CLOSED BLOCKS

6 Months Ended

Jun. 30, 2012

4) CLOSED BLOCK

The excess of Closed Block liabilities over Closed Block assets (adjusted to exclude the impact of related amounts in AOCI) represents the expected maximum future post-tax earnings from the Closed Block that would be recognized in income from continuing operations over the period the policies and contracts in the Closed Block remain in force. As of January 1, 2001, AXA Equitable has developed an actuarial calculation of the expected timing of AXA Equitable's Closed Block's earnings.

If the actual cumulative earnings from the Closed Block are greater than the expected cumulative earnings, only the expected earnings will be recognized in net income. Actual cumulative earnings in excess of expected cumulative earnings at any point in time are recorded as a policyholder dividend obligation because they will ultimately be paid to Closed Block policyholders as an additional policyholder dividend unless offset by future performance that is less favorable than originally expected. If a policyholder dividend obligation has been previously established and the actual Closed Block earnings in a subsequent period are less than the expected earnings for that period, the policyholder dividend obligation would be reduced (but not below zero). If, over the period the policies and contracts in the Closed Block remain in force, the actual cumulative earnings of the Closed Block are less than the expected cumulative earnings, only actual earnings would be recognized in income from continuing operations. If the Closed Block has insufficient funds to make guaranteed policy benefit payments, such payments will be made from assets outside the Closed Block.

Many expenses related to Closed Block operations, including amortization of DAC, are charged to operations outside of the Closed Block; accordingly, net revenues of the Closed Block do not represent the actual profitability of the Closed Block operations. Operating costs and expenses outside of the Closed Block are, therefore, disproportionate to the business outside of the Closed Block.

Summarized financial information for the Closed Block follows:

			June 30,		December 31,
			2012		2011

			(In Millions)

CLOSED BLOCK LIABILITIES:
Future policy benefits, policyholders’ account balances and other			$	8,045	$	8,121
Policyholder dividend obligation				305		260
Other liabilities				71		86
Total Closed Block liabilities				8,421		8,467

ASSETS DESIGNATED TO THE CLOSED BLOCK:
Fixed maturities, available for sale, at fair value (amortized cost of $5,309 and $5,342)				5,743		5,686
Mortgage loans on real estate				1,184		1,205
Policy loans				1,052		1,061
Cash and other invested assets				56		30
Other assets				122		207
Total assets designated to the Closed Block				8,157		8,189

Excess of Closed Block liabilities over assets designated to the Closed Block				264		278

Amounts included in accumulated other comprehensive income (loss):
	Net unrealized investment gains (losses), net of deferred income tax (expense) benefit
		of $(49) and $(33) and policyholder dividend obligation of $(305) and $(260)		91		62

Maximum Future Earnings To Be Recognized From Closed Block Assets and Liabilities			$	355	$	340

Closed Block revenues and expenses were as follows:

			Three Months Ended				Six Months Ended
			June 30,				June 30,
		2012		2011		2012		2011

		(In Millions)

REVENUES:
Premiums and other income		$	79	$	89	$	160	$	181
Net investment income (loss)			105		108		212		218
	Net investment gains (losses)		(6)		(7)		(10)		(6)
Total revenues			178		190		362		393

BENEFITS AND OTHER DEDUCTIONS:
Policyholders’ benefits and dividends			198		195		385		400
Other operating costs and expenses			0		0		0		1
Total benefits and other deductions			198		195		385		401

Net revenues before income taxes			(20)		(5)		(23)		(8)
Income tax (expense) benefit			7		2		8		3
Net Revenues (Losses)		$	(13)	$	(3)	$	(15)	$	(5)

Reconciliation of the policyholder dividend obligation follows:

		Six Months Ended
		June 30,
	2012		2011

	(In Millions)

Balances, beginning of year	$	260	$	119
Unrealized investment gains (losses)		45		39
Balances, End of Period	$	305	$	158