Lincoln Financial Group
Table of Contents
Analyst Coverage		1
Notes		2
Consolidated Statements of Income (Loss)		3
Consolidated Balance Sheets		4
Earnings, Shares, Return on Equity and Return to Stockholder Highlights		5
Income (Loss) from Operations, Average Equity and ROE By Segment		6
Select Earnings Drivers By Segment		7
Deposits, Net Flows and Account Balances By Segment		8
Sales By Segment		9
Operating Revenues and General and Administrative Expenses By Segment		10
Operating Commissions and Other Expenses		11
Interest Rate Yields and Spreads By Segment		12
Select Investment Data		13
Realized Gain (Loss) and Benefit Ratio Unlocking, After-DAC		14
Select Liquidity and Ratings Agency Data		15
Select Earnings and Operational Data:
	Annuities	16
	Retirement Plan Services	17
	Life Insurance	18
	Group Protection	19
	Other Operations and Discontinued Operations	20
DAC, VOBA, DSI and DFEL Roll Forwards:
	Consolidated	21
	Annuities	22
	Retirement Plan Services, Life Insurance and Group Protection	23
Account Value Roll Forwards:
	Annuities	24
	Retirement Plan Services	25
	Life Insurance	26
Select Non-GAAP to GAAP Reconciliations		27

Lincoln Financial Group
Analyst Coverage
Firm	Analyst	Phone Number
Bank of America - Merrill Lynch	Seth Weiss	646-855-3783
Barclays Capital	Jay Gelb	212-526-1561
Citi Research	Erik Bass	212-816-5257
Credit Suisse	Tom Gallagher	212-538-2010
Deutsche Bank	Yaron Kinar	212-250-7927
Dowling and Partners	Ryan Krueger	860-676-8600
Evercore Partners	Mark Finkelstein	312-445-6440
FBR Capital Markets	Randy Binner	703-312-1890
Goldman Sachs and Company	Christopher Giovanni	212-357-3560
JP Morgan Securities	Jimmy Bhullar	212-622-6397
Keefe, Bruyette and Woods	Jeff Schuman	860-722-5902
Langen McAlenney	Bob Glasspiegel	860-724-1203
Macquarie Capital	Sean Dargan	212-231-0663
Morgan Stanley	Nigel Dally	212-761-4132
Raymond James and Associates	Steven Schwartz	312-612-7686
RBC Capital	Eric Berg	212-618-7593
Sandler O'Neil and Partners	Edward Shields	312-281-3487
Scotia Capital	Joanne Smith	212-225-5071
Sterne, Agee and Leach, Inc.	John Nadel	212-338-4717
UBS	Suneet Kamath	212-713-1355
Wells Fargo Securities	John Hall	212-214-8032
Investor Inquiries May Be Directed To
Jim Sjoreen, Senior Vice President, Investor Relations
Email: Jim.Sjoreen@lfg.com
Voice: 484-583-1420
Fax: 484-583-3962
Notes
This list is provided for informational purposes only.  Lincoln Financial Group does not endorse the analyses, conclusions or recommendations contained in any report issued by these or any other analysts.
Lincoln Financial Group's Statistical Supplement will be available immediately after the release of earnings for each quarter through our Investor Relations website:  www.LincolnFinancial.com/investor.

Page 1

Lincoln Financial Group

Notes

Computations

The financial ratios reported herein are calculated using whole dollars instead of dollars rounded to millions.

If the effect of equity classification would result in a more dilutive EPS, the numerator used in the calculation of our diluted EPS is adjusted to remove the mark-to-market adjustment for deferred units of LNC stock in our deferred compensation plans.  In addition, for any period where a loss from continuing operations is experienced, shares used in the diluted EPS calculation represent basic shares, as using dilutive shares would be anti-dilutive to the calculation.  In these periods, we would also exclude the deferred compensation adjustment.

Return on equity ("ROE") measures how efficiently we generate profits from the resources provided by our net assets.  ROE is calculated by dividing annualized net income (loss) (or income (loss) from operations) by average equity, excluding accumulated other comprehensive income (loss) ("AOCI").  Management evaluates consolidated ROE by both including and excluding the effect of average goodwill.

Book value per share, excluding AOCI, is calculated by dividing stockholders' equity, excluding AOCI, by common shares outstanding assuming the conversion of our Series A preferred shares.  We provide book value per share, excluding AOCI, to enable investors to analyze the amount of our net worth that is attributable primarily to our business operations.

Definitions
Holding company available liquidity consists of cash and cash equivalents, excluding cash held as collateral, investments maturing in one year or less at origination and receivables under the inter-company cash management program, less payables under the inter-company cash management program, payables from purchases of securities not settled as of the balance sheet date and commercial paper outstanding.
Sales as reported consist of the following:
	•	MoneyGuard® (our linked-benefit product) – 15% of single premium deposits;
	•	MoneyGuard® (flexible premium option), universal life ("UL") (excluding linked-benefit products) and variable universal life ("VUL"), including corporate-owned life insurance ("COLI") and bank-owned life insurance ("BOLI") - first year commissionable premiums plus 5% of excess premiums received, including an adjustment for internal replacements at approximately 50% of target;
	•	Term - 100% of first year paid premiums;
	•	Annuities - deposits from new and existing customers; and
	•	Group Protection - annualized first year premiums from new policies.
Throughout the document, "after-DAC" refers to the associated amortization expense of deferred acquisition costs ("DAC"), value of business acquired ("VOBA"), deferred sales inducements ("DSI") and deferred front-end loads ("DFEL") and changes in other contract holder funds.

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Lincoln Financial Group
Notes
Non-GAAP Performance Measures
Non-GAAP measures do not replace the most directly comparable GAAP measures, and we have included detailed reconciliations herein.
We exclude the after-tax effects of the following items from GAAP net income (loss) to arrive at income (loss) from operations:
	•	Realized gains and losses associated with the following ("excluded realized gain (loss)"):
		▪	Sales or disposals and impairments of securities;
		▪	Changes in the fair value of derivatives, embedded derivatives within certain reinsurance arrangements and trading securities ("gain (loss) on the mark-to-market on certain instruments");
		▪	Changes in the fair value of the derivatives we own to hedge our guaranteed death benefit ("GDB") riders reflected within variable annuity net derivative results;
		▪	Changes in the fair value of the embedded derivatives of our guaranteed living benefit ("GLB") riders accounted for at fair value, net of the change in the fair value of the derivatives we own to hedge them reflected within variable annuity net derivative results; and
		▪	Changes in the fair value of the embedded derivative liabilities related to index call options we may purchase in the future to hedge contract holder index allocations applicable to future reset periods for our indexed annuity products accounted for at fair value ("indexed annuity forward-starting option");
	•	Changes in reserves resulting from benefit ratio unlocking on our GDB and GLB riders ("benefit ratio unlocking") reflected within variable annuity net derivative results;
	•	Income (loss) from reserve changes, net of related amortization, on business sold through reinsurance;
	•	Gains (losses) on early extinguishment of debt;
	•	Losses from the impairment of intangible assets;
	•	Income (loss) from discontinued operations; and
	•	Income (loss) from the initial adoption of new accounting standards.
Operating revenues represent GAAP revenues excluding the pre-tax effects of the following items:
	•	Excluded realized gain (loss);
	•	Revenue adjustments from the initial adoption of new accounting standards;
	•	Amortization of DFEL arising from changes in GDB and GLB benefit ratio unlocking; and
	•	Amortization of deferred gains arising from reserve changes on business sold through reinsurance.
We use our federal income tax rate of 35% while taking into account any permanent differences for events recognized differently in our financial statements and federal income tax returns when reconciling our non-GAAP measures to the most comparable GAAP measure.
Management believes that the non-GAAP performance measures discussed above explain the results of our ongoing businesses in a manner that allows for a better understanding of the underlying trends in our current business because the excluded items are unpredictable and not necessarily indicative of current operating fundamentals or future performance of the business segments, and, in many instances, decisions regarding these items do not necessarily relate to the operations of the individual segments.  In addition, we believe that our definitions of operating revenues and income from operations provide investors with more valuable measures of our performance because they better reveal trends in our business.
Statistical Supplement is Dated
The financial data in this document is dated May 1, 2013, and has not been updated since that date.  Lincoln Financial Group does not intend to update this document.

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Lincoln Financial Group
Consolidated Statements of Income (Loss)
Unaudited (millions of dollars, except per share data)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Revenues
Insurance premiums	$	589		$	630		$	606		$	637		$	654			11.0	%
Insurance fees		902			885			990			957			958			6.2	%
Net investment income		1,166			1,197			1,146			1,190			1,150			-1.4	%
Realized gain (loss):
Other-than-temporary impairment ("OTTI")		(47	)		(33	)		(32	)		(41	)		(14	)		70.2	%
Realized gain (loss), excluding OTTI		(38	)		76			102			88			(40	)		-42.1	%
Total realized gain (loss)		(85	)		43			70			47			(54	)		36.5	%
Amortization of deferred gains on business sold through reinsurance		19			19			19			19			19			0.0	%
Other revenues and fees		119			124			123			123			117			-1.7	%
Total revenues		2,710			2,898			2,954			2,973			2,844			4.9	%
Expenses
Interest credited		625			617			611			615			622			-0.5	%
Benefits		853			943			810			937			958			12.3	%
Commissions and other expenses		856			828			1,047			951			895			4.6	%
Interest and debt expense		68			68			68			70			64			-5.9	%
Total expenses		2,402			2,456			2,536			2,573			2,539			5.7	%
Income (loss) from continuing operations before taxes		308			442			418			400			305			-1.0	%
Federal income tax expense (benefit)		64			121			18			80			66			3.1	%
Income (loss) from continuing operations		244			321			400			320			239			-2.0	%
Income (loss) from discontinued operations		(1	)		-			28			-			-			100.0	%
Net income (loss)		243			321			428			320			239			-1.6	%
Adjustment for LNC stock units in our deferred compensation plans		-			(4	)		-			-			-		NM
Net income (loss) available to common stockholders - diluted	$	243		$	317		$	428		$	320		$	239			-1.6	%
Earnings (Loss) Per Common Share - Diluted
Income (loss) from continuing operations	$	0.82		$	1.09		$	1.41		$	1.14		$	0.86			4.9	%
Income (loss) from discontinued operations		-			-			0.10			-			-		NM
Net income (loss)	$	0.82		$	1.09		$	1.51		$	1.14		$	0.86			4.9	%

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Lincoln Financial Group
Consolidated Balance Sheets
Unaudited (millions of dollars)
	As of
	3/31/12		6/30/12		9/30/12		12/31/12		3/31/13		Change
ASSETS
Investments:
Available-for-sale ("AFS") securities:
Corporate bonds	$	60,599	$	63,914	$	66,476	$	68,016	$	69,274		14.3	%
U.S. government bonds		486		517		508		442		432		-11.1	%
Foreign government bonds		650		664		661		654		626		-3.7	%
Mortgage-backed securities		9,095		8,504		7,863		7,174		6,542		-28.1	%
Asset-backed collateralized debt obligations		102		120		147		180		173		69.6	%
State and municipal bonds		4,126		4,284		4,338		4,353		4,430		7.4	%
Hybrid and redeemable preferred securities		1,196		1,188		1,186		1,217		1,234		3.2	%
VIEs' fixed maturity securities		702		705		706		708		708		0.9	%
Equity securities		126		154		156		157		148		17.5	%
Total AFS securities		77,082		80,050		82,041		82,901		83,567		8.4	%
Trading securities		2,650		2,649		2,650		2,554		2,528		-4.6	%
Mortgage loans on real estate		6,938		6,804		6,690		7,029		7,057		1.7	%
Real estate		113		116		112		65		65		-42.5	%
Policy loans		2,842		2,829		2,780		2,766		2,727		-4.0	%
Derivative investments		2,244		3,399		3,072		2,652		2,268		1.1	%
Other investments		1,043		1,041		1,123		1,098		1,073		2.9	%
Total investments		92,912		96,888		98,468		99,065		99,285		6.9	%
Cash and invested cash		3,516		5,257		4,373		4,230		3,107		-11.6	%
DAC and VOBA		6,880		6,505		5,813		6,667		6,936		0.8	%
Premiums and fees receivable		437		388		366		380		440		0.7	%
Accrued investment income		1,026		1,021		1,067		1,015		1,078		5.1	%
Reinsurance recoverables		6,534		6,601		6,424		6,449		6,489		-0.7	%
Funds withheld reinsurance assets		866		863		846		837		798		-7.9	%
Goodwill		2,273		2,273		2,273		2,273		2,273		0.0	%
Other assets		2,486		2,475		2,502		2,580		2,569		3.3	%
Separate account assets		91,088		88,839		93,326		95,373		101,366		11.3	%
Total assets	$	208,018	$	211,110	$	215,458	$	218,869	$	224,341		7.8	%

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Lincoln Financial Group
Consolidated Balance Sheets
Unaudited (millions of dollars)
	As of
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Future contract benefits	$	18,784		$	19,930		$	19,232		$	19,780		$	19,149			1.9	%
Other contract holder funds		70,027			70,422			70,706			72,218			72,760			3.9	%
Short-term debt		300			300			200			200			706			135.3	%
Long-term debt by rating agency leverage definitions:
Operating (see note (1) on page 15 for details)		1,122			1,122			1,122			1,122			1,122			0.0	%
Financial		4,484			4,597			4,372			4,317			3,767			-16.0	%
Reinsurance related embedded derivatives		158			185			215			215			199			25.9	%
Funds withheld reinsurance liabilities		1,043			999			987			940			926			-11.2	%
Deferred gain on business sold through reinsurance		375			356			338			319			301			-19.7	%
Payables for collateral on investments		2,875			5,070			4,566			4,181			4,107			42.9	%
VIEs' liabilities		149			158			121			92			83			-44.3	%
Other liabilities		4,493			5,093			5,153			5,139			4,993			11.1	%
Separate account liabilities		91,088			88,839			93,326			95,373			101,366			11.3	%
Total liabilities		194,898			197,071			200,338			203,896			209,479			7.5	%
Stockholders' Equity
Common stock		7,448			7,310			7,214			7,121			7,043			-5.5	%
Retained earnings		3,050			3,350			3,756			4,044			4,238			39.0	%
AOCI:
Unrealized gain (loss) on AFS securities		2,934			3,627			4,354			4,066			3,777			28.7	%
Unrealized OTTI on AFS securities		(119	)		(117	)		(99	)		(107	)		(87	)		26.9	%
Unrealized gain (loss) on derivative instruments		89			150			177			163			203			128.1	%
Foreign currency translation adjustment		(3	)		(4	)		(3	)		(4	)		(6	)		-100.0	%
Funded status of employee benefit plans		(279	)		(277	)		(279	)		(310	)		(306	)		-9.7	%
Total AOCI		2,622			3,379			4,150			3,808			3,581			36.6	%
Total stockholders' equity		13,120			14,039			15,120			14,973			14,862			13.3	%
Total liabilities and stockholders' equity	$	208,018		$	211,110		$	215,458		$	218,869		$	224,341			7.8	%

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Lincoln Financial Group
Earnings, Shares, Return on Equity and Return to Stockholder Highlights
Unaudited (millions of dollars, except per share data)
	As of or For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss)
Income (loss) from operations	$	293		$	319		$	362		$	310		$	285			-2.7	%
Net income (loss)		243			321			428			320			239			-1.6	%
Earnings (Loss) Per Diluted Share
Income (loss) from operations	$	0.99		$	1.09		$	1.27		$	1.10		$	1.02			3.0	%
Net income (loss)		0.82			1.09			1.51			1.14			0.86			4.9	%
Average Stockholders' Equity
Average equity, including AOCI	$	13,110		$	13,579		$	14,580		$	15,048		$	14,918			13.8	%
Average AOCI		2,650			3,000			3,764			3,979			3,695			39.4	%
Average equity, excluding AOCI	$	10,460		$	10,579		$	10,816		$	11,069		$	11,223			7.3	%
ROE
Income (loss) from operations		11.2	%		12.1	%		13.4	%		11.2	%		10.2	%
Net income (loss)		9.3	%		12.2	%		15.8	%		11.6	%		8.5	%
Per Share
Dividends declared during the period	$	0.08		$	0.08		$	0.08		$	0.12		$	0.12			50.0	%
Book value, including AOCI		45.94			50.26			54.94			55.14			55.33			20.4	%
Book value, excluding AOCI		36.76			38.16			39.86			41.11			42.00			14.3	%
Shares
Repurchased during the period		6.0			6.5			4.2			3.8			3.4			-44.0	%
Average for the period - diluted		295.9			290.0			284.7			281.1			278.6			-5.8	%
End-of-period - assuming conversion of preferred		285.6			279.3			275.2			271.6			268.6			-6.0	%
End-of-period - diluted		293.0			286.8			282.4			279.1			277.2			-5.4	%
Cash Returned to Common Stockholders
Shares repurchased	$	150		$	150		$	100		$	92		$	100			-33.3	%
Common dividends		23			23			22			22			33			43.5	%
Total cash returned to common stockholders	$	173		$	173		$	122		$	114		$	133			-23.1	%

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Lincoln Financial Group
Income (Loss) from Operations, Average Equity and ROE By Segment
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss) from Operations
Annuities	$	137		$	158		$	139		$	162		$	159			16.1	%
Retirement Plan Services		35			38			29			28			35			0.0	%
Life Insurance		139			135			152			147			112			-19.4	%
Group Protection		16			27			16			13			14			-12.5	%
Other Operations		(34	)		(39	)		26			(40	)		(35	)		-2.9	%
Income (loss) from operations	$	293		$	319		$	362		$	310		$	285			-2.7	%
Average Equity, Excluding AOCI
Segment equity, excluding goodwill:
Annuities	$	2,960		$	3,091		$	3,110		$	3,053		$	2,977			0.6	%
Retirement Plan Services		911			1,001			1,031			941			908			-0.3	%
Life Insurance		5,655			5,805			5,879			5,919			5,998			6.1	%
Group Protection		906			927			955			992			1,036			14.3	%
Total segment equity, excluding goodwill		10,432			10,824			10,975			10,905			10,919			4.7	%
Other Operations and goodwill		28			(245	)		(159	)		164			304		NM
Total average equity, excluding AOCI	$	10,460		$	10,579		$	10,816		$	11,069		$	11,223			7.3	%
ROE
Segment ROE, excluding goodwill:
Annuities		18.5	%		20.4	%		17.9	%		21.2	%		21.3	%
Retirement Plan Services		15.2	%		15.1	%		11.2	%		12.0	%		15.5	%
Life Insurance		9.9	%		9.3	%		10.3	%		10.0	%		7.5	%
Group Protection		7.1	%		11.6	%		6.5	%		5.3	%		5.6	%
Consolidated ROE - income (loss) from operations		11.2	%		12.1	%		13.4	%		11.2	%		10.2	%

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Lincoln Financial Group
Select Earnings Drivers By Segment
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12		6/30/12		9/30/12		12/31/12		3/31/13		Change
Annuities
Operating revenues	$	731	$	734	$	745	$	766	$	777		6.3	%
Average account values		89,537		89,890		92,323		94,709		99,545		11.2	%
Net flows		293		701		396		1,060		885		202.0	%
Retirement Plan Services
Operating revenues	$	252	$	258	$	255	$	259	$	260		3.2	%
Average account values		40,834		41,315		42,315		43,385		45,374		11.1	%
Net flows		212		194		232		348		344		62.3	%
Life Insurance
Operating revenues	$	1,227	$	1,235	$	1,296	$	1,297	$	1,245		1.5	%
Average account values		35,643		36,064		36,355		36,957		37,671		5.7	%
Average in-force face amount		579,897		581,015		583,264		587,509		592,304		2.1	%
Net flows		741		713		685		1,148		848		14.4	%
Group Protection
Operating revenues	$	504	$	540	$	517	$	531	$	550		9.1	%
Non-medical earned premiums		431		441		450		462		475		10.2	%
Consolidated
Operating revenues	$	2,820	$	2,880	$	2,914	$	2,956	$	2,934		4.0	%
Average account values		166,014		167,269		170,993		175,051		182,590		10.0	%
Net flows		1,246		1,608		1,313		2,556		2,077		66.7	%

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Lincoln Financial Group
Deposits, Net Flows and Account Balances By Segment
Unaudited (millions of dollars)
	As of or For the Three Months Ended
	3/31/12		6/30/12		9/30/12		12/31/12		3/31/13		Change
Deposits
Annuities	$	2,480	$	2,867	$	2,677	$	3,539	$	3,219		29.8	%
Retirement Plan Services		1,511		1,291		1,717		1,861		1,667		10.3	%
Life Insurance		1,159		1,137		1,106		1,546		1,240		7.0	%
Total deposits	$	5,150	$	5,295	$	5,500	$	6,946	$	6,126		19.0	%
Net Flows
Annuities	$	293	$	701	$	396	$	1,060	$	885		202.0	%
Retirement Plan Services		212		194		232		348		344		62.3	%
Life Insurance		741		713		685		1,148		848		14.4	%
Total net flows	$	1,246	$	1,608	$	1,313	$	2,556	$	2,077		66.7	%
Account Balances as of End-of-Period
Annuities	$	91,668	$	90,377	$	94,193	$	96,514	$	101,414		10.6	%
Retirement Plan Services		42,020		41,397		43,103		43,931		46,442		10.5	%
Life Insurance		36,008		36,121		36,589		37,325		38,018		5.6	%
Total account balances	$	169,696	$	167,895	$	173,885	$	177,770	$	185,874		9.5	%
Average Account Balances
Annuities	$	89,537	$	89,890	$	92,323	$	94,709	$	99,545		11.2	%
Retirement Plan Services		40,834		41,315		42,315		43,385		45,374		11.1	%
Life Insurance		35,643		36,064		36,355		36,957		37,671		5.7	%
Total average account balances	$	166,014	$	167,269	$	170,993	$	175,051	$	182,590		10.0	%

Page 8

Lincoln Financial Group
Sales By Segment
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12		6/30/12		9/30/12		12/31/12		3/31/13		Change
Sales
Annuities:
Variable	$	2,185	$	2,422	$	2,188	$	3,019	$	2,939		34.5	%
Fixed		295		445		489		520		280		-5.1	%
Total Annuities	$	2,480	$	2,867	$	2,677	$	3,539	$	3,219		29.8	%
Retirement Plan Services:
Small market	$	418	$	372	$	362	$	577	$	407		-2.6	%
Mid - large market		920		746		1,186		1,123		1,099		19.5	%
Multi-Fund® and other variable		173		173		169		161		161		-6.9	%
Total Retirement Plan Services	$	1,511	$	1,291	$	1,717	$	1,861	$	1,667		10.3	%
Life Insurance:
UL, excluding MoneyGuard®	$	47	$	51	$	38	$	52	$	40		-14.9	%
MoneyGuard®		41		41		40		47		45		9.8	%
VUL		10		12		9		30		23		130.0	%
COLI and BOLI		11		11		9		78		26		136.4	%
Term		13		13		16		19		16		23.1	%
Total Life Insurance	$	122	$	128	$	112	$	226	$	150		23.0	%
Group Protection:
Life	$	29	$	33	$	41	$	84	$	31		6.9	%
Disability		28		38		41		97		31		10.7	%
Dental		10		18		15		25		9		-10.0	%
Total Group Protection	$	67	$	89	$	97	$	206	$	71		6.0	%

Page 9

Lincoln Financial Group
Operating Revenues and General and Administrative Expenses By Segment
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Operating Revenues
Annuities	$	731		$	734		$	745		$	766		$	777			6.3	%
Retirement Plan Services		252			258			255			259			260			3.2	%
Life Insurance		1,227			1,235			1,296			1,297			1,245			1.5	%
Group Protection		504			540			517			531			550			9.1	%
Other Operations		106			113			101			103			102			-3.8	%
Total	$	2,820		$	2,880		$	2,914		$	2,956		$	2,934			4.0	%
General and Administrative Expenses, Net of Amounts Capitalized
Annuities	$	107		$	97		$	103		$	118		$	97			-9.3	%
Retirement Plan Services		67			70			73			86			66			-1.5	%
Life Insurance		108			102			105			113			98			-9.3	%
Group Protection		51			55			57			63			55			7.8	%
Other Operations		22			23			24			23			26			18.2	%
Total	$	355		$	347		$	362		$	403		$	342			-3.7	%
General and Administrative Expenses, Net of Amounts Capitalized, As a % of Operating Revenues
Annuities		14.6	%		13.2	%		13.9	%		15.4	%		12.4	%
Retirement Plan Services		26.6	%		27.3	%		28.7	%		33.1	%		25.6	%
Life Insurance		8.8	%		8.3	%		8.1	%		8.7	%		7.9	%
Group Protection		10.0	%		10.2	%		11.0	%		11.9	%		10.0	%
Other Operations		21.3	%		19.4	%		24.8	%		21.1	%		25.7	%
Total		12.6	%		12.0	%		12.4	%		13.6	%		11.7	%

Page 10

Lincoln Financial Group
Operating Commissions and Other Expenses
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Operating Commissions and Other Expenses Incurred
General and administrative expenses	$	398		$	395		$	405		$	467		$	395			-0.8	%
Commissions		450			465			454			551			514			14.2	%
Media expenses		16			16			16			17			15			-6.3	%
Taxes, licenses and fees		62			55			70			58			67			8.1	%
Interest and debt expense		68			68			68			65			64			-5.9	%
Expenses associated with reserve financing and unrelated letters of credit		13			13			14			15			16			23.1	%
Total operating commissions and other expenses incurred		1,007			1,012			1,027			1,173			1,071			6.4	%
Less Amounts Capitalized
General and administrative expenses		(43	)		(48	)		(43	)		(64	)		(53	)		-23.3	%
Commissions		(237	)		(261	)		(242	)		(328	)		(280	)		-18.1	%
Taxes, licenses and fees		(10	)		(10	)		(8	)		(12	)		(10	)		0.0	%
Total amounts capitalized		(290	)		(319	)		(293	)		(404	)		(343	)		-18.3	%
Total expenses incurred, net of amounts capitalized, excluding amortization		717			693			734			769			728			1.5	%
Amortization
Amortization of DAC and VOBA		200			204			376			245			227			13.5	%
Amortization of intangibles		1			1			1			1			1			0.0	%
Total amortization		201			205			377			246			228			13.4	%
Total operating commissions and other expenses	$	918		$	898		$	1,111		$	1,015		$	956			4.1	%

Page 11

Lincoln Financial Group
Interest Rate Yields and Spreads By Segment
Unaudited
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Annuities
Investments on reserves, excluding alternative		4.93	%		4.86	%		4.83	%		4.69	%		4.66	%		(27	)
Prepayment and make whole premiums		0.04	%		0.07	%		0.04	%		0.08	%		0.09	%		5
Alternative investments		0.00	%		0.01	%		0.00	%		0.00	%		0.00	%		-
Net investment income yield on reserves		4.97	%		4.94	%		4.87	%		4.77	%		4.75	%		(22	)
Interest rate credited to contract holders		3.15	%		3.03	%		2.94	%		2.79	%		2.77	%		(38	)
Interest rate spread		1.82	%		1.91	%		1.93	%		1.98	%		1.98	%		16
Retirement Plan Services
Investments on reserves, excluding alternative		5.34	%		5.28	%		5.23	%		5.04	%		5.02	%		(32	)
Prepayment and make whole premiums		0.04	%		0.02	%		0.01	%		0.07	%		0.10	%		6
Alternative investments		0.01	%		0.02	%		0.00	%		0.00	%		0.00	%		(1	)
Net investment income yield on reserves		5.39	%		5.32	%		5.24	%		5.11	%		5.12	%		(27	)
Interest rate credited to contract holders		3.22	%		3.22	%		3.22	%		3.16	%		3.14	%		(8	)
Interest rate spread		2.17	%		2.10	%		2.02	%		1.95	%		1.98	%		(19	)
Life Insurance
Attributable to interest-sensitive products:
Investments on reserves, excluding alternative		5.77	%		5.75	%		5.60	%		5.60	%		5.53	%		(24	)
Prepayment and make whole premiums		0.02	%		0.07	%		0.02	%		0.13	%		0.03	%		1
Alternative investments		0.17	%		0.15	%		0.03	%		0.29	%		0.00	%		(17	)
Net investment income yield on reserves		5.96	%		5.97	%		5.65	%		6.02	%		5.56	%		(40	)
Interest rate credited to contract holders		3.97	%		3.93	%		3.94	%		3.99	%		3.98	%		1
Interest rate spread		1.99	%		2.04	%		1.71	%		2.03	%		1.58	%		(41	)
Attributable to traditional products:
Investments on reserves, excluding alternative		5.73	%		5.79	%		5.67	%		5.56	%		5.58	%		(15	)
Prepayment and make whole premiums		0.00	%		0.04	%		0.00	%		0.47	%		0.05	%		5
Alternative investments		0.01	%		0.02	%		0.00	%		0.00	%		0.00	%		(1	)
Net investment income yield on reserves		5.74	%		5.85	%		5.67	%		6.03	%		5.63	%		(11	)

Page 12

Lincoln Financial Group
Select Investment Data
Unaudited (millions of dollars)
	As of 3/31/12					As of 12/31/12					As of 3/31/13
	Amount		%			Amount		%			Amount		%
AFS and Trading Securities, at Fair Value
AFS securities:
Corporate bonds	$	60,599		76.0	%	$	68,016		79.6	%	$	69,274		80.5	%
U.S. government bonds		486		0.6	%		442		0.5	%		432		0.5	%
Foreign government bonds		650		0.8	%		654		0.8	%		626		0.7	%
Mortgage-backed securities		9,095		11.4	%		7,174		8.4	%		6,542		7.6	%
Asset-backed collateralized debt obligations		102		0.1	%		180		0.2	%		173		0.2	%
State and municipal bonds		4,126		5.2	%		4,353		5.1	%		4,430		5.1	%
Hybrid and redeemable preferred securities		1,196		1.5	%		1,217		1.4	%		1,234		1.4	%
VIEs' fixed maturity securities		702		0.9	%		708		0.8	%		708		0.8	%
Equity securities		126		0.2	%		157		0.2	%		148		0.2	%
Total AFS securities		77,082		96.7	%		82,901		97.0	%		83,567		97.1	%
Trading securities		2,650		3.3	%		2,554		3.0	%		2,528		2.9	%
Total AFS and trading securities	$	79,732		100.0	%	$	85,455		100.0	%	$	86,095		100.0	%
AFS and Trading Securities, at Amortized Cost
Fixed maturity securities	$	72,859		99.8	%	$	75,520		99.8	%	$	76,883		99.8	%
Equity securities		115		0.2	%		139		0.2	%		131		0.2	%
Total AFS and trading securities	$	72,974		100.0	%	$	75,659		100.0	%	$	77,014		100.0	%
% of Fixed Maturity AFS Securities, at Amortized Cost
Investment grade				94.3	%				94.5	%				94.7	%
Below investment grade				5.7	%				5.5	%				5.3	%

	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Net Investment Income	$	1,166		$	1,197		$	1,146		$	1,190		$	1,150			-1.4	%
Average Invested Assets, at Amortized Cost		83,883			84,958			85,802			86,498			87,690			4.5	%
Net Investment Income Yield		5.56	%		5.64	%		5.34	%		5.50	%		5.25	%		(31	)

Page 13

Lincoln Financial Group
Realized Gain (Loss) and Benefit Ratio Unlocking, After-DAC
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Realized Gain (Loss), Pre-Tax
Total operating realized gain (loss)	$	27		$	25		$	31		$	30		$	37			37.0	%
Total excluded realized gain (loss)		(112	)		18			39			17			(91	)		18.8	%
Total realized gain (loss), pre-tax	$	(85	)	$	43		$	70		$	47		$	(54	)		36.5	%
Realized Gain (Loss) Net of Benefit Ratio Unlocking, After-Tax
Realized gain (loss) related to investments	$	6		$	(45	)	$	3		$	(2	)	$	(4	)	NM
Variable annuity net derivative results:
Hedge program performance, including unlocking for GLB reserves hedged		19			(38	)		99			18			1			-94.7	%
GLB non-performance risk component		(85	)		86			(61	)		(5	)		(35	)		58.8	%
Total variable annuity net derivative results		(66	)		48			38			13			(34	)		48.5	%
Indexed annuity forward-starting option		10			(1	)		(6	)		2			(8	)	NM
Excluded realized gain (loss) net of benefit ratio unlocking, after-tax	$	(50	)	$	2		$	35		$	13		$	(46	)		8.0	%
Components of Realized Gain (Loss) Related to Investments, After-Tax
OTTI	$	(31	)	$	(21	)	$	(21	)	$	(27	)	$	(9	)		70.2	%
Other realized gain (loss) related to certain investments		(1	)		(12	)		(14	)		2			(1	)		37.9	%
Gain (loss) on the mark-to-market on certain instruments		38			(12	)		38			23			6			-84.2	%
Total realized gain (loss) related to investments, after-tax	$	6		$	(45	)	$	3		$	(2	)	$	(4	)	NM

Page 14

Lincoln Financial Group
Select Liquidity and Rating Agency Data
Unaudited (millions of dollars)
	As of
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Leverage Ratio
Short-term debt	$	300		$	300		$	200		$	200		$	706			135.3	%
Long-term debt		5,606			5,719			5,494			5,439			4,889			-12.8	%
Total debt		5,906			6,019			5,694			5,639			5,595			-5.3	%
Less:
Long-term operating debt (1)		1,122			1,122			1,122			1,122			1,122			0.0	%
75% of capital securities		908			908			908			908			908			0.0	%
Carrying value of fair value hedges		234			330			307			269			227			-3.0	%
Total numerator	$	3,642		$	3,659		$	3,357		$	3,340		$	3,338			-8.3	%
Stockholders' equity, excluding AOCI	$	10,498		$	10,660		$	10,970		$	11,165		$	11,281			7.5	%
Total debt		5,906			6,019			5,694			5,639			5,595			-5.3	%
Total denominator	$	16,404		$	16,679		$	16,664		$	16,804		$	16,876			2.9	%
Leverage ratio		22.2	%		21.9	%		20.1	%		19.9	%		19.8	%
Holding Company Available Liquidity	$	833		$	802		$	618		$	706		$	647			-22.3	%
							Ratings as of May 1, 2013
																Standard
							A.M. Best			Fitch			Moody's			& Poor's
Senior Debt Ratings							a-			BBB+			Baa2			A-
Financial Strength Ratings
Lincoln National Life Insurance Company							A+			A+			A2			AA-
First Penn-Pacific Life Insurance Company							A			A+			A2			A-
Lincoln Life & Annuity Company of New York							A+			A+			A2			AA-

(1) We have categorized as operating debt the senior notes issued in October 2007 and June 2010 because the proceeds were used as a long-term structured solution to reduce the strain on increasing statutory reserves associated with secondary guarantee UL and term policies and the senior note issued in September 2008 by our primary insurance subsidiary.

Page 15

Lincoln Financial Group
Annuities - Select Earnings and Operational Data
Unaudited (millions of dollars)
	As of or For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	17		$	18		$	29		$	34		$	33			94.1	%
Insurance fees		325			323			332			351			369			13.5	%
Net investment income		272			279			268			263			257			-5.5	%
Operating realized gain (loss)		27			25			30			31			31			14.8	%
Other revenues and fees		90			89			86			87			87			-3.3	%
Total operating revenues		731			734			745			766			777			6.3	%
Operating expenses:
Interest credited		171			163			146			153			153			-10.5	%
Benefits		45			49			131			55			65			44.4	%
Commissions incurred		183			202			203			245			229			25.1	%
Other expenses incurred		196			187			190			212			194			-1.0	%
Amounts capitalized		(124	)		(149	)		(138	)		(182	)		(163	)		-31.5	%
Amortization		98			86			40			97			105			7.1	%
Total operating expenses		569			538			572			580			583			2.5	%
Income (loss) from operations before taxes		162			196			173			186			194			19.8	%
Federal income tax expense (benefit)		25			38			34			24			35			40.0	%
Income (loss) from operations	$	137		$	158		$	139		$	162		$	159			16.1	%
Effective Federal Income Tax Rate		15.4	%		19.7	%		19.6	%		12.7	%		18.0	%
Average Equity, Excluding Goodwill and AOCI	$	2,960		$	3,091		$	3,110		$	3,053		$	2,977			0.6	%
ROE, Excluding Goodwill		18.5	%		20.4	%		17.9	%		21.2	%		21.3	%
Return on Average Account Values		61			70			60			68			64			3
Account Values
Separate account values:
Average	$	69,003		$	69,222		$	71,535		$	73,804		$	78,489			13.7	%
End-of-period		71,059			69,615			73,401			75,501			80,312			13.0	%
General account values:
Average		20,534			20,668			20,788			20,905			21,056			2.5	%
End-of-period		20,609			20,762			20,792			21,013			21,102			2.4	%

Page 16

Lincoln Financial Group
Retirement Plan Services - Select Earnings and Operational Data
Unaudited (millions of dollars)
	As of or For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss) from Operations
Operating revenues:
Insurance fees	$	52		$	53		$	53		$	54		$	56			7.7	%
Net investment income		197			202			199			201			202			2.5	%
Other revenues and fees		3			3			3			4			2			-33.3	%
Total operating revenues		252			258			255			259			260			3.2	%
Operating expenses:
Interest credited		111			112			114			115			117			5.4	%
Commissions incurred		18			17			17			19			18			0.0	%
Other expenses incurred		76			78			81			93			77			1.3	%
Amounts capitalized		(10	)		(9	)		(9	)		(10	)		(9	)		10.0	%
Amortization		10			10			13			10			9			-10.0	%
Total operating expenses		205			208			216			227			212			3.4	%
Income (loss) from operations before taxes		47			50			39			32			48			2.1	%
Federal income tax expense (benefit)		12			12			10			4			13			8.3	%
Income (loss) from operations	$	35		$	38		$	29		$	28		$	35			0.0	%
Effective Federal Income Tax Rate		25.9	%		23.8	%		26.0	%		13.0	%		27.2	%
Average Equity, Excluding Goodwill and AOCI	$	911		$	1,001		$	1,031		$	941		$	908			-0.3	%
ROE, Excluding Goodwill		15.2	%		15.1	%		11.2	%		12.0	%		15.5	%
Return on Average Account Values		34			37			27			26			31			(3	)
Account Values
Separate account values:
Average	$	13,589		$	13,373		$	13,558		$	13,536		$	13,970			2.8	%
End-of-period		13,959			13,338			13,788			13,466			14,233			2.0	%
Mutual fund account values:
Average		13,522			14,039			14,631			15,404			16,595			22.7	%
End-of-period		14,241			14,056			15,073			15,747			17,313			21.6	%
General account values:
Average		13,723			13,903			14,126			14,445			14,809			7.9	%
End-of-period		13,820			14,003			14,242			14,718			14,896			7.8	%

Page 17

Lincoln Financial Group
Life Insurance - Select Earnings and Operational Data
Unaudited (millions of dollars)
	As of or For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	109		$	114		$	103		$	116		$	113			3.7	%
Insurance fees		524			510			605			551			533			1.7	%
Net investment income		588			606			578			624			585			-0.5	%
Operating realized gain (loss)		-			(1	)		1			(1	)		6		NM
Other revenues and fees		6			6			9			7			8			33.3	%
Total operating revenues		1,227			1,235			1,296			1,297			1,245			1.5	%
Operating expenses:
Interest credited		312			312			320			316			324			3.8	%
Benefits		469			474			295			486			505			7.7	%
Commissions incurred		130			126			115			161			139			6.9	%
Other expenses incurred		174			168			168			178			169			-2.9	%
Amounts capitalized		(145	)		(143	)		(131	)		(181	)		(157	)		-8.3	%
Amortization		80			97			313			124			98			22.5	%
Total operating expenses		1,020			1,034			1,080			1,084			1,078			5.7	%
Income (loss) from operations before taxes		207			201			216			213			167			-19.3	%
Federal income tax expense (benefit)		68			66			64			66			55			-19.1	%
Income (loss) from operations	$	139		$	135		$	152		$	147		$	112			-19.4	%
Effective Federal Income Tax Rate		32.9	%		32.7	%		29.7	%		30.8	%		32.9	%
Average Equity, Excluding Goodwill and AOCI	$	5,655		$	5,805		$	5,879		$	5,919		$	5,998			6.1	%
ROE, Excluding Goodwill		9.9	%		9.3	%		10.3	%		10.0	%		7.5	%
Average Account Values	$	35,643		$	36,064		$	36,355		$	36,957		$	37,671			5.7	%
In-Force Face Amount
UL and other	$	307,957		$	308,763		$	308,470		$	311,235		$	311,588			1.2	%
Term insurance		272,006			273,305			275,992			279,322			282,463			3.8	%
Total in-force face amount	$	579,963		$	582,068		$	584,462		$	590,557		$	594,051			2.4	%

Page 18

Lincoln Financial Group
Group Protection - Select Earnings and Operational Data
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Income (Loss) from Operations
Operating revenues:
Insurance premiums	$	463		$	495		$	473		$	487		$	508			9.7	%
Net investment income		38			42			41			41			39			2.6	%
Other revenues and fees		3			3			3			3			3			0.0	%
Total operating revenues		504			540			517			531			550			9.1	%
Operating expenses:
Interest credited		1			1			1			1			1			0.0	%
Benefits		350			368			360			367			384			9.7	%
Commissions incurred		54			53			55			61			63			16.7	%
Other expenses incurred		73			82			82			99			80			9.6	%
Amounts capitalized		(11	)		(17	)		(15	)		(31	)		(15	)		-36.4	%
Amortization		12			11			10			14			15			25.0	%
Total operating expenses		479			498			493			511			528			10.2	%
Income (loss) from operations before taxes		25			42			24			20			22			-12.0	%
Federal income tax expense (benefit)		9			15			8			7			8			-11.1	%
Income (loss) from operations	$	16		$	27		$	16		$	13		$	14			-12.5	%
Effective Federal Income Tax Rate		35.0	%		35.6	%		34.2	%		34.9	%		35.0	%
Average Equity, Excluding Goodwill and AOCI	$	906		$	927		$	955		$	992		$	1,036			14.3	%
ROE, Excluding Goodwill		7.1	%		11.6	%		6.5	%		5.3	%		5.6	%
Loss Ratios by Product Line
Life		78.2	%		75.0	%		76.8	%		72.3	%		80.1	%
Disability		70.1	%		69.6	%		76.3	%		77.9	%		69.1	%
Dental		82.1	%		76.5	%		69.0	%		70.8	%		77.4	%
Total non-medical		74.9	%		72.7	%		75.7	%		74.7	%		74.8	%
Medical		87.6	%		89.7	%		85.4	%		86.7	%		89.3	%

Page 19

Lincoln Financial Group
Other Operations and Discontinued Operations - Select Earnings and Operational Data
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Other Operations
Operating revenues:
Insurance premiums	$	-		$	3		$	-		$	-		$	-		NM
Net investment income		70			68			61			61			66			-5.7	%
Amortization of deferred gain on business sold through reinsurance		18			18			18			18			18			0.0	%
Media revenues		17			21			21			21			17			0.0	%
Other revenues and fees		1			3			1			3			1			0.0	%
Total operating revenues		106			113			101			103			102			-3.8	%
Operating expenses:
Interest credited		31			30			30			32			27			-12.9	%
Benefits		28			35			43			32			27			-3.6	%
Media expenses		16			16			16			17			15			-6.3	%
Commissions and other expenses		20			15			33			24			25			25.0	%
Interest and debt expenses		68			68			68			65			64			-5.9	%
Total operating expenses		163			164			190			170			158			-3.1	%
Income (loss) from operations before taxes		(57	)		(51	)		(89	)		(67	)		(56	)		1.8	%
Federal income tax expense (benefit)		(23	)		(12	)		(115	)		(27	)		(21	)		8.7	%
Income (loss) from operations	$	(34	)	$	(39	)	$	26		$	(40	)	$	(35	)		-2.9	%
Discontinued Operations
Gain (loss) on disposal before taxes	$	(1	)	$	-		$	-		$	-		$	-			100.0	%
Federal income tax expense (benefit)		-			-			(28	)		-			-		NM
Gain (loss) on disposal	$	(1	)	$	-		$	28		$	-		$	-			100.0	%

Page 20

Lincoln Financial Group
Consolidated - DAC, VOBA, DSI and DFEL Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
DAC and VOBA
Balance as of beginning-of-period	$	6,776		$	6,880		$	6,505		$	5,813		$	6,667			-1.6	%
Business sold through reinsurance		-			-			2			-			-		NM
Deferrals		290			319			293			404			343			18.3	%
Operating amortization		(200	)		(204	)		(376	)		(245	)		(227	)		-13.5	%
Deferrals, net of operating amortization		90			115			(83	)		159			116			28.9	%
Amortization associated with benefit ratio unlocking		(5	)		2			(2	)		-			(2	)		60.0	%
Adjustment related to realized (gains) losses		19			(34	)		(30	)		(16	)		4			-78.9	%
Adjustment related to unrealized (gains) losses		-			(458	)		(579	)		711			151		NM
Balance as of end-of-period	$	6,880		$	6,505		$	5,813		$	6,667		$	6,936			0.8	%
DSI
Balance as of beginning-of-period	$	271		$	268		$	260		$	252		$	253			-6.6	%
Deferrals		9			10			11			9			3			-66.7	%
Operating amortization		(12	)		(10	)		3			(12	)		(12	)		0.0	%
Deferrals, net of operating amortization		(3	)		-			14			(3	)		(9	)	NM
Amortization associated with benefit ratio unlocking		(1	)		-			-			-			-			100.0	%
Adjustment related to realized (gains) losses		2			(4	)		(4	)		(3	)		-			-100.0	%
Adjustment related to unrealized (gains) losses		(1	)		(4	)		(18	)		7			5		NM
Balance as of end-of-period	$	268		$	260		$	252		$	253		$	249			-7.1	%
DFEL
Balance as of beginning-of-period	$	1,369		$	1,404		$	1,261		$	1,001		$	1,373			0.3	%
Deferrals		90			88			78			92			83			-7.8	%
Operating amortization		(50	)		(42	)		(130	)		(61	)		(55	)		-10.0	%
Deferrals, net of operating amortization		40			46			(52	)		31			28			-30.0	%
Amortization associated with benefit ratio unlocking		(1	)		-			(1	)		-			-			100.0	%
Adjustment related to realized (gains) losses		5			(6	)		(12	)		(4	)		1			-80.0	%
Adjustment related to unrealized (gains) losses		(9	)		(183	)		(195	)		345			(51	)	NM
Balance as of end-of-period	$	1,404		$	1,261		$	1,001		$	1,373		$	1,351			-3.8	%

Page 21

Lincoln Financial Group
Annuities - DAC, VOBA, DSI and DFEL Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
DAC and VOBA
Balance as of beginning-of-period	$	1,912		$	1,965		$	1,940		$	1,910		$	2,092			9.4	%
Deferrals		125			149			138			182			164			31.2	%
Operating amortization		(98	)		(86	)		(40	)		(97	)		(105	)		-7.1	%
Deferrals, net of operating amortization		27			63			98			85			59			118.5	%
Amortization associated with benefit ratio unlocking		(4	)		2			(2	)		-			(2	)		50.0	%
Adjustment related to realized (gains) losses		17			(34	)		(32	)		(15	)		8			-52.9	%
Adjustment related to unrealized (gains) losses		13			(56	)		(94	)		112			39			200.0	%
Balance as of end-of-period	$	1,965		$	1,940		$	1,910		$	2,092		$	2,196			11.8	%
DSI
Balance as of beginning-of-period	$	269		$	267		$	258		$	250		$	249			-7.4	%
Deferrals		9			10			11			7			2			-77.8	%
Operating amortization		(12	)		(10	)		3			(12	)		(11	)		8.3	%
Deferrals, net of operating amortization		(3	)		-			14			(5	)		(9	)	NM
Amortization associated with benefit ratio unlocking		(1	)		-			-			-			-			100.0	%
Adjustment related to realized (gains) losses		3			(4	)		(4	)		(3	)		-			-100.0	%
Adjustment related to unrealized (gains) losses		(1	)		(5	)		(18	)		7			6		NM
Balance as of end-of-period	$	267		$	258		$	250		$	249		$	246			-7.9	%
DFEL
Balance as of beginning-of-period	$	263		$	267		$	265		$	258		$	258			-1.9	%
Deferrals		6			7			5			6			5			-16.7	%
Operating amortization		(5	)		(3	)		2			(5	)		(5	)		0.0	%
Deferrals, net of operating amortization		1			4			7			1			-			-100.0	%
Amortization associated with benefit ratio unlocking		(1	)		-			(1	)		-			-			100.0	%
Adjustment related to realized (gains) losses		5			(6	)		(12	)		(4	)		2			-60.0	%
Adjustment related to unrealized (gains) losses		(1	)		-			(1	)		3			1			200.0	%
Balance as of end-of-period	$	267		$	265		$	258		$	258		$	261			-2.2	%

Page 22

Lincoln Financial Group
Retirement Plan Services, Life Insurance and Group Protection - DAC, VOBA and DFEL Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
DAC and VOBA - Retirement Plan Services
Balance as of beginning-of-period	$	183		$	165		$	145		$	108		$	102			-44.3	%
Deferrals		10			9			9			10			9			-10.0	%
Operating amortization		(10	)		(10	)		(13	)		(10	)		(9	)		10.0	%
Deferrals, net of operating amortization		-			(1	)		(4	)		-			-		NM
Adjustment related to unrealized (gains) losses		(18	)		(19	)		(33	)		(6	)		(33	)		-83.3	%
Balance as of end-of-period	$	165		$	145		$	108		$	102		$	69			-58.2	%
DAC and VOBA - Life Insurance
Balance as of beginning-of-period	$	4,516		$	4,586		$	4,251		$	3,620		$	4,281			-5.2	%
Business sold through reinsurance		-			-			2			-			-		NM
Deferrals		145			143			131			182			157			8.3	%
Operating amortization		(80	)		(97	)		(313	)		(124	)		(98	)		-22.5	%
Deferrals, net of operating amortization		65			46			(182	)		58			59			-9.2	%
Adjustment related to realized (gains) losses		1			(1	)		1			(1	)		(4	)	NM
Adjustment related to unrealized (gains) losses		4			(380	)		(452	)		604			144		NM
Balance as of end-of-period	$	4,586		$	4,251		$	3,620		$	4,281		$	4,480			-2.3	%
DFEL - Life Insurance
Balance as of beginning-of-period	$	1,106		$	1,136		$	997		$	742		$	1,115			0.8	%
Deferrals		83			82			73			87			77			-7.2	%
Operating amortization		(45	)		(39	)		(132	)		(57	)		(49	)		-8.9	%
Deferrals, net of operating amortization		38			43			(59	)		30			28			-26.3	%
Adjustment related to realized (gains) losses		-			-			-			-			(1	)	NM
Adjustment related to unrealized (gains) losses		(8	)		(182	)		(196	)		343			(52	)	NM
Balance as of end-of-period	$	1,136		$	997		$	742		$	1,115		$	1,090			-4.0	%
DAC and VOBA - Group Protection
Balance as of beginning-of-period	$	165		$	164		$	170		$	175		$	192			16.4	%
Deferrals		11			17			15			31			15			36.4	%
Operating amortization		(12	)		(11	)		(10	)		(14	)		(15	)		-25.0	%
Deferrals, net of operating amortization		(1	)		6			5			17			-			100.0	%
Balance as of end-of-period	$	164		$	170		$	175		$	192		$	192			17.1	%

Page 23

Lincoln Financial Group
Annuities - Account Value Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Fixed Annuities
Balance as of beginning-of-period	$	18,106		$	18,186		$	18,273		$	18,347		$	18,438			1.8	%
Gross deposits		295			445			489			520			280			-5.1	%
Withdrawals and deaths		(465	)		(477	)		(599	)		(571	)		(435	)		6.5	%
Net flows		(170	)		(32	)		(110	)		(51	)		(155	)		8.8	%
Reinvested interest credited		241			110			173			135			254			5.4	%
Sales inducements deferred		9			9			11			7			2			-77.8	%
Balance as of end-of-period, gross		18,186			18,273			18,347			18,438			18,539			1.9	%
Reinsurance ceded		(883	)		(871	)		(849	)		(830	)		(811	)		8.2	%
Balance as of end-of-period, net	$	17,303		$	17,402		$	17,498		$	17,608		$	17,728			2.5	%
Variable Annuities
Balance as of beginning-of-period	$	68,330		$	74,366		$	72,976		$	76,696		$	78,906			15.5	%
Gross deposits		2,185			2,422			2,188			3,019			2,939			34.5	%
Withdrawals and deaths		(1,722	)		(1,689	)		(1,682	)		(1,908	)		(1,899	)		-10.3	%
Net flows		463			733			506			1,111			1,040			124.6	%
Change in market value and reinvestment		5,573			(2,123	)		3,214			1,099			3,741			-32.9	%
Balance as of end-of-period, gross		74,366			72,976			76,696			78,906			83,687			12.5	%
Reinsurance ceded		(1	)		(1	)		(1	)		-			(1	)		0.0	%
Balance as of end-of-period, net	$	74,365		$	72,975		$	76,695		$	78,906		$	83,686			12.5	%
Total
Balance as of beginning-of-period	$	86,436		$	92,552		$	91,249		$	95,043		$	97,344			12.6	%
Gross deposits		2,480			2,867			2,677			3,539			3,219			29.8	%
Withdrawals and deaths		(2,187	)		(2,166	)		(2,281	)		(2,479	)		(2,334	)		-6.7	%
Net flows		293			701			396			1,060			885			202.0	%
Change in market value and reinvestment		5,814			(2,013	)		3,387			1,234			3,995			-31.3	%
Sales inducements deferred		9			9			11			7			2			-77.8	%
Balance as of end-of-period, gross		92,552			91,249			95,043			97,344			102,226			10.5	%
Reinsurance ceded		(884	)		(872	)		(850	)		(830	)		(812	)		8.1	%
Balance as of end-of-period, net	$	91,668		$	90,377		$	94,193		$	96,514		$	101,414			10.6	%

Page 24

Lincoln Financial Group
Retirement Plan Services - Account Value Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Small Market
Balance as of beginning-of-period	$	6,167		$	6,641		$	6,470		$	6,766		$	7,001			13.5	%
Gross deposits		418			372			362			577			407			-2.6	%
Withdrawals and deaths		(412	)		(368	)		(330	)		(405	)		(409	)		0.7	%
Net flows		6			4			32			172			(2	)	NM
Transfers between fixed and variable accounts		(11	)		-			(5	)		(22	)		(14	)		-27.3	%
Change in market value and reinvestment		479			(175	)		269			85			388			-19.0	%
Balance as of end-of-period	$	6,641		$	6,470		$	6,766		$	7,001		$	7,373			11.0	%
Mid - Large Market
Balance as of beginning-of-period	$	17,435		$	19,199		$	19,139		$	20,293		$	21,050			20.7	%
Gross deposits		920			746			1,186			1,123			1,099			19.5	%
Withdrawals and deaths		(505	)		(395	)		(798	)		(633	)		(532	)		-5.3	%
Net flows		415			351			388			490			567			36.6	%
Transfers between fixed and variable accounts		(2	)		(5	)		(17	)		(12	)		13		NM
Change in market value and reinvestment		1,351			(406	)		783			279			1,146			-15.2	%
Balance as of end-of-period	$	19,199		$	19,139		$	20,293		$	21,050		$	22,776			18.6	%
Multi-Fund®and Other
Balance as of beginning-of-period	$	15,531		$	16,180		$	15,788		$	16,044		$	15,880			2.2	%
Gross deposits		173			173			169			161			161			-6.9	%
Withdrawals and deaths		(382	)		(334	)		(357	)		(475	)		(382	)		0.0	%
Net flows		(209	)		(161	)		(188	)		(314	)		(221	)		-5.7	%
Change in market value and reinvestment		858			(231	)		444			150			634			-26.1	%
Balance as of end-of-period	$	16,180		$	15,788		$	16,044		$	15,880		$	16,293			0.7	%
Total
Balance as of beginning-of-period	$	39,133		$	42,020		$	41,397		$	43,103		$	43,931			12.3	%
Gross deposits		1,511			1,291			1,717			1,861			1,667			10.3	%
Withdrawals and deaths		(1,299	)		(1,097	)		(1,485	)		(1,513	)		(1,323	)		-1.8	%
Net flows		212			194			232			348			344			62.3	%
Transfers between fixed and variable accounts		(13	)		(5	)		(22	)		(34	)		(1	)		92.3	%
Change in market value and reinvestment		2,688			(812	)		1,496			514			2,168			-19.3	%
Balance as of end-of-period	$	42,020		$	41,397		$	43,103		$	43,931		$	46,442			10.5	%

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Lincoln Financial Group
Life Insurance - Account Value Roll Forwards
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12			12/31/12			3/31/13			Change
Interest-Sensitive Life
Balance as of beginning-of-period	$	31,219		$	31,494		$	31,750		$	31,986		$	32,432			3.9	%
Deposits		991			990			971			1,132			998			0.7	%
Withdrawals and deaths		(317	)		(331	)		(337	)		(267	)		(187	)		41.0	%
Net flows		674			659			634			865			811			20.3	%
Contract holder assessments		(710	)		(712	)		(712	)		(737	)		(743	)		-4.6	%
Reinvested interest credited		311			309			314			318			317			1.9	%
Balance as of end-of-period, gross		31,494			31,750			31,986			32,432			32,817			4.2	%
Reinsurance ceded		(862	)		(859	)		(847	)		(838	)		(831	)		3.6	%
Balance as of end-of-period, net	$	30,632		$	30,891		$	31,139		$	31,594		$	31,986			4.4	%
VUL
Balance as of beginning-of-period	$	5,687		$	6,202		$	6,005		$	6,262		$	6,523			14.7	%
Deposits		168			147			135			414			242			44.0	%
Withdrawals and deaths		(101	)		(93	)		(84	)		(131	)		(205	)	NM
Net flows		67			54			51			283			37			-44.8	%
Contract holder assessments		(95	)		(88	)		(104	)		(126	)		(85	)		10.5	%
Change in market value and reinvestment		543			(163	)		310			104			384			-29.3	%
Balance as of end-of-period, gross		6,202			6,005			6,262			6,523			6,859			10.6	%
Reinsurance ceded		(826	)		(775	)		(812	)		(792	)		(827	)		-0.1	%
Balance as of end-of-period, net	$	5,376		$	5,230		$	5,450		$	5,731		$	6,032			12.2	%
Total
Balance as of beginning-of-period	$	36,906		$	37,696		$	37,755		$	38,248		$	38,955			5.6	%
Deposits		1,159			1,137			1,106			1,546			1,240			7.0	%
Withdrawals and deaths		(418	)		(424	)		(421	)		(398	)		(392	)		6.2	%
Net flows		741			713			685			1,148			848			14.4	%
Contract holder assessments		(805	)		(800	)		(816	)		(863	)		(828	)		-2.9	%
Change in market value and reinvestment		854			146			624			422			701			-17.9	%
Balance as of end-of-period, gross		37,696			37,755			38,248			38,955			39,676			5.3	%
Reinsurance ceded		(1,688	)		(1,634	)		(1,659	)		(1,630	)		(1,658	)		1.8	%
Balance as of end-of-period, net	$	36,008		$	36,121		$	36,589		$	37,325		$	38,018			5.6	%

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Lincoln Financial Group
Select Non-GAAP to GAAP Reconciliations
Unaudited (millions of dollars)
	For the Three Months Ended
	3/31/12			6/30/12			9/30/12		12/31/12			3/31/13			Change
Revenues
Operating revenues	$	2,820		$	2,880		$	2,914	$	2,956		$	2,934			4.0	%
Excluded realized gain (loss)		(112	)		18			39		17			(91	)		18.8	%
Amortization of DFEL on benefit ratio unlocking		1			(1	)		-		(1	)		-			-100.0	%
Amortization of deferred gains arising from reserve changes on business sold through reinsurance		1			1			1		1			1			0.0	%
Total revenues	$	2,710		$	2,898		$	2,954	$	2,973		$	2,844			4.9	%
Excluded Realized Gain (Loss) Net of Benefit Ratio Unlocking, After-Tax
Total excluded realized gain (loss)	$	(73	)	$	12		$	25	$	11		$	(60	)		17.8	%
Benefit ratio unlocking		23			(10	)		10		2			14			-39.1	%
Net gain (loss), after-tax	$	(50	)	$	2		$	35	$	13		$	(46	)		8.0	%
Net Income
Income (loss) from operations	$	293		$	319		$	362	$	310		$	285			-2.7	%
Excluded realized gain (loss)		(73	)		12			25		11			(60	)		17.8	%
Benefit ratio unlocking		23			(10	)		10		2			14			-39.1	%
Income (loss) from reserve changes (net of related amortization) on business sold through reinsurance		1			-			1		-			-			-100.0	%
Gain (loss) on early extinguishment of debt		-			-			-		(3	)		-		NM
Impairment of intangibles		-			-			2		-			-		NM
Income (loss) from discontinued operations		(1	)		-			28		-			-			100.0	%
Net income (loss)	$	243		$	321		$	428	$	320		$	239			-1.6	%
Earnings (Loss) Per Common Share - Diluted
Income (loss) from operations	$	0.99		$	1.09		$	1.27	$	1.10		$	1.02			3.0	%
Excluded realized gain (loss)		(0.25	)		0.03			0.09		0.04			(0.21	)		16.0	%
Benefit ratio unlocking		0.08			(0.03	)		0.04		0.01			0.05			-37.5	%
Gain (loss) on early extinguishment of debt		-			-			-		(0.01	)		-		NM
Impairment of intangibles		-			-			0.01		-			-		NM
Income (loss) from discontinued operations		-			-			0.10		-			-		NM
Net income (loss)	$	0.82		$	1.09		$	1.51	$	1.14		$	0.86			4.9	%

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