		36.72		6,276,349		4,770,878
Invesco V.I. Core Equity Fund - Series II Shares		40,170		36.18		1,453,350		1,120,153
Invesco V.I. Diversified Dividend Fund - Series I Shares		3,919		27.18		106,530		99,732
Invesco V.I. Diversified Dividend Fund - Series II Shares		727,433		27.01		19,647,978		18,177,404
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		3,481		19.88		69,207		65,958
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		3,893,383		19.35		75,336,960		70,046,314
Invesco V.I. Equity and Income Fund - Series I Shares		2,444		19.04		46,539		44,506
Invesco V.I. Equity and Income Fund - Series II Shares		830,122		18.95		15,730,818		14,903,961
Invesco V.I. International Growth Fund - Series I Shares		57,035		39.89		2,275,145		2,048,169
Invesco V.I. International Growth Fund - Series II Shares		1,252,254		39.33		49,251,137		44,010,616
Ivy VIP Asset Strategy Portfolio		968,588		9.37		9,073,536		9,232,771
Ivy VIP Energy Portfolio		1,134,112		5.87		6,655,877		6,603,674
Ivy VIP High Income Portfolio		5,185,519		3.64		18,861,808		18,664,329
Ivy VIP High Income Portfolio - Class I		29,115		3.64		106,108		105,458
Ivy VIP Micro Cap Growth Portfolio		178,226		22.42		3,995,820		3,799,669
Ivy VIP Micro Cap Growth Portfolio - Class I		4,779		22.46		107,341		103,144
Ivy VIP Mid Cap Growth Portfolio		679,601		11.61		7,889,485		6,756,653
Ivy VIP Mid Cap Growth Portfolio - Class I		33,260		11.63		386,789		362,426
Ivy VIP Science and Technology Portfolio		780,247		27.04		21,095,924		19,062,285
Ivy VIP Science and Technology Portfolio - Class I		5,715		27.05		154,567		158,036
Janus Henderson Balanced Portfolio - Service Shares		382,955		37.09		14,203,810		10,981,746
Janus Henderson Enterprise Portfolio - Service Shares		103,044		66.67		6,869,947		4,477,373
Janus Henderson Global Research Portfolio - Service Shares		13,568		50.17		680,687		398,312
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		75,858		10.94		829,889		829,365
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		4,350,787		10.82		47,075,511		46,983,597
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		359,977		16.55		5,957,613		5,609,611
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		5,269		10.62		55,958		54,965
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		195,506		10.62		2,076,270		1,986,765
Lincoln iShares® Global Growth Allocation Fund - Standard Class		46,119		11.40		525,896		507,574
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		71,639		11.13		797,203		748,025
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		1,810,610		12.38		22,415,348		22,157,454
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		251,956		28.18		7,100,133		5,993,862
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		794,206		18.86		14,978,734		13,807,001
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		1,648,321		14.38		23,702,854		24,388,797
LVIP American Balanced Allocation Fund - Service Class		3,588,847		12.99		46,622,713		45,099,273
LVIP American Balanced Allocation Fund - Standard Class		531,775		13.00		6,912,014		6,544,896
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		24,541,289		13.80		338,571,628		290,100,798
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		2,155,954		11.81		25,466,127		24,036,378
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		60,831		11.82		718,838		662,262
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		5,747,646		12.59		72,357,117		66,367,088

N-154

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		32,557	$	12.59	$	410,021	$	371,485
LVIP American Global Growth Fund - Service Class II		9,784,772		19.41		189,922,419		162,489,367
LVIP American Global Small Capitalization Fund - Service Class II		4,836,263		15.56		75,257,093		67,240,151
LVIP American Growth Allocation Fund - Service Class		2,441,099		13.62		33,257,532		31,576,312
LVIP American Growth Allocation Fund - Standard Class		98,069		13.63		1,336,874		1,274,067
LVIP American Growth Fund - Service Class II		26,185,673		20.74		542,959,922		444,095,768
LVIP American Growth-Income Fund - Service Class II		22,743,980		20.37		463,226,641		393,391,061
LVIP American Income Allocation Fund - Standard Class		6,996		11.77		82,347		80,419
LVIP American International Fund - Service Class II		12,456,865		15.49		192,907,008		164,404,071
LVIP American Preservation Fund - Service Class		740,245		9.80		7,252,923		7,333,573
LVIP American Preservation Fund - Standard Class		13,044		9.80		127,800		130,144
LVIP Baron Growth Opportunities Fund - Service Class		3,821,348		49.07		187,509,740		151,124,691
LVIP Baron Growth Opportunities Fund - Standard Class		16,564		50.37		834,234		743,066
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		42,721,136		20.88		892,060,051		734,615,631
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		26,199		20.92		548,027		471,549
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		88,396,632		10.72		947,788,687		912,712,993
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		16,372		10.79		176,637		172,117
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		17,207,409		11.39		195,957,975		182,469,869
LVIP BlackRock Inflation Protected Bond Fund - Service Class		77,535,084		10.18		789,617,302		831,808,482
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		192,921		10.21		1,969,530		1,986,134
LVIP BlackRock Multi-Asset Income Fund - Service Class		839,080		9.59		8,042,581		8,021,876
LVIP BlackRock Multi-Asset Income Fund - Standard Class		22,530		9.59		215,948		217,747
LVIP BlackRock Scientific Allocation Fund - Service Class		109,544		15.58		1,706,152		1,737,934
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		20,161,795		11.72		236,255,918		216,018,612
LVIP Blended Core Equity Managed Volatility Fund - Service Class		20,754,546		12.74		264,392,157		217,706,877
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		6,069		12.74		77,341		64,200
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		15,609,338		37.29		582,103,448		466,991,965
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class		63,776		37.98		2,422,346		1,591,454
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		35,035,527		14.54		509,486,636		426,809,758
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		5,614		14.96		83,998		64,419
LVIP Clarion Global Real Estate Fund - Service Class		10,915,797		9.49		103,579,999		92,288,162
LVIP Clarion Global Real Estate Fund - Standard Class		64,643		9.59		619,732		609,093
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		11,476,146		10.61		121,761,912		110,244,870
LVIP Delaware Bond Fund - Service Class		249,961,376		13.61		3,400,974,478		3,446,114,500
LVIP Delaware Bond Fund - Standard Class		5,625,461		13.61		76,545,642		76,345,449
LVIP Delaware Diversified Floating Rate Fund - Service Class		75,670,772		10.16		768,966,378		764,917,085
LVIP Delaware Diversified Floating Rate Fund - Standard Class		192,688		10.19		1,963,293		1,948,868
LVIP Delaware Social Awareness Fund - Service Class		1,540,052		38.94		59,974,248		56,882,039
LVIP Delaware Social Awareness Fund - Standard Class		193,687		39.13		7,579,380		6,561,281
LVIP Delaware Special Opportunities Fund - Service Class		1,902,525		41.32		78,619,942		73,169,285
LVIP Delaware Wealth Builder Fund - Service Class		901,381		14.71		13,257,520		12,864,008
LVIP Delaware Wealth Builder Fund - Standard Class		313,403		14.72		4,614,227		4,320,138
LVIP Dimensional International Core Equity Fund - Service Class		3,621,763		11.49		41,624,922		37,058,838
LVIP Dimensional International Core Equity Fund - Standard Class		310,710		11.50		3,572,858		3,044,472
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		33,291,611		10.82		360,115,360		322,470,633
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		134,753		10.82		1,458,024		1,280,622
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		2,810,480		31.86		89,544,698		85,946,640
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		130,405		32.02		4,175,827		4,041,091
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		2,914,893		12.63		36,826,753		32,495,961
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		257,728		12.64		3,256,650		2,790,042
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		44,106,428		15.28		673,946,227		583,024,336
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		153,473		15.29		2,346,916		1,948,408
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		54,273,430		10.52		570,902,213		573,624,659
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		802,758		10.52		8,444,213		8,523,137
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		23,426,171		35.98		842,756,515		739,825,819
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		723,021		10.26		7,416,024		7,206,886
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		1,309		10.26		13,430		13,716
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		29,095,589		10.67		310,391,726		291,880,905
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		1,085		10.67		11,575		10,539
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		83,152,431		14.29		1,188,580,846		1,100,153,383
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		13,287		14.30		190,024		183,502

N-155

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
LVIP Global Growth Allocation Managed Risk Fund - Service Class		587,693,563	$	14.76	$	8,676,120,065	$	7,539,799,360
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		479,444		14.77		7,078,994		6,584,595
LVIP Global Income Fund - Service Class		57,746,286		11.28		651,609,096		658,928,863
LVIP Global Income Fund - Standard Class		64,170		11.36		728,712		708,438
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		446,502,881		15.10		6,742,193,495		5,916,963,445
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		82,321		15.11		1,243,458		1,177,483
LVIP Goldman Sachs Income Builder Fund - Service Class		944,610		10.11		9,551,897		9,336,065
LVIP Goldman Sachs Income Builder Fund - Standard Class		4,545		10.11		45,965		44,948
LVIP Government Money Market Fund - Service Class		21,197,739		10.00		211,977,421		211,977,421
LVIP Government Money Market Fund - Standard Class		2,285,194		10.00		22,851,954		22,851,953
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		27,443,401		11.28		309,616,452		281,592,949
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		12,266,911		11.37		139,413,447		123,405,497
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		7,072		11.37		80,399		73,484
LVIP JPMorgan High Yield Fund - Service Class		16,807,690		10.80		181,523,058		185,555,186
LVIP JPMorgan High Yield Fund - Standard Class		28,382		10.80		306,577		312,703
LVIP JPMorgan Retirement Income Fund - Service Class		107,246		14.16		1,518,709		1,555,704
LVIP JPMorgan Retirement Income Fund - Standard Class		54,364		14.16		769,962		787,583
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		35,204,423		17.61		619,773,873		513,210,734
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		17,009		17.74		301,651		268,421
LVIP Managed Risk Profile 2010 Fund - Service Class		488,921		11.90		5,815,719		5,364,606
LVIP Managed Risk Profile 2020 Fund - Service Class		854,842		11.91		10,177,752		8,535,254
LVIP Managed Risk Profile 2030 Fund - Service Class		432,842		11.84		5,123,980		4,348,486
LVIP Managed Risk Profile 2040 Fund - Service Class		413,625		11.37		4,703,748		3,779,329
LVIP MFS International Equity Managed Volatility Fund - Service Class		25,141,184		11.55		290,330,398		250,320,164
LVIP MFS International Growth Fund - Service Class		10,596,489		17.90		189,666,554		140,939,634
LVIP MFS International Growth Fund - Standard Class		463		17.88		8,271		7,908
LVIP MFS Value Fund - Service Class		22,713,186		43.06		978,007,082		640,757,640
LVIP MFS Value Fund - Standard Class		35,478		43.09		1,528,573		1,463,719
LVIP Mondrian International Value Fund - Service Class		15,761,085		18.02		284,030,514		264,615,924
LVIP Mondrian International Value Fund - Standard Class		666,282		18.03		12,013,724		10,982,494
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		3,813,379		11.10		42,339,947		37,790,039
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		19,747		11.11		219,306		182,184
LVIP PIMCO Low Duration Bond Fund - Service Class		40,191,679		10.01		402,278,517		404,180,677
LVIP PIMCO Low Duration Bond Fund - Standard Class		627,602		10.01		6,281,045		6,330,025
LVIP Select Core Equity Managed Volatility Fund - Service Class		32,426,575		13.48		437,077,801		375,639,088
LVIP Select Core Equity Managed Volatility Fund - Standard Class		9,876		13.49		133,187		113,168
LVIP SSGA Bond Index Fund - Service Class		88,256,675		11.23		991,475,494		983,752,629
LVIP SSGA Bond Index Fund - Standard Class		235,130		11.23		2,640,743		2,679,773
LVIP SSGA Conservative Index Allocation Fund - Service Class		5,507,033		13.09		72,065,031		65,762,780
LVIP SSGA Conservative Structured Allocation Fund - Service Class		15,631,185		12.05		188,371,407		177,334,278
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		56,308		12.05		678,736		674,853
LVIP SSGA Developed International 150 Fund - Service Class		17,380,692		9.39		163,274,222		143,013,948
LVIP SSGA Developed International 150 Fund - Standard Class		62,780		9.39		589,633		563,488
LVIP SSGA Emerging Markets 100 Fund - Service Class		18,933,077		9.93		187,910,788		179,784,134
LVIP SSGA Emerging Markets 100 Fund - Standard Class		146,636		9.92		1,455,068		1,376,580
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		70,780,274		12.39		877,109,160		808,075,780
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		60,240		12.39		746,620		705,401
LVIP SSGA International Index Fund - Service Class		30,041,179		9.91		297,648,003		243,459,068
LVIP SSGA International Index Fund - Standard Class		245,412		9.91		2,431,053		2,294,376
LVIP SSGA International Managed Volatility Fund - Service Class		37,884,890		10.00		378,886,781		325,538,594
LVIP SSGA International Managed Volatility Fund - Standard Class		15,636		10.00		156,301		130,874
LVIP SSGA Large Cap 100 Fund - Service Class		25,221,552		13.90		350,453,471		311,221,038
LVIP SSGA Large Cap 100 Fund - Standard Class		213,886		13.92		2,976,217		3,046,120
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		26,902,185		13.79		371,034,936		313,455,343
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		2,770		13.80		38,214		29,728
LVIP SSGA Mid-Cap Index Fund - Service Class		2,567,135		13.05		33,508,817		31,465,465
LVIP SSGA Mid-Cap Index Fund - Standard Class		95,875		13.06		1,251,654		1,161,203
LVIP SSGA Moderate Index Allocation Fund - Service Class		15,610,583		14.65		228,741,878		193,920,566
LVIP SSGA Moderate Index Allocation Fund - Standard Class		1,984		14.66		29,087		29,680
LVIP SSGA Moderate Structured Allocation Fund - Service Class		61,235,651		13.15		805,493,746		721,835,030
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		14,204		13.16		186,958		181,893

N-156

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		12,602,772	$	15.16	$	191,108,430	$	156,519,970
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		18,476		15.19		280,672		281,800
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		33,781,978		13.64		460,651,048		404,675,110
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		172,436		13.65		2,353,068		2,283,887
LVIP SSGA S&P 500 Index Fund - Service Class		59,801,887		18.38		1,099,039,081		744,275,670
LVIP SSGA S&P 500 Index Fund - Standard Class		2,529,371		18.39		46,502,480		34,772,717
LVIP SSGA Small-Cap Index Fund - Service Class		9,826,014		31.72		311,632,017		228,674,812
LVIP SSGA Small-Cap Index Fund - Standard Class		206,168		31.73		6,542,319		5,770,346
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		10,603,599		13.45		142,586,603		137,823,590
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		249,653		13.46		3,360,575		3,514,541
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		27,640,126		13.27		366,784,481		314,471,955
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		7,110		13.28		94,383		80,721
LVIP T. Rowe Price Growth Stock Fund - Service Class		7,085,716		42.74		302,815,152		205,494,835
LVIP T. Rowe Price Growth Stock Fund - Standard Class		33,299		43.58		1,451,293		1,192,946
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		6,513,353		25.07		163,276,724		129,473,882
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		152,822		25.97		3,968,630		3,025,574
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		82,595,700		10.96		905,166,275		819,310,562
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		3,218		10.96		35,273		31,597
LVIP Vanguard Domestic Equity ETF Fund - Service Class		10,554,710		18.79		198,312,443		154,982,727
LVIP Vanguard Domestic Equity ETF Fund - Standard Class		72,829		18.80		1,369,406		1,127,374
LVIP Vanguard International Equity ETF Fund - Service Class		11,427,597		11.59		132,388,711		114,832,558
LVIP Vanguard International Equity ETF Fund - Standard Class		132,610		11.59		1,536,951		1,367,173
LVIP Wellington Capital Growth Fund - Service Class		7,558,396		44.73		338,094,601		227,743,052
LVIP Wellington Capital Growth Fund - Standard Class		1,385		45.77		63,374		61,456
LVIP Wellington Mid-Cap Value Fund - Service Class		3,552,425		27.78		98,686,370		73,883,006
LVIP Wellington Mid-Cap Value Fund - Standard Class		12,235		27.87		340,998		303,840
LVIP Western Asset Core Bond Fund - Service Class		3,866,274		9.87		38,144,660		38,351,033
LVIP Western Asset Core Bond Fund - Standard Class		63,115		9.86		622,439		626,384
MFS® VIT Growth Series - Initial Class		76,461		48.90		3,738,951		3,501,510
MFS® VIT Growth Series - Service Class		2,243,825		47.27		106,065,584		85,110,613
MFS® VIT Total Return Series - Initial Class		268,020		24.70		6,620,090		6,570,136
MFS® VIT Total Return Series - Service Class		2,864,126		24.28		69,540,979		66,803,949
MFS® VIT Utilities Series - Initial Class		240,381		29.50		7,091,251		7,257,032
MFS® VIT Utilities Series - Service Class		6,711,192		28.98		194,490,329		185,730,738
MFS® VIT II Core Equity Portfolio - Service Class		99,819		24.96		2,491,491		2,287,660
MFS® VIT II International Value Portfolio - Initial Class		36,626		28.25		1,034,695		922,679
MFS® VIT II International Value Portfolio - Service Class		1,106,539		27.80		30,761,797		26,259,307
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		36,954		7.91		292,306		297,047
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		884,911		7.85		6,946,553		7,010,739
Morgan Stanley VIF Growth Portfolio - Class II		77,468		30.89		2,392,982		1,931,466
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		1,407,066		19.58		27,550,352		20,299,973
Oppenheimer Global Fund/VA Service Shares		193,038		46.88		9,049,624		6,245,242
Oppenheimer International Growth Fund/VA Non-Service Shares		563,025		2.59		1,458,235		1,351,249
Oppenheimer International Growth Fund/VA Service Shares		5,091,395		2.70		13,746,767		12,042,993
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		23,487		25.79		605,717		561,549
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		417,846		25.42		10,621,653		9,738,024
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		356,841		8.88		3,168,749		3,130,442
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		12,761		8.89		113,447		109,963
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		1,727,523		7.24		12,507,267		16,799,260
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		4,634		7.14		33,087		36,549
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		274,362		13.14		3,605,120		3,525,014
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		2,445		13.14		32,121		31,670
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		370,131		10.54		3,901,182		3,792,493
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		3,901		10.54		41,115		39,626
Putnam VT Absolute Return 500 Fund - Class IA		127		10.88		1,385		1,343
Putnam VT Absolute Return 500 Fund - Class IB		272,706		10.73		2,926,132		2,832,474
Putnam VT Equity Income Fund - Class IB		45,674		26.69		1,219,032		1,080,084
Putnam VT George Putnam Balanced Fund - Class IA		20,040		11.82		236,872		231,771
Putnam VT George Putnam Balanced Fund - Class IB		1,201,955		11.78		14,159,024		13,316,714
Putnam VT Global Health Care Fund - Class IA		7,856		16.92		132,921		132,102
Putnam VT Global Health Care Fund - Class IB		806,424		16.44		13,257,609		13,515,675

N-157

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

5. Investments (continued)

Subaccount	Shares Owned		Net Asset Value		Fair Value of Shares		Cost of Shares
Putnam VT Income Fund - Class IB		557,178	$	11.01	$	6,134,532	$	6,135,243
QS Variable Conservative Growth - Class II		66,568		14.62		973,219		1,068,852
Rational Dividend Capture VA Fund		107,643		11.78		1,268,031		1,244,539
SEI VP Market Growth Strategy Fund - Class III		237,688		11.14		2,647,840		2,456,519
SEI VP Market Plus Strategy Fund - Class III		174,884		11.75		2,054,892		1,864,366
Templeton Foreign VIP Fund - Class 1		1,883		15.80		29,746		30,078
Templeton Foreign VIP Fund - Class 4		199,371		15.71		3,132,114		2,855,211
Templeton Global Bond VIP Fund - Class 1		138,529		17.16		2,377,156		2,454,002
Templeton Global Bond VIP Fund - Class 2		20,220,126		16.51		333,834,284		348,442,136
Templeton Global Bond VIP Fund - Class 4		1,553,552		16.87		26,208,415		26,234,787
Templeton Growth VIP Fund - Class 2		1,884,901		15.97		30,101,871		25,091,090
VanEck VIP Global Hard Assets Fund - Class S Shares		160,609		22.87		3,673,122		3,463,721
VanEck VIP Global Hard Assets Fund - Initial Class Shares		16,166		23.73		383,615		389,334
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		1,444,642		9.34		13,492,958		13,446,154
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares		130,096		9.33		1,213,798		1,224,112
Virtus Rampart Equity Trend Series - Class A Shares		109,117		13.25		1,445,802		1,370,690
Virtus Rampart Equity Trend Series - Class I Shares		4		13.38		51		45

6. Changes in Units Outstanding

The change in units outstanding for the year ended December 31, 2017, is as follows:

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
AB VPS Global Thematic Growth Portfolio - Class B		299,224		(384,346	)		(85,122	)
AB VPS Growth and Income Portfolio - Class B		431		(431	)		—
AB VPS International Value Portfolio - Class B		211		(409	)		(198	)
AB VPS Large Cap Growth Portfolio - Class B		29,657		(148,699	)		(119,042	)
AB VPS Small/Mid Cap Value Portfolio - Class A		6,449		(4,154	)		2,295
AB VPS Small/Mid Cap Value Portfolio - Class B		647,353		(590,131	)		57,222
ALPS/Alerian Energy Infrastructure Portfolio - Class I		32,879		(5,354	)		27,525
ALPS/Alerian Energy Infrastructure Portfolio - Class III		279,504		(256,759	)		22,745
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		10,068		(8,394	)		1,674
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		303,243		(91,541	)		211,702
ALPS/Stadion Core ETF Portfolio - Class I		—		(234	)		(234	)
ALPS/Stadion Core ETF Portfolio - Class III		563,927		(86,054	)		477,873
ALPS/Stadion Tactical Growth Portfolio - Class III		130,017		(80,659	)		49,358
American Century VP Balanced Fund - Class I		8,420		(2,129	)		6,291
American Century VP Balanced Fund - Class II		3,010,896		(444,805	)		2,566,091
American Century VP Inflation Protection Fund - Class II		3,949		(4,099	)		(150	)
American Century VP Large Company Value Fund - Class I		35,339		(2,155	)		33,184
American Century VP Large Company Value Fund - Class II		385,294		(26,501	)		358,793
American Funds Asset Allocation Fund - Class 1		335,992		(105,158	)		230,834
American Funds Asset Allocation Fund - Class 1A		380,555		(22,255	)		358,300
American Funds Asset Allocation Fund - Class 4		2,685,595		(729,839	)		1,955,756
American Funds Blue Chip Income and Growth Fund - Class 1		71,362		(41,217	)		30,145
American Funds Blue Chip Income and Growth Fund - Class 1A		55,330		(1,369	)		53,961
American Funds Blue Chip Income and Growth Fund - Class 4		910,441		(393,670	)		516,771
American Funds Bond Fund - Class 1		238,587		(13,288	)		225,299
American Funds Bond Fund - Class 1A		129,694		(26,477	)		103,217
American Funds Capital Income Builder® - Class 1		7,820		(10,408	)		(2,588	)
American Funds Capital Income Builder® - Class 1A		74,688		(33,807	)		40,881
American Funds Capital Income Builder® - Class 4		953,592		(466,454	)		487,138
American Funds Global Balanced Fund - Class 1		51		(7,142	)		(7,091	)
American Funds Global Balanced Fund - Class 1A		20,229		(8	)		20,221
American Funds Global Bond Fund - Class 1		58,123		(14,517	)		43,606
American Funds Global Bond Fund - Class 1A		6,016		(10	)		6,006
American Funds Global Growth and Income Fund - Class 1		12,654		(35,833	)		(23,179	)
American Funds Global Growth and Income Fund - Class 1A		9,883		(252	)		9,631
American Funds Global Growth Fund - Class 1		16,004		(36,380	)		(20,376	)

N-158

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
American Funds Global Growth Fund - Class 1A		144,915		(10,206	)		134,709
American Funds Global Growth Fund - Class 2		329,027		(1,959,763	)		(1,630,736	)
American Funds Global Growth Fund - Class 4		1,310,971		(122,270	)		1,188,701
American Funds Global Small Capitalization Fund - Class 1		6,900		(5,008	)		1,892
American Funds Global Small Capitalization Fund - Class 1A		14,818		(21	)		14,797
American Funds Global Small Capitalization Fund - Class 2		163,860		(2,968,432	)		(2,804,572	)
American Funds Global Small Capitalization Fund - Class 4		374,391		(60,589	)		313,802
American Funds Growth Fund - Class 1		67,929		(67,773	)		156
American Funds Growth Fund - Class 1A		232,138		(7,442	)		224,696
American Funds Growth Fund - Class 2		425,505		(8,527,266	)		(8,101,761	)
American Funds Growth Fund - Class 4		2,899,548		(220,677	)		2,678,871
American Funds Growth-Income Fund - Class 1		63,952		(20,805	)		43,147
American Funds Growth-Income Fund - Class 1A		183,001		(1,924	)		181,077
American Funds Growth-Income Fund - Class 2		193,405		(11,503,272	)		(11,309,867	)
American Funds Growth-Income Fund - Class 4		2,226,771		(180,099	)		2,046,672
American Funds High-Income Bond Fund - Class 1		35,948		(10,386	)		25,562
American Funds High-Income Bond Fund - Class 1A		37,572		(601	)		36,971
American Funds International Fund - Class 1		118,328		(34,809	)		83,519
American Funds International Fund - Class 1A		135,324		(9,324	)		126,000
American Funds International Fund - Class 2		328,270		(5,811,880	)		(5,483,610	)
American Funds International Fund - Class 4		1,226,567		(232,743	)		993,824
American Funds International Growth and Income Fund - Class 1		24,289		(25,136	)		(847	)
American Funds International Growth and Income Fund - Class 1A		54,159		(71	)		54,088
American Funds Managed Risk Asset Allocation Fund - Class P1		57,211		(83,685	)		(26,474	)
American Funds Managed Risk Asset Allocation Fund - Class P2		2,337,058		(334,194	)		2,002,864
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		4,647		(10,681	)		(6,034	)
American Funds Managed Risk Growth Fund - Class P1		6,760		(9,671	)		(2,911	)
American Funds Managed Risk Growth-Income Fund - Class P1		5,718		(5,902	)		(184	)
American Funds Managed Risk International Fund - Class P1		13,013		(16,386	)		(3,373	)
American Funds Mortgage Fund - Class 1		4,546		(654	)		3,892
American Funds Mortgage Fund - Class 1A		9,824		(511	)		9,313
American Funds Mortgage Fund - Class 4		266,484		(219,742	)		46,742
American Funds New World Fund® - Class 1		73,207		(46,022	)		27,185
American Funds New World Fund® - Class 1A		52,481		(1,052	)		51,429
American Funds New World Fund® - Class 4		708,823		(231,626	)		477,197
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		1,311		(6,754	)		(5,443	)
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A		99,315		(70,134	)		29,181
BlackRock Global Allocation V.I. Fund - Class I		76,581		(13,415	)		63,166
BlackRock Global Allocation V.I. Fund - Class III		1,081,015		(7,540,631	)		(6,459,616	)
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		426		(17	)		409
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		104,811		(36,264	)		68,547
ClearBridge Variable Aggressive Growth Portfolio - Class I		9,989		(2,961	)		7,028
ClearBridge Variable Aggressive Growth Portfolio - Class II		279,916		(245,919	)		33,997
ClearBridge Variable Large Cap Growth Portfolio - Class I		29,581		(61	)		29,520
ClearBridge Variable Large Cap Growth Portfolio - Class II		1,268,702		(38,620	)		1,230,082
ClearBridge Variable Mid Cap Portfolio - Class I		17,513		(2,349	)		15,164
ClearBridge Variable Mid Cap Portfolio - Class II		797,386		(219,794	)		577,592
Columbia VP Commodity Strategy Fund - Class 1		15,807		(197	)		15,610
Columbia VP Commodity Strategy Fund - Class 2		48,470		(1,614	)		46,856
Columbia VP Emerging Markets Bond Fund - Class 1		35,044		(11,377	)		23,667
Columbia VP Emerging Markets Bond Fund - Class 2		117,263		(8,537	)		108,726
Columbia VP Strategic Income Fund - Class 1		4,167		(4,167	)		—
Columbia VP Strategic Income Fund - Class 2		296,573		(16,200	)		280,373
Delaware VIP® Diversified Income Series - Service Class		13,940,901		(1,218,034	)		12,722,867
Delaware VIP® Diversified Income Series - Standard Class		231,150		(60,666	)		170,484
Delaware VIP® Emerging Markets Series - Service Class		908,648		(2,462,531	)		(1,553,883	)
Delaware VIP® Emerging Markets Series - Standard Class		28,060		(14,131	)		13,929
Delaware VIP® High Yield Series - Service Class		281,468		(1,154,211	)		(872,743	)
Delaware VIP® High Yield Series - Standard Class		122,505		(255,001	)		(132,496	)
Delaware VIP® International Value Equity Series - Standard Class		19		(1,264	)		(1,245	)
Delaware VIP® Limited-Term Diversified Income Series - Service Class		4,480,693		(6,134,091	)		(1,653,398	)
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		41,142		(9,679	)		31,463

N-159

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
Delaware VIP® REIT Series - Service Class		430,366		(973,493	)		(543,127	)
Delaware VIP® REIT Series - Standard Class		23,195		(17,042	)		6,153
Delaware VIP® Small Cap Value Series - Service Class		1,396,071		(1,191,710	)		204,361
Delaware VIP® Small Cap Value Series - Standard Class		15,493		(24,795	)		(9,302	)
Delaware VIP® Smid Cap Core Series - Service Class		343,876		(872,036	)		(528,160	)
Delaware VIP® Smid Cap Core Series - Standard Class		7,928		(34,515	)		(26,587	)
Delaware VIP® U.S. Growth Series - Service Class		56,794		(2,662,627	)		(2,605,833	)
Delaware VIP® U.S. Growth Series - Standard Class		8,419		(8,419	)		—
Delaware VIP® Value Series - Service Class		632,095		(1,960,252	)		(1,328,157	)
Delaware VIP® Value Series - Standard Class		74,316		(70,991	)		3,325
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		31,442		(13,764	)		17,678
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		398,183		(500,510	)		(102,327	)
Deutsche Equity 500 Index VIP Portfolio - Class A		9,928		(73,197	)		(63,269	)
Deutsche Small Cap Index VIP Portfolio - Class A		10,698		(23,299	)		(12,601	)
Eaton Vance VT Floating-Rate Income Fund - ADV Class		124,891		(9,138	)		115,753
Eaton Vance VT Floating-Rate Income Fund - Initial Class		980,990		(452,180	)		528,810
Fidelity® VIP Contrafund® Portfolio - Initial Class		22,889		(11,890	)		10,999
Fidelity® VIP Contrafund® Portfolio - Service Class		8,145		(8,145	)		—
Fidelity® VIP Contrafund® Portfolio - Service Class 2		1,017,351		(3,532,500	)		(2,515,149	)
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2		598,890		(63,516	)		535,374
Fidelity® VIP Growth Portfolio - Initial Class		38,465		(42,579	)		(4,114	)
Fidelity® VIP Growth Portfolio - Service Class 2		1,497,928		(1,198,310	)		299,618
Fidelity® VIP Mid Cap Portfolio - Initial Class		61,807		(21,307	)		40,500
Fidelity® VIP Mid Cap Portfolio - Service Class 2		1,269,161		(2,463,606	)		(1,194,445	)
Fidelity® VIP Overseas Portfolio - Service Class 2		654		(654	)		—
Fidelity® VIP Strategic Income Portfolio - Initial Class		20,641		(9,894	)		10,747
Fidelity® VIP Strategic Income Portfolio - Service Class 2		893,631		(218,782	)		674,849
First Trust Dorsey Wright Tactical Core Portfolio - Class I		261,713		(37,596	)		224,117
First Trust Multi Income Allocation Portfolio - Class I		117,348		(92,737	)		24,611
First Trust Multi Income Allocation Portfolio - Class II		—		(259	)		(259	)
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		6,024,777		(271,712	)		5,753,065
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		15,650		(22	)		15,628
Franklin Founding Funds Allocation VIP Fund - Class 4		167,629		(58,932	)		108,697
Franklin Income VIP Fund - Class 1		5,516		(1,296	)		4,220
Franklin Income VIP Fund - Class 2		1,106,354		(4,070,990	)		(2,964,636	)
Franklin Income VIP Fund - Class 4		2,469,694		(271,576	)		2,198,118
Franklin Mutual Shares VIP Fund - Class 1		16,911		(2,496	)		14,415
Franklin Mutual Shares VIP Fund - Class 2		776,200		(4,190,484	)		(3,414,284	)
Franklin Mutual Shares VIP Fund - Class 4		993,067		(61,767	)		931,300
Franklin Rising Dividends VIP Fund - Class 1		6,865		(12,614	)		(5,749	)
Franklin Rising Dividends VIP Fund - Class 4		425,632		(168,606	)		257,026
Franklin Small Cap Value VIP Fund - Class 1		18,506		(3,492	)		15,014
Franklin Small Cap Value VIP Fund - Class 4		203,365		(148,962	)		54,403
Franklin Small-Mid Cap Growth VIP Fund - Class 1		7,647		(7,979	)		(332	)
Franklin Small-Mid Cap Growth VIP Fund - Class 4		186,203		(60,936	)		125,267
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		134,078		(233,322	)		(99,244	)
Goldman Sachs VIT Government Money Market Fund - Service Shares		840,372		(2,118,094	)		(1,277,722	)
Goldman Sachs VIT Large Cap Value Fund - Service Shares		88,830		(588,246	)		(499,416	)
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		25,082		(50,066	)		(24,984	)
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		5,185		(585	)		4,600
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		133,253		(133,627	)		(374	)
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		—		(149	)		(149	)
Guggenheim VT Long Short Equity		144,184		(62,228	)		81,956
Guggenheim VT Multi-Hedge Strategies		121,324		(76,831	)		44,493
Hartford Capital Appreciation HLS Fund - Class IA		2,421		(2,416	)		5
Hartford Capital Appreciation HLS Fund - Class IC		219,854		(99,615	)		120,239
Invesco V.I. American Franchise Fund - Series I Shares		6,169		(36,197	)		(30,028	)
Invesco V.I. American Franchise Fund - Series II Shares		611		(5,107	)		(4,496	)
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		51,614		(1,758	)		49,856
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		326,956		(195,222	)		131,734
Invesco V.I. Comstock Fund - Series I Shares		4,578		(6,622	)		(2,044	)
Invesco V.I. Comstock Fund - Series II Shares		125,539		(35,218	)		90,321

N-160

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
Invesco V.I. Core Equity Fund - Series I Shares		1,033		(65,678	)		(64,645	)
Invesco V.I. Core Equity Fund - Series II Shares		2,475		(18,339	)		(15,864	)
Invesco V.I. Diversified Dividend Fund - Series I Shares		9,668		(3,353	)		6,315
Invesco V.I. Diversified Dividend Fund - Series II Shares		422,323		(231,258	)		191,065
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		14,021		(11,480	)		2,541
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		4,957,291		(327,441	)		4,629,850
Invesco V.I. Equity and Income Fund - Series I Shares		4,049		(1,711	)		2,338
Invesco V.I. Equity and Income Fund - Series II Shares		666,415		(70,048	)		596,367
Invesco V.I. International Growth Fund - Series I Shares		21,237		(19,927	)		1,310
Invesco V.I. International Growth Fund - Series II Shares		695,839		(226,105	)		469,734
Ivy VIP Asset Strategy Portfolio		78,265		(179,452	)		(101,187	)
Ivy VIP Energy Portfolio		535,292		(499,714	)		35,578
Ivy VIP High Income Portfolio		776,331		(269,620	)		506,711
Ivy VIP High Income Portfolio - Class I		10,018		(461	)		9,557
Ivy VIP Micro Cap Growth Portfolio		173,162		(113,878	)		59,284
Ivy VIP Micro Cap Growth Portfolio - Class I		9,227		(7	)		9,220
Ivy VIP Mid Cap Growth Portfolio		200,652		(34,875	)		165,777
Ivy VIP Mid Cap Growth Portfolio - Class I		31,605		(652	)		30,953
Ivy VIP Science and Technology Portfolio		587,856		(107,537	)		480,319
Ivy VIP Science and Technology Portfolio - Class I		13,550		(2,104	)		11,446
Janus Henderson Balanced Portfolio - Service Shares		36,144		(91,248	)		(55,104	)
Janus Henderson Enterprise Portfolio - Service Shares		9,395		(32,822	)		(23,427	)
Janus Henderson Global Research Portfolio - Service Shares		748		(10,236	)		(9,488	)
JPMorgan Insurance Trust Core Bond Portfolio - Class 1		88,289		(5,841	)		82,448
JPMorgan Insurance Trust Core Bond Portfolio - Class 2		4,834,134		(65,097	)		4,769,037
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		230,582		(79,834	)		150,748
JPMorgan Insurance Trust Income Builder Portfolio - Class 1		5,042		(26	)		5,016
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		92,162		(19,969	)		72,193
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1		4,769		(17,911	)		(13,142	)
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2		169,993		(1,000,607	)		(830,614	)
Lincoln iShares® Global Growth Allocation Fund - Standard Class		54,807		(8,829	)		45,978
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class		72,077		(823	)		71,254
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		844,897		(205,222	)		639,675
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		205,845		(75,615	)		130,230
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		20,695		(67,382	)		(46,687	)
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		1,231,951		(623,603	)		608,348
LVIP American Balanced Allocation Fund - Service Class		1,858,023		(285,918	)		1,572,105
LVIP American Balanced Allocation Fund - Standard Class		124,041		(63,310	)		60,731
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		6,410,483		(1,263,928	)		5,146,555
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		472,310		(349,717	)		122,593
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		7		(634	)		(627	)
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		959,312		(972,567	)		(13,255	)
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		25		(25,813	)		(25,788	)
LVIP American Global Growth Fund - Service Class II		2,066,261		(292,922	)		1,773,339
LVIP American Global Small Capitalization Fund - Service Class II		281,136		(462,501	)		(181,365	)
LVIP American Growth Allocation Fund - Service Class		1,004,045		(177,553	)		826,492
LVIP American Growth Allocation Fund - Standard Class		43,355		(108,807	)		(65,452	)
LVIP American Growth Fund - Service Class II		4,464,301		(289,977	)		4,174,324
LVIP American Growth-Income Fund - Service Class II		4,284,239		(199,187	)		4,085,052
LVIP American Income Allocation Fund - Standard Class		1,940		(348	)		1,592
LVIP American International Fund - Service Class II		1,801,738		(670,361	)		1,131,377
LVIP American Preservation Fund - Service Class		227,138		(224,077	)		3,061
LVIP American Preservation Fund - Standard Class		1,671		(687	)		984
LVIP Baron Growth Opportunities Fund - Service Class		877,662		(955,485	)		(77,823	)
LVIP Baron Growth Opportunities Fund - Standard Class		7,324		(5,807	)		1,517
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		5,381,000		(2,541,030	)		2,839,970
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		7,349		(892	)		6,457
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		3,274,701		(9,220,937	)		(5,946,236	)
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		125		(371	)		(246	)
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		10,782,300		(113,594	)		10,668,706
LVIP BlackRock Inflation Protected Bond Fund - Service Class		7,019,526		(3,231,482	)		3,788,044
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		114,493		(5,376	)		109,117

N-161

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP BlackRock Multi-Asset Income Fund - Service Class		243,759		(106,820	)		136,939
LVIP BlackRock Multi-Asset Income Fund - Standard Class		1,354		(6,551	)		(5,197	)
LVIP BlackRock Scientific Allocation Fund - Service Class		157,156		(25,888	)		131,268
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		10,010,148		(921,026	)		9,089,122
LVIP Blended Core Equity Managed Volatility Fund - Service Class		2,221,476		(1,478,463	)		743,013
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		—		(534	)		(534	)
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		3,299,339		(1,502,801	)		1,796,538
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class		7,092		(26,130	)		(19,038	)
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		1,433,837		(4,271,113	)		(2,837,276	)
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		3,745		(4,407	)		(662	)
LVIP Clarion Global Real Estate Fund - Service Class		740,287		(1,130,757	)		(390,470	)
LVIP Clarion Global Real Estate Fund - Standard Class		26,118		(714	)		25,404
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		2,702,185		(329,580	)		2,372,605
LVIP Delaware Bond Fund - Service Class		22,471,288		(3,158,050	)		19,313,238
LVIP Delaware Bond Fund - Standard Class		243,362		(746,768	)		(503,406	)
LVIP Delaware Diversified Floating Rate Fund - Service Class		9,590,830		(3,032,807	)		6,558,023
LVIP Delaware Diversified Floating Rate Fund - Standard Class		129,199		(70,415	)		58,784
LVIP Delaware Social Awareness Fund - Service Class		133,305		(437,006	)		(303,701	)
LVIP Delaware Social Awareness Fund - Standard Class		6,295		(48,176	)		(41,881	)
LVIP Delaware Special Opportunities Fund - Service Class		925,674		(372,481	)		553,193
LVIP Delaware Wealth Builder Fund - Service Class		221,560		(281,445	)		(59,885	)
LVIP Delaware Wealth Builder Fund - Standard Class		13,103		(23,918	)		(10,815	)
LVIP Dimensional International Core Equity Fund - Service Class		2,611,149		(125,089	)		2,486,060
LVIP Dimensional International Core Equity Fund - Standard Class		168,381		(34,353	)		134,028
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		5,220,544		(1,470,695	)		3,749,849
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		9,606		(27,563	)		(17,957	)
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		1,840,402		(462,809	)		1,377,593
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		233,659		(77,839	)		155,820
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		2,116,896		(576,144	)		1,540,752
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		176,550		(37,712	)		138,838
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		6,983,933		(1,410,899	)		5,573,034
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		22,660		(128,982	)		(106,322	)
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		10,239,588		(1,290,013	)		8,949,575
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		447,043		(162,358	)		284,685
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		3,550,583		(5,632,897	)		(2,082,314	)
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		555,131		(90,581	)		464,550
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class		1,204		—			1,204
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		3,920,761		(1,366,101	)		2,554,660
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		13		—			13
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		706,737		(11,516,141	)		(10,809,404	)
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		45		(186	)		(141	)
LVIP Global Growth Allocation Managed Risk Fund - Service Class		7,925,774		(50,954,269	)		(43,028,495	)
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		226,049		(10,263	)		215,786
LVIP Global Income Fund - Service Class		5,083,322		(1,584,180	)		3,499,142
LVIP Global Income Fund - Standard Class		12,157		(4,518	)		7,639
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		6,086,582		(42,635,929	)		(36,549,347	)
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		25,442		(2,595	)		22,847
LVIP Goldman Sachs Income Builder Fund - Service Class		590,031		(86,381	)		503,650
LVIP Goldman Sachs Income Builder Fund - Standard Class		2,138		(822	)		1,316
LVIP Government Money Market Fund - Service Class		13,212,925		(14,104,681	)		(891,756	)
LVIP Government Money Market Fund - Standard Class		1,638,838		(1,976,959	)		(338,121	)
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		4,098,008		(1,085,888	)		3,012,120
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		668,333		(1,265,381	)		(597,048	)
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		52		(543	)		(491	)
LVIP JPMorgan High Yield Fund - Service Class		2,099,726		(2,008,978	)		90,748
LVIP JPMorgan High Yield Fund - Standard Class		20,689		(5,596	)		15,093
LVIP JPMorgan Retirement Income Fund - Service Class		132,248		(3,776	)		128,472
LVIP JPMorgan Retirement Income Fund - Standard Class		70,369		(22	)		70,347
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		3,633,109		(1,979,897	)		1,653,212
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		11,058		(7,443	)		3,615
LVIP Managed Risk Profile 2010 Fund - Service Class		103,790		(85,723	)		18,067
LVIP Managed Risk Profile 2020 Fund - Service Class		6,287		(102,875	)		(96,588	)

N-162

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP Managed Risk Profile 2030 Fund - Service Class		31,661		(68,316	)		(36,655	)
LVIP Managed Risk Profile 2040 Fund - Service Class		121,241		(98,981	)		22,260
LVIP MFS International Equity Managed Volatility Fund - Service Class		5,004,170		(1,429,446	)		3,574,724
LVIP MFS International Growth Fund - Service Class		1,272,180		(1,730,071	)		(457,891	)
LVIP MFS International Growth Fund - Standard Class		7,034		(9,605	)		(2,571	)
LVIP MFS Value Fund - Service Class		1,789,050		(3,444,826	)		(1,655,776	)
LVIP MFS Value Fund - Standard Class		127,004		(5,206	)		121,798
LVIP Mondrian International Value Fund - Service Class		507,582		(3,163,640	)		(2,656,058	)
LVIP Mondrian International Value Fund - Standard Class		11,305		(85,302	)		(73,997	)
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		1,199,612		(311,323	)		888,289
LVIP PIMCO Low Duration Bond Fund - Service Class		8,415,176		(3,579,086	)		4,836,090
LVIP PIMCO Low Duration Bond Fund - Standard Class		247,923		(61,079	)		186,844
LVIP Select Core Equity Managed Volatility Fund - Service Class		616,099		(4,370,053	)		(3,753,954	)
LVIP Select Core Equity Managed Volatility Fund - Standard Class		—		(7,908	)		(7,908	)
LVIP SSGA Bond Index Fund - Service Class		5,141,187		(4,529,205	)		611,982
LVIP SSGA Bond Index Fund - Standard Class		149,981		(7,061	)		142,920
LVIP SSGA Conservative Index Allocation Fund - Service Class		562,973		(768,277	)		(205,304	)
LVIP SSGA Conservative Structured Allocation Fund - Service Class		672,996		(1,552,254	)		(879,258	)
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		8,465		(4,895	)		3,570
LVIP SSGA Developed International 150 Fund - Service Class		1,314,894		(1,523,014	)		(208,120	)
LVIP SSGA Developed International 150 Fund - Standard Class		15,191		(7,772	)		7,419
LVIP SSGA Emerging Markets 100 Fund - Service Class		1,327,403		(2,013,574	)		(686,171	)
LVIP SSGA Emerging Markets 100 Fund - Standard Class		84,832		(26,667	)		58,165
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		1,466,902		(6,504,597	)		(5,037,695	)
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		11,506		(1,490	)		10,016
LVIP SSGA International Index Fund - Service Class		1,759,445		(3,551,564	)		(1,792,119	)
LVIP SSGA International Index Fund - Standard Class		163,076		(57,326	)		105,750
LVIP SSGA International Managed Volatility Fund - Service Class		1,585,572		(4,681,002	)		(3,095,430	)
LVIP SSGA International Managed Volatility Fund - Standard Class		2,759		(4,729	)		(1,970	)
LVIP SSGA Large Cap 100 Fund - Service Class		1,173,772		(1,437,764	)		(263,992	)
LVIP SSGA Large Cap 100 Fund - Standard Class		47,849		(18,302	)		29,547
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		5,308,927		(1,083,478	)		4,225,449
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		—		(124	)		(124	)
LVIP SSGA Mid-Cap Index Fund - Service Class		2,802,139		(117,200	)		2,684,939
LVIP SSGA Mid-Cap Index Fund - Standard Class		108,876		(10,068	)		98,808
LVIP SSGA Moderate Index Allocation Fund - Service Class		1,545,273		(1,442,783	)		102,490
LVIP SSGA Moderate Index Allocation Fund - Standard Class		16,512		(13,978	)		2,534
LVIP SSGA Moderate Structured Allocation Fund - Service Class		1,609,416		(4,705,443	)		(3,096,027	)
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		2,703		(4,288	)		(1,585	)
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		1,182,155		(1,043,618	)		138,537
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class		23,838		(13	)		23,825
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		1,983,961		(2,608,654	)		(624,693	)
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		139,934		(2,056	)		137,878
LVIP SSGA S&P 500 Index Fund - Service Class		4,269,125		(3,430,436	)		838,689
LVIP SSGA S&P 500 Index Fund - Standard Class		422,872		(292,054	)		130,818
LVIP SSGA Small-Cap Index Fund - Service Class		1,807,683		(1,579,800	)		227,883
LVIP SSGA Small-Cap Index Fund - Standard Class		214,000		(17,931	)		196,069
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		876,923		(664,053	)		212,870
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		106,634		(15,905	)		90,729
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		6,305,703		(930,188	)		5,375,515
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		369		(4,770	)		(4,401	)
LVIP T. Rowe Price Growth Stock Fund - Service Class		1,413,706		(1,623,624	)		(209,918	)
LVIP T. Rowe Price Growth Stock Fund - Standard Class		50,744		(10,916	)		39,828
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		1,092,262		(281,955	)		810,307
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		75,550		(23,456	)		52,094
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		23,495,981		(1,630,656	)		21,865,325
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		—		(269	)		(269	)
LVIP Vanguard Domestic Equity ETF Fund - Service Class		3,081,239		(916,086	)		2,165,153
LVIP Vanguard Domestic Equity ETF Fund - Standard Class		46,694		(5,151	)		41,543
LVIP Vanguard International Equity ETF Fund - Service Class		3,469,065		(562,518	)		2,906,547
LVIP Vanguard International Equity ETF Fund - Standard Class		76,066		(26,724	)		49,342
LVIP Wellington Capital Growth Fund - Service Class		187,676		(2,646,565	)		(2,458,889	)

N-163

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP Wellington Capital Growth Fund - Standard Class		13,115		(8,972	)		4,143
LVIP Wellington Mid-Cap Value Fund - Service Class		861,341		(650,988	)		210,353
LVIP Wellington Mid-Cap Value Fund - Standard Class		7,242		(2,827	)		4,415
LVIP Western Asset Core Bond Fund - Service Class		3,838,501		(63,512	)		3,774,989
LVIP Western Asset Core Bond Fund - Standard Class		61,058		(151	)		60,907
MFS® VIT Growth Series - Initial Class		51,330		(56,919	)		(5,589	)
MFS® VIT Growth Series - Service Class		639,363		(447,034	)		192,329
MFS® VIT Total Return Series - Initial Class		16,946		(81,162	)		(64,216	)
MFS® VIT Total Return Series - Service Class		2,389,005		(289,361	)		2,099,644
MFS® VIT Utilities Series - Initial Class		9,109		(34,736	)		(25,627	)
MFS® VIT Utilities Series - Service Class		216,223		(1,110,657	)		(894,434	)
MFS® VIT II Core Equity Portfolio - Service Class		1,695		(9,574	)		(7,879	)
MFS® VIT II International Value Portfolio - Initial Class		60,478		(9,156	)		51,322
MFS® VIT II International Value Portfolio - Service Class		903,616		(222,017	)		681,599
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		22,697		(3,530	)		19,167
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		198,159		(166,014	)		32,145
Morgan Stanley VIF Growth Portfolio - Class II		19,862		(14,230	)		5,632
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		24,269		(177,055	)		(152,786	)
Oppenheimer Global Fund/VA Service Shares		14,928		(64,171	)		(49,243	)
Oppenheimer International Growth Fund/VA Non-Service Shares		68,472		(3,482	)		64,990
Oppenheimer International Growth Fund/VA Service Shares		477,595		(199,729	)		277,866
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		9,254		(4,688	)		4,566
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		211,934		(94,599	)		117,335
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		157,970		(28,947	)		129,023
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		633		(176	)		457
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		559,751		(622,085	)		(62,334	)
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		340		(9	)		331
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		131,530		(95,669	)		35,861
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		6,970		(6,428	)		542
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		84,035		(59,641	)		24,394
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		573		—			573
Putnam VT Absolute Return 500 Fund - Class IA		129		—			129
Putnam VT Absolute Return 500 Fund - Class IB		93,826		(34,996	)		58,830
Putnam VT Equity Income Fund - Class IB		65,099		(9,402	)		55,697
Putnam VT George Putnam Balanced Fund - Class IA		20,143		(37	)		20,106
Putnam VT George Putnam Balanced Fund - Class IB		1,332,020		(107,165	)		1,224,855
Putnam VT Global Health Care Fund - Class IA		17,183		(6,648	)		10,535
Putnam VT Global Health Care Fund - Class IB		585,733		(220,096	)		365,637
Putnam VT Growth & Income Fund - Class IB		1,754		(67,087	)		(65,333	)
Putnam VT Income Fund - Class IB		230,381		(38,260	)		192,121
QS Variable Conservative Growth - Class II		92,339		(1,573	)		90,766
Rational Dividend Capture VA Fund		8,552		(14,013	)		(5,461	)
SEI VP Market Growth Strategy Fund - Class III		175,063		(115,617	)		59,446
SEI VP Market Plus Strategy Fund - Class III		5,832		(8,792	)		(2,960	)
Templeton Foreign VIP Fund - Class 1		608		(63	)		545
Templeton Foreign VIP Fund - Class 4		85,355		(70,815	)		14,540
Templeton Global Bond VIP Fund - Class 1		107,042		(30,935	)		76,107
Templeton Global Bond VIP Fund - Class 2		608,596		(1,852,994	)		(1,244,398	)
Templeton Global Bond VIP Fund - Class 4		979,018		(128,487	)		850,531
Templeton Growth VIP Fund - Class 2		125,272		(352,115	)		(226,843	)
VanEck VIP Global Hard Assets Fund - Class S Shares		292,887		(193,731	)		99,156
VanEck VIP Global Hard Assets Fund - Initial Class Shares		20,443		(12,734	)		7,709
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		325,874		(86,929	)		238,945
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares		132,284		(21,908	)		110,376
Virtus Rampart Equity Trend Series - Class A Shares		11,753		(8,545	)		3,208
Virtus Rampart Equity Trend Series - Class I Shares		5		—			5

N-164

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

The change in units outstanding for the year ended December 31, 2016, is as follows:

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
AB VPS Global Thematic Growth Portfolio - Class B		136,987		(491,164	)		(354,177	)
AB VPS International Value Portfolio - Class B		907		(1,247	)		(340	)
AB VPS Large Cap Growth Portfolio - Class B		46,578		(120,991	)		(74,413	)
AB VPS Small/Mid Cap Value Portfolio - Class A		24,047		(839	)		23,208
AB VPS Small/Mid Cap Value Portfolio - Class B		434,082		(890,413	)		(456,331	)
ALPS/Alerian Energy Infrastructure Portfolio - Class I		1,154		(2,751	)		(1,597	)
ALPS/Alerian Energy Infrastructure Portfolio - Class III		369,292		(124,407	)		244,885
ALPS/Red Rocks Listed Private Equity Portfolio - Class I		28,169		(25,464	)		2,705
ALPS/Red Rocks Listed Private Equity Portfolio - Class III		234,654		(51,956	)		182,698
ALPS/Stadion Core ETF Portfolio - Class I		4,406		—			4,406
ALPS/Stadion Core ETF Portfolio - Class III		120,733		(247,810	)		(127,077	)
ALPS/Stadion Tactical Growth Portfolio - Class III		306,474		(61,623	)		244,851
American Century VP Balanced Fund - Class II		1,869,393		(108,114	)		1,761,279
American Century VP Inflation Protection Fund - Class II		2,315		(32	)		2,283
American Funds Asset Allocation Fund - Class 1		693,252		(32,919	)		660,333
American Funds Asset Allocation Fund - Class 4		3,810,298		(434,092	)		3,376,206
American Funds Blue Chip Income and Growth Fund - Class 1		52,580		(20,499	)		32,081
American Funds Blue Chip Income and Growth Fund - Class 4		920,827		(267,558	)		653,269
American Funds Bond Fund - Class 1		196,358		(91,766	)		104,592
American Funds Capital Income Builder® - Class 1		57,507		(3,152	)		54,355
American Funds Capital Income Builder® - Class 4		1,653,341		(289,366	)		1,363,975
American Funds Global Balanced Fund - Class 1		25,894		(7,737	)		18,157
American Funds Global Bond Fund - Class 1		57,559		(18,359	)		39,200
American Funds Global Growth and Income Fund - Class 1		43,656		(2,962	)		40,694
American Funds Global Growth Fund - Class 1		22,649		(5,419	)		17,230
American Funds Global Growth Fund - Class 2		615,016		(1,665,455	)		(1,050,439	)
American Funds Global Growth Fund - Class 4		779,760		(413,362	)		366,398
American Funds Global Small Capitalization Fund - Class 1		35,251		(6,581	)		28,670
American Funds Global Small Capitalization Fund - Class 2		731,339		(2,282,230	)		(1,550,891	)
American Funds Global Small Capitalization Fund - Class 4		239,457		(183,386	)		56,071
American Funds Growth Fund - Class 1		111,856		(21,417	)		90,439
American Funds Growth Fund - Class 2		579,794		(7,685,020	)		(7,105,226	)
American Funds Growth Fund - Class 4		2,065,190		(405,421	)		1,659,769
American Funds Growth-Income Fund - Class 1		58,566		(10,319	)		48,247
American Funds Growth-Income Fund - Class 2		884,332		(9,983,549	)		(9,099,217	)
American Funds Growth-Income Fund - Class 4		1,331,300		(293,713	)		1,037,587
American Funds High-Income Bond Fund - Class 1		26,649		(5,813	)		20,836
American Funds International Fund - Class 1		104,621		(79,485	)		25,136
American Funds International Fund - Class 2		1,290,896		(4,289,068	)		(2,998,172	)
American Funds International Fund - Class 4		723,484		(238,585	)		484,899
American Funds International Growth and Income Fund - Class 1		10,660		(19,380	)		(8,720	)
American Funds Managed Risk Asset Allocation Fund - Class P1		29,017		(9,057	)		19,960
American Funds Managed Risk Asset Allocation Fund - Class P2		3,042,360		(202,663	)		2,839,697
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1		5,762		(485	)		5,277
American Funds Managed Risk Growth Fund - Class P1		8,345		(19	)		8,326
American Funds Managed Risk Growth-Income Fund - Class P1		77		(155	)		(78	)
American Funds Managed Risk International Fund - Class P1		4,563		(5,737	)		(1,174	)
American Funds Mortgage Fund - Class 1		18,377		(7,395	)		10,982
American Funds Mortgage Fund - Class 4		456,019		(476,477	)		(20,458	)
American Funds New World Fund® - Class 1		94,771		(15,369	)		79,402
American Funds New World Fund® - Class 4		721,918		(234,454	)		487,464
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1		12,915		(2,129	)		10,786
BlackRock Global Allocation V.I. Fund - Class I		87,328		(34,058	)		53,270
BlackRock Global Allocation V.I. Fund - Class III		2,087,321		(9,480,078	)		(7,392,757	)
BlackRock iShares® Alternative Strategies V.I. Fund - Class I		1,050		(119	)		931
BlackRock iShares® Alternative Strategies V.I. Fund - Class III		312,713		(28,796	)		283,917
ClearBridge Variable Aggressive Growth Portfolio - Class I		2,343		(1,592	)		751
ClearBridge Variable Aggressive Growth Portfolio - Class II		407,243		(282,922	)		124,321
ClearBridge Variable Mid Cap Portfolio - Class I		14,292		(3,939	)		10,353
ClearBridge Variable Mid Cap Portfolio - Class II		574,885		(314,876	)		260,009

N-165

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
Delaware VIP® Diversified Income Series - Service Class		8,403,702		(5,218,205	)		3,185,497
Delaware VIP® Diversified Income Series - Standard Class		146,040		(41,359	)		104,681
Delaware VIP® Emerging Markets Series - Service Class		930,833		(2,987,967	)		(2,057,134	)
Delaware VIP® Emerging Markets Series - Standard Class		27,830		(86	)		27,744
Delaware VIP® High Yield Series - Service Class		806,325		(1,667,785	)		(861,460	)
Delaware VIP® High Yield Series - Standard Class		126,806		(46,699	)		80,107
Delaware VIP® International Value Equity Series - Standard Class		30		(1,950	)		(1,920	)
Delaware VIP® Limited-Term Diversified Income Series - Service Class		5,120,151		(9,823,959	)		(4,703,808	)
Delaware VIP® Limited-Term Diversified Income Series - Standard Class		10,764		(13,416	)		(2,652	)
Delaware VIP® REIT Series - Service Class		872,975		(643,797	)		229,178
Delaware VIP® REIT Series - Standard Class		36,335		(41,248	)		(4,913	)
Delaware VIP® Small Cap Value Series - Service Class		779,017		(1,582,772	)		(803,755	)
Delaware VIP® Small Cap Value Series - Standard Class		21,400		(29,229	)		(7,829	)
Delaware VIP® Smid Cap Core Series - Service Class		587,899		(723,954	)		(136,055	)
Delaware VIP® Smid Cap Core Series - Standard Class		5,076		(30,361	)		(25,285	)
Delaware VIP® U.S. Growth Series - Service Class		660,947		(1,611,170	)		(950,223	)
Delaware VIP® Value Series - Service Class		2,195,701		(1,243,543	)		952,158
Delaware VIP® Value Series - Standard Class		43,741		(32,716	)		11,025
Deutsche Alternative Asset Allocation VIP Portfolio - Class A		13,603		(9,113	)		4,490
Deutsche Alternative Asset Allocation VIP Portfolio - Class B		279,735		(475,927	)		(196,192	)
Deutsche Equity 500 Index VIP Portfolio - Class A		1,686		(50,031	)		(48,345	)
Deutsche Small Cap Index VIP Portfolio - Class A		2,477		(20,257	)		(17,780	)
Eaton Vance VT Floating-Rate Income Fund - ADV Class		15,785		(16,330	)		(545	)
Eaton Vance VT Floating-Rate Income Fund - Initial Class		753,102		(344,226	)		408,876
Fidelity® VIP Contrafund® Portfolio - Initial Class		87,989		(484	)		87,505
Fidelity® VIP Contrafund® Portfolio - Service Class 2		763,150		(4,280,613	)		(3,517,463	)
Fidelity® VIP Equity-Income Portfolio - Service Class 2		460		(460	)		—
Fidelity® VIP Growth Portfolio - Initial Class		12,103		(74,783	)		(62,680	)
Fidelity® VIP Growth Portfolio - Service Class 2		1,067,786		(1,265,655	)		(197,869	)
Fidelity® VIP Mid Cap Portfolio - Initial Class		48,367		(10,386	)		37,981
Fidelity® VIP Mid Cap Portfolio - Service Class 2		1,237,223		(2,803,688	)		(1,566,465	)
Fidelity® VIP Overseas Portfolio - Service Class 2		1,053		(1,053	)		—
Fidelity® VIP Strategic Income Portfolio - Initial Class		27,495		(748	)		26,747
Fidelity® VIP Strategic Income Portfolio - Service Class 2		668,412		(92,428	)		575,984
First Trust Dorsey Wright Tactical Core Portfolio - Class I		514,695		(318,113	)		196,582
First Trust Multi Income Allocation Portfolio - Class I		221,638		(38,428	)		183,210
First Trust Multi Income Allocation Portfolio - Class II		4,551		—			4,551
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I		716,335		(112,931	)		603,404
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II		7		(47	)		(40	)
Franklin Founding Funds Allocation VIP Fund - Class 4		225,740		(35,287	)		190,453
Franklin Income VIP Fund - Class 1		3,935		(72	)		3,863
Franklin Income VIP Fund - Class 2		1,720,941		(4,465,415	)		(2,744,474	)
Franklin Income VIP Fund - Class 4		813,116		(198,066	)		615,050
Franklin Mutual Shares VIP Fund - Class 1		54,848		(2,647	)		52,201
Franklin Mutual Shares VIP Fund - Class 2		683,513		(6,932,420	)		(6,248,907	)
Franklin Mutual Shares VIP Fund - Class 4		211,321		(68,279	)		143,042
Franklin Rising Dividends VIP Fund - Class 1		18,569		(3,243	)		15,326
Franklin Rising Dividends VIP Fund - Class 4		685,700		(104,245	)		581,455
Franklin Small Cap Value VIP Fund - Class 1		2,633		(361	)		2,272
Franklin Small Cap Value VIP Fund - Class 4		298,153		(38,532	)		259,621
Franklin Small-Mid Cap Growth VIP Fund - Class 1		17,894		(51	)		17,843
Franklin Small-Mid Cap Growth VIP Fund - Class 2		2,270		(2,270	)		—
Franklin Small-Mid Cap Growth VIP Fund - Class 4		159,950		(58,131	)		101,819
Goldman Sachs VIT Government Money Market Fund - Institutional Shares		473,055		(411,352	)		61,703
Goldman Sachs VIT Government Money Market Fund - Service Shares		6,277,338		(5,055,418	)		1,221,920
Goldman Sachs VIT Large Cap Value Fund - Service Shares		194,729		(944,514	)		(749,785	)
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares		107,624		(98,514	)		9,110
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares		4,075		(1,034	)		3,041
Goldman Sachs VIT Strategic Income Fund - Advisor Shares		238,823		(95,582	)		143,241
Goldman Sachs VIT Strategic Income Fund - Institutional Shares		2,530		(13	)		2,517
Guggenheim VT Long Short Equity		128,284		(136,512	)		(8,228	)
Guggenheim VT Multi-Hedge Strategies		185,519		(117,764	)		67,755

N-166

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
Hartford Capital Appreciation HLS Fund - Class IA		—		(226	)		(226	)
Hartford Capital Appreciation HLS Fund - Class IC		295,764		(79,361	)		216,403
Invesco V.I. American Franchise Fund - Series I Shares		7,224		(19,141	)		(11,917	)
Invesco V.I. American Franchise Fund - Series II Shares		389		(9,444	)		(9,055	)
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares		1,470		(3,509	)		(2,039	)
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares		570,379		(112,448	)		457,931
Invesco V.I. Comstock Fund - Series I Shares		3,764		(459	)		3,305
Invesco V.I. Comstock Fund - Series II Shares		130,188		(41,032	)		89,156
Invesco V.I. Core Equity Fund - Series I Shares		9,447		(61,373	)		(51,926	)
Invesco V.I. Core Equity Fund - Series II Shares		302		(17,832	)		(17,530	)
Invesco V.I. Diversified Dividend Fund - Series I Shares		2,729		(2,819	)		(90	)
Invesco V.I. Diversified Dividend Fund - Series II Shares		1,000,341		(164,045	)		836,296
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares		2,087		(594	)		1,493
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares		702,553		(217,695	)		484,858
Invesco V.I. Equity and Income Fund - Series I Shares		1,542		(5	)		1,537
Invesco V.I. Equity and Income Fund - Series II Shares		267,160		(52,187	)		214,973
Invesco V.I. International Growth Fund - Series I Shares		5,607		(25,959	)		(20,352	)
Invesco V.I. International Growth Fund - Series II Shares		576,851		(112,115	)		464,736
Ivy VIP Asset Strategy Portfolio		226,305		(307,707	)		(81,402	)
Ivy VIP Energy Portfolio		515,579		(268,552	)		247,027
Ivy VIP High Income Portfolio		540,520		(153,297	)		387,223
Ivy VIP Micro Cap Growth Portfolio		159,835		(30,388	)		129,447
Ivy VIP Mid Cap Growth Portfolio		288,730		(149,555	)		139,175
Ivy VIP Science and Technology Portfolio		464,905		(305,668	)		159,237
Janus Henderson Balanced Portfolio - Service Shares		72,490		(105,502	)		(33,012	)
Janus Henderson Enterprise Portfolio - Service Shares		21,899		(17,914	)		3,985
Janus Henderson Global Research Portfolio - Service Shares		1,821		(7,506	)		(5,685	)
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2		212,247		(49,717	)		162,530
JPMorgan Insurance Trust Income Builder Portfolio - Class 2		104,086		(11,967	)		92,119
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1		7,088		(378	)		6,710
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2		334,064		(43,903	)		290,161
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC		631,757		(65,009	)		566,748
Lord Abbett Series Fund Developing Growth Portfolio - Class VC		199,810		(112,401	)		87,409
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC		9,219		(100,929	)		(91,710	)
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC		800,698		(418,237	)		382,461
LVIP American Balanced Allocation Fund - Service Class		1,253,644		(102,268	)		1,151,376
LVIP American Balanced Allocation Fund - Standard Class		289,196		(613,974	)		(324,778	)
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class		6,448,463		(802,610	)		5,645,853
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class		867,142		(130,083	)		737,059
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class		6,658		(546	)		6,112
LVIP American Global Growth Allocation Managed Risk Fund - Service Class		1,303,337		(395,413	)		907,924
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class		19,894		(42,002	)		(22,108	)
LVIP American Global Growth Fund - Service Class II		1,106,000		(941,170	)		164,830
LVIP American Global Small Capitalization Fund - Service Class II		297,691		(652,686	)		(354,995	)
LVIP American Growth Allocation Fund - Service Class		747,853		(134,958	)		612,895
LVIP American Growth Allocation Fund - Standard Class		71,288		(5,934	)		65,354
LVIP American Growth Fund - Service Class II		1,353,719		(1,225,366	)		128,353
LVIP American Growth-Income Fund - Service Class II		1,240,321		(1,002,513	)		237,808
LVIP American Income Allocation Fund - Standard Class		4,287		(47	)		4,240
LVIP American International Fund - Service Class II		604,819		(963,715	)		(358,896	)
LVIP American Preservation Fund - Service Class		588,804		(184,360	)		404,444
LVIP American Preservation Fund - Standard Class		7,886		(3,946	)		3,940
LVIP AQR Enhanced Global Strategies Fund - Service Class		20,265		(267,955	)		(247,690	)
LVIP AQR Enhanced Global Strategies Fund - Standard Class		6		(1,356	)		(1,350	)
LVIP Baron Growth Opportunities Fund - Service Class		368,032		(1,508,437	)		(1,140,405	)
LVIP Baron Growth Opportunities Fund - Standard Class		13,099		(1,327	)		11,772
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class		11,870,261		(1,332,403	)		10,537,858
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class		12,937		(893	)		12,044
LVIP BlackRock Emerging Markets Managed Volatility Fund - Service Class		2,780,936		(30,403,349	)		(27,622,413	)
LVIP BlackRock Emerging Markets Managed Volatility Fund - Standard Class		3,757		(21,527	)		(17,770	)
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class		7,659,971		(7,878,064	)		(218,093	)
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class		2,545		(12,535	)		(9,990	)

N-167

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class		6,758,538		(102,251	)		6,656,287
LVIP BlackRock Inflation Protected Bond Fund - Service Class		5,204,215		(5,647,080	)		(442,865	)
LVIP BlackRock Inflation Protected Bond Fund - Standard Class		27,305		(11,107	)		16,198
LVIP BlackRock Multi-Asset Income Fund - Service Class		366,979		(102,908	)		264,071
LVIP BlackRock Multi-Asset Income Fund - Standard Class		6,268		(4,062	)		2,206
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class		11,633,966		(264,734	)		11,369,232
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Service Class		1,488,371		(4,453,972	)		(2,965,601	)
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Standard Class		15,389		(48,999	)		(33,610	)
LVIP Blended Core Equity Managed Volatility Fund - Service Class		8,519,947		(553,785	)		7,966,162
LVIP Blended Core Equity Managed Volatility Fund - Standard Class		24		(414	)		(390	)
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class		7,071,603		(852,905	)		6,218,698
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class		16,398		(15,328	)		1,070
LVIP Blended Mid Cap Managed Volatility Fund - Service Class		16,899,721		(1,323,914	)		15,575,807
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class		4,447		(11	)		4,436
LVIP Clarion Global Real Estate Fund - Service Class		856,923		(1,619,276	)		(762,353	)
LVIP Clarion Global Real Estate Fund - Standard Class		5,151		(3,761	)		1,390
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class		3,645,792		(321,688	)		3,324,104
LVIP Delaware Bond Fund - Service Class		22,932,731		(7,701,473	)		15,231,258
LVIP Delaware Bond Fund - Standard Class		117,175		(705,877	)		(588,702	)
LVIP Delaware Diversified Floating Rate Fund - Service Class		5,572,849		(8,113,288	)		(2,540,439	)
LVIP Delaware Diversified Floating Rate Fund - Standard Class		44,401		(85,289	)		(40,888	)
LVIP Delaware Social Awareness Fund - Service Class		158,129		(422,065	)		(263,936	)
LVIP Delaware Social Awareness Fund - Standard Class		5,540		(50,621	)		(45,081	)
LVIP Delaware Special Opportunities Fund - Service Class		433,190		(453,443	)		(20,253	)
LVIP Delaware Wealth Builder Fund - Service Class		179,331		(304,710	)		(125,379	)
LVIP Delaware Wealth Builder Fund - Standard Class		1,795		(31,174	)		(29,379	)
LVIP Dimensional International Core Equity Fund - Service Class		756,431		(235,950	)		520,481
LVIP Dimensional International Core Equity Fund - Standard Class		121,755		(284	)		121,471
LVIP Dimensional International Equity Managed Volatility Fund - Service Class		3,953,702		(1,787,259	)		2,166,443
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class		11,899		(59,370	)		(47,471	)
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class		778,230		(261,463	)		516,767
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class		75,545		(44,344	)		31,201
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class		1,261,467		(229,719	)		1,031,748
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class		91,353		(30,616	)		60,737
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class		7,080,812		(1,098,693	)		5,982,119
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class		34,280		(141,761	)		(107,481	)
LVIP Dimensional/Vanguard Total Bond Fund - Service Class		9,493,899		(3,241,182	)		6,252,717
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class		208,104		(28,296	)		179,808
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class		9,445,890		(5,384,823	)		4,061,067
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class		38,975		(33,942	)		5,033
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class		8,146,338		(583,363	)		7,562,975
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class		1,019		(1,054	)		(35	)
LVIP Global Conservative Allocation Managed Risk Fund - Service Class		6,789,190		(8,578,965	)		(1,789,775	)
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class		12,168		(8,798	)		3,370
LVIP Global Growth Allocation Managed Risk Fund - Service Class		15,549,587		(49,456,813	)		(33,907,226	)
LVIP Global Growth Allocation Managed Risk Fund - Standard Class		28		(9,181	)		(9,153	)
LVIP Global Income Fund - Service Class		4,155,194		(3,883,410	)		271,784
LVIP Global Income Fund - Standard Class		58,594		(223	)		58,371
LVIP Global Moderate Allocation Managed Risk Fund - Service Class		15,070,709		(34,967,265	)		(19,896,556	)
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class		13,763		(8,747	)		5,016
LVIP Goldman Sachs Income Builder Fund - Service Class		201,832		(75,971	)		125,861
LVIP Goldman Sachs Income Builder Fund - Standard Class		1,555		(747	)		808
LVIP Government Money Market Fund - Service Class		16,415,574		(18,412,390	)		(1,996,816	)
LVIP Government Money Market Fund - Standard Class		1,498,438		(1,703,461	)		(205,023	)
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class		12,733,476		(194,834	)		12,538,642
LVIP Invesco Select Equity Managed Volatility Fund - Service Class		2,021,367		(1,167,776	)		853,591
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class		337		(675	)		(338	)
LVIP JPMorgan High Yield Fund - Service Class		3,490,259		(2,699,092	)		791,167
LVIP JPMorgan High Yield Fund - Standard Class		9,244		(206	)		9,038
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class		9,672,321		(828,679	)		8,843,642
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class		6,887		(5,111	)		1,776
LVIP Managed Risk Profile 2010 Fund - Service Class		63,051		(45,370	)		17,681

N-168

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP Managed Risk Profile 2020 Fund - Service Class		31,908		(91,536	)		(59,628	)
LVIP Managed Risk Profile 2030 Fund - Service Class		20,490		(139,021	)		(118,531	)
LVIP Managed Risk Profile 2040 Fund - Service Class		15,895		(172,372	)		(156,477	)
LVIP MFS International Equity Managed Volatility Fund - Service Class		4,936,132		(978,421	)		3,957,711
LVIP MFS International Growth Fund - Service Class		1,242,272		(1,225,235	)		17,037
LVIP MFS International Growth Fund - Standard Class		1,973		(1,062	)		911
LVIP MFS Value Fund - Service Class		1,445,091		(4,351,013	)		(2,905,922	)
LVIP MFS Value Fund - Standard Class		3,221		(31	)		3,190
LVIP Mondrian International Value Fund - Service Class		1,002,914		(1,937,058	)		(934,144	)
LVIP Mondrian International Value Fund - Standard Class		22,587		(87,772	)		(65,185	)
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class		1,030,600		(188,037	)		842,563
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class		19,155		—			19,155
LVIP PIMCO Low Duration Bond Fund - Service Class		17,595,764		(4,201,251	)		13,394,513
LVIP PIMCO Low Duration Bond Fund - Standard Class		339,142		(67,833	)		271,309
LVIP Select Core Equity Managed Volatility Fund - Service Class		3,167,009		(4,439,599	)		(1,272,590	)
LVIP Select Core Equity Managed Volatility Fund - Standard Class		16,582		(54,970	)		(38,388	)
LVIP SSGA Bond Index Fund - Service Class		8,617,157		(5,512,816	)		3,104,341
LVIP SSGA Bond Index Fund - Standard Class		36,841		(2,306	)		34,535
LVIP SSGA Conservative Index Allocation Fund - Service Class		1,385,417		(1,171,555	)		213,862
LVIP SSGA Conservative Structured Allocation Fund - Service Class		1,839,366		(1,893,798	)		(54,432	)
LVIP SSGA Conservative Structured Allocation Fund - Standard Class		3,102		(3,938	)		(836	)
LVIP SSGA Developed International 150 Fund - Service Class		819,301		(1,793,782	)		(974,481	)
LVIP SSGA Developed International 150 Fund - Standard Class		9,461		(1,474	)		7,987
LVIP SSGA Emerging Markets 100 Fund - Service Class		1,350,400		(2,423,233	)		(1,072,833	)
LVIP SSGA Emerging Markets 100 Fund - Standard Class		19,102		(15,958	)		3,144
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class		2,845,984		(7,963,394	)		(5,117,410	)
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class		8,270		(5,738	)		2,532
LVIP SSGA International Index Fund - Service Class		2,292,494		(1,934,539	)		357,955
LVIP SSGA International Index Fund - Standard Class		32,741		(27,516	)		5,225
LVIP SSGA International Managed Volatility Fund - Service Class		32,648,299		(934,293	)		31,714,006
LVIP SSGA International Managed Volatility Fund - Standard Class		19,771		(2,454	)		17,317
LVIP SSGA Large Cap 100 Fund - Service Class		610,617		(2,321,412	)		(1,710,795	)
LVIP SSGA Large Cap 100 Fund - Standard Class		35,465		(12,198	)		23,267
LVIP SSGA Large Cap Managed Volatility Fund - Service Class		7,760,905		(542,171	)		7,218,734
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class		2		(4	)		(2	)
LVIP SSGA Moderate Index Allocation Fund - Service Class		1,680,277		(1,370,028	)		310,249
LVIP SSGA Moderate Structured Allocation Fund - Service Class		1,751,153		(4,915,840	)		(3,164,687	)
LVIP SSGA Moderate Structured Allocation Fund - Standard Class		39		(14	)		25
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class		1,017,947		(1,171,251	)		(153,304	)
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class		1,902,804		(3,454,924	)		(1,552,120	)
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class		59,649		—			59,649
LVIP SSGA S&P 500 Index Fund - Service Class		3,395,205		(4,971,052	)		(1,575,847	)
LVIP SSGA S&P 500 Index Fund - Standard Class		341,653		(276,667	)		64,986
LVIP SSGA Small-Cap Index Fund - Service Class		1,280,568		(2,855,490	)		(1,574,922	)
LVIP SSGA Small-Cap Index Fund - Standard Class		52,665		(31,101	)		21,564
LVIP SSGA Small-Mid Cap 200 Fund - Service Class		574,490		(834,073	)		(259,583	)
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class		20,292		(17,147	)		3,145
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class		7,252,374		(699,321	)		6,553,053
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class		2,128		(6,045	)		(3,917	)
LVIP T. Rowe Price Growth Stock Fund - Service Class		1,387,847		(2,902,125	)		(1,514,278	)
LVIP T. Rowe Price Growth Stock Fund - Standard Class		49,247		(3,271	)		45,976
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class		478,679		(617,210	)		(138,531	)
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class		18,386		(18,204	)		182
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class		35,795,444		(514,259	)		35,281,185
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class		46		(117	)		(71	)
LVIP Vanguard Domestic Equity ETF Fund - Service Class		1,895,949		(849,397	)		1,046,552
LVIP Vanguard Domestic Equity ETF Fund - Standard Class		17,707		(16,592	)		1,115
LVIP Vanguard International Equity ETF Fund - Service Class		1,357,275		(636,917	)		720,358
LVIP Vanguard International Equity ETF Fund - Standard Class		17,539		(15,271	)		2,268
LVIP VIP Mid Cap Managed Volatility Portfolio - Service Class		1,558,440		(8,616,998	)		(7,058,558	)
LVIP VIP Mid Cap Managed Volatility Portfolio - Standard Class		149		(9,176	)		(9,027	)
LVIP Wellington Capital Growth Fund - Service Class		789,399		(1,747,338	)		(957,939	)

N-169

Lincoln Life Variable Annuity Account N

Notes to financial statements (continued)

6. Changes in Units Outstanding (continued)

Subaccount	Units Issued		Units Redeemed			Net Increase (Decrease)
LVIP Wellington Capital Growth Fund - Standard Class		506		(506	)		—
LVIP Wellington Mid-Cap Value Fund - Service Class		831,316		(655,083	)		176,233
LVIP Wellington Mid-Cap Value Fund - Standard Class		22,294		—			22,294
MFS® VIT Growth Series - Initial Class		7,005		(12,322	)		(5,317	)
MFS® VIT Growth Series - Service Class		968,847		(212,368	)		756,479
MFS® VIT Total Return Series - Initial Class		364,452		(389,853	)		(25,401	)
MFS® VIT Total Return Series - Service Class		2,278,801		(384,131	)		1,894,670
MFS® VIT Utilities Series - Initial Class		7,083		(40,503	)		(33,420	)
MFS® VIT Utilities Series - Service Class		773,097		(1,148,762	)		(375,665	)
MFS® VIT II Core Equity Portfolio - Service Class		297		(15,526	)		(15,229	)
MFS® VIT II International Value Portfolio - Initial Class		17,544		(2,567	)		14,977
MFS® VIT II International Value Portfolio - Service Class		801,738		(175,357	)		626,381
Morgan Stanley VIF Global Infrastructure Portfolio - Class I		2,850		(534	)		2,316
Morgan Stanley VIF Global Infrastructure Portfolio - Class II		300,737		(78,119	)		222,618
Morgan Stanley VIF Growth Portfolio - Class II		10,059		(13,647	)		(3,588	)
Neuberger Berman AMT Mid Cap Growth Portfolio - I Class		503		(503	)		—
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class		40,335		(215,622	)		(175,287	)
Oppenheimer Global Fund/VA Service Shares		36,709		(43,321	)		(6,612	)
Oppenheimer International Growth Fund/VA Non-Service Shares		5,018		(5,903	)		(885	)
Oppenheimer International Growth Fund/VA Service Shares		444,633		(126,082	)		318,551
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares		36,962		(1,204	)		35,758
Oppenheimer Main Street Small Cap Fund®/VA Service Shares		288,018		(50,625	)		237,393
PIMCO VIT All Asset All Authority Portfolio - Advisor Class		134,544		(54,849	)		79,695
PIMCO VIT All Asset All Authority Portfolio - Institutional Class		57		(13,377	)		(13,320	)
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class		622,354		(384,925	)		237,429
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class		14		(379	)		(365	)
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class		257,694		(127,033	)		130,661
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class		1,562		(39	)		1,523
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class		152,456		(74,904	)		77,552
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class		1,265		(274	)		991
Putnam VT Absolute Return 500 Fund - Class IA		2,594		(3,537	)		(943	)
Putnam VT Absolute Return 500 Fund - Class IB		61,119		(82,394	)		(21,275	)
Putnam VT Global Health Care Fund - Class IA		1,185		(971	)		214
Putnam VT Global Health Care Fund - Class IB		357,622		(324,771	)		32,851
Putnam VT Growth & Income Fund - Class IB		928		(10,080	)		(9,152	)
Putnam VT Income Fund - Class IB		226,198		(22,566	)		203,632
Rational Dividend Capture VA Fund		25,990		(16,606	)		9,384
SEI VP Market Growth Strategy Fund - Class III		105,085		(14,448	)		90,637
SEI VP Market Plus Strategy Fund - Class III		32,854		(9,216	)		23,638
Templeton Foreign VIP Fund - Class 1		105		(84	)		21
Templeton Foreign VIP Fund - Class 4		223,136		(115,044	)		108,092
Templeton Global Bond VIP Fund - Class 1		10,718		(16,693	)		(5,975	)
Templeton Global Bond VIP Fund - Class 2		622,887		(3,302,269	)		(2,679,382	)
Templeton Global Bond VIP Fund - Class 4		784,925		(272,185	)		512,740
Templeton Growth VIP Fund - Class 2		141,762		(359,542	)		(217,780	)
Transparent Value Directional Allocation VI Portfolio - Class I		4		(3,438	)		(3,434	)
Transparent Value Directional Allocation VI Portfolio - Class II		20,391		(833,523	)		(813,132	)
VanEck VIP Global Hard Assets Fund - Class S Shares		303,626		(121,705	)		181,921
VanEck VIP Global Hard Assets Fund - Initial Class Shares		12		(3,465	)		(3,453	)
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares		474,176		(124,090	)		350,086
Virtus Rampart Equity Trend Series - Class A Shares		19,474		(262,721	)		(243,247	)

7. Subsequent Event

Management evaluated subsequent events through the date these financial statements were issued and determined there were no additional matters to be disclosed.

N-170

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors of The Lincoln National Life Insurance Company and

Contract Owners of Lincoln Life Variable Annuity Account N

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of Lincoln Life Variable Annuity Account N ("Variable Account"), comprised of the subaccounts described in the related appendix to this opinion (collectively referred to as the "subaccounts"), as of December 31, 2017, and the related statement of operations and the statements of changes in net assets for the periods indicated in the appendix to this opinion, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of each of the subaccounts constituting Lincoln Life Variable Annuity Account N at December 31, 2017, the results of its operations and changes in net assets for the periods indicated in the appendix to this opinion, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements are the responsibility of the Variable Account's management. Our responsibility is to express an opinion on the subaccounts' financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Variable Account in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Variable Account is not required to have, nor were we engaged to perform, an audit of the Variable Account's internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Variable Account's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of investments owned as of December 31, 2017, by correspondence with the fund company. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Ernst & Young

We have served as the Variable Account's Auditor since 1998.
Philadelphia, Pennsylvania
April 11, 2018

N-171

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Invesco V.I. American Franchise Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. American Franchise Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Balanced-Risk Allocation Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Balanced-Risk Allocation Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Comstock Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Comstock Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Core Equity Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Core Equity Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Diversified Dividend Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Diversified Dividend Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Equally-Weighted S&P 500 Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Equally-Weighted S&P 500 Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. Equity and Income Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. International Growth Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Invesco V.I. International Growth Fund - Series II Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS Global Thematic Growth Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS Growth and Income Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS International Value Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS Large Cap Growth Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS Small/Mid Cap Value Portfolio - Class A	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
AB VPS Small/Mid Cap Value Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ALPS/Alerian Energy Infrastructure Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ALPS/Alerian Energy Infrastructure Portfolio - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ALPS/Red Rocks Listed Private Equity Portfolio - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-172

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
ALPS/Stadion Core ETF Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ALPS/Stadion Core ETF Portfolio - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ALPS/Stadion Tactical Growth Portfolio - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Asset Allocation Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Asset Allocation Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Blue Chip Income and Growth Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Blue Chip Income and Growth Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Bond Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Capital Income Builder® - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Capital Income Builder® - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Balanced Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Bond Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Growth and Income Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Growth Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Growth Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Growth Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Small Capitalization Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Small Capitalization Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Global Small Capitalization Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Growth Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Growth Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Growth Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Growth-Income Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Growth-Income Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-173

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
American Funds Growth-Income Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds High-Income Bond Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds International Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds International Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds International Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds International Growth and Income Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk Asset Allocation Fund - Class P1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk Asset Allocation Fund - Class P2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk Blue Chip Income and Growth Fund - Class P1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk Growth Fund - Class P1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk Growth-Income Fund - Class P1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Managed Risk International Fund - Class P1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Mortgage Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds Mortgage Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds New World Fund® - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds New World Fund® - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
BlackRock Global Allocation V.I. Fund - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
BlackRock Global Allocation V.I. Fund - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
BlackRock iShares® Alternative Strategies V.I. Fund - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Columbia VP Strategic Income Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Diversified Income Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Diversified Income Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-174

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Delaware VIP® Emerging Markets Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® High Yield Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® High Yield Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® International Value Equity Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Limited-Term Diversified Income Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Limited-Term Diversified Income Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® REIT Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® REIT Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Small Cap Value Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Small Cap Value Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Smid Cap Core Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Smid Cap Core Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® U.S. Growth Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® U.S. Growth Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Value Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Value Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Deutsche Equity 500 Index VIP Portfolio - Class A	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Deutsche Small Cap Index VIP Portfolio - Class A	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Deutsche Alternative Asset Allocation VIP Portfolio - Class A	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Deutsche Alternative Asset Allocation VIP Portfolio - Class B	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Eaton Vance VT Floating-Rate Income Fund - ADV Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Eaton Vance VT Floating-Rate Income Fund - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Contrafund® Portfolio - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-175

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Fidelity® VIP Contrafund® Portfolio - Service Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Growth Portfolio - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Growth Portfolio - Service Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Mid Cap Portfolio - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Mid Cap Portfolio - Service Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Overseas Portfolio - Service Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Strategic Income Portfolio - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Fidelity® VIP Strategic Income Portfolio - Service Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
First Trust Multi Income Allocation Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
First Trust/Dow Jones Dividend & Income Allocation Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Founding Funds Allocation VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Income VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Income VIP Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Income VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Mutual Shares VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Mutual Shares VIP Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Mutual Shares VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Rising Dividends VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Rising Dividends VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Small Cap Value VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Small Cap Value VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Franklin Small-Mid Cap Growth VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-176

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Franklin Small-Mid Cap Growth VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Foreign VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Foreign VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Global Bond VIP Fund - Class 1	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Global Bond VIP Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Global Bond VIP Fund - Class 4	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Templeton Growth VIP Fund - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Government Money Market Fund - Institutional Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Government Money Market Fund - Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Large Cap Value Fund - Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Advisor Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Multi-Strategy Alternatives Portfolio - Institutional Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Goldman Sachs VIT Strategic Income Fund - Advisor Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Hartford Capital Appreciation HLS Fund - Class IA	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Hartford Capital Appreciation HLS Fund - Class IC	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP Asset Strategy Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP Energy Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP High Income Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP Micro Cap Growth Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP Mid Cap Growth Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Ivy VIP Science and Technology Portfolio	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Janus Henderson Balanced Portfolio - Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-177

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Janus Henderson Enterprise Portfolio - Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Janus Henderson Global Research Portfolio - Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
JPMorgan Insurance Trust Global Allocation Portfolio - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
JPMorgan Insurance Trust Income Builder Portfolio - Class 2	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ClearBridge Variable Aggressive Growth Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ClearBridge Variable Aggressive Growth Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ClearBridge Variable Mid Cap Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
ClearBridge Variable Mid Cap Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Balanced Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Balanced Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Century Select Mid Cap Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Balanced Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Balanced Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Growth Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Growth Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Growth Fund - Service Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Global Small Capitalization Fund - Service Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Growth Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Growth Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Growth Fund - Service Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Growth-Income Fund - Service Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-178

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP American Income Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American International Fund - Service Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Preservation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP American Preservation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Baron Growth Opportunities Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Baron Growth Opportunities Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Dividend Value Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Dividend Value Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Global Allocation V.I. Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Inflation Protected Bond Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Inflation Protected Bond Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Multi-Asset Income Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP BlackRock Multi-Asset Income Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Blended Core Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Blended Core Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Blended Large Cap Growth Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Blended Large Cap Growth Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Blended Mid Cap Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Clarion Global Real Estate Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Clarion Global Real Estate Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-179

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP ClearBridge Large Cap Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Bond Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Bond Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Diversified Floating Rate Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Diversified Floating Rate Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Social Awareness Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Social Awareness Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Special Opportunities Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Wealth Builder Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Delaware Wealth Builder Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional International Core Equity Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional International Core Equity Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional International Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional International Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Core Equity 1 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Core Equity 1 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Core Equity 2 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Core Equity 2 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional U.S. Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional/Vanguard Total Bond Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Dimensional/Vanguard Total Bond Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-180

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP Franklin Templeton Global Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Franklin Templeton Value Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Franklin Templeton Value Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Conservative Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Conservative Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Growth Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Growth Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Income Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Income Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Moderate Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Global Moderate Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Goldman Sachs Income Builder Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Goldman Sachs Income Builder Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Government Money Market Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Government Money Market Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Invesco Diversified Equity-Income Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Invesco Select Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Invesco Select Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP JPMorgan High Yield Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP JPMorgan High Yield Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-181

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP JPMorgan Select Mid Cap Value Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Managed Risk Profile 2010 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Managed Risk Profile 2020 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Managed Risk Profile 2030 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Managed Risk Profile 2040 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP MFS International Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP MFS International Growth Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP MFS International Growth Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP MFS Value Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP MFS Value Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Mondrian International Value Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Mondrian International Value Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Multi-Manager Global Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP PIMCO Low Duration Bond Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP PIMCO Low Duration Bond Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Select Core Equity Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Select Core Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Bond Index Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Bond Index Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Conservative Index Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Conservative Structured Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-182

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP SSGA Conservative Structured Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Developed International 150 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Developed International 150 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Emerging Markets 100 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Emerging Markets 100 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Global Tactical Allocation Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA International Index Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA International Index Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA International Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Large Cap 100 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Large Cap 100 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Large Cap Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Large Cap Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Moderate Index Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Moderate Structured Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Moderate Structured Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Moderately Aggressive Index Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA S&P 500 Index Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA S&P 500 Index Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Small-Cap Index Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-183

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP SSGA Small-Cap Index Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Small-Mid Cap 200 Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA Small-Mid Cap 200 Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA SMID Cap Managed Volatility Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP SSGA SMID Cap Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP T. Rowe Price Growth Stock Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP T. Rowe Price Growth Stock Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP T. Rowe Price Structured Mid-Cap Growth Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP U.S. Growth Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP U.S. Growth Allocation Managed Risk Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Vanguard Domestic Equity ETF Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Vanguard Domestic Equity ETF Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Vanguard International Equity ETF Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Vanguard International Equity ETF Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Wellington Capital Growth Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP Wellington Mid-Cap Value Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Lord Abbett Series Fund Bond Debenture Portfolio - Class VC	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Lord Abbett Series Fund Developing Growth Portfolio - Class VC	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Lord Abbett Series Fund Fundamental Equity Portfolio - Class VC	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Lord Abbett Series Fund Short Duration Income Portfolio - Class VC	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT Growth Series - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-184

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
MFS® VIT Growth Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT Total Return Series - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT Total Return Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT Utilities Series - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT Utilities Series - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT II Core Equity Portfolio - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT II International Value Portfolio - Initial Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
MFS® VIT II International Value Portfolio - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Morgan Stanley VIF Global Infrastructure Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Morgan Stanley VIF Global Infrastructure Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Morgan Stanley VIF Growth Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Rational Dividend Capture VA Fund	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Neuberger Berman AMT Mid Cap Intrinsic Value Portfolio - I Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Oppenheimer Global Fund/VA Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Oppenheimer International Growth Fund/VA Non-Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Oppenheimer International Growth Fund/VA Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Oppenheimer Main Street Small Cap Fund®/VA Non-Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Oppenheimer Main Street Small Cap Fund®/VA Service Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT All Asset All Authority Portfolio - Advisor Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT All Asset All Authority Portfolio - Institutional Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Advisor Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT CommodityRealReturn® Strategy Portfolio - Institutional Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT Emerging Markets Bond Portfolio - Advisor Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017

N-185

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
PIMCO VIT Emerging Markets Bond Portfolio - Institutional Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT Unconstrained Bond Portfolio - Advisor Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
PIMCO VIT Unconstrained Bond Portfolio - Institutional Class	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Putnam VT Absolute Return 500 Fund - Class IB	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Putnam VT Global Health Care Fund - Class IA	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Putnam VT Global Health Care Fund - Class IB	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Putnam VT Income Fund - Class IB	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Guggenheim VT Long Short Equity	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Guggenheim VT Multi-Hedge Strategies	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
SEI VP Market Growth Strategy Fund - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
SEI VP Market Plus Strategy Fund - Class III	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
VanEck VIP Global Hard Assets Fund - Class S Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
VanEck VIP Global Hard Assets Fund - Initial Class Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class A Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Virtus Newfleet Multi-Sector Intermediate Bond Series - Class I Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Virtus Rampart Equity Trend Series - Class A Shares	As of December 31, 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Delaware VIP® Emerging Markets Series - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from January 5, 2016 through December 31, 2016
American Century VP Inflation Protection Fund - Class II	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from January 22, 2016 through December 31, 2016
ALPS/Red Rocks Listed Private Equity Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from March 7, 2016 through December 31, 2016
LVIP Blended Mid Cap Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from January 29, 2016 through December 31, 2016
LVIP Wellington Mid-Cap Value Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from January 19, 2016 through December 31, 2016

N-186

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
LVIP SSGA International Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from November 15, 2016 through December 31, 2016
LVIP Multi-Manager Global Equity Managed Volatility Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from October 20, 2016 through December 31, 2016
First Trust Dorsey Wright Tactical Core Portfolio - Class I	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from March 11, 2016 through December 31, 201
Invesco V.I. Equity and Income Fund - Series I Shares	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from November 11, 2016 through December 31, 2016
Goldman Sachs VIT Strategic Income Fund - Institutional Shares	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from September 28, 2016 through December 31, 2016
First Trust Multi Income Allocation Portfolio - Class II	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from November 28, 2016 through December 31, 2016
BlackRock iShares® Alternative Strategies V.I. Fund - Class I	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from March 16, 2016 through December 31, 2016
LVIP SSGA Moderately Aggressive Structured Allocation Fund - Standard Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from March 28, 2016 through December 31, 2016
American Century VP Balanced Fund - Class II	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from May 25, 2016 through December 31, 2016
LVIP BlackRock Global Growth ETF Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from June 14, 2016 through December 31, 2016
LVIP BlackRock U.S. Growth ETF Allocation Managed Risk Fund - Service Class	As of December 31, 2017	For the year ended December 31, 2017	For the year ended December 31, 2017 and the period from June 13, 2016 through December 31, 2016
LVIP JPMorgan Retirement Income Fund - Standard Class	As of December 31, 2017	For the period from July 6, 2017 through December 31, 2017
American Century VP Balanced Fund - Class I	As of December 31, 2017	For the period from March 28, 2017 through December 31, 2017
LVIP JPMorgan Retirement Income Fund - Service Class	As of December 31, 2017	For the period from June 7, 2017 through December 31, 2017
LVIP Wellington Capital Growth Fund - Standard Class	As of December 31, 2017	For the period from January 26, 2017 through December 31, 2017
LVIP BlackRock Scientific Allocation Fund - Service Class	As of December 31, 2017	For the period from May 30, 2017 through December 31, 2017
JPMorgan Insurance Trust Core Bond Portfolio - Class 1	As of December 31, 2017	For the period from April 4, 2017 through December 31, 2017
LVIP Franklin Templeton Multi-Asset Opportunities Fund - Standard Class	As of December 31, 2017	For the period from December 19, 2017 through December 31, 2017
Putnam VT Absolute Return 500 Fund - Class IA	As of December 31, 2017	For the period from July 24, 2017 through December 31, 2017

N-187

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
Virtus Rampart Equity Trend Series - Class I Shares	As of December 31, 2017	For the period from April 4, 2017 through December 31, 2017
JPMorgan Insurance Trust Income Builder Portfolio - Class 1	As of December 31, 2017	For the period from May 10, 2017 through December 31, 2017
Fidelity® VIP FundsManager® 50% Portfolio - Service Class 2	As of December 31, 2017	For the period from January 17, 2017 through December 31, 2017
JPMorgan Insurance Trust Core Bond Portfolio - Class 2	As of December 31, 2017	For the period from January 9, 2017 through December 31, 2017
Putnam VT George Putnam Balanced Fund - Class IB	As of December 31, 2017	For the period from January 12, 2017 through December 31, 2017
Columbia VP Strategic Income Fund - Class 2	As of December 31, 2017	For the period from January 11, 2017 through December 31, 2017
LVIP SSGA Moderately Aggressive Index Allocation Fund - Standard Class	As of December 31, 2017	For the period from June 6, 2017 through December 31, 2017
LVIP SSGA Moderate Index Allocation Fund - Standard Class	As of December 31, 2017	For the period from November 10, 2017 through December 31, 2017
Columbia VP Emerging Markets Bond Fund - Class 2	As of December 31, 2017	For the period from January 12, 2017 through December 31, 2017
LVIP SSGA Mid-Cap Index Fund - Standard Class	As of December 31, 2017	For the period from January 31, 2017 through December 31, 2017
LVIP SSGA Mid-Cap Index Fund - Service Class	As of December 31, 2017	For the period from January 10, 2017 through December 31, 2017
Columbia VP Commodity Strategy Fund - Class 2	As of December 31, 2017	For the period from February 6, 2017 through December 31, 2017
Putnam VT George Putnam Balanced Fund - Class IA	As of December 31, 2017	For the period from July 17, 2017 through December 31, 2017
Columbia VP Emerging Markets Bond Fund - Class 1	As of December 31, 2017	For the period from April 6, 2017 through December 31, 2017
Columbia VP Commodity Strategy Fund - Class 1	As of December 31, 2017	For the period from February 16, 2017 through December 31, 2017
American Funds Asset Allocation Fund - Class 1A	As of December 31, 2017	For the period from April 13, 2017 through December 31, 2017
American Funds Blue Chip Income and Growth Fund - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds Capital Income Builder® - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds Global Growth Fund - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds Global Small Capitalization Fund - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds Growth Fund - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds Growth-Income Fund - Class 1A	As of December 31, 2017	For the period from February 24, 2017 through December 31, 2017
American Funds International Fund - Class 1A	As of December 31, 2017	For the period from February 21, 2017 through December 31, 2017

N-188

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
American Funds Mortgage Fund - Class 1A	As of December 31, 2017	For the period from February 10, 2017 through December 31, 2017
American Funds New World Fund® - Class 1A	As of December 31, 2017	For the period from February 10, 2017 through December 31, 2017
American Funds Bond Fund - Class 1A	As of December 31, 2017	For the period from March 20, 2017 through December 31, 2017
American Funds Global Balanced Fund - Class 1A	As of December 31, 2017	For the period from July 25, 2017 through December 31, 2017
American Funds Global Bond Fund - Class 1A	As of December 31, 2017	For the period from June 27, 2017 through December 31, 2017
American Funds Global Growth and Income Fund - Class 1A	As of December 31, 2017	For the period from July 28, 2017 through December 31, 2017
American Funds High-Income Bond Fund - Class 1A	As of December 31, 2017	For the period from February 10, 2017 through December 31, 2017
American Funds International Growth and Income Fund - Class 1A	As of December 31, 2017	For the period from March 30, 2017 through December 31, 2017
American Funds U.S. Government/AAA-Rated Securities Fund - Class 1A	As of December 31, 2017	For the period from May 30, 2017 through December 31, 2017
Lincoln iShares® U.S. Moderate Allocation Fund - Standard Class	As of December 31, 2017	For the period from May 18, 2017 through December 31, 2017
Lincoln iShares® Global Growth Allocation Fund - Standard Class	As of December 31, 2017	For the period from May 30, 2017 through December 31, 2017
American Century VP Large Company Value Fund - Class II	As of December 31, 2017	For the period from June 7, 2017 through December 31, 2017
American Century VP Large Company Value Fund - Class I	As of December 31, 2017	For the period from June 27, 2017 through December 31, 2017
ClearBridge Variable Large Cap Growth Portfolio - Class II	As of December 31, 2017	For the period from May 25, 2017 through December 31, 2017
ClearBridge Variable Large Cap Growth Portfolio - Class I	As of December 31, 2017	For the period from July 6, 2017 through December 31, 2017
QS Variable Conservative Growth - Class II	As of December 31, 2017	For the period from June 26, 2017 through December 31, 2017
Putnam VT Equity Income Fund - Class IB	As of December 31, 2017	For the period from May 12, 2017 through December 31, 2017
LVIP Western Asset Core Bond Fund - Standard Class	As of December 31, 2017	For the period from June 5, 2017 through December 31, 2017
LVIP Western Asset Core Bond Fund - Service Class	As of December 31, 2017	For the period from May 22, 2017 through December 31, 2017
Ivy VIP High Income Portfolio - Class I	As of December 31, 2017	For the period from July 21, 2017 through December 31, 2017
Ivy VIP Micro Cap Growth Portfolio - Class I	As of December 31, 2017	For the period from August 22, 2017 through December 31, 2017
Ivy VIP Mid Cap Growth Portfolio - Class I	As of December 31, 2017	For the period from July 24, 2017 through December 31, 2017
Ivy VIP Science and Technology Portfolio - Class I	As of December 31, 2017	For the period from September 11, 2017 through December 31, 2017

N-189

Subaccount	Statements of Assets and Liabilities	Statements of Operations	Statements of Changes in Net Assets
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 1	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
JPMorgan Insurance Trust Intrepid Mid Cap Portfolio - Class 2	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
LVIP AQR Enhanced Global Strategies Fund - Service Class	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	For the year ended December 31, 2016 (the fund ceased to be available as an investment option to Variable Account contract owners during 2016)
LVIP AQR Enhanced Global Strategies Fund - Standard Class	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	For the year ended December 31, 2016 (the fund ceased to be available as an investment option to Variable Account contract owners during 2016)
LVIP BlackRock Emerging Markets Managed Volatility Fund - Service Class	N/A - the fund merged into LVIP SSGA International Managed Volatility Fund - Service Class during 2016	N/A - the fund merged into LVIP SSGA International Managed Volatility Fund - Service Class during 2016	For the year ended December 31, 2016 (the fund merged into LVIP SSGA International Managed Volatility Fund - Service Class during 2016)
LVIP BlackRock Emerging Markets Managed Volatility Fund - Standard Class	N/A - the fund merged into LVIP SSGA International Managed Volatility Fund - Standard Class during 2016	N/A - the fund merged into LVIP SSGA International Managed Volatility Fund - Standard Class during 2016	For the year ended December 31, 2016 (the fund merged into LVIP SSGA International Managed Volatility Fund - Standard Class during 2016)
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Service Class	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016	For the year ended December 31, 2016 (the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016)
LVIP BlackRock U.S. Opportunities Managed Volatility Fund - Standard Class	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Standard Class during 2016	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Standard Class during 2016	For the year ended December 31, 2016 (the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Standard Class during 2016)
LVIP VIP Mid Cap Managed Volatility Portfolio - Service Class	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016	N/A - the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016	For the year ended December 31, 2016 (the fund merged into LVIP Blended Mid Cap Managed Volatility Fund - Service Class during 2016)
LVIP VIP Mid Cap Managed Volatility Portfolio - Standard Class	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	For the year ended December 31, 2016 (the fund ceased to be available as an investment option to Variable Account contract owners during 2016)
Putnam VT Growth & Income Fund - Class IB	N/A - the fund merged into Putnam VT Equity Income Fund - Class IB during 2017	For the year ended December 31, 2017	For each of the two years in the period ended December 31, 2017
Transparent Value Directional Allocation VI Portfolio - Class I	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	For the year ended December 31, 2016 (the fund ceased to be available as an investment option to Variable Account contract owners during 2016)
Transparent Value Directional Allocation VI Portfolio - Class II	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	N/A - the fund ceased to be available as an investment option to Variable Account contract owners during 2016	For the year ended December 31, 2016 (the fund ceased to be available as an investment option to Variable Account contract owners during 2016)

N-190

Lincoln Life Variable Annuity Account N

PART C - OTHER INFORMATION

Item 24. Financial Statements and Exhibits

(a) List of Financial Statements

1. Part A

The Table of Condensed Financial Information is included in Part A of this Registration Statement. (Not Applicable)

2. Part B

The following financial statements for the Variable Account are included in Part B of this Registration Statement.

Statement of Assets and Liabilities - December 31, 2017

Statement of Operations - Year ended December 31, 2017

Statements of Changes in Net Assets - Years ended December 31, 2017 and 2016

Notes to Financial Statements - December 31, 2017

Report of Independent Registered Public Accounting Firm

3. Part B

The following consolidated financial statements for The Lincoln National Life Insurance Company are included in Part B of this Registration Statement.

Consolidated Balance Sheets – Years ended December 31, 2017 and 2016

Consolidated Statements of Comprehensive Income (Loss) - Years ended December 31, 2017, 2016 and 2015

Consolidated Statements of Stockholder’s Equity - Years ended December 31, 2017, 2016 and 2015

Consolidated Statements of Cash Flows - Years ended December 31, 2017, 2016, and 2015

Notes to Consolidated Financial Statements - December 31, 2017

Report of Independent Registered Public Accounting Firm

(b) List of Exhibits

(1) Resolutions of the Board of Directors of The Lincoln National Life Insurance Company establishing Separate Account N incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-40937) filed on November 25, 1997.

(2) Not Applicable

(3)(a) Form of Broker-Dealer Selling Agreement among The Lincoln National Life Insurance Company, Lincoln Life & Annuity Company of New York and Lincoln Financial Distributors, Inc. incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-222786) filed on January 30, 2018.

(b) Amended and Restated Principal Underwriting Agreement dated May 1, 2007 between The Lincoln National Life Insurance Company and Lincoln Financial Distributors, Inc. incorporated herein by reference to Post-Effective Amendment No. 24 (File No. 333-61554) filed on December 18, 2007.

(4)(a) Annuity Contract (30070-B) incorporated herein by reference to Post-Effective Amendment No. 3 (File No. 333-36304) filed on June 8, 2001.

(b) Annuity Contract (30070-A 8/03) incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-138190) filed on October 26, 2006.

(c) Indexed Account Rider (AR-601) incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-222786) filed on January 30, 2018.

(d) Variable and Indexed Linked Annuity Payment Option Rider (i4LA-IA-NQ)

(e) Variable and Indexed Linked Annuity Payment Option Rider (i4LA-IA-Q)

(f) Guarantee of Principal Death Benefit Rider (B Share) (ICC18-32148) incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-222786) filed on January 30, 2018.

(g) Guarantee of Principal Death Benefit Rider (Advisory) (ICC16-32148) incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-222786) filed on January 30, 2018.

(5) Application (ANF11534) incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-222786) filed on January 30, 2018.

(6)(a) Articles of Incorporation of The Lincoln National Life Insurance Company incorporated herein by reference to Pre-Effective Amendment No. 1 (File No. 333-04999) filed on September 24, 1996.

(b) By-laws of The Lincoln National Life Insurance Company incorporated herein by reference to Post-Effective Amendment No. 3 on Form N-6 (File No. 333-118478) filed on April 5, 2007.

(7) Not Applicable

(8)(a) Fund Participation Agreements and Amendments between The Lincoln National Life Insurance Company and:

(i) AIM Variable Insurance Funds (Invesco Variable Insurance Funds) incorporated herein by reference to Post-Effective Amendment No. 21 on Form N-6 (File No. 333-146507) filed on April 2, 2013.

(ii) American Funds Insurance incorporated herein by reference to Post-Effective Amendment No. 26 on Form N-6 (File No. 333-146507) filed on April 3, 2017.

(iii) BlackRock Variable Series Funds, Inc. incorporated herein by reference to Post-Effective Amendment No. 16 on Form N-6 (File No. 333-146507) filed on April 1, 2011.

(iv) Fidelity Variable Insurance Products Fund incorporated herein by reference to Post-Effective Amendment No. 34 on Form N-6 (File No. 333-125790) filed on April 9, 2018.

(v) First Trust Variable Insurance Trust and First Trust Portfolios, L.P. incorporated herein by reference to Post-Effective Amendment No. 9 (File No. 333-193272) filed on April 13, 2016.

(vi) Franklin Templeton Variable Insurance Products Trust incorporated herein by reference to Post-Effective Amendment No. 23 on Form N-6 (File No. 333-146507) filed on April 1, 2015.

(vii) JPMorgan Insurance Trust incorporated herein by reference to Post-Effective Amendment No. 26 on Form N-6 (File No. 333-146507) filed on April 3, 2017.

(viii) Lincoln Variable Insurance Products Trust incorporated herein by reference to Post-Effective Amendment No. 24 on Form N-6 (File No. 333-146507) filed on April 1, 2016.

(b) Rule 22c-2 Agreements between The Lincoln National Life Insurance Company and:

(i) AIM Variable Insurance Funds incorporated herein by reference to Post-Effective Amendment No. 30 (File No. 333-36304) filed on May 29, 2008.

(ii) American Funds Insurance Series incorporated herein by reference to Post-Effective Amendment No. 30 (File No. 333-36304) filed on May 29, 2008.

(iii) BlackRock Variable Series Funds, Inc. incorporated herein by reference to Post-Effective Amendment No. 22 (File No. 333-68842) filed on June 22, 2009.

(iv) Fidelity Variable Insurance Products Trust incorporated herein by reference to Post-Effective Amendment No. 30 (File No. 333-36304) filed on May 29, 2008.

(v) Franklin Templeton Variable Insurance Products Trust incorporated herein by reference to Post-Effective Amendment No. 30 (File No. 333-36304) filed on May 29, 2008.

(vi) Lincoln Variable Insurance Products Trust incorporated herein by reference to Post-Effective Amendment No. 30 (File No. 333-36304) filed on May 29, 2008.

(c) Accounting and Financial Administration Services Agreement dated October 1, 2007 among Mellon Bank, N.A., The Lincoln National Life Insurance Company and Lincoln Life & Annuity Company of New York is incorporated herein by reference to Registration Statement on Form N-4 (File No. 333-147673) filed on November 28, 2007.

(9) Opinion and Consent of Scott C. Durocher, Senior Counsel of The Lincoln National Life Insurance Company, as to the legality of securities being issued

(10)(a) Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm

(b) Power of Attorney - Principal Officers and Directors of The Lincoln National Life Insurance Company

(11) Not applicable

(12) Not applicable

(13) Organizational Chart of the Lincoln National Insurance Holding Company System. (Filed herein)

B-2

Item 25. Directors and Officers of the Depositor

The following list contains the officers and directors of The Lincoln National Life Insurance Company who are engaged directly or indirectly in activities relating to Lincoln Life Variable Annuity Account N as well as the contracts. The list also shows The Lincoln National Life Insurance Company's executive officers.

Name	Positions and Offices with Depositor
Ellen G. Cooper*	Executive Vice President, Chief Investment Officer, and Director
Jeffrey D. Coutts*	Senior Vice President and Treasurer
Randal J. Freitag*	Executive Vice President, Chief Financial Officer, and Director
Wilford H. Fuller*	Executive Vice President and Director
Dennis R. Glass*	President and Director
Andrea D. Goodrich*	Senior Vice President and Secretary
Stephen B. Harris*	Senior Vice President and Chief Ethics and Compliance Officer
Kirkland L. Hicks*	Executive Vice President, Director, and General Counsel
Christine Janofsky*	Senior Vice President, Chief Accounting Officer, and Controller
Keith J. Ryan**	Vice President and Director
Joseph D. Spada***	Vice President and Chief Compliance Officer for Separate Accounts

*Principal business address is Radnor Financial Center, 150 Radnor Chester Road, Radnor, PA 19087

**Principal business address is 1300 South Clinton Street, Fort Wayne, Indiana 46802

***Principal business address is 350 Church Street, Hartford, Connecticut 06096

Item 26. Persons Controlled by or Under Common Control with the Depositor or Registrant

See Exhibit 13: Organizational Chart of the Lincoln National Insurance Holding Company System.

Item 27. Number of Contractowners

As of February 28, 2018 there were 363,361 contract owners under Account N.

Item 28. Indemnification

a) Brief description of indemnification provisions.

In general, Article VII of the By-Laws of The Lincoln National Life Insurance Company (Lincoln Life or Company) provides that Lincoln Life will indemnify certain persons against expenses, judgments and certain other specified costs incurred by any such person if he/she is made a party or is threatened to be made a party to a suit or proceeding because he/she was a director, officer, or employee of Lincoln Life, as long as he/she acted in good faith and in a manner he/she reasonably believed to be in the best interests of, or act opposed to the best interests of, Lincoln Life. Certain additional conditions apply to indemnification in criminal proceedings.

In particular, separate conditions govern indemnification of directors, officers, and employees of Lincoln Life in connection with suits by, or in the right of, Lincoln Life.

Please refer to Article VII of the By-Laws of Lincoln Life (Exhibit no. 6(b) hereto) for the full text of the indemnification provisions. Indemnification is permitted by, and is subject to the requirements of, Indiana law.

b) Undertaking pursuant to Rule 484 of Regulation C under the Securities Act of 1933:

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described in Item 28(a) above or otherwise, the Registrant 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 the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any such action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant 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.

B-3

Item 29. Principal Underwriter

(a) Lincoln Financial Distributors, Inc. (“LFD”) currently serves as Principal Underwriter for: Lincoln National Variable Annuity Account C; Lincoln National Flexible Premium Variable Life Account D; Lincoln National Variable Annuity Account E; Lincoln National Flexible Premium Variable Life Account F; Lincoln National Flexible Premium Variable Life Account G; Lincoln National Variable Annuity Account H; Lincoln Life & Annuity Variable Annuity Account H; Lincoln Life Flexible Premium Variable Life Account J; Lincoln Life Flexible Premium Variable Life Account K; Lincoln National Variable Annuity Account L; Lincoln Life & Annuity Variable Annuity Account L; Lincoln Life Flexible Premium Variable Life Account M; Lincoln Life & Annuity Flexible Premium Variable Life Account M; Lincoln Life Variable Annuity Account N; Lincoln New York Account N for Variable Annuities; Lincoln Life Variable Annuity Account Q; Lincoln Life Flexible Premium Variable Life Account R; LLANY Separate Account R for Flexible Premium Variable Life Insurance; Lincoln Life Flexible Premium Variable Life Account S; LLANY Separate Account S for Flexible Premium Variable Life Insurance; Lincoln Life Variable Annuity Account T; Lincoln Life Variable Annuity Account W; and Lincoln Life Flexible Premium Variable Life Account Y and Lincoln Life & Annuity Flexible Premium Variable Life Account Y; Lincoln Life Variable Annuity Account JF-H; Lincoln Life Variable Annuity Account JF-I; Lincoln Life Flexible Premium Variable Life Account JF-A; Lincoln Life Flexible Premium Variable Life Account JF-C; Lincoln Life Variable Annuity Account JL-A; Lincoln Life & Annuity Flexible Premium Variable Life Account JA-B; Lincoln Variable Insurance Products Trust; Lincoln Advisors Trust.

(b) Officers and Directors of Lincoln Financial Distributors, Inc.:

Name	Positions and Offices with Underwriter
Andrew J. Bucklee*	Senior Vice President and Director
Patrick J. Caulfield**	Vice President, Chief Compliance Officer and Senior Counsel
Jeffrey D. Coutts*	Senior Vice President and Treasurer
Wilford H. Fuller*	President, Chief Executive Officer and Director
John C. Kennedy*	Senior Vice President, Head of Retirement Solutions Distribution, and Director
Thomas P. O'Neill*	Senior Vice President and Chief Operating Officer
Christopher P. Potochar*	Senior Vice President and Director, Head of Finance and Strategy
Nancy A. Smith*	Secretary

*Principal Business address is Radnor Financial Center, 150 Radnor Chester Road, Radnor, PA 19087

**Principal Business address is 350 Church Street, Hartford, CT 06103

(c) N/A

Item 30. Location of Accounts and Records

All accounts, books, and other documents, except accounting records, required to be maintained by Section 31a of the 1940 Act and the Rules promulgated thereunder are maintained by The Lincoln National Life Insurance Company, 1300 South Clinton Street, Fort Wayne, Indiana 46802. The accounting records are maintained by The Bank of New York Mellon, One Mellon Bank Center, 500 Grant Street, Pittsburgh, PA 15258.

Item 31. Management Services

Not Applicable.

Item 32. Undertakings

(a) Registrant undertakes that it will file a post-effective amendment to this registration statement as frequently as necessary to ensure that the audited financial statements in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted.

(b) Registrant undertakes that it will include either (1) as part of any application to purchase a Certificate or an Individual Contract offered by the Prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a post card or a similar written communication affixed to or included in the Prospectus that the applicant can remove to send for a Statement of Additional Information.

(c) Registrant undertakes to deliver any Statement of Additional Information and any financial statements required to be made available under this Form promptly upon written or oral request to Lincoln Life at the address or phone number listed in the Prospectus.

B-4

(d) The Lincoln National Life Insurance Company hereby represents that the fees and charges deducted under the contract, in the aggregate, are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by The Lincoln National Life Insurance Company.

SIGNATURES

(a) As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant has caused this Pre-Effective Amendment No. 1 to the registration statement to be signed on its behalf, in the City of Hartford, and State of Connecticut on this 14th day of May, 2018.

Lincoln Life Variable Annuity Account N (Registrant) Lincoln Level AdvantageSM B-Share Lincoln Level AdvantageSM Advisory Lincoln Level AdvantageSM B-Class
By:	/s/ Kimberly A. Genovese Kimberly A. Genovese Assistant Vice President, The Lincoln National Life Insurance Company (Title)
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY (Depositor)
By:	/s/ Stephen R. Turer Stephen R. Turer (Signature-Officer of Depositor) Senior Vice President, The Lincoln National Life Insurance Company (Title)

(b) As required by the Securities Act of 1933, this Amendment to the registration statement has been signed by the following persons in their capacities indicated on May 14, 2018.

Signature	Title
*/s/ Dennis R. Glass Dennis R. Glass	President and Director (Principal Executive Officer)
*/s/ Ellen Cooper Ellen Cooper	Executive Vice President, Chief Investment Officer and Director
*/s/ Randal J. Freitag Randal J. Freitag	Executive Vice President, Chief Financial Officer and Director (Principal Financial Officer)
*/s/ Wilford H. Fuller Wilford H. Fuller	Executive Vice President and Director
*/s/ Kirkland L. Hicks Kirkland L. Hicks	Executive Vice President, Director, and General Counsel
*/s/ Keith J. Ryan Keith J. Ryan	Vice President and Director
*By: /s/ Kimberly A. Genovese Kimberly A. Genovese	Pursuant to a Power of Attorney

B-5