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Derivative Instruments (Tables)

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements [Abstract]

Outstanding derivative instruments with off-balance-sheet risks

				As of December 31, 2011						As of December 31, 2010
				Notional		Fair Value				Notional		Fair Value
				Amounts		Asset		Liability		Amounts		Asset		Liability
Qualifying Hedges
Cash flow hedges:
	Interest rate contracts⁽¹⁾			$	2,512	$	130	$	-	$	2,076	$	(40)	$	-
	Foreign currency contracts⁽¹⁾				340		38		-		340		30		-
		Total cash flow hedges			2,852		168		-		2,416		(10)		-
Fair value hedges:
	Interest rate contracts⁽²⁾				1,675		319		319		1,675		55		55
Non-Qualifying Hedges
Interest rate contracts⁽¹⁾					30,232		568		-		18,406		(426)		-
Foreign currency contracts⁽¹⁾					4		-		-		219		-		-
Equity market contracts⁽¹⁾					16,401		2,096		-		11,577		1,442		-
Credit contracts⁽¹⁾					48		-		-		-		-		-
Credit contracts⁽³⁾					148		-		16		145		-		16
Embedded derivatives:
	Deferred compensation plans⁽³⁾				-		-		354		-		-		363
	Indexed annuity contracts⁽⁴⁾				-		-		399		-		-		497
	GLB reserves⁽⁴⁾				-		-		2,217		-		-		408
	Reinsurance related ⁽⁵⁾				-		-		168		-		-		102
	AFS securities⁽¹⁾				-		-		-		-		15		-
			Total derivative instruments	$	51,360	$	3,151	$	3,473	$	34,438	$	1,076	$	1,441

Maturity of the notional amounts of derivative financial instruments

			Remaining Life as of December 31, 2011
			Less Than		1 – 5		6 – 10		11 – 30		Over 30
			1 Year		Years		Years		Years		Years		Total
Interest rate contracts⁽¹⁾			$	2,154	$	11,353	$	11,349	$	9,556	$	7	$	34,419
Foreign currency contracts⁽²⁾				4		154		105		81		-		344
Equity market contracts				8,638		3,155		4,589		17		2		16,401
Credit contracts				40		116		40		-		-		196
	Total derivative instruments
		with notional amounts	$	10,836	$	14,778	$	16,083	$	9,654	$	9	$	51,360

Change in our unrealized gain on derivative instruments in accumulated OCI

						For the Years Ended December 31,
						2011		2010		2009
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year						$	(15)	$	11	$	127
Other comprehensive income (loss):
	Unrealized holding gains (losses) arising during the year:
		Cash flow hedges:
			Interest rate contracts				178		(47)		30
			Foreign currency contracts				3		14		(52)
		Fair value hedges:
			Interest rate contracts				4		4		4
			Equity market contracts				-		-		(28)
		Net investment in a foreign subsidiary					-		-		(74)
		AFS securities embedded derivatives					-		2		-
	Change in foreign currency exchange rate adjustment						7		4		-
	Change in DAC, VOBA, DSI and DFEL						(1)		(4)		22
	Income tax benefit (expense)						(66)		9		(13)
	Less:
		Reclassification adjustment for gains (losses) included in net income (loss):
			Cash flow hedges:
				Interest rate contracts⁽¹⁾			(15)		4		4
				Interest rate contracts⁽²⁾			(1)		4		-
				Foreign currency contracts⁽¹⁾			2		2		-
			Fair value hedges:
				Interest rate contracts⁽²⁾			4		4		4
		Associated amortization of DAC, VOBA, DSI and DFEL					-		(1)		-
		Income tax benefit (expense)					4		(5)		(3)
					Balance as of end-of-year	$	116	$	(15)	$	11

Gains (losses) on derivative instruments recorded within income (loss) from continuing operations

				For the Years Ended December 31,
				2011		2010		2009
Qualifying Hedges
Cash flow hedges:
	Interest rate contracts⁽¹⁾			$	(15)	$	3	$	3
	Foreign currency contracts⁽¹⁾				2		2		1
		Total cash flow hedges			(13)		5		4
Fair value hedges:
	Interest rate contracts⁽²⁾				50		42		17
	Equity market contracts⁽³⁾				-		15		1
		Total fair value hedges			50		57		18
Non-Qualifying Hedges
Interest rate contracts⁽¹⁾					(44)		5		-
Interest rate contracts⁽³⁾					1,144		175		(1,553)
Foreign currency contracts⁽¹⁾					-		43		(98)
Foreign currency contracts⁽³⁾					(12)		(13)		(7)
Equity market contracts⁽³⁾					316		(386)		(1,379)
Equity market contracts⁽⁴⁾					21		(118)		35
Credit contracts⁽¹⁾					-		1		1
Credit contracts⁽³⁾					(7)		7		(37)
Embedded derivatives:
	Deferred compensation plans⁽⁴⁾				(11)		(34)		(63)
	Indexed annuity contracts⁽³⁾				5		(81)		(75)
	GLB reserves⁽³⁾				(1,809)		268		2,228
	Reinsurance related⁽³⁾				(66)		(71)		(62)
	AFS securities⁽¹⁾				-		2		-
			Total derivative instruments	$	(426)	$	(140)	$	(988)

Gains (losses) on derivative instruments designated as cash flow hedges

		For the Years Ended December 31,
		2011		2010		2009
Ineffective portion recognized in realized gain (loss)		$	-	$	-	$	(1)
Gain (loss) recognized as a component of OCI with the offset
	to net investment income		(13)		6		4

Gains (losses) on derivative instruments designated as fair value hedges

		For the Years Ended December 31,
		2011		2010		2009
Ineffective portion recognized in realized gain (loss)		$	-	$	1	$	1
Gain (loss) recognized as a component of OCI with the offset
	to interest expense		4		4		4

Open credit default swap liabilities

As of December 31, 2011

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Maturity

Entering

Recourse

Obligation⁽¹⁾

Instruments

Value⁽²⁾

Payout

12/20/2012⁽³⁾

⁽⁵⁾

⁽⁶⁾

BBB+

12/20/2016⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB+

(12)

03/20/2017⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB

(4)

(16)

148

As of December 31, 2010

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Maturity

Entering

Recourse

Obligation⁽¹⁾

Instruments

Value⁽²⁾

Payout

12/20/2012⁽³⁾

⁽⁵⁾

⁽⁶⁾

BBB+

12/20/2016⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB

(12)

03/20/2017⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB-

(4)

(16)

145

			As of December 31,
			2011		2010
Maximum potential payout			$	148	$	145
Less:
	Counterparty thresholds			-		10
		Maximum collateral potentially required to post	$	148	$	135

Collateral support agreements

	As of December 31, 2011				As of December 31, 2010
	Collateral		Collateral		Collateral		Collateral
	Posted by		Posted by		Posted by		Posted by
S&P	Counter-		LNC		Counter-		LNC
Credit	Party		(Held by		Party		(Held by
Rating of	(Held by		Counter-		(Held by		Counter-
Counterparty	LNC)		Party)		LNC)		Party)

AAA	$	-	$	-	$	1	$	-
AA		35		-		99		-
AA-		219		-		65		-
A+		848		-		548		(76)
A		1,681		(120)		436		(223)
A-		387		-		-		-
	$	3,170	$	(120)	$	1,149	$	(299)

- Definition

This element may be used to tag a single block of text that encapsulates the entire credit derivatives disclosure including data and tables. This disclosures provides pertinent information by sellers of credit derivatives, about each credit derivative, or each group of similar credit derivatives, including (a) the nature of the credit derivative - its term, how it arose, the events or circumstances that would require the seller to perform under the credit derivative, and the current status of the payment/performance risk of the credit derivative; (b) the maximum potential amount of future payments (undiscounted) the seller could be required to make under the credit derivative; (c) the current fair value of the credit derivative; and (d) the nature of any recourse provisions under the credit derivative, and any assets held either as collateral or by third parties. A credit derivative is a derivative instrument (1) in which one or more of its underlyings are related to the credit risk of a specified entity (or a group of entities) or an index based on the credit risk of a group of entities and (2) that exposes the seller to potential loss from credit-risk-related events specified in the contract. Examples of credit derivatives within the scope of this paragraph include, but are not limited to, credit default swaps, credit spread options, and credit index products; also includes a hybrid instrument that has an embedded credit derivative (for example, a credit-linked note).

+ References+ Details