2.2.0.25falsefalse006080 - Disclosure - INCOME TAXEStruefalsefalse1falsefalseUSDfalsefalse1/1/2010 - 12/31/2010 USD ($) USD ($) / shares $c00021http://www.sec.gov/CIK0001224608duration2010-01-01T00:00:002010-12-31T00:00:00u000Standardhttp://www.xbrl.org/2003/iso4217USDiso42170u002Dividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0u001Standardhttp://www.xbrl.org/2003/instancesharesxbrli0USDUSD$2true0cno_NotesToFinancialStatementsAbstractcnofalsenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00falsefalsefalsefalsefalseOtherxbrli:stringItemTypestringNo definition available.falsefalseNotes to Financial Statements [Abstract]3false0us-gaap_IncomeTaxDisclosureTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalse00<div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 27pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">6.      INCOME TAXES</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">The components of income tax expense were as follows (dollars in millions):</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr><td style="PADDING-BOTTOM: 2px" valign="bottom">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2010</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2009</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2008</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr><td valign="bottom">  </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Current tax expense                                                                       </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">9.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">9.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">3.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Deferred tax provision                                                                       </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">94.2</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">50.8</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">5.6</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="64%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Income tax expense on period income                                                                </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">103.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">60.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">9.4</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="64%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Valuation allowance                                                                       </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(95.0</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">27.8</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">403.9</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="64%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 4px" valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Total income tax expense                                                                </div></td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">8.9</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">87.9</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">413.3</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div> </div><div> </div><div> </div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">A reconciliation of the U.S. statutory corporate tax rate to the effective rate reflected in the consolidated statement of operations is as follows:</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div align="left"><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr><td style="PADDING-BOTTOM: 2px" valign="bottom">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2010</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2009</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2008</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr><td valign="bottom">  </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">U.S. statutory corporate rate                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">35.0 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">35.0 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">35.0 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">Valuation allowance                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(32.4 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">16.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">10,916.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">Other nondeductible expenses (benefits)</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(.3 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(1.4 </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">125.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">State taxes                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">78.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">Provision for tax issues, tax credits and other</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(.1 </td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">15.2</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="64%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 4px" valign="bottom" align="left" width="64%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 9pt; MARGIN-RIGHT: -9.35pt" align="left">Effective tax rate                                                       </div></td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">3.0 </td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">50.6 </td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">11,170.3 </td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">%</td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">The components of the Company’s income tax assets and liabilities were as follows (dollars in millions):</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr><td style="PADDING-BOTTOM: 2px" valign="bottom">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2010</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">2009</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr><td valign="bottom" align="left"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Deferred tax assets:</div></td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr><td valign="bottom" align="left"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9pt" align="left">Net federal operating loss carryforwards attributable to:</div></td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td><td valign="bottom"> </td><td valign="bottom" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Life insurance subsidiaries                                                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">681.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">745.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Non-life companies                                                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">870.6</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">883.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9pt" align="left">Net state operating loss carryforwards                                                                                             </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">17.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">19.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9pt" align="left">Tax credits                                                                                             </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">23.4</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">18.5</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9.35pt" align="left">Capital loss carryforwards                                                                                             </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">339.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">393.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9pt" align="left">Deductible temporary differences:</div></td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Investments                                                                                           </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">5.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Insurance liabilities                                                                                           </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">738.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">782.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Unrealized depreciation of investments                                                                                           </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">146.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Other                                                                                           </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">62.8</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">44.0</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: -9pt" align="left">Gross deferred tax assets                                                                                        </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">2,740.2</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">3,033.5</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9.35pt" align="left">Deferred tax liabilities:</div></td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9.35pt" align="left">Investments                                                                                             </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(38.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9.35pt" align="left">Present value of future profits and deferred acquisition costs</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(676.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(694.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: -9.35pt" align="left">Unrealized appreciation on investments                                                                                             </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(132.3</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9.35pt" align="left">Gross deferred tax liabilities                                                                                         </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(808.6</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(732.1</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9.35pt" align="left">Net deferred tax assets before valuation allowance                                                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1,931.6</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">2,301.4</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Valuation allowance                                                                                                 </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(1,081.4</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(1,176.4</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Net deferred tax assets                                                                                         </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">850.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1,125.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">Current income taxes accrued                                                                                                 </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(10.8</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(1.0</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td></tr><tr bgcolor="white"><td valign="bottom" width="76%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 4px" valign="bottom" align="left" width="76%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">Income tax assets, net                                                                                         </div></td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">839.4</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">1,124.0</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Our income tax expense includes deferred income taxes arising from temporary differences between the financial reporting and tax bases of assets and liabilities, capital loss carryforwards and NOLs.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which temporary differences are expected to be recovered or paid.  The effect of a change in tax rates on deferred tax assets and liabilities is recognized in earnings in the period when the changes are enacted.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">A reduction of the net carrying amount of deferred tax assets by establishing a valuation allowance is required if, based on the available evidence, it is more likely than not that such assets will not be realized.  We evaluate the need to</div><div> </div><div> </div><div> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">establish a valuation allowance for our deferred income tax assets on an ongoing basis.  In evaluating our deferred income tax assets, we consider whether the deferred income tax assets will be realized, based on the more-likely-than-not realization threshold criterion.  The ultimate realization of our deferred income tax assets depends upon generating sufficient future taxable income during the periods in which our temporary differences become deductible and before our capital loss carryforwards and NOLs expire.  This assessment requires significant judgment.  In assessing the need for a valuation allowance, appropriate consideration is given to all positive and negative evidence related to the realization of the deferred tax assets.  This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, excess appreciated asset value over the tax basis of net assets, the duration of carryforward periods, our experience with operating loss and tax credit carryforwards expiring unused, and tax planning alternatives.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Concluding that a valuation allowance is not required is difficult when there has been significant negative evidence, such as cumulative losses in recent years.  We utilize a three year rolling calculation of actual income before income taxes as our primary measure of cumulative losses in recent years.  Our analysis of whether there needs to be any changes to the deferred tax valuation allowance recognizes that as of December 31, 2010, we have incurred a cumulative loss over the evaluation period, resulting from the substantial loss during 2008 primarily related to the Transfer of Senior Health to an independent trust as described in the note to these consolidated financial statements entitled “Transfer of Senior Health Insurance Company of Pennsylvania to an Independent Trust”.  As a result of the cumulative losses recognized in recent years, our evaluation of the need to increase the valuation allowance for deferred tax assets was primarily based on our historical taxable earnings.  However, because a substantial portion of the cumulative losses for the three-year period ended December 31, 2010, relates to transactions to dispose of blocks of businesses, we have adjusted the three-year cumulative results for the income and losses from the blocks of business disposed of in the past and the business transferred as further described in the note to these financial statements entitled “Transfer of Senior Health Insurance Company of Pennsylvania to an Independent Trust”.  We consider this to be non-recurring and have reflected our best estimates of when temporary differences will reverse over the carryforward periods.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">At December 31, 2010, our valuation allowance for our net deferred tax assets was $1.1 billion, as we have determined that it is more likely than not that a portion of our deferred tax assets will not be realized.  This determination was made by evaluating each component of the deferred tax asset and assessing the effects of limitations and/or interpretations on the value of such component to be fully recognized in the future.  We have also evaluated the likelihood that we will have sufficient taxable income to offset the available deferred tax assets based on evidence which we consider to be objective and verifiable. Based upon our analysis completed at December 31, 2010, we believe that we will, more likely than not, recover $850.2 million of our deferred tax assets through reductions of our tax liabilities in future periods.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">During 2010, we reduced the valuation allowance established in prior periods by $95 million.  The decrease was primarily attributable to:  revisions to projected future taxable income supported by our increased profitability in the past two years ($47 million); utilization of capital loss carryforwards with current capital gains ($30 million); and utilization of NOL carryforwards with higher taxable income than projected in our previous analysis of the valuation allowance ($18 million).</div><div> </div><div> </div><div> </div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Changes in our valuation allowance are summarized as follows (dollars in millions):</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr bgcolor="#cceeff"><td style="PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">Balance at December 31, 2007                                                                                  </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">672.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Increase in 2008                                                                               </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">856.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="left" width="8%"><div align="left">(a)</div></td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Expiration of capital loss carryforwards                                                                               </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(209.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Write-off of capital loss carryforwards related to Senior Health</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">(133.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Write-off of certain NOLs related to Senior Health</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(5.5</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td style="PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">Balance at December 31, 2008                                                                                  </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1,180.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Increase in 2009                                                                               </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">27.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="left" width="8%"><div align="left">(b)</div></td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Expiration of capital loss carryforwards                                                                               </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(32.1</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 9pt; MARGIN-RIGHT: 0pt" align="left">Balance at December 31, 2009                                                                                 </div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1,176.4</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="white"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 18pt; MARGIN-RIGHT: 0pt" align="left">Decrease in 2010                                                                               </div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%">(95.0</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%">)</td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="left" width="8%"><div align="left">(c)</div></td></tr><tr bgcolor="white"><td valign="bottom" width="80%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="8%">  </td></tr><tr bgcolor="#cceeff"><td style="PADDING-BOTTOM: 4px" valign="bottom" align="left" width="80%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 9pt; MARGIN-RIGHT: 0pt" align="left">Balance at December 31, 2010                                                                                 </div></td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">1,081.4</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" width="8%">  </td></tr></table></div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">____________________</div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr valign="top"><td style="WIDTH: 27pt" align="right"><div>(a)  </div></td><td><div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">The $856.2 million increase to our valuation allowance during 2008 included increases of:  (i) $452 million of deferred tax assets related to Senior Health, which was transferred to an independent trust during 2008; (ii) $298 million related to our reassessment of the recovery of our deferred tax assets in accordance with GAAP, following the additional losses incurred as a result of the transaction to transfer Senior Health to an independent trust; (iii) $60 million related to the recognition of additional realized investment losses for which we are unlikely to receive any tax benefit; and (iv) $45 million related to the estimated additional future expense following the modifications to our Senior Credit Agreement as described in the note to these consolidated financial statements entitled “Notes Payable - Direct Corporate Obligations.”</div></td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr valign="top"><td style="WIDTH: 27pt" align="right"><div>(b)  </div></td><td><div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">The $27.8 million increase to our valuation allowance during 2009 included increases of:  (i) $23.0 million related to our reassessment of the recovery of our deferred tax assets following the completion of reinsurance transactions in 2009; and (ii) $4.8 million related to the recognition of additional realized investment losses for which we are unlikely to receive any tax benefit.</div></td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr valign="top"><td style="WIDTH: 27pt" align="right"><div>(c)  </div></td><td><div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">The $95.0 million reduction to the deferred tax valuation allowance during 2010 resulted from the utilization of NOLs and capital loss carryforwards and higher projections of future taxable income based on evidence we consider to be objective and verifiable.</div></td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Recovery of our deferred tax assets is dependent on achieving the projections of future taxable income embedded in our analysis and failure to do so would result in an increase in the valuation allowance in a future period.  Any future increase in the valuation allowance may result in additional income tax expense and reduce shareholders’ equity, and such an increase could have a significant impact upon our earnings in the future.  In addition, the use of the Company’s NOLs is dependent, in part, on whether the Internal Revenue Service (the “IRS”) does not take an adverse position in the future regarding the tax position we have taken in our tax returns with respect to the allocation of a portion of the cancellation of indebtedness income resulting from the bankruptcy of our Predecessor and the classification of the loss we recognized as a result of the transfer of Senior Health to an Independent Trust (as further described below).</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">The Internal Revenue Code (the “Code”) limits the extent to which losses realized by a non-life entity (or entities) may offset income from a life insurance company (or companies) to the lesser of:  (i) 35 percent of the income of the life insurance company; or (ii) 35 percent of the total loss of the non-life entities (including NOLs of the non-life entities).  There is no similar limitation on the extent to which losses realized by a life insurance entity (or entities) may offset income from a non-life entity (or entities).</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Section 382 imposes limitations on a corporation’s ability to use its NOLs when the company undergoes an ownership change.  Future transactions and the timing of such transactions could cause an ownership change for Section 382 income tax purposes.  Such transactions may include, but are not limited to, additional repurchases or issuances of common stock</div><div> </div><div> </div><div> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">(including upon conversion of our outstanding 7.0% Convertible Senior Debentures due 2016 (the “7.0% Debentures”), or acquisitions or sales of shares of CNO stock by certain holders of our shares, including persons who have held, currently hold or may accumulate in the future five percent or more of our outstanding common stock for their own account.  Many of these transactions are beyond our control.  If an additional ownership change were to occur for purposes of Section 382, we would be required to calculate an annual restriction on the use of our NOLs to offset future taxable income.  The annual restriction would be calculated based upon the value of CNO’s equity at the time of such ownership change, multiplied by a federal long-term tax exempt rate (3.67 percent at December 31, 2010), and the annual restriction could effectively eliminate our ability to use a substantial portion of our NOLs to offset future taxable income.  We regularly monitor ownership change (as calculated for purposes of Section 382) and, as of December 31, 2010, we were below the 50 percent ownership change level that would trigger further impairment of our ability to utilize our NOLs.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">On January 20, 2009, the Company’s Board of Directors adopted a Section 382 Rights Agreement which is designed to protect shareholder value by preserving the value of our tax assets primarily associated with tax NOLs under Section 382.  The Section 382 Rights Agreement was adopted to reduce the likelihood of this occurring by deterring the acquisition of stock that would create “5 percent shareholders” as defined in Section 382.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Under the Section 382 Rights Agreement, one right was distributed for each share of our common stock outstanding as of the close of business on January 30, 2009.  Effective January 20, 2009, if any person or group (subject to certain exemptions) becomes a “5 percent shareholder” of CNO without the approval of the Board of Directors, there would be a triggering event causing significant dilution in the voting power and economic ownership of that person or group.  Existing shareholders who currently are “5 percent shareholders” will trigger a dilutive event only if they acquire additional shares exceeding one percent of our outstanding shares without prior approval from the Board of Directors.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">The Section 382 Rights Agreement will continue in effect until January 20, 2012, unless earlier terminated or redeemed by the Board of Directors.  The Company’s Audit Committee will review our NOLs on an annual basis and will recommend amending or terminating the Section 382 Rights Agreement based on its review.  The Section 382 Rights Agreement was approved by a vote at the annual meeting of shareholders on May 12, 2009.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">On May 11, 2010, our shareholders approved an amendment to CNO’s certificate of incorporation designed to prevent certain transfers of common stock which could otherwise adversely affect our ability to use our NOLs (the “Section 382 Charter Amendment”).  Subject to the provisions set forth in the Section 382 Charter Amendment, transfers of our common stock would be void and of no effect if the effect of the purported transfer would be to:  (i) increase the direct or indirect ownership of our common stock by any person or public group (as such term is defined in the regulations under Section 382) from less than 5% to 5% or more of our common stock; (ii) increase the percentage of our common stock owned directly or indirectly by a person or public group owning or deemed to own 5% or more of our common stock; or (iii) create a new public group.  The Section 382 Charter Amendment will continue in effect until December 31, 2013.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">As of December 31, 2010, we had $4.4 billion of federal NOLs and $1.0 billion of capital loss carryforwards, which expire as follows (dollars in millions):</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="center">Year of expiration</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="38%" colspan="9"><div align="center">Net operating loss carryforwards (a)</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="3%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="11%" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -4.9pt" align="center">Capital loss</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="5%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="14%" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -4.9pt" align="center">Total loss</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr><td style="PADDING-BOTTOM: 2px" valign="bottom" width="26%">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="18%" colspan="4"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -5.4pt" align="center">Life</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="19%" colspan="4"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">Non-life</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="3%"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="11%" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">carryforwards</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="5%"> </td><td style="BORDER-BOTTOM: black 2px solid" valign="bottom" width="14%" colspan="2"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">carryforwards</div></td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr><td valign="bottom" width="26%">  </td><td valign="bottom" width="1%"> </td><td valign="bottom" width="10%" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" width="1%"> </td><td valign="bottom" width="11%" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" width="3%"> </td><td valign="bottom" width="11%" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="5%"> </td><td valign="bottom" width="14%" colspan="2"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2011</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2013</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">942.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">942.0</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2014</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">28.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">28.7</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2018</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">1,713.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="left" width="7%"><div align="left">(a)</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">1,713.9</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2021</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">29.6</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">29.6</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2022</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">204.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">204.1</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2023</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">1,999.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="left" width="7%"><div align="left">(a)</div></td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">1,999.3</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2024</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">3.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">3.2</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2025</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">118.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">118.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2027</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">216.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">216.8</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2028</div></td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">.5</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" align="right" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" align="right" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%">.5</td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 2px" valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">2029</div></td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="9%"> -</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="7%">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="10%">148.7</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" width="7%">  </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="3%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="10%">-</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 2px" valign="bottom" align="right" width="5%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: right" valign="bottom" width="13%">148.7</td><td style="PADDING-BOTTOM: 2px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="#cceeff"><td valign="bottom" width="26%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="9%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="7%">  </td><td valign="bottom" width="3%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="10%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td valign="bottom" width="5%"> </td><td style="TEXT-ALIGN: left" valign="bottom" width="1%"> </td><td style="TEXT-ALIGN: right" valign="bottom" width="13%"> </td><td style="TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr><tr bgcolor="white"><td style="PADDING-BOTTOM: 4px" valign="bottom" width="26%"><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -3.6pt" align="center">Total</div></td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="9%">1,947.6</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" width="7%">  </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="1%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="10%">2,487.4</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" width="7%">  </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="3%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="10%">970.7</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td><td style="PADDING-BOTTOM: 4px" valign="bottom" align="right" width="5%"> </td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: left" valign="bottom" width="1%">$</td><td style="BORDER-BOTTOM: black 4px double; TEXT-ALIGN: right" valign="bottom" width="13%">5,405.7</td><td style="PADDING-BOTTOM: 4px; TEXT-ALIGN: left" valign="bottom" nowrap="nowrap" width="1%"> </td></tr></table></div><div> </div><div> </div><div> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: -9pt" align="left">____________________</div><div><table style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman" cellspacing="0" cellpadding="0" width="100%"><tr valign="top"><td style="WIDTH: 27pt" align="right"><div>(a)  </div></td><td><div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">The allocation of the NOLs summarized above assumes the IRS does not take an adverse position in the future regarding the tax position we plan to take in our tax returns with respect to the allocation of cancellation of indebtedness income.  If the IRS disagrees with the tax position we plan to take with respect to the allocation of cancellation of indebtedness income, and their position prevails, approximately $631 million of the NOLs expiring in 2018 would be characterized as non-life NOLs.</div></td></tr></table></div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">We had deferred tax assets related to NOLs for state income taxes of $17.8 million and $19.1 million at December 31, 2010 and 2009, respectively.  The related state NOLs are available to offset future state taxable income in certain states through 2015.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">As more fully discussed below, the Company’s interpretation of the tax law, as it relates to the application of the cancellation of indebtedness income to its NOLs, is an uncertain tax position.  Since all other life NOLs must be utilized prior to this portion of the NOL, it has not yet been utilized nor is it expected to be utilized within the next twelve months.  As a result, an uncertain tax position has not yet been taken on the Company’s tax return.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Although authoritative guidance allowed a change in accounting, the Company has chosen to continue its past accounting policy of classifying interest and penalties as income tax expense in the consolidated statement of operations.  No such amounts were recognized in 2010, 2009 or 2008.  The liability for accrued interest and penalties was not significant at December 31, 2010 or December 31, 2009.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">Tax years 2007 through 2009 are open to examination by the IRS, and tax year 2002 remains open only for potential adjustments related to certain partnership investments.  The Company does not anticipate any material adjustments related to these partnership investments.  The Company’s various state income tax returns are generally open for tax years 2007 through 2009 based on the individual state statutes of limitation.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">In July 2006, the Joint Committee of Taxation accepted the audit and the settlement which characterized $2.1 billion of the tax losses on our Predecessor’s investment in Conseco Finance Corp. as life company losses and the remaining $3.8 billion as non-life losses prior to the application of the cancellation of indebtedness attribute reductions described below.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">The Code provides that any income realized as a result of the cancellation of indebtedness in bankruptcy (cancellation of debt income or “CODI”) must reduce NOLs.  We realized $2.5 billion of CODI when we emerged from bankruptcy.  Pursuant to the Company’s interpretation of the tax law, the CODI reductions were all used to reduce non-life NOLs.  However, if the IRS were to disagree with our interpretation and ultimately prevail, we believe $631 million of NOLs classified as life company NOLs would be re-characterized as non-life NOLs and subject to the 35% limitation discussed above.  Such a re-characterization would also extend the year of expiration as life company NOLs expire after 15 years whereas non-life NOLs expire after 20 years.  Due to uncertainties with respect to the ultimate position the IRS may take and limitations on our ability to utilize NOLs based on projected life and non-life income, we have considered the $631 million of CODI to be a reduction to life NOLs when determining our valuation allowance.  If we determine the IRS agrees with our position that the $631 million of CODI is a reduction to non-life NOLs, our valuation allowance would be reduced by approximately $140 million based on the income projection used in our valuation allowance at December 31, 2010.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: 0pt" align="left">We recognized a $742 million loss on our investment in Senior Health which was worthless when it was transferred to an Independent Trust in 2008.  We have treated the loss as a capital loss when determining the deferred tax benefit we may receive.  We also established a full valuation allowance as we believe we will not generate capital gains to utilize the benefit.  However, due to uncertainties in the tax code, we have reflected this loss as an ordinary loss in our tax return, contrary to certain IRS rulings.  If classifying this loss as ordinary is ultimately determined to be correct, our valuation allowance would be reduced by approximately $160 million based on income projections used in our valuation allowance at December 31, 2010.</div><div style="DISPLAY: block; TEXT-INDENT: 0pt"> </div><div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; MARGIN-RIGHT: -9pt" align="left">In accordance with GAAP, we are precluded from recognizing the tax benefits of any tax windfall upon the exercise of a stock option or the vesting of restricted stock unless such deduction resulted in actual cash savings to the Company.  Because of the Company’s NOLs, no cash savings have occurred.  NOL carryforwards of $.6 million related to deductions for stock options and restricted stock will be reflected in additional paid-in capital if realized.</div><div> </div>6.      INCOME TAXESThe components of income tax expense were as follows (dollars in millions): falsefalsefalsefalsefalseOtherus-types:textBlockItemTypestringDescription containing the entire income tax disclosure. Examples include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. This element may be used as a single block of text to encapsulate the entire disclosure including data and tables.Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph h -Article 4 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 136, 172 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 109 -Paragraph 43, 44, 45, 46, 47, 48, 49 falsefalseINCOME TAXES12INCOME TAXESUnKnownUnKnownUnKnownUnKnownfalsetrue