485BPOS 1 a08-3494_1485bpos.txt 485BPOS AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 24, 2008. FILE NO. 333-119416 811-08580 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------ FORM N-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------ PRE-EFFECTIVE AMENDMENT NO. / / POST-EFFECTIVE AMENDMENT NO. 7 /X/ REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 AMENDMENT NO. 154 /X/ HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SEPARATE ACCOUNT THREE (Exact Name of Registrant) HARTFORD LIFE AND ANNUITY INSURANCE COMPANY (Name of Depositor) P.O. BOX 2999 HARTFORD, CT 06104-2999 (Address of Depositor's Principal Offices) (860) 843-1941 (Depositor's Telephone Number, Including Area Code) RICHARD J. WIRTH HARTFORD LIFE AND ANNUITY INSURANCE COMPANY P.O. BOX 2999 HARTFORD, CT 06104-2999 (Name and Address of Agent for Service) ------------ APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING: AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THE REGISTRATION STATEMENT. ------------ It is proposed that this filing will become effective: / / immediately upon filing pursuant to paragraph (b) of Rule 485 /X/ on May 1, 2008, pursuant to paragraph (b) of Rule 485 / / 60 days after filing pursuant to paragraph (a)(1) of Rule 485 / / on pursuant to paragraph (a)(1) of Rule 485 / / this post-effective amendment designates a new effective date for a previously filed post-effective amendment. ------------------------------------------------------------------------------ ------------------------------------------------------------------------------ PART A THE DIRECTOR M PLUS HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SEPARATE ACCOUNT THREE (EST. 6/22/94) HARTFORD LIFE INSURANCE COMPANY SEPARATE ACCOUNT THREE (EST. 6/22/94) P.O. BOX 5085 HARTFORD, CONNECTICUT 06102-5085 [TELEPHONE ICON] 1-800-862-6668 (CONTRACT OWNERS) 1-800-862-7155 (REGISTERED REPRESENTATIVES) [COMPUTER ICON] WWW.HARTFORDINVESTOR.COM [THE HARTFORD LOGO] -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- This variable annuity prospectus describes a contract between each Owner and joint Owner ("you") and Hartford Life and Annuity Insurance Company or Hartford Life Insurance Company ("us," "we" or "our"). This variable annuity allows you to allocate your Premium Payment among the following portfolio companies: X AllianceBernstein Variable Products Series Fund, Inc. X Fidelity Variable Insurance Funds X Hartford HLS Series Fund II, Inc. X Hartford Series Fund, Inc. X Lord Abbett Series Fund, Inc. X Oppenheimer Variable Accounts Funds X Putnam Variable Trust X The Universal Institutional Funds, Inc. X Van Kampen Life Investment Trust Please read this prospectus carefully before investing and keep it for your records and for future reference. You can also contact us to get a Statement of Additional Information free of charge. The Statement of Additional Information contains more information about this Contract and, like this prospectus, is filed with the Securities and Exchange Commission ("SEC" or "Commission"). Although we file this prospectus and the Statement of Additional Information with the SEC, the SEC doesn't approve or disapprove these securities or determine if the information in this prospectus is truthful or complete. Anyone who represents that the SEC does these things may be guilty of a criminal offense. This prospectus and the Statement of Additional Information can also be obtained from us or the SEC's website (www.sec.gov). This variable annuity may not be suitable for everyone. This variable annuity may not be appropriate for people who do not have a long investment time horizon or intend to engage in market timing. You will get NO ADDITIONAL TAX advantage from this variable annuity if you are investing in a variable annuity through a tax-advantaged retirement plan (such as a 401(k) plan or Individual Retirement Account ("IRA")). This prospectus is not intended to provide tax, accounting or legal advice. NOT INSURED BY FDIC OR ANY MAY LOSE NOT A DEPOSIT OF OR GUARANTEED BY [NOT] FDIC FEDERAL GOVERNMENT AGENCY VALUE ANY BANK OR ANY BANK AFFILIATE [NOT] BANK
-------------------------------------------------------------------------------- PROSPECTUS DATED: MAY 1, 2007 STATEMENT OF ADDITIONAL INFORMATION DATED: MAY 1, 2007 2 ------------------------------------------------------------------------------- TABLE OF CONTENTS
PAGE -------------------------------------------------------------------------------- 1. HIGHLIGHTS 3 2. SYNOPSIS 5 3. GENERAL INFORMATION 8 The Company 8 The Separate Account 8 The Funds 8 Fixed Accumulation Feature 10 4. PERFORMANCE RELATED INFORMATION 10 5. THE CONTRACT 11 a. Purchases and Contract Value 11 b. Charges and Fees 18 c. Surrenders 19 d. Annuity Payouts 22 e. Standard Death Benefits 25 6. OPTIONAL DEATH BENEFITS 28 a. MAV Plus 28 7. OPTIONAL WITHDRAWAL BENEFITS 30 a. The Hartford's Principal First Preferred 30 b. The Hartford's Lifetime Income Foundation 33 c. The Hartford's Lifetime Income Builder II 41 d. The Hartford's Principal First 49 8. MISCELLANEOUS 52 a. Definitions 52 b. State Variations 56 c. Financial Statements 58 d. More Information 58 e. Legal Proceedings 58 f. How Contracts Are Sold 59 9. FEDERAL TAX CONSIDERATIONS 61 10. INFORMATION REGARDING TAX-QUALIFIED RETIREMENT PLANS 67 TABLE OF CONTENTS TO STATEMENT OF ADDITIONAL INFORMATION 74 APPENDIX I -- EXAMPLES APP I-1 APPENDIX II -- ACCUMULATION UNIT VALUES APP II-1 APPENDIX A -- PRODUCT COMPARISON INFORMATION APP A-1 APPENDIX B -- OPTIONAL BENEFITS COMPARISONS APP B-1 APPENDIX C -- THE HARTFORD'S LIFETIME INCOME BUILDER APP C-1 APPENDIX D -- EXCHANGE PROGRAMS APP D-1
3 ------------------------------------------------------------------------------- 1. HIGHLIGHTS A. OVERVIEW This is a deferred, flexible-premium variable annuity. A deferred variable annuity has an accumulation phase and a payout phase. You make investments during the accumulation phase. The value of your investments is used to set your benefits. At the end of the accumulation phase, we use that accumulated value to set the payments that we make during the payout phase. Generally speaking, the longer the accumulation phase, the greater your Contract Value will be for setting your benefits and annuity payouts. This variable annuity lets you: X Invest among different investment options. (Sections 3, 5(a) & Appendix A) X Make tax-free transfers among investment options. (Sections 5(a), 9 & 10) X Defer taxes on your investments until you withdraw your money (subject to possible IRS penalty). (Sections 5(c), 9 & 10) X Choose from among several optional living benefits that provide guaranteed withdrawals over a fixed or an indeterminate time period. (Sections 2, 7 & Appendix B) X Collect Annuity Payouts over a fixed or an indeterminate time period. (Section 5(d)) X Select among different Death Benefits. (Sections 2, 5(e), 6, 7(b), 7(c) & Appendices I & B) B. HOW TO BUY OUR VARIABLE ANNUITY (Sections 5(a), 8(a) & Appendix A) [In writing] Complete our application or order request and submit it to your Financial Intermediary for approval. $ Include the applicable minimum Premium Payment. [Thumbs up] Choose an optional feature right for you. Options include:
OPTIONAL FEATURE GENERAL PURPOSE -------------------------------------------------------------------------------- MAV/MAV Plus Guaranteed Minimum Death Benefit that ratchets up based on performance The Hartford's Principal First Guaranteed Minimum Withdrawal Benefit with periodic step-up rights The Hartford's Principal First Guaranteed Minimum Withdrawal Benefit Preferred The Hartford's Lifetime Income Builder Guaranteed Minimum Lifetime Withdrawal Selects Benefit with limited annual step-up rights The Hartford's Lifetime Income Builder Guaranteed Minimum Lifetime Withdrawal Portfolios Benefit with full annual step-up rights The Hartford's Lifetime Income Builder Guaranteed Minimum Lifetime Withdrawal II Benefit with limited annual step-up rights The Hartford's Lifetime Income Builder Guaranteed Minimum Lifetime Withdrawal Foundation Benefit
For The Hartford's Lifetime Income Builder Selects, we reserve the right to limit the Funds into which you may allocate your Contract Value. For The Hartford's Lifetime Income Builder Portfolios, your Contract Value must be invested in one or more Programs and in an approved model portfolio, Funds, or other investment vehicles established from time to time. Partial Surrenders taken prior to the Lifetime Eligibility Date or in excess of the available Lifetime Benefit Payment will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Threshold/Lifetime Benefit Payment, and (ii) proportionate basis for the amount in excess of the Threshold/Lifetime Benefit Payment. Optional features are subject to restrictions that may limit or eliminate the availability of these benefits. Optional features selected will be identified on your application and Contract. Not every optional feature may be available from your Financial Intermediary and may be subject to additional restrictions. Other optional features that are not actively sold are referenced in Appendix C. For more information, see Section 7 & Appendix B. Not every variation of this variable annuity may be available from your Financial Intermediary. 4 ------------------------------------------------------------------------------- C. INVESTMENT OPTIONS (Sections 3, 5(a) & Appendices II & A) You may invest in: X Funds with different investment strategies, objectives and risk/reward profiles. X In certain circumstances, you may also invest in a Fixed Accumulation Feature. D. CHARGES AND FEES (Sections 2, 5(b), 5(c) & Appendices II, A & B) You will pay the following types of fees: X Sales charges (varies by Contract version) X Contract expenses (varies by Contract version) X Optional rider fees (if selected) X Fund expenses E. ASK QUESTIONS BEFORE YOU INVEST Before you decide to buy any variable annuity, consider the following questions: - Will you use the variable annuity primarily to save for retirement or a similar long-term goal? - Are you investing in the variable annuity through a retirement plan or IRA (which would mean that you are not receiving any additional tax-deferral benefit from the variable annuity)? - Are you willing to take the risk that your Contract Value may decrease if your underlying investment options perform poorly? - Do you intend to hold this variable annuity long enough to avoid paying any applicable surrender charges if you have to withdraw money? - If you are exchanging one annuity for another one, do the benefits of the exchange outweigh the costs, such as any applicable surrender charges you might have to pay if you withdraw your money before the end of any surrender charge period for the new annuity? - Do you need an optional living or Death Benefit? - If you are purchasing our "Plus" variable annuity, are you sure that you understand that you are buying a "bonus" annuity? Do you understand that you pay for Payment Enhancements through higher surrender charges, a longer surrender period and higher mortality and expense risk charges? Do you know that we may take back some or all Payment Enhancements in certain circumstances? Here are a few suggestions that might make it easier for you to use this prospectus: X We use a lot of defined terms to describe how this variable annuity works. These terms are capitalized and described in the Definition section (section 8(a)). Unavoidably, we sometimes interchangeably use different terms that essentially mean the same thing (for instance, this variable annuity is also called a "Contract"). X We include cross references to other sections to help describe certain aspects of this variable annuity in more detail. For example, we may describe an optional benefit in section 7 but examples of how it works are in Appendix I. X Know what kind of variable annuity you are buying. We have noted what type of variable annuity (and in some instances, what series of variable annuity) this is on the cover page of this prospectus. This information will also appear in your application and Contract. Even though we have included comparison information about other variations of this variable annuity so that you can have a better idea which one might be appropriate for you, you may only need to focus only on those sections that specifically apply to the form of variable annuity you chose. X The format and tables provided are designed to help you compare features. We have used a consistent question and answer format in sections 6 and 7 to make it easier to compare optional benefits. Appendix B provides a summary of these features in an easy to read table. Likewise, Appendix A is designed to compare and contrast different variations of this variable annuity. F. COMMISSIONS FOR SELLING THIS VARIABLE ANNUITY (Section 8(f) & Appendix A) We pay a commission for selling this variable annuity to you. Commissions vary based on a variety of factors such as whether they are paid up front or over time, the type of variable annuity sold and your age. We also provide various promotional incentives to Financial Intermediaries to promote our products. These arrangements create a potential conflict of interest. You should ask your Registered Representative for information regarding these matters. 5 ------------------------------------------------------------------------------- 2. SYNOPSIS THE FOLLOWING TABLES DESCRIBE THE FEES AND EXPENSES THAT YOU WILL PAY WHEN BUYING, OWNING AND SURRENDERING YOUR VARIABLE ANNUITY. THE FIRST TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU WILL PAY AT THE TIME THAT YOU BUY OR SURRENDER THIS VARIABLE ANNUITY. STATE PREMIUM TAXES MAY ALSO BE DEDUCTED. CONTRACT OWNER TRANSACTION EXPENSES SALES CHARGE IMPOSED ON PURCHASES (as a percentage of Premium Payments) None $0 - $49,999 0% $50,000 - $99,999 0% $100,000 - $249,999 0% $250,000 - $499,999 0% $500,000 - $999,999 0% $1,000,000+ 0% CONTINGENT DEFERRED SALES CHARGE* (as a percentage of Premium Payments) First Year 8% Second Year 8% Third Year 8% Fourth Year 8% Fifth Year 7% Sixth Year 6% Seventh Year 5% Eighth Year 4% Ninth Year 0% SURRENDER FEE (as a percentage of amount Surrendered, if applicable) None EXCHANGE FEE None
* Each Premium Payment has its own Contingent Deferred Sales Charge schedule. CONTRACT OWNER PERIODIC EXPENSES THE NEXT TABLE DESCRIBES THE FEES AND EXPENSES THAT YOU WILL PAY PERIODICALLY AND ON A DAILY BASIS (EXCEPT AS NOTED) DURING THE TIME THAT YOU OWN THIS VARIABLE ANNUITY, NOT INCLUDING FUND FEES AND EXPENSES. ANNUAL MAINTENANCE FEE (1) $30 SEPARATE ACCOUNT ANNUAL EXPENSES (as a percentage of average daily Account Value) Mortality and Expense Risk Charge 1.40% Administrative Charge 0.20% Total Separate Account Annual Expenses 1.60% MAXIMUM OPTIONAL CHARGES (as a percentage of average daily Account Value) The Hartford's Principal First Preferred Charge (5) 0.20% The Hartford's Principal First Charge (2)(5) 0.75% MAV/MAV Plus Charge 0.30% Total Separate Account Annual Expenses with optional benefit separate account charges 2.65% MAXIMUM OPTIONAL CHARGES (3) (as a percentage of Benefit Amount or Payment Base (4)) The Hartford's Lifetime Income Foundation (5) 0.30% The Hartford's Lifetime Income Builder II Charge (2)(5) 0.75% The Hartford's Lifetime Income Builder Charge (2)(5) 0.75%
6 ------------------------------------------------------------------------------- The Hartford's Lifetime Income Builder Selects (2)(3)(5) Single Life Option Charge 1.50% Joint/Spousal Life Option Charge 1.50% The Hartford's Lifetime Income Builder Portfolios (2)(3)(5) Single Life Option Charge 1.50% Joint/Spousal Life Option Charge 1.50%
(1) Fee waived if Contract Value is $50,000 or more on your Contract Anniversary or when you fully Surrender your Contract. (2) The current charges for new purchases are The Hartford's Lifetime Income Builder (0.40%), The Hartford's Lifetime Income Builder II (0.40%) and The Hartford's Principal First (0.50%), The Hartford's Lifetime Income Builder Selects (0.55%) and The Hartford's Lifetime Income Builder Portfolios (0.65%). (3) Charge deducted on each Contract Anniversary and when you fully Surrender your Contract. (4) See "Does the Benefit Amount/Payment Base change under this rider?" in Section 6 for a description of the terms "Benefit Amount" and "Payment Base." (5) You may not own more than one of these optional riders at the same time. The next item shows the minimum and maximum Total Annual Fund Operating Expenses charged by the Funds that you may pay on a daily basis during the time that you own this variable annuity. More detail concerning each Fund's fees and expenses is contained in the prospectus for each Fund. THE NEXT ITEM SHOWS THE MINIMUM AND MAXIMUM TOTAL FUND OPERATING EXPENSES CHARGED BY THE FUNDS THAT YOU MAY PAY ON A DAILY BASIS DURING THE TIME THAT YOU OWN THIS VARIABLE ANNUITY. MORE DETAIL CONCERNING EACH FUND'S FEES AND EXPENSES IS CONTAINED IN THE PROSPECTUS FOR EACH FUND.
MINIMUM MAXIMUM -------------------------------------------------------------------------------------------------- TOTAL ANNUAL FUND OPERATING EXPENSES 0.33% 3.80% (these are expenses that are deducted from Fund assets, including management fees, Rule 12b-1 distribution and/or service fees, and other expenses)
7 ------------------------------------------------------------------------------- EXAMPLE THIS EXAMPLE IS INTENDED TO HELP YOU COMPARE THE COST OF INVESTING IN THIS VARIABLE ANNUITY WITH THE COST OF INVESTING IN OTHER VARIABLE ANNUITIES. LET'S SAY, HYPOTHETICALLY, THAT YOUR ANNUAL INVESTMENT RETURN IS 5% AND THAT YOUR FEES AND EXPENSES TODAY WERE AS HIGH AS POSSIBLE. THE EXAMPLE ILLUSTRATES THE EFFECT OF FEES AND EXPENSES THAT YOU COULD INCUR (OTHER THAN TAXES). YOUR ACTUAL FEES AND EXPENSES MAY VARY. FOR EVERY $10,000 INVESTED, HERE'S HOW MUCH YOU WOULD PAY UNDER EACH OF THE THREE SCENARIOS POSED: (1) If you Surrender your variable annuity at the end of the applicable time period: 1 year $1,447 3 years $2,761 5 years $3,945 10 years $6,406
(2) If you annuitize at the end of the applicable time period: 1 year $584 3 years $1,930 5 years $3,232 10 years $6,301
(3) If you do not Surrender your variable annuity: 1 year $689 3 years $2,035 5 years $3,337 10 years $6,406
CONDENSED FINANCIAL INFORMATION -------------------------------------------------------------------------------- When Premium Payments are credited to your Funds, they are converted into Accumulation Units by dividing the amount of your Premium Payments, minus any Premium Taxes, by the Accumulation Unit Value for that day. For more information on how Accumulation Unit Values are calculated see Section 5(a). Please refer to Appendix II for information regarding the minimum and maximum class of Accumulation Unit Values. All classes of Accumulation Unit Values may be obtained, free of charge, by contacting us. 8 ------------------------------------------------------------------------------- 3. GENERAL INFORMATION THE COMPANY We are a stock life insurance company engaged in the business of writing life insurance and individual and group annuities. Hartford Life Insurance Company is authorized to do business in all states of the United States and the District of Columbia. Hartford Life and Annuity Insurance Company is authorized to do business in all states of the United States except New York, the District of Columbia and Puerto Rico. Hartford Life and Annuity Insurance Company was originally incorporated under the laws of Wisconsin on January 9, 1956, and subsequently redomiciled to Connecticut. Hartford Life Insurance Company was originally incorporated under the laws of Massachusetts on June 5, 1902, and subsequently redomiciled to Connecticut. Our offices are located in Simsbury, Connecticut. Not all Contracts are available from each issuing company. Neither company cross guarantees the obligations of the other. We are ultimately controlled by The Hartford Financial Services Group, Inc., one of the largest financial service providers in the United States. THE SEPARATE ACCOUNT We set aside and invest the assets of some of our annuity contracts, including this Contract, in a Separate Account. These Separate Accounts are registered as a unit investment trust under the 1940 Act. This registration does not involve supervision by the SEC of the management or the investment practices of a Separate Account or us. Separate Accounts meet the definition of "Separate Account" under federal securities law. The Separate Accounts referenced in this prospectus hold only assets for variable annuity contracts. These Separate Accounts: - Hold assets for your benefit and the benefit of other Contract Owners, and the persons entitled to the payouts described in the Contract. - Are not subject to the liabilities arising out of any other business we may conduct. All guarantees under the Contract are our general corporate obligations. - Are not affected by the rate of return of our General Account or by the investment performance of any of our other Separate Accounts. - May be subject to liabilities from a Sub-Account of a Separate Account that holds assets of other variable annuity contracts offered by a Separate Account, which are not described in this prospectus. - Are credited with income and gains, and takes losses, whether or not realized, from the assets they hold without regard to our other income, gains or loss. We do not guarantee the investment results of any Separate Account. There is no assurance that the value of your Contract will equal the total of the payments you make to us. THE FUNDS The Funds available for investment are described in Appendix A. These are not the same mutual funds that you can buy through your stockbroker even though they may have similar investment strategies and the same portfolio managers. Each Fund has varying degrees of investment risk. Funds are also subject to separate fees and expenses such as management fees, distribution fees and operating expenses. PLEASE CONTACT US TO OBTAIN A COPY OF THE PROSPECTUSES FOR EACH FUND. YOU SHOULD READ THESE PROSPECTUSES CAREFULLY BEFORE INVESTING. We do not guarantee the investment results of any Fund. Certain Funds may not be available in all states and in all variations of this Contract. MIXED AND SHARED FUNDING -- Fund shares may be sold to our other separate accounts, our insurance company affiliates or other unaffiliated insurance companies to serve as an underlying investment for variable annuity contracts and variable life insurance policies, pursuant to a practice known as "mixed and shared funding." As a result, there is a possibility that a material conflict may arise between the interests of Contract Owners, and other contract owners investing these Funds. If a material conflict arose, we will consider what action may be appropriate, including removing the Fund from the Separate Account or replacing the Fund with another underlying fund. VOTING RIGHTS -- We are the legal owners of all Fund shares held in the Separate Account and we have the right to vote at the Funds' shareholder meetings. To the extent required by federal securities laws or regulations, we will: - Notify you of any Fund shareholders' meeting if the shares held for your Contract may be voted. - Send proxy materials and a form of instructions that you can use to tell us how to vote the Fund shares held for your Contract. - Arrange for the handling and tallying of proxies received from Contract Owners. 9 ------------------------------------------------------------------------------- - Vote all Fund shares attributable to your Contract according to instructions received from you, and - Vote all Fund shares for which no voting instructions are received in the same proportion as shares for which instructions have been received. If any federal securities laws or regulations, or their present interpretation, change to permit us to vote Fund shares on our own, we may decide to do so. You may attend any shareholder meeting at which shares held for your Contract may be voted. After we begin to make Annuity Payouts to you, the number of votes you have will decrease. As a result of proportional voting, a small number of Contract Owners could determine the outcome of a proposition subject to shareholder vote. SUBSTITUTIONS, ADDITIONS, OR DELETIONS OF FUNDS -- Subject to any applicable law, we may make certain changes to the underlying funds offered under your Contract. We may, in our sole discretion, establish new Funds. New Funds may be made available to existing Contract Owners as we deem appropriate. We may also close one or more Funds to additional Premium Payments or transfers from existing Funds. We may liquidate one or more Sub-Accounts if the board of directors of any Fund determines that such actions are prudent. Unless otherwise directed, investment instructions will be automatically updated to reflect the Fund surviving after any merger, substitution or liquidation. We may eliminate the shares of any of the Funds from the Contract for any reason and we may substitute shares of another registered investment company for the shares of any Fund already purchased or to be purchased in the future by the Separate Account. To the extent required by the 1940 Act, substitutions of shares attributable to your interest in a Fund will not be made until we have the approval of the SEC and we have notified you of the change. In the event of any substitution or change, we may, by appropriate endorsement, make any changes in the Contract necessary or appropriate to reflect the substitution or change. If we decide that it is in the best interest of the Contract Owners, the Separate Account may be operated as a management company under the 1940 Act or any other form permitted by law, may be de-registered under the 1940 Act in the event such registration is no longer required, or may be combined with one or more other Separate Accounts. FEES WE RECEIVE FROM FUNDS AND RELATED PARTIES -- We receive substantial and varying administrative service payments and Rule 12b-1 fees from certain Funds or related parties. These types of payments and fees are sometimes referred to as "revenue sharing" payments. We consider these payments and fees among a number of factors when deciding to add or keep a fund on the menu of Funds that we offer through the Contract. We collect these payments and fees under agreements between us and a Fund's principal underwriter, transfer agent, investment adviser and/or other entities related to the Fund. We expect to make a profit on these fees. The availability of these types of arrangements creates an incentive for us to seek and offer Funds (and classes of shares of such Funds) that pay us revenue sharing. Other funds (or available classes of shares) may have lower fees and better overall investment performance. As of December 31, 2007, we have entered into arrangements to receive administrative service payments and/or Rule 12b-1 fees from each of the following Fund complexes (or affiliated entities): AIM Advisors, Inc., AllianceBernstein Variable Products Series Funds & Alliance Bernstein Investments, American Variable Insurance Series & Capital Research and Management Company, Branch Banking & Trust Company, Evergreen Investment Services Inc., Fidelity Distributors Corporation, Fidelity Investments Institutional Operations Company, Fifth Third Bank Corporation, Franklin Templeton Services, LLC, The Huntington Funds, Lord Abbett Series Fund & Lord Abbett Distributor, LLC, MFS Fund Distributors, Inc. & Massachusetts Financial Services Company, Merrill Lynch Asset Management & Princeton Funds Distributor, Morgan Stanley Distribution, Inc. & Morgan Stanley Investment Management & The Universal Institutional Funds, MTB Investment Advisors, Inc., Banc of America Advisors, LLC, Banc One Investment Advisors Corporation, Oppenheimer Variable Account Funds & Oppenheimer Funds Distributor, Inc., Pioneer Variable Contracts Trust & Pioneer Investment Management, Inc. & Pioneer Funds Distributor, Inc., Prudential Investment Management Services, LLC, Putnam Retail Management Limited Partnership, SunTrust Securities, Inc. & Trusco Capital Management, Inc., UBS Financial Services, Inc., Van Kampen Life Investment Trust & Van Kampen Asset Management, Van Kampen Funds, The Victory Variable Insurance Funds & Victory Capital Management, Inc. & Victory Capital Advisers, Inc. and Wells Fargo Variable Trust & Wells Fargo Fund Management, LLC. We are affiliated with Hartford Series Fund, Inc. and Hartford HLS Series Fund II, Inc. (collectively, the "HLS Funds") based on our affiliation with their investment advisers HL Investment Advisors, LLC and Hartford Investment Management Company. In addition to investment advisory fees, we, or our other insurance company affiliates, receive fees to provide, among other things, administrative, processing, accounting and shareholder services for the HLS Funds. Not all Fund complexes pay the same amounts of revenue sharing payments and/or Rule 12b-1 fees. Therefore, the amount of fees we collect may be greater or smaller based on the Funds you select. Revenue sharing and Rule 12b-1 fees did not exceed 0.50% and 0.25%, respectively, in 2007, and are not expected to exceed 0.50% and 0.35%, respectively, in 2008, of the annual percentage of 10 ------------------------------------------------------------------------------- the average daily net assets (for instance, in 2007, assuming that you invested in a Fund that paid us the maximum fees and you maintained a hypothetical average balance of $10,000, we would collect $75 from that Fund). We will endeavor to update this listing annually and interim arrangements may not be reflected. For the fiscal year ended December 31, 2007, revenue sharing and Rule 12b-1 fees did not exceed $162.2 million. These fees do not take into consideration indirect benefits received by offering HLS Funds as investment options. FIXED ACCUMULATION FEATURE THIS PORTION OF THE PROSPECTUS RELATING TO THE FIXED ACCUMULATION FEATURE IS NOT REGISTERED UNDER THE 1933 ACT AND THE FIXED ACCUMULATION FEATURE IS NOT REGISTERED AS AN INVESTMENT COMPANY UNDER THE 1940 ACT. THE FIXED ACCUMULATION FEATURE OR ANY OF ITS INTERESTS ARE NOT SUBJECT TO THE PROVISIONS OR RESTRICTIONS OF THE 1933 ACT OR THE 1940 ACT, AND THE STAFF OF THE SEC HAS NOT REVIEWED THE DISCLOSURE REGARDING THE FIXED ACCUMULATION FEATURE. THE FOLLOWING DISCLOSURE ABOUT THE FIXED ACCUMULATION FEATURE MAY BE SUBJECT TO CERTAIN GENERALLY APPLICABLE PROVISIONS OF THE FEDERAL SECURITIES LAWS REGARDING THE ACCURACY AND COMPLETENESS OF DISCLOSURES. THE FIXED ACCUMULATION FEATURE IS NOT OFFERED IN ALL CONTRACTS. Premium Payments and Contract Values allocated to the Fixed Accumulation Feature become a part of our General Account assets. We invest the assets of the General Account according to the laws governing the investments of insurance company General Accounts. Premium Payments and Contract Values allocated to the Fixed Accumulation Feature are available to our general creditors. We guarantee that we will credit interest to amounts you allocate to the Fixed Accumulation Feature at a rate that meets your State's minimum requirements. We may change the minimum guaranteed interest rate subject only to applicable State insurance law. We may credit interest at a rate in excess of the minimum guaranteed interest rate. We will periodically publish the Fixed Accumulation Feature interest rates currently in effect. There is no specific formula for determining interest rates. Some of the factors that we may consider in determining whether to credit excess interest are: general economic trends, rates of return currently available and anticipated on our investments, regulatory and tax requirements and competitive factors. We will account for any deductions, Surrenders or transfers from the Fixed Accumulation Feature on a "first-in first-out" basis. The Fixed Accumulation Feature interest rates may vary by State. ANY INTEREST CREDITED TO AMOUNTS YOU ALLOCATE TO THE FIXED ACCUMULATION FEATURE IN EXCESS OF THE MINIMUM GUARANTEED INTEREST RATE WILL BE DETERMINED AT OUR SOLE DISCRETION. YOU ASSUME THE RISK THAT INTEREST CREDITED TO THE FIXED ACCUMULATION FEATURE MAY NOT EXCEED THE MINIMUM GUARANTEED INTEREST RATE FOR ANY GIVEN YEAR. From time to time, we may credit increased interest rates under certain programs established in our sole discretion. We may restrict your ability to allocate Contract Values or Premium Payments to the Fixed Accumulation Feature at any time in our sole discretion. We may close the Fixed Accumulation Feature to new Premium Payments or transfers of existing Contract Value. We may also make the Fixed Accumulation Feature available only through enrollment in a program that we establish. 4. PERFORMANCE RELATED INFORMATION The Separate Account may advertise certain performance-related information concerning the Sub-Accounts. Performance information about a Sub-Account is based on the Sub-Account's past performance only and is no indication of future performance. When a Sub-Account advertises its standardized total return, it will usually be calculated from the date of either the Separate Account's inception or the Sub-Account's inception, whichever is later, for one year, five years, and ten years or some other relevant periods if the Sub-Account has not been in existence for at least ten years. Total return is measured by comparing the value of an investment in the Sub-Account at the beginning of the relevant period to the value of the investment at the end of the period. Total return calculations reflect a deduction for Total Annual Fund Operating Expenses, any Contingent Deferred Sales Charge (CDSC), and Separate Account Annual Expenses without any optional charge deductions, and the Annual Maintenance Fee. The Separate Account may also advertise non-standardized total returns that pre-date the inception of the Separate Account. These non-standardized total returns are calculated by assuming that the Sub-Accounts have been in existence for the same periods as the Funds and by taking deductions for charges equal to those currently assessed against the Sub-Accounts. Non-standardized total return calculations reflect a deduction for Total Annual Fund Operating Expenses and Separate Account Annual Expenses without any optional charge deductions, and do not include deduction for CDSC or the Annual Maintenance Fee. This means the non-standardized total return for a Sub-Account is higher than the standardized total return for a Sub-Account. These non-standardized returns must be accompanied by standardized returns. If applicable, the Sub-Accounts may advertise yield in addition to total return. This yield is based on the 30-day SEC yield of the Fund less the recurring charges at the Separate Account level. 11 ------------------------------------------------------------------------------- A money market Sub-Account may advertise yield and effective yield. The yield of a Sub-Account is based upon the income earned by the Sub-Account over a seven-day period and then annualized, i.e. the income earned in the period is assumed to be earned every seven days over a 52-week period and stated as a percentage of the investment. Effective yield is calculated similarly but when annualized, the income earned by the investment is compounded in the course of a 52-week period. Yield and effective yield include the recurring charges at the Separate Account level. We may provide information on various topics to Contract Owners and prospective Contract Owners in advertising, sales literature or other materials. These topics may include the relationship between sectors of the economy and the economy as a whole and its effect on various securities markets, investment strategies and techniques (such as systematic investing, Dollar Cost Averaging and asset allocation), the advantages and disadvantages of investing in tax-deferred and taxable instruments, customer profiles and hypothetical purchase scenarios, financial management and tax and retirement planning, and other investment alternatives, including comparisons between the Contract and the characteristics of and market for such alternatives. 5. THE CONTRACT A. PURCHASES AND CONTRACT VALUE WHO CAN BUY THIS CONTRACT? The Contract is an individual or group tax-deferred variable annuity Contract. It is designed for retirement planning purposes and may be purchased by any individual, group or trust, including: - Any trustee or custodian for a retirement plan qualified under Sections 401(a) or 403(a) of the Code; - Annuity purchase plans adopted by public school systems and certain tax-exempt organizations according to Section 403(b) of the Code; - Individual Retirement Annuities adopted according to Section 408 of the Code; - Employee pension plans established for employees by a state, a political subdivision of a state, or an agency of either a state or a political subdivision of a state; and - Certain eligible deferred compensation plans as defined in Section 457 of the Code. The examples above represent qualified Contracts, as defined by the Code. In addition, individuals and trusts can also purchase Contracts that are not part of a tax qualified retirement plan. These are known as non-qualified Contracts. If you are purchasing the Contract for use in an IRA or other qualified retirement plan, you should consider other features of the Contract besides tax deferral, since any investment vehicle used within an IRA or other qualified plan receives tax-deferred treatment under the Code. Refer to Appendix A for more information about the different forms of contracts we offer. Not all forms of contracts may be available through your Registered Representative or from each issuing company. HOW DO YOU PURCHASE A CONTRACT? You may only purchase a Contract through a Financial Intermediary. A Registered Representative will work with you to complete and submit an application or an order request form. Part of this process will include an assessment whether this variable annuity may be suitable for you. Prior to recommending the purchase or exchange of a deferred variable annuity, your Registered Representative shall make reasonable efforts to obtain certain information about you and your investment needs. This recommendation will be independently reviewed by a principal within your Financial Intermediary before an application or order will be sent to us. Your Premium Payment will not be invested in any Fund during this period. To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. When you open an account, your Financial Intermediary will ask for your name, address, date of birth and other information that will allow us to identify you. They may also ask to see your driver's license or other identifying documents. Non-Resident Alien (NRA) application submissions require our prior approval. The minimum initial Premium Payment required to buy this Contract varies based on the type of purchaser, variable annuity variation chosen and whether you enroll in a systematic investment program such as the InvestEase(R) Program. See Appendix A for more information. Financial Intermediaries may impose other requirements regarding the form of payment they will accept. Premium Payments not actually received by us within the time period provided below will result in the rejection of your application or order request. Premium Payments sent to us must be made in U.S. dollars and checks must be drawn on U.S. banks. We do not accept cash, third party checks or double endorsed checks. We reserve the right to limit the number of checks processed at one time. If your check 12 ------------------------------------------------------------------------------- does not clear, your purchase will be cancelled and you could be liable for any losses or fees incurred. A check must clear our account through our Administrative Office to be considered to be in good order. Premium Payments may not exceed $1 million without our prior approval. We reserve the right to impose special conditions on anyone who seeks our approval to exceed this limit. You and your Annuitant must not be older than age 85 on the date that your Contract is issued. You must be of minimum legal age in the state where the Contract is being purchased or a guardian must act on your behalf. Optional riders are subject to additional maximum issue age restrictions. CAN YOU CANCEL YOUR CONTRACT AFTER YOU PURCHASE IT? If for any reason you are not satisfied with your Contract, simply return it within ten days after you receive it with a written request for cancellation that indicates your tax-withholding instructions. In some states, you may be allowed more time to cancel your Contract. We may require additional information, including a signature guarantee, before we can cancel your Contract. Unless otherwise required by state law, we will pay you your Contract Value as of the Valuation Day we receive your request to cancel and will refund any sales or Contract charges incurred during the period you owned the Contract. The Contract Value may be more or less than your Premium Payments depending upon the investment performance of your Account. This means that you bear the risk of any decline in your Contract Value until we receive your notice of cancellation. In certain states, however, we are required to return your Premium Payment without deduction for any fees or charges. HOW ARE PREMIUM PAYMENTS APPLIED TO YOUR CONTRACT? Your initial Premium Payment will usually be invested within two Valuation Days of our actual receipt in-hand at our Administrative Office of both a properly completed application or order request and the Premium Payment; both being in good order. If we receive your subsequent Premium Payment before the end of a Valuation Day, it will be invested on the same Valuation Day. If we receive your subsequent Premium Payment after the end of a Valuation Day, it will be invested on the next Valuation Day. If we receive your subsequent Premium Payment on a non-Valuation Day, the amount will be invested on the next Valuation Day. Unless we receive new instructions, we will invest all Premium Payments based on your last instructions on record. We will send you a confirmation when we invest your Premium Payments. If the request or other information accompanying the initial Premium Payment is incomplete or not in good order when received, we will hold the money in a non-interest bearing account for up to five Valuation Days (from the Valuation Day that we actually receive your initial Premium Payment at our Administrative Office) while we try to obtain complete information. If we cannot obtain the information within five Valuation Days, we will either return the Premium Payment and explain why the Premium Payment could not be processed or keep the Premium Payment if you authorize us to keep it until you provide the necessary information. Generally, we will receive your application or order request (whether for an initial purchase or a subsequent investment) after your Financial Intermediary has completed a suitability review. We will then consider if your investment is in good order. The suitability and good order process can take up to 17 Business Days from when you leave your Premium with your Registered Representative. During this period, Premium Payments will not be applied to your Contract. You will not earn any interest on Premium Payments even if your Premium Payments have been sent to us or deposited into our bank account. We are not responsible for market losses, gains or lost investment opportunities incurred during this review period or if your Financial Intermediary asks us to unwind a transaction based on their review of your Registered Representative's recommendations. Your Financial Institution, and we, may directly or indirectly earn income on your Premium Payments. These circumstances represent a conflict of interest. For more information, contact your Registered Representative. HOW IS THE VALUE OF YOUR CONTRACT CALCULATED BEFORE THE ANNUITY COMMENCEMENT DATE? The Contract Value is the sum of the value of the Fixed Accumulation Feature, if applicable, and all Funds. There are two things that affect your Contract Value: (1) the number of Accumulation Units, and (2) the Accumulation Unit Value. Contract Value is determined by multiplying the number of Accumulation Units by the Accumulation Unit Value. On any Valuation Day the investment performance of the Sub-Accounts will fluctuate with the performance of the Funds. When Premium Payments are credited to your Account, they are converted into Accumulation Units by dividing the amount of your Premium Payments, minus any Premium Taxes, by the Accumulation Unit Value for that day. The more Premium Payments you make to your Contract, the more Accumulation Units you will own. You decrease the number of Accumulation Units you have by requesting partial or full Surrenders, settling a Death Benefit claim or by annuitizing your Contract. To determine the current Accumulation Unit Value, we take the prior Valuation Day's Accumulation Unit Value and multiply it by the Net Investment Factor for the current Valuation Day. 13 ------------------------------------------------------------------------------- The Net Investment Factor is used to measure the investment performance of a Sub-Account from one Valuation Day to the next. The Net Investment Factor for each Sub-Account equals: - The net asset value per share plus applicable distributions per share of each Fund at the end of the current Valuation Day; reduced by - The net asset value per share of each Fund at the end of the prior Valuation Day; reduced by - Contract charges including the deductions for the mortality and expense risk charge and any other periodic expenses, including charges for optional benefits, divided by the number of days in the year multiplied by the number of days in the Valuation period. We will send you a statement at least annually. WHAT OTHER WAYS CAN YOU INVEST? You may enroll in the following features (sometimes called a "Program") for no additional fee. Not all Programs are available with all Contract variations. INVESTEASE This electronic funds transfer feature allows you to have money automatically transferred from your checking or savings account and deposited into your Contract on a monthly or quarterly basis. It can be changed or discontinued at any time. The minimum amount for each transfer is $50. You can elect to have transfers made into any available Fund. You can not use this Program to invest in the DCA Plus Programs. STATIC ASSET ALLOCATION MODELS This feature allows you to select an asset allocation model of Funds based on several potential factors including your risk tolerance, time horizon, investment objectives, or your preference to invest in certain funds or fund families. Based on these factors, you can select one of several asset allocation models, with each specifying percentage allocations among various Funds available under your Contract. Asset allocation models can be based on generally accepted investment theories that take into account the historic returns of different asset classes (e.g., equities, bonds or cash) over different time periods, or can be based on certain potential investment strategies that could possibly be achieved by investing in particular funds or fund families and are not based on such investment theories. If you choose to participate in one of these asset allocation models, you must invest all of your Premium Payment into one model. You may invest in an asset allocation model through the Dollar Cost Averaging Program where the Fixed Accumulation Feature, a Money Market sub-account, or a Dollar Cost Averaging Plus Program is the source of the assets to be invested in the asset allocation model you have chosen. You can also participate in these asset allocation models while enrolled in the Automatic Income Program. You may participate in only one asset allocation model at a time. Asset allocation models cannot be combined with other asset allocation models or with individual sub-account elections. You can switch asset allocation models up to twelve times per year. Your ability to elect or switch into and between asset allocation models may be restricted based on fund abusive trading restrictions. You may be required to invest in an acceptable asset allocation model as a condition for electing and maintaining certain guaranteed minimum withdrawal benefits. Your investments in an asset allocation model will be rebalanced quarterly to reflect the model's original percentages. We have no discretionary authority or control over your investment decisions. These asset allocation models are based on then available Funds and do not include the Fixed Accumulation Feature. We make available educational information and materials (e.g., risk tolerance questionnaire, pie charts, graphs, or case studies) that can help you select an asset allocation model, but we do not recommend asset allocation models or otherwise provide advice as to what asset allocation model may be appropriate for you. While we will not alter allocation percentages used in any asset allocation model, allocation weightings could be affected by mergers, liquidations, fund substitutions or closures. Individual availability of these models is subject to fund company restrictions. Please refer to WHAT RESTRICTIONS ARE THERE ON YOUR ABILITY TO MAKE A SUB-ACCOUNT TRANSFER? for more information. You will not be provided with information regarding periodic updates to the Funds and allocation percentages in the asset allocation models, and we will not reallocate your Account Value based on those updates. Information on updated asset allocation models may be obtained by contacting your Registered Representative. Investment alternatives other than these asset allocation models are available that may enable you to invest your Contract Value with similar risk and return characteristics. When considering an asset allocation model for your individual situation, you should consider your other assets, income and investments in addition to this annuity. 14 ------------------------------------------------------------------------------- - Asset Rebalancing In asset rebalancing, you select a portfolio of Funds, and we will rebalance your assets at the specified frequency to reflect the original allocation percentages you selected. You can choose how much of your Contract Value you want to invest in this program. You can also combine this program with others such as the Automatic Income Program and Dollar Cost Averaging Program (subject to restrictions). You may designate only one set of asset allocation instructions at a time. - Dollar Cost Averaging We offer three dollar cost averaging programs: - DCA Plus - Fixed Amount DCA - Earnings/Interest DCA DCA Plus -- These programs allow you to earn a fixed rate of interest on investments. These programs are different from the Fixed Accumulation Feature. We determine, in our sole discretion, the interest rates to be credited. These interest rates may vary depending on the Contract you purchased. Please consult your Registered Representative to determine the interest rate for your Program. You may elect to lock in a rate of interest using either the "12-Month Transfer Program" or the "6-Month Transfer Program". - Under the 12-Month Transfer Program, new Premium Payments will be credited with an interest rate that will not change for 12 months. You must then transfer these investments into available Funds (and not the Fixed Accumulation Feature) during this 12 month period. You must elect to make not less than 7 nor more than 12 transfers to fully deplete sums invested in this Program. - Under the 6-Month Transfer Program, new Premium Payments will be credited with an interest rate that will not change for 6 months. You must then transfer these investments into available Funds (and not the Fixed Accumulation Feature) during this 6 month period. You must make not less than 3 nor more than 6 transfers at any frequency you chose to fully deplete sums invested in this Program. - Each time you make a subsequent Premium Payment, you can invest in a different rate lock program. Any subsequent investments made in a month (or other interest rate effective period) other than your last program investment are considered a separate rate lock program investment. You can invest in up to 5 different rate lock programs at one time. - You must invest at least $5,000 in each rate lock program ($2,000 for qualified plan transfers or rollovers, including IRAs). We may pre- authorize transfers from our Fixed Accumulation Feature subject to restrictions. This minimum amount applies to the initial and all subsequent Premium Payments in a given rate lock program. - Pre-authorized transfers will begin within 15 days of receipt of the Program payment provided we receive complete enrollment instructions in good order. - If a DCA Plus payment is received without enrollment instructions and a DCA Plus program is active on the contract, we will set up the new Program to mirror the existing one. If a DCA Plus payment is received without enrollment instructions and a DCA Plus program is not active on the contract, but is the future investment allocation and a Static Model Portfolio Plan is active on the contract, we will set up the new Program to move funds to the Static Model Portfolio Plan. Otherwise, we will contact your investment professional to obtain complete instructions. If we do not receive in good order enrollment instructions within the 15 day timeframe noted above, we will refund the Program payment for further instruction. - If your Program payment is less than the required minimum amount, we will invest into the destination funds indicated on the Program instructions accompanying the payment. If Program instructions were not provided and a DCA Plus Program is active on the contract, we will apply the payment to the destination funds of the current DCA Plus program. Otherwise, we will contact your investment professional to obtain further investment instructions. - The credited interest rate used under the DCA Plus Programs is not earned on the full amount of your Premium Payment for the entire length of the Program because Program transfers to Funds decrease the amount of your Premium Payment remaining in the Program. - You may elect to terminate your involvement in this Program at any time. Upon cancellation, all the amounts remaining in the Program will be immediately transferred to the Funds you designated. Fixed Amount DCA -- This feature allows you to regularly transfer (monthly or quarterly) a fixed amount from the Fixed Accumulation Feature (if available based on the form of Contract selected) or any Fund into a different Fund. This program begins in 15 days unless you instruct us otherwise. You must make at least three transfers in order to remain in this program. Earnings/Interest DCA -- This feature allows you to regularly transfer (monthly or quarterly) the interest earned from your investment in the Fixed Accumulation Feature (if available based on the form of Contract selected) or any Fund into another Fund. This program begins two business days plus the frequency selected unless you instruct us otherwise. You must make at least three transfers in order to remain in this program. 15 ------------------------------------------------------------------------------- AUTOMATIC INCOME PROGRAM This systematic withdrawal feature allows you to make partial Surrenders up to 10% of your total Premium Payments each Contract Year without a Contingent Deferred Sales Charge. You can designate the Funds to be surrendered from and also choose the frequency of partial Surrenders (monthly, quarterly, semiannual, or annually). The minimum amount of each Surrender is $100. Amounts taken under this program will count towards the Annual Withdrawal Amount, and if received prior to age 59 1/2, may have adverse tax consequences, including a 10% federal income tax penalty on the taxable portion of the Surrender payment. You may satisfy Code Section 72(t)/(q) requirements by enrolling in this program. Your level of participation in this program may result in your exceeding permissible withdrawal limits under certain optional withdrawal riders. OTHER PROGRAM CONSIDERATIONS - You may terminate your enrollment in any Program at any time. - We may discontinue, modify or amend any of these Programs at any time. We will automatically and unilaterally amend your enrollment instructions if: - any Fund is merged or substituted into another Fund -- then your allocations will be directed to the surviving Fund; or - any Fund is liquidated -- then your allocations will be directed to any available money market Fund. You may always provide us with updated instructions following any of these events. - Continuous or periodic investment neither insures a profit nor protects against a loss in declining markets. Because these Programs involve continuous investing regardless of fluctuating price levels, you should carefully consider your ability to continue investing through periods of fluctuating prices. - We make available educational information and materials (e.g., pie charts, graphs, or case studies) that can help you select a model portfolio, but we do not recommend models or otherwise provide advice as to what model portfolio may be appropriate for you. Asset allocation does not guarantee that your Contract Value will increase nor will it protect against a decline if market prices fall. If you choose to participate in an asset allocation program, you are responsible for determining which model portfolio is best for you. Tools used to assess your risk tolerance may not be accurate and could be useless if your circumstances change over time. Although each model portfolio is intended to maximize returns given various levels of risk tolerance, a model portfolio may not perform as intended. Market, asset class or allocation option class performance may differ in the future from historical performance and from the assumptions upon which the model portfolio is based, which could cause a model portfolio to be ineffective or less effective in reducing volatility. A model portfolio may perform better or worse than any single Fund, allocation option or any other combination of Funds or allocation options. In addition, the timing of your investment and automatic rebalancing may affect performance. Quarterly rebalancing and periodic updating of model portfolios can cause their component Funds to incur transactional expenses to raise cash for money flowing out of Funds or to buy securities with money flowing into the Funds. Moreover, large outflows of money from the Funds may increase the expenses attributable to the assets remaining in the Funds. These expenses can adversely affect the performance of the relevant Funds and of the model portfolios. In addition, these inflows and outflows may cause a Fund to hold a large portion of its assets in cash, which could detract from the achievement of the Fund's investment objective, particularly in periods of rising market prices. For additional information regarding the risks of investing in a particular fund, see that Fund's prospectus. - Additional considerations apply for qualified Contracts with respect to Static Asset Allocation Model programs. Neither we, nor any third party service provider, nor any of their respective affiliates, is acting as a fiduciary under The Employee Retirement Income Security Act of 1974, as amended (ERISA) or the Code, in providing any information or other communication contemplated by any Program, including, without limitation, any model portfolios. That information and communications are not intended, and may not serve as a primary basis for your investment decisions with respect to your participation in a Program. Before choosing to participate in a Program, you must determine that you are capable of exercising control and management of the assets of the plan and of making an independent and informed decision concerning your participation in the Program. Also, you are solely responsible for determining whether and to what extent the Program is appropriate for you and the assets contained in the qualified Contract. Qualified Contracts are subject to additional rules regarding participation in these Programs. It is your responsibility to ensure compliance of any recommendation in connection with any model portfolio with governing plan documents. - If you make systematic transfers from the Fixed Accumulation Feature under a Dollar Cost Averaging Program or DCA Plus Program, you must wait 6 months after your last systematic transfer before moving Sub-Account Values back to the Fixed Accumulation Feature. - These Programs may be adversely affected by Fund trading policies. CAN YOU TRANSFER FROM ONE FUND TO ANOTHER? During those phases of your Contract when transfers are permissible, you may make transfers between Funds according to the following policies and procedures, as they may be amended from time to time. 16 ------------------------------------------------------------------------------- In addition, many of the Funds that are available as investment options in our variable annuity products are also available as investment options in variable life insurance policies, retirement plans, funding agreements and other products offered by us or our affiliates. Each day, investors and participants in these other products engage in similar transfer transactions. We take advantage of our size and available technology to combine sales of a particular Fund for many of the variable annuities, variable life insurance policies, retirement plans, funding agreements or other products offered by us or our affiliates. We also combine many of the purchases of that particular Fund for many of the products we offer. We then "net" these trades by offsetting purchases against redemptions. Netting trades has no impact on the net asset value of the Fund shares that you purchase or sell. Netting trades has no impact on the net asset value of the Fund shares that you purchase or sell. This means that we sometimes reallocate shares of a Fund rather than buy new shares or sell shares of the Fund. For example, if we combine all transfer-out (redemption) requests and Surrenders of a stock Fund Sub-Account with all other sales of that Fund from all our other products, we may have to sell $1 million dollars of that Fund on any particular day. However, if other Contract Owners and the owners of other products offered by us want to transfer-in (purchase) an amount equal to $300,000 of that same Fund, then we would send a sell order to the Fund for $700,000 (a $1 million sell order minus the purchase order of $300,000) rather than making two or more transactions. WHAT RESTRICTIONS ARE THERE ON YOUR ABILITY TO MAKE A SUB-ACCOUNT TRANSFER? FIRST, YOU MAY MAKE ONLY ONE SUB-ACCOUNT TRANSFER REQUEST EACH DAY. We limit each Contract Owner to one Sub-Account transfer request each Valuation Day. We count all Sub-Account transfer activity that occurs on any one Valuation Day as one "Sub-Account transfer", however, you cannot transfer the same Contract Value more than once a Valuation Day. EXAMPLES
TRANSFER REQUEST PER VALUATION DAY PERMISSIBLE? -------------------------------------------------------------------------------- Transfer $10,000 from a money market Sub-Account to a growth Yes Sub-Account Transfer $10,000 from a money market Sub-Account to any Yes number of other Sub-Accounts (dividing the $10,000 among the other Sub-Accounts however you chose) Transfer $10,000 from any number of different Sub-Accounts Yes to any number of other Sub-Accounts Transfer $10,000 from a money market Sub-Account to a growth No Sub-Account and then, before the end of that same Valuation Day, transfer the same $10,000 from the growth Sub-Account to an international Sub-Account
SECOND, YOU ARE ALLOWED TO SUBMIT A TOTAL OF 20 SUB-ACCOUNT TRANSFERS EACH CONTRACT YEAR (the "Transfer Rule") by U.S. Mail, Voice Response Unit, Internet or telephone. Once you have reached the maximum number of Sub-Account transfers, you may only submit any additional Sub-Account transfer requests and any trade cancellation requests in writing through U.S. Mail or overnight delivery service. In other words, Voice Response Unit, Internet or telephone transfer requests will not be honored. We may, but are not obligated to, notify you when you are in jeopardy of approaching these limits. For example, we will send you a letter after your 10th Sub-Account transfer to remind you about the Transfer Rule. After your 20th transfer request, our computer system will not allow you to do another Sub-Account transfer by telephone, Voice Response Unit or via the Internet. You will then be instructed to send your Sub-Account transfer request by U.S. Mail or overnight delivery service. We reserve the right to aggregate your Contracts (whether currently existing or those recently surrendered) for the purposes of enforcing these restrictions. The Transfer Rule does not apply to Sub-Account transfers that occur automatically as part of a Company sponsored asset allocation or Dollar Cost Averaging program. Reallocations made based on a Fund merger, substitution, or liquidation also do not count toward this transfer limit. Restrictions may vary based on state law. We make no assurances that the Transfer Rule is or will be effective in detecting or preventing market timing. THIRD, POLICIES HAVE BEEN DESIGNED TO RESTRICT EXCESSIVE SUB-ACCOUNT TRANSFERS. You should not purchase this Contract if you want to make frequent Sub-Account transfers for any reason. In particular, don't purchase this Contract if you plan to engage in "market timing," which includes frequent transfer activity into and out of the same Fund, or frequent Sub-Account transfers in order to exploit any inefficiencies in the pricing of a Fund. Even if you do not engage in market timing, certain restrictions may be imposed. FUND TRADING POLICIES You are subject to Fund trading policies, if any. We are obligated to provide, at the Fund's request, tax identification numbers and other shareholder identifying information contained in our records to assist Funds in identifying any pattern or frequency of Sub-Account transfers that may violate their trading policy. In certain instances, we have agreed to serve as a Fund's agent to help monitor compliance with that Fund's trading policy. 17 ------------------------------------------------------------------------------- We are obligated to follow each Fund's instructions regarding enforcement of their trading policy. Penalties for violating these policies may include, among other things, temporarily or permanently limiting or banning you from making Sub-Account transfers into a Fund or other funds within that fund complex. We are not authorized to grant exceptions to a Fund's trading policy. Please refer to each Fund's prospectus for more information. Fund abusive trading policies do not apply or may be limited. For instance: - Certain types of financial intermediaries may not be required to provide us with shareholder information. - "Excepted funds" such as money market funds and any Fund that affirmatively permits short-term trading of its securities may opt not to adopt this type of policy. This type of policy may not apply to any financial intermediary that a Fund treats as a single investor. - A Fund can decide to exempt categories of contract holders whose contracts are subject to inconsistent trading restrictions or none at all. - Non-shareholder initiated purchases or redemptions may not always be monitored. These include Sub-Account transfers that are executed: (i) automatically pursuant to a company sponsored contractual or systematic program such as transfers of assets as a result of "dollar cost averaging" programs, asset allocation programs, automatic rebalancing programs, annuity payouts, loans, or systematic withdrawal programs; (ii) as a result of the payment of a Death Benefit; (iii) as a step-up in Contract Value pursuant to a Contract Death Benefit or guaranteed minimum withdrawal benefit; (iv) as a result of any deduction of charges or fees under a Contract; or (v) as a result of payments such as loan repayments, scheduled contributions, scheduled withdrawals or surrenders, retirement plan salary reduction contributions, or planned premium payments. POSSIBILITY OF UNDETECTED ABUSIVE TRADING OR MARKET TIMING. We may not be able to detect or prevent all abusive trading or market timing activities. For instance, - Since we net all the purchases and redemptions for a particular Fund for this and many of our other products, transfers by any specific market timer could be inadvertently overlooked. - Certain forms of variable annuities and types of Funds may be attractive to market timers. We can not provide assurances that we will be capable of addressing possible abuses in a timely manner. - These policies apply only to individuals and entities that own this Contract or have the right to make transfers (regardless of whether requests are made by you or anyone else acting on your behalf). However, the Funds that make up the Sub-Accounts of this Contract are also available for use with many different variable life insurance policies, variable annuity products and funding agreements, and are offered directly to certain qualified retirement plans. Some of these products and plans may have less restrictive transfer rules or no transfer restrictions at all. HOW ARE YOU AFFECTED BY FREQUENT SUB-ACCOUNT TRANSFERS? We are not responsible for losses or lost investment opportunities associated with the effectuation of these policies. Frequent Sub-Account transfers may result in the dilution of the value of the outstanding securities issued by a Fund as a result of increased transaction costs and lost investment opportunities typically associated with maintaining greater cash positions. This can adversely impact Fund performance and, as a result, the performance of your Contract. This may also lower the Death Benefit paid to your Beneficiary or lower Annuity Payouts for your Payee as well as reduce value of other optional benefits available under your Contract. Separate Account investors could be prevented from purchasing Fund shares if we reach an impasse on the execution of a Fund's trading instructions. In other words, a Fund complex could refuse to allow new purchases of shares by all our variable product investors if the Fund and we can not reach a mutually acceptable agreement on how to treat an investor who, in a Fund's opinion, has violated the Fund's trading policy. In some cases, we do not have the tax identification number or other identifying information requested by a Fund in our records. In those cases, we rely on the Contract Owner to provide the information. If the Contract Owner does not provide the information, we may be directed by the Fund to restrict the Contract Owner from further purchases of Fund shares. In those cases, all participants under a plan funded by the Contract will also be precluded from further purchases of Fund shares. FIXED ACCUMULATION FEATURE TRANSFERS -- If applicable, during each Contract Year, you may make transfers out of the Fixed Accumulation Feature to the Sub-Accounts, subject to the transfer restrictions discussed below. All transfer allocations must be in whole numbers (e.g., 1%). Each Contract Year you may transfer the greater of: - 30% of the greatest Contract Value in the Fixed Accumulation Feature as of any Contract Anniversary or Contract issue date. When we calculate the 30%, we add Premium Payments made after that date but before the next Contract Anniversary. The 30% does not include Contract Value in any DCA Plus Program; or 18 ------------------------------------------------------------------------------- - An amount equal to your largest previous transfer from the Fixed Accumulation Feature in any one Contract Year. We apply these restrictions to all transfers from the Fixed Accumulation Feature, including all systematic transfers and Dollar Cost Averaging Programs, except for transfers under our DCA Plus Program. If your interest rate renews at a rate at least 1% lower than your prior interest rate, you may transfer any amount up to 100% of the amount to be invested at the renewal rate. You must make this transfer request within 60 days of being notified of the renewal rate. We may defer transfers and Surrenders from the Fixed Accumulation Feature for up to 6 months from the date of your request. You must wait 6 months after your most recent transfer from the Fixed Accumulation Feature before moving Sub-Account Values back to the Fixed Accumulation Feature. If you make systematic transfers from the Fixed Accumulation Feature under a Dollar Cost Averaging Program or DCA Plus Program, you must wait 6 months after your last systematic transfer before moving Sub-Account Values back to the Fixed Accumulation Feature. As a result of these limitations, it may take a significant amount of time (i.e., several years) to move Contract Values in the Fixed Accumulation Feature to Sub-Accounts and therefore this may not provide an effective short term defensive strategy. TELEPHONE AND INTERNET TRANSFERS -- Transfer instructions received by telephone before the end of any Valuation Day will be carried out at the end of that day. Otherwise, the instructions will be carried out at the end of the next Valuation Day. Transfer instructions you send electronically are considered to be received by us at the time and date stated on the electronic acknowledgement we return to you. If the time and date indicated on the acknowledgement is before the end of any Valuation Day, the instructions will be carried out at the end of that Valuation Day. Otherwise, the instructions will be carried out at the end of the next Valuation Day. If you do not receive an electronic acknowledgement, you should contact us as soon as possible. We will send you a confirmation when we process your transfer. You are responsible for verifying transfer confirmations and promptly reporting any inaccuracy or discrepancy to us and your Registered Representative. Any oral communication should be re-confirmed in writing. Telephone or Internet transfer requests may currently only be cancelled by calling us before the end of the Valuation Day you made the transfer request. We, our agents or our affiliates are NOT responsible for losses resulting from telephone or electronic requests that we believe are genuine. We will use reasonable procedures to confirm that instructions received by telephone or through our website are genuine, including a requirement that Contract Owners provide certain identification information, including a personal identification number. We record all telephone transfer instructions. We may suspend, modify, or terminate telephone or electronic transfer privileges at any time. POWER OF ATTORNEY -- You may authorize another person or your Registered Representative to make transfers on your behalf by submitting a completed power of attorney form. Once we have the completed form on file, we will accept transfer instructions, subject to our transfer restrictions, from your designated third party until we receive new instructions in writing from you. You will not be able to make transfers or other changes to your Contract if you have authorized someone else to act under a power of attorney. B. CHARGES AND FEES MORTALITY AND EXPENSE RISK CHARGE We deduct a daily charge for assuming mortality and expense risks under the Contract. This charge is deducted from your Sub-Account Value. The mortality and expense risk charge is broken into charges for mortality risks and for an expense risk: - Mortality Risk -- There are two types of mortality risks that we assume, those made while your Premium Payments are accumulating and those made once Annuity Payouts have begun. During the accumulation phase of your Contract, we are required to cover any difference between the Death Benefit paid and the Surrender Value. These differences may occur in periods of declining value or in periods where the CDSCs would have been applicable. The risk that we bear during this period is that actual mortality rates, in aggregate, may exceed expected mortality rates. Once Annuity Payouts have begun, we may be required to make Annuity Payouts as long as the Annuitant is living, regardless of how long the Annuitant lives. The risk that we bear during this period is that the actual mortality rates, in aggregate, may be lower than the expected mortality rates. - Expense Risk -- We also bear an expense risk that the CDSCs, if applicable, and the Annual Maintenance Fee collected before the Annuity Commencement Date may not be enough to cover the actual cost of selling, distributing and administering the Contract. 19 ------------------------------------------------------------------------------- Although variable Annuity Payouts will fluctuate with the performance of the Fund selected, your Annuity Payouts will NOT be affected by (a) the actual mortality experience of our Annuitants, or (b) our actual expenses if they are greater than the deductions stated in the Contract. Because we cannot be certain how long our Annuitants will live, we charge this percentage fee based on the mortality tables currently in use. The mortality and expense risk charge enables us to keep our commitments and to pay you as planned. If the mortality and expense risk charge under a Contract is insufficient to cover our actual costs, we will bear the loss. If the mortality and expense risk charge exceeds these costs, we keep the excess as profit. We may use these profits, as well as revenue sharing and Rule 12b-1 fees received from certain Funds, for any proper corporate purpose including, among other things, payment of sales expenses, including the fees paid to distributors. We expect to make a profit from the mortality and expense risk charge. ANNUAL MAINTENANCE FEE The Annual Maintenance Fee is a flat fee that is deducted from your Contract Value to reimburse us for expenses relating to the administrative maintenance of the Contract and your Account. The annual charge is deducted on a Contract Anniversary or when the Contract is fully Surrendered if the Contract Value at either of those times is less than $50,000. The charge is deducted proportionately from each Sub-Account in which you are invested. We will waive the Annual Maintenance Fee if your Contract Value is $50,000 or more on your Contract Anniversary or when you fully Surrender your Contract. In addition, we will waive one Annual Maintenance Fee for Contract Owners who own more than one Contract with a combined Contract Value between $50,000 and $100,000. If you have multiple Contracts with a combined Contract Value of $100,000 or greater, we will waive the Annual Maintenance Fee on all Contracts. However, we may limit the number of waivers to a total of six Contracts. We also may waive the Annual Maintenance Fee under certain other conditions. We do not include contracts from our Putnam Hartford line of variable annuity contracts with the Contracts when we combine Contract Value for purposes of this waiver. ADMINISTRATIVE CHARGE We apply a daily administration charge against all Contract Values held in the Separate Account during both the accumulation and annuity phases of the Contract. There is not necessarily a relationship between the amount of administrative charge imposed on a given Contract and the amount of expenses that may be attributable to that Contract; expenses may be more or less than the charge. This charge compensates us for administrative expenses that exceed revenues from the Annual Maintenance Fee described above. PREMIUM TAXES We deduct premium taxes, if required, by a state or other government agency. Some states collect these taxes when Premium Payments are made; others collect at Annuitization. Since we pay premium taxes when they are required by applicable law, we may deduct them from your Contract when we pay the taxes, upon Surrender, or on the Annuity Commencement Date. The premium tax rate varies by state or municipality and currently ranges from 0% - 3.5%. SALES CHARGES We offer three contract variations that have a CDSC (these forms of contract are called "Outlook", "Plus" and our base contract (which does not have a separate marketing name but is sometimes referred to in this prospectus as the "Core" version)), one contract version has a front end sales charge (called "Edge") and one contract version has no sales charge (called "Access"). These types of charges (and any available reductions or waivers) are described in Section 2. CHARGES AGAINST THE FUNDS Annual Fund Operating Expenses -- The Separate Account purchases shares of the Funds at net asset value. The net asset value of the Fund reflects investment advisory fees, distribution fees, operating expenses and administrative expenses already deducted from the assets of the Funds. These charges are described in the Funds' prospectuses. REDUCED FEES AND CHARGES We may offer, in our discretion, reduced fees and charges including, but not limited to, CDSCs, the Mortality and Expense Risk Charge, the Annual Maintenance Fee, and charges for optional benefits, for certain Contracts (including employer sponsored savings plans) which may result in decreased costs and expenses. Reductions in these fees and charges will not be unfairly discriminatory against any Contract Owner. Please see "Synopsis" for a description of charges and fees. C. SURRENDERS WHAT KINDS OF SURRENDERS ARE AVAILABLE? BEFORE THE ANNUITY COMMENCEMENT DATE: Full Surrenders -- When you Surrender your Contract before the Annuity Commencement Date, the Surrender Value of the Contract will be made in a lump sum payment. The Surrender Value is the Contract Value minus any applicable Premium Taxes, CDSCs, 20 ------------------------------------------------------------------------------- a pro-rated portion of optional benefit charges, if applicable and the Annual Maintenance Fee. The Surrender Value may be more or less than the amount of the Premium Payments made to a Contract. Partial Surrenders -- You may request a partial Surrender of Contract Values at any time before the Annuity Commencement Date. We will deduct any applicable CDSC. You can ask us to deduct the CDSC from the amount you are Surrendering or from your remaining Contract Value. If we deduct the CDSC from your remaining Contract Value, that amount will also be subject to CDSC. This is our default option. Both full and partial Surrenders are taken proportionally out of the Sub-Accounts and the Fixed Accumulation Feature unless prohibited by your state. Please see section 8 (State Variations) for additional details. There are several restrictions on partial Surrenders before the Annuity Commencement Date: - The partial Surrender amount must be at least equal to $100, our current minimum for partial Surrenders, and - After a Surrender, your Contract Value must be equal to or greater than our then current minimum Contract Value that we establish according to our current policies and procedures. We may change the minimum Contract Value in our sole discretion, with notice to you. We will close your Contract and pay the full Surrender Value if the Contract Value is under the minimum after a Surrender. Your resulting standard Death Benefit will be reduced proportionately if you Surrender the majority of your Contract Value. See sections 6 and 7 for information regarding the impact of Surrenders to optional benefits. AFTER THE ANNUITY COMMENCEMENT DATE: Full Surrenders -- You may Surrender your Contract on or after the Annuity Commencement Date only if you selected the Payment for a Period Certain Annuity Payout Option. Under this option, we pay you the Commuted Value of your Contract minus any applicable CDSCs. The Commuted Value is determined on the day we receive your written request for Surrender. Partial Surrenders -- Partial Surrenders are permitted after the Annuity Commencement Date if you select the Life Annuity With Payments for a Period Certain, Joint and Last Survivor Life Annuity With Payments for a Period Certain or the Payment for a Period Certain Annuity Payout Options. You may take partial Surrenders of amounts equal to the Commuted Value of the payments that we would have made during the "Period Certain" for the number of years you select under the Annuity Payout Option that we guarantee to make Annuity Payouts. Both full and partial Surrenders are taken proportionally out of the Sub-Accounts and the Fixed Accumulation Feature unless prohibited by your state. Please see section 8 (State Variations) for additional details. To qualify for partial Surrenders under these Annuity Payout Options you must make the Surrender request during the Period Certain. We will deduct any applicable CDSCs. If you elect to take the entire Commuted Value of the Annuity Payouts we would have made during the Period Certain, we will not make any Annuity Payouts during the remaining Period Certain. If you elect to take only some of the Commuted Value of the Annuity Payouts we would have made during the Period Certain, we will reduce the remaining Annuity Payouts during the remaining Period Certain. Annuity Payouts that are to be made after the Period Certain is over will not change. These options may not be available if the Contract is issued to qualify under Code Sections 401, 403, 408, or 457. For such Contracts, this option will be available only if the guaranteed payment period is less than the life expectancy of the annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. Please check with your qualified tax adviser because there could be adverse tax consequences for partial Surrenders after the Annuity Commencement Date. 21 ------------------------------------------------------------------------------- HOW DO YOU REQUEST A SURRENDER? Requests for full Surrenders must be in writing. Requests for partial Surrenders can be made in writing or by telephone or on the Internet. We will send your money within seven days of receiving complete instructions. However, we may postpone payment of Surrenders whenever: (a) the New York Stock Exchange is closed, (b) trading on the New York Stock Exchange is restricted by the SEC, (c) the SEC permits and orders postponement or (d) the SEC determines that an emergency exists to restrict valuation. Written Requests -- To request a full or partial Surrender, complete a Surrender Form or send us a letter, signed by you, stating: - the dollar amount that you want to receive, either before or after we withhold taxes and deduct for any applicable charges, - your tax withholding amount or percentage, if any, and - your mailing address. If there are joint Contract Owners, both must authorize all Surrenders. For a partial Surrender, specify the Sub-Accounts that you want your Surrender to come from; otherwise, the Surrender will be taken in proportion to the value in each Sub-Account. Telephone Requests -- To request a partial Surrender by telephone, we must have received your completed Telephone Redemption Program Enrollment Form. If there are joint Contract Owners, both must sign this form. By signing the form, you authorize us to accept telephone instructions for partial Surrenders from either Contract Owner. Telephone authorization will remain in effect until we receive a written cancellation notice from you or your joint Contract Owner, we discontinue the program, or you are no longer the owner of the Contract. Please call us with any questions regarding restrictions on telephone Surrenders. Internet Requests -- To request a partial Surrender by internet; we must have received your completed Internet partial Withdrawal Program Enrollment Form. If there are joint Contract Owners, both must sign this form. By signing the form, you authorize us to accept internet instructions for partial Surrenders from either Owner. Internet authorization will remain in effect until we receive a written cancellation notice from you or your joint Contract Owner, we discontinue the program, or you are no longer the owner of the Contract. Please call us with any questions regarding restrictions on Internet Surrenders. We may record telephone calls and use other procedures to verify information and confirm that instructions are genuine. We will not be liable for losses or expenses arising from telephone instructions reasonably believed to be genuine. WE MAY MODIFY THE REQUIREMENTS FOR TELEPHONE REDEMPTIONS AT ANY TIME. Telephone and Internet Surrender instructions received before the end of a Valuation Day will be processed at the end of that Valuation Day. Otherwise, your request will be processed at the end of the next Valuation Day. Completing a Power of Attorney form for another person to act on your behalf may prevent you from making Surrenders via telephone and Internet. WHAT SHOULD BE CONSIDERED ABOUT TAXES? There are certain tax consequences associated with Surrenders. If you make a Surrender prior to age 59 1/2, there may be adverse tax consequences including a 10% federal income tax penalty on the taxable portion of the Surrender payment. Surrendering before age 59 1/2 may also affect the continuing tax-qualified status of some Contracts. WE DO NOT MONITOR SURRENDER REQUESTS. CONSULT YOUR PERSONAL TAX ADVISER TO DETERMINE WHETHER A SURRENDER IS PERMISSIBLE, WITH OR WITHOUT FEDERAL INCOME TAX PENALTY. More than one Contract issued in the same calendar year -- If you own more than one Contract issued by us or our affiliates in the same calendar year, then these Contracts may be treated as one Contract for the purpose of determining the taxation of distributions prior to the Annuity Commencement Date. Internal Revenue Code section 403(b) annuities -- As of December 31, 1988, all section 403(b) annuities have limits on full and partial Surrenders. Contributions to your Contract made after December 31, 1988 and any increases in cash value after December 31, 1988 may not be distributed unless you are: (a) age 59 1/2, (b) no longer employed, (c) deceased, (d) disabled, or (e) experiencing a financial hardship (cash value increases may not be distributed for hardships prior to age 59 1/2 ). Distributions prior to age 59 1/2 due to financial hardship; unemployment or retirement may still be subject to a penalty tax of 10%. We will no longer accept any incoming 403(b) exchanges or applications for 403(b) individual annuity contracts. 22 ------------------------------------------------------------------------------- D. ANNUITY PAYOUTS When you "annuitize" your Contract, you begin the process of converting Accumulation Units in what is known as the "payout phase." The payout phase starts with your Annuity Commencement Date and ends when we make the last payment required under your Contract. You should answer the following questions: - When do you want Annuity Payouts to begin? - Which Annuity Payout Option do you want to use? - How often do you want the Payee to receive Annuity Payouts? - Do you want Annuity Payouts to be fixed dollar amount or variable dollar amount? Please check with your Registered Representative to select the Annuity Payout Option that best meets your income needs. WHEN DO YOUR ANNUITY PAYOUTS BEGIN? Your Annuity Commencement Date cannot be earlier than: X 2nd Contract Anniversary - if choosing a fixed dollar amount Annuity Payout X Immediately - if choosing a variable dollar amount Annuity Payout or be later than: X Annuitant's 90th birthday (or if the Contract Owner is a Charitable Remainder Trust, the Annuitant's 100th birthday) X 10th Contract Year (subject to state variation) X The Annuity Commencement Date stated in an extension request (subject to your Financial Intermediary's rules for granting extension requests) received by us not less than 30 days prior to a scheduled Annuity Commencement Date We reserve the right, in our sole discretion, to refuse to extend your Annuity Commencement Date regardless of whether we may have granted extensions in the past to you or other similarly situated investors. In certain instances, a Financial Intermediary has asked us to prohibit Annuity Commencement Date extensions for their customers when the Annuitant turns age 95. Please ask your Registered Representative whether you are affected by any such prohibition and make sure that you fully understand the implications this might have in regard to your living and Death Benefits. The Annuity Calculation Date is when the amount of your Annuity Payout is determined. This occurs within five Valuation Days before your selected Annuity Commencement Date. All Annuity Payouts, regardless of frequency, will occur on the same day of the month as the Annuity Commencement Date. After the initial payout, if an Annuity Payout date falls on a non-Valuation Day, the Annuity Payout is computed on the prior Valuation Day. If the Annuity Payout date does not occur in a given month due to a leap year or months with only 28 days (i.e. the 31st), the Annuity Payout will be computed on the last Valuation Day of the month. WHICH ANNUITY PAYOUT OPTION DO YOU WANT TO USE? Your Contract contains the Annuity Payout Options described below. We may at times offer other Annuity Payout Options. Once we begin to make Annuity Payouts, the Annuity Payout Option cannot be changed. LIFE ANNUITY We make Annuity Payouts as long as the Annuitant is living. When the Annuitant dies, we stop making Annuity Payouts. A Payee would receive only one Annuity Payout if the Annuitant dies after the first payout, two Annuity Payouts if the Annuitant dies after the second payout, and so forth. LIFE ANNUITY WITH PAYMENTS FOR A PERIOD CERTAIN We will make Annuity Payouts as long as the Annuitant is living, but we at least guarantee to make Annuity Payouts for a time period you select, between 5 years and 100 years minus the Annuitant's age. If the Annuitant dies before the guaranteed number of years have passed, then the Beneficiary may elect to continue Annuity Payouts for the remainder of the guaranteed number of years or receive the Commuted Value in one sum. LIFE ANNUITY WITH A CASH REFUND We will make Annuity Payouts as long as the Annuitant is living. When the Annuitant dies, if the Annuity Payouts already made are less than the Contract Value on the Annuity Commencement Date minus any Premium Tax, the remaining value will be paid to the Beneficiary. The remaining value is equal to the Contract Value minus any Premium Tax minus all Annuity Payouts already made. This option is only available for fixed dollar amount Annuity Payouts. 23 ------------------------------------------------------------------------------- JOINT AND LAST SURVIVOR LIFE ANNUITY We will make Annuity Payouts as long as the Annuitant and Joint Annuitant are living. When one Annuitant dies, we continue to make Annuity Payouts until that second Annuitant dies. When choosing this option, you must decide what will happen to the Annuity Payouts after the first Annuitant dies. You must select Annuity Payouts that: - Remain the same at 100%, or - Decrease to 66.67%, or - Decrease to 50%. For variable Annuity Payouts, these percentages represent Annuity Units; for fixed Annuity Payouts, they represent actual dollar amounts. The percentage will also impact the Annuity Payout amount we pay while both Annuitants are living. If you pick a lower percentage, your original Annuity Payouts will be higher while both Annuitants are alive. JOINT AND LAST SURVIVOR LIFE ANNUITY WITH PAYMENTS FOR A PERIOD CERTAIN We will make Annuity Payouts as long as either the Annuitant or Joint Annuitant are living, but we at least guarantee to make Annuity Payouts for a time period you select, between 5 years and 100 years minus your younger Annuitant's age. If the Annuitant and the Joint Annuitant both die before the guaranteed number of years have passed, then the Beneficiary may continue Annuity Payouts for the remainder of the guaranteed number of years or receive the Commuted Value in one sum. When choosing this option, you must decide what will happen to the Annuity Payouts after the first Annuitant dies. You must select Annuity Payouts that: - Remain the same at 100%, or - Decrease to 66.67%, or - Decrease to 50%. For variable dollar amount Annuity Payouts, these percentages represent Annuity Units. For fixed dollar amount Annuity Payouts, these percentages represent actual dollar amounts. The percentage will also impact the Annuity Payout amount we pay while both Annuitants are living. If you pick a lower percentage, your original Annuity Payouts will be higher while both Annuitants are alive. PAYMENTS FOR A PERIOD CERTAIN We agree to make payments for a specified time. The minimum period that you can select is 10 years during the first two Contract Years and 5 years after the second Contract Anniversary. The maximum period that you can select is 100 years minus your Annuitant's age. If, at the death of the Annuitant, Annuity Payouts have been made for less than the time period selected, then the Beneficiary may elect to continue the remaining Annuity Payouts or receive the Commuted Value in one sum. You may not choose a fixed dollar amount Annuity Payout during the first two Contract Years. YOU CANNOT SURRENDER YOUR CONTRACT ONCE ANNUITY PAYOUTS BEGIN, UNLESS YOU HAVE SELECTED LIFE ANNUITY WITH PAYMENTS FOR A PERIOD CERTAIN, JOINT AND LAST SURVIVOR LIFE ANNUITY WITH PAYMENTS FOR A PERIOD CERTAIN, OR PAYMENTS FOR A PERIOD CERTAIN ANNUITY PAYOUT OPTION. A CONTINGENT DEFERRED SALES CHARGE, IF APPLICABLE, MAY BE DEDUCTED. For qualified Contracts, if you elect an Annuity Payout Option with a Period Certain, the guaranteed number of years must be less than the life expectancy of the Annuitant at the time the Annuity Payouts begin. We compute life expectancy using the IRS mortality tables. Automatic Annuity Payouts -- If you do not elect an Annuity Payout Option, monthly Annuity Payouts will automatically begin on the Annuity Commencement Date under the Life Annuity with Payments for a Period Certain Annuity Payout Option with a ten-year period certain. Automatic Annuity Payouts will be fixed dollar amount Annuity Payouts, variable dollar amount Annuity Payouts, or a combination of fixed or variable dollar amount Annuity Payouts, depending on the investment allocation of your Account in effect on the Annuity Commencement Date. Automatic variable Annuity Payouts will be based on an Assumed Investment Return equal to 5%. HOW OFTEN DO YOU WANT THE PAYEE TO RECEIVE ANNUITY PAYOUTS? In addition to selecting an Annuity Commencement Date and an Annuity Payout Option, you must also decide how often you want the Payee to receive Annuity Payouts. You may choose to receive Annuity Payouts: - monthly, - quarterly, - semi-annually, or - annually. 24 ------------------------------------------------------------------------------- Once you select a frequency, it cannot be changed. If you do not make a selection, the Payee will receive monthly Annuity Payouts. You must select a frequency that results in an Annuity Payout of at least $50. If the amount falls below $50, we have the right to change the frequency to bring the Annuity Payout up to at least $50. DO YOU WANT ANNUITY PAYOUTS TO BE FIXED DOLLAR AMOUNT OR VARIABLE DOLLAR AMOUNT? You may choose an Annuity Payout Option with fixed dollar amounts or variable dollar amounts, depending on your income needs. You may not choose a fixed dollar amount Annuity Payout during the first two Contract Years. Fixed Dollar Amount Annuity Payouts -- Once a fixed dollar amount Annuity Payout begins, you cannot change your selection to receive variable dollar amount Annuity Payouts. You will receive equal fixed dollar amount Annuity Payouts throughout the Annuity Payout period. Fixed dollar amount Annuity Payout amounts are determined by multiplying the Contract Value, minus any applicable Premium Taxes, by an annuity rate set by us. Variable Dollar Amount Annuity Payouts -- Once a variable dollar amount Annuity Payout begins, you cannot change your selection to receive a fixed dollar amount Annuity Payout. A variable dollar amount Annuity Payout is based on the investment performance of the Sub-Accounts. The variable dollar amount Annuity Payouts may fluctuate with the performance of the Funds. To begin making variable dollar amount Annuity Payouts, we convert the first Annuity Payout amount to a set number of Annuity Units and then price those units to determine the Annuity Payout amount. The number of Annuity Units that determines the Annuity Payout amount remains fixed unless you transfer units between Sub-Accounts. The dollar amount of the first variable Annuity Payout depends on: - the Annuity Payout Option chosen, - the Annuitant's attained age and gender (if applicable), - the applicable annuity purchase rates based on the 1983a Individual Annuity Mortality table adjusted for projections based on accepted actuarial principles, and - the Assumed Investment Return ("AIR"). The total amount of the first variable dollar amount Annuity Payout is determined by dividing the Contract Value minus any applicable Premium Taxes by $1,000 and multiplying the result by the payment factor defined in the Contract for the selected Annuity Payout Option. The dollar amount of each subsequent variable dollar amount Annuity Payout is equal to the total of Annuity Units for each Sub-Account multiplied by the Annuity Unit Value of each Sub-Account. The Annuity Unit Value of each Sub-Account for any Valuation Period is equal to the Accumulation Unit Value Net Investment Factor for the current Valuation Period multiplied by the Annuity Unit Factor, multiplied by the Annuity Unit Value for the preceding Valuation Period. The Annuity Unit Factor offsets the AIR used to calculate your first variable dollar amount Annuity Payout. The first Annuity Payout will be based upon the AIR. The remaining Annuity Payouts will fluctuate based on the performance of the Funds in relation to the AIR. The degree of the fluctuation will depend on the AIR you select. You can select one of the following AIRs offered, subject to state variations:
ANNUITY ANNUITY ANNUITY AIR UNIT FACTOR AIR UNIT FACTOR AIR UNIT FACTOR ------------------------------------------------------------------- 3% 0.999919% 5% 0.999866% 6% 0.999840%
The greater the AIR, the greater the initial Annuity Payout. But a higher AIR may result in a smaller potential growth in future Annuity Payouts when the Sub-Accounts earn more than the AIR. On the other hand, a lower AIR results in a lower initial Annuity Payout, but future Annuity Payouts have the potential to be greater when the Sub-Accounts earn more than the AIR. For example, if the Sub-Accounts earned exactly the same as the AIR, then the second monthly Annuity Payout is the same as the first. If the Sub-Accounts earned more than the AIR, then the second monthly Annuity Payout is higher than the first. If the Sub-Accounts earned less than the AIR, then the second monthly Annuity Payout is lower than the first. Level variable dollar amount Annuity Payouts would be produced if the investment returns remained constant and equal to the AIR. In fact, Annuity Payouts will vary up or down as the investment rate varies up or down from the AIR. The degree of variation depends on the AIR you select. After the Annuity Calculation Date, you may transfer dollar amounts of Annuity Units from one Sub-Account to another. On the day you make a transfer, the dollar amounts are equal for both Sub-Accounts and the number of Annuity Units will be different. We will transfer the dollar amount of your Annuity Units the day we receive your written request if received before the close of the New 25 ------------------------------------------------------------------------------- York Stock Exchange. Otherwise, the transfer will be made on the next Valuation Day. All Sub-Account transfers must comply with applicable transfer restriction policies. Combination Annuity Payout -- You may choose to receive a combination of fixed dollar amount and variable dollar amount Annuity Payouts as long as they total 100% of your Annuity Payout. For example, you may choose to use 40% fixed dollar amount and 60% variable dollar amount to meet your income needs. Combination Annuity Payouts are not available during the first two Contract Years. E. STANDARD DEATH BENEFITS WHAT IS THE DEATH BENEFIT AND HOW IS IT CALCULATED? The Death Benefit is the amount we will pay if the Owner, joint Owner, or the Annuitant dies before we begin to make Annuity Payouts. We calculate the Death Benefit when, and as of the date that, we receive a certified death certificate or other legal document acceptable to us. The Death Benefits described below are at no additional cost. Standard Death Benefits are automatically included in your Contract unless superseded by certain optional benefits. Terms and titles used in riders to your Contract may differ from those used in this prospectus. The calculated Death Benefit will remain invested according to the Owner's last instructions until we receive complete written settlement instructions from the Beneficiary. This means the Death Benefit amount will fluctuate with the performance of the Account. When there is more than one Beneficiary, we will calculate the Accumulation Units for each Sub-Account and the dollar amount for the Fixed Accumulation Feature for each Beneficiary's portion of the proceeds. THE PREMIUM SECURITY DEATH BENEFIT This standard Death Benefit is automatically issued if you and the Annuitant are all younger than age 81 when the Contract is issued. This Death Benefit is the highest of: - Contract Value; or - Total Premium Payments adjusted for partial Surrenders; or - The lesser of: - Maximum Anniversary Value, or - the sum of Contract Value plus 25% of Maximum Anniversary Value (excluding Premium Payments we receive within 12 months of death). Please refer to Premium Security Death Benefit examples 1 - 2 in Appendix I. THE ASSET PROTECTION DEATH BENEFIT This standard Death Benefit is automatically issued if you or the Annuitant are between ages 81 to 85 when the Contract is issued. This Death Benefit is the highest of: - Contract Value; or - The lesser of: - Premium Payments (adjusted for partial Surrenders), or - the sum of Contract Value plus 25% of total Premium Payments adjusted for partial Surrenders (excluding Premium Payments we receive within 12 months of death). If one of the Owners and Annuitant is age 81 or older on the date we issue this Contract and one of the Owners and Annuitant is age 79 or younger on the date we issue this Contract; however, the Death Benefit payable upon the death of the younger of the Owners or Annuitant will be the lesser of Maximum Anniversary Value or the sum of Contract Value plus 25% of Maximum Anniversary Value. Please refer to Asset Protection Death Benefit examples 1 - 3 in Appendix I. MAXIMUM ANNIVERSARY VALUE The Maximum Anniversary Value is based on a series of calculations on Contract Anniversaries of Contract Values, Premium Payments and partial Surrenders. We will calculate an Anniversary Value for each Contract Anniversary prior to the deceased's 81st birthday or the date of death, whichever is earlier. The Anniversary Value is equal to the Contract Value as of a Contract Anniversary with the following adjustments: - Your Anniversary Value is increased by the dollar amount of any Premium Payments made since the Contract Anniversary; and 26 ------------------------------------------------------------------------------- - Your Anniversary Value is reduced for any partial Surrenders since the Contract Anniversary. The Maximum Anniversary Value is equal to the greatest Anniversary Value attained from this series of calculations. ADJUSTMENTS FOR SURRENDERS We calculate the adjustments to your Maximum Anniversary Value for any Surrenders by reducing your Anniversary Value on a dollar-for-dollar basis for any Surrenders within a Contract Year up to 10% of aggregate Premium Payments. After that, we reduce your Anniversary Value proportionally based on the amount of any Surrenders that exceed 10% of aggregate Premium Payments divided by your aggregate Contract Value at the time of Surrender. For examples of how this is applied for the Premium Security Death Benefit, please refer to Premium Security Death Benefit examples 1 - 2 in Appendix I and for the Asset Protection Death Benefit, please refer to Asset Protection Death Benefit examples 1 - 3 in Appendix I. We calculate the adjustment to your aggregate Premium Payments for any Surrenders by reducing your aggregate Premium Payments on a dollar-for-dollar basis for any Surrenders within a Contract Year up to 10% of aggregate Premium Payments. After that, we reduce your aggregate Premium Payments proportionately based on the amount of any Surrenders that exceed 10% of aggregate Premium Payments divided by your aggregate Contract Value at the time of Surrender. ADDITIONAL INFORMATION ABOUT DEATH BENEFITS We reserve the right to treat all deferred variable annuities that you buy from us or our affiliates as a single contract for the purposes of determining your total Death Benefits. These limits will be applied if you make $5 million or more in total aggregate Premium Payments. If applicable, the aggregate limit on total Death Benefits payable by us or our affiliates will never exceed a maximum of: - $5 million of Premium Payments (as reduced by an adjustment for Surrenders), or - Contract Value plus $1 million. Any reduction in Death Benefits will be in proportion to the Contract Value of each deferred variable annuity at the time of reduction. HOW IS THE DEATH BENEFIT PAID? The Death Benefit may be taken in one lump sum or under any of the Annuity Payout Options then being offered by us, unless the Owner has designated the manner in which the Beneficiary will receive the Death Benefit. We will calculate the Death Benefit as of the date we receive a certified death certificate or other legal documents acceptable by us. The Death Benefit amount remains invested and is subject to market fluctuation until complete settlement instructions are received from each Beneficiary. On the date we receive complete instructions from the Beneficiary, we will compute the Death Benefit amount to be paid out or applied to a selected Annuity Payout Option. When there is more than one Beneficiary, we will calculate the Death Benefit amount for each Beneficiary's portion of the proceeds and then pay it out or apply it to a selected Annuity Payout Option according to each Beneficiary's instructions. If we receive the complete instructions on a non-Valuation Day, computations will take place on the next Valuation Day. If your Beneficiary elects to receive the Death Benefit amount as a lump sum payment, unless we are otherwise instructed, we may transfer that amount to our General Account and issue the Beneficiary a draft book. The Beneficiary can write one draft for total payment of the Death Benefit, or keep the money in the General Account and write drafts as needed. We will credit interest at a rate determined periodically in our sole discretion. For federal income tax purposes, the Beneficiary will be deemed to have received the lump sum payment on transfer of the Death Benefit amount to the General Account. The interest will be taxable to the Beneficiary in the tax year that it is credited. If the Beneficiary resides or the Contract was purchased in a state that imposes restrictions on this method of lump sum payment, we may issue a check to the Beneficiary. The Beneficiary may elect under the Annuity Proceeds Settlement Option "Death Benefit Remaining with the Company" to leave proceeds from the Death Benefit invested with us for up to five years from the date of death if death occurred before the Annuity Commencement Date. Once we receive a certified death certificate or other legal documents acceptable to us, the Beneficiary can: (a) make Sub-Account transfers (subject to applicable restrictions) and (b) take Surrenders without paying Contingent Deferred Sales Charges, if any. We reserve the right to inform the IRS in the event that we believe that any Beneficiary has intentionally delayed delivering proper proof of death in order to circumvent applicable Code proceeds payment duties. We shall endeavor to fully discharge the last instructions from the Owner wherever possible or practical. The Beneficiary of a non-qualified Contract or IRA (prior to the required distribution date) may also elect the Single Life Expectancy Only option. This option allows the Beneficiary to take the Death Benefit in a series of payments spread over a period equal to the Beneficiary's remaining life expectancy. Distributions are calculated based on IRS life expectancy tables. This option is subject to different limitations and conditions depending on whether the Contract is non-qualified or an IRA. 27 ------------------------------------------------------------------------------- If the Owner dies before the Annuity Commencement Date, the Death Benefit must be distributed within five years after death or be distributed under a distribution option or Annuity Payout Option that satisfies the Alternatives to the Required Distributions described below. If the Owner dies on or after the Annuity Commencement Date under an Annuity Payout Option that permits the Beneficiary to elect to continue Annuity Payouts or receive the Commuted Value, any remaining value must be distributed at least as rapidly as under the payment method being used as of the Owner's death. If the Owner is not an individual (e.g. a trust), then the original Annuitant will be treated as the Owner in the situations described above and any change in the original Annuitant will be treated as the death of the Owner. WHAT SHOULD THE BENEFICIARY CONSIDER? Alternatives to the Required Distributions -- The selection of an Annuity Payout Option and the timing of the selection will have an impact on the tax treatment of the Death Benefit. To receive favorable tax treatment, the Annuity Payout Option selected: (a) cannot extend beyond the Beneficiary's life or life expectancy, and (b) must begin within one year of the date of death. If these conditions are NOT met, the Death Benefit will be treated as a lump sum payment for tax purposes. This sum will be taxable in the year in which it is considered received. Spousal Contract Continuation -- If the Owner dies and the Owner's Spouse is a beneficiary, then the portion of the Contract payable to the Spouse may be continued with the Spouse as Owner, unless the Spouse elects to receive the Death Benefit as a lump sum payment or as an Annuity Payment Option. For certain Contracts, if the Contract continues with the Spouse as Owner, we will adjust the Contract Value to the amount that we would have paid as the Death Benefit payment, had the Spouse elected to receive the Death Benefit as a lump sum payment. Spousal Contract continuation will only apply one time for each Contract. WHO WILL RECEIVE THE DEATH BENEFIT? The distribution of the Death Benefit applies only when death is before the Annuity Commencement Date. If death occurs on or after the Annuity Commencement Date, there may be no payout at death unless the Owner has elected an Annuity Payout Option that permits the Beneficiary to elect to continue Annuity Payouts or receive the Commuted Value. IF DEATH OCCURS BEFORE THE ANNUITY COMMENCEMENT DATE: IF THE DECEASED IS THE . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving joint The Annuitant is living or Joint Contract Owner receives Contract Owner deceased the Death Benefit. Contract Owner There is no surviving joint The Annuitant is living or Designated Beneficiary receives Contract Owner deceased the Death Benefit. Contract Owner There is no surviving joint The Annuitant is living or Contract Owner's estate Contract Owner and the deceased receives the Death Benefit. Beneficiary predeceases the Contract Owner Annuitant The Contract Owner is living There is no named Contingent The Contract Owner becomes the Annuitant Contingent Annuitant and the Contract continues. The Contract Owner may waive this presumption and receive the Death Benefit. Annuitant The Contract Owner is living The Contingent Annuitant is Contingent Annuitant becomes living the Annuitant, and the Contract continues.
28 ------------------------------------------------------------------------------- IF DEATH OCCURS ON OR AFTER THE ANNUITY COMMENCEMENT DATE: IF THE DECEASED IS THE . . . AND . . . THEN THE . . . Contract Owner The Annuitant is living Designated Beneficiary becomes the Contract Owner. Annuitant The Contract Owner is living Contract Owner receives the payout at death, if any. Annuitant The Annuitant is also the Owner Designated Beneficiary receives the payout at death, if any.
THESE ARE THE MOST COMMON SCENARIOS. SOME OF THE ANNUITY PAYOUT OPTIONS MAY NOT RESULT IN A PAYOUT AT DEATH. 6. OPTIONAL DEATH BENEFITS A. MAV PLUS OBJECTIVE Refund net Premium Payments as well as some percentage of any Contract Value gains. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? The Death Benefit will be the greater of the standard Death Benefit and MAV Plus Death Benefit. If you also elect any optional benefit rider, the Death Benefit will be the greater of such optional rider and this rider. The MAV Plus Death Benefit is the greatest of: A. Contract Value on the date we receive due proof of death. B. Total Premium Payments adjusted for any partial Surrenders (see clause D below for a description of this adjustment). C. Maximum Anniversary Value -- The Maximum Anniversary Value is based on a series of calculations on Contract Anniversaries of Contract Values, Premium Payments and partial Surrenders. We will calculate an Anniversary Value for each Contract Anniversary prior to the deceased's 81st birthday or the date of death, whichever is earlier. The Anniversary Value is equal to the Contract Value as of a Contract Anniversary with the following adjustments: (a) Anniversary Value is increased by the dollar amount of any Premium Payments made since the Contract Anniversary; and (b) Anniversary Value is adjusted for any partial Surrenders since the Contract Anniversary. The Maximum Anniversary Value is equal to the greatest Anniversary Value attained from this series of calculations. D. Earnings Protection Benefit -- The Earnings Protection Benefit depends on the age of you and/or your Annuitant on the date this rider is added to your Contract. - If each is aged 69 or younger, the Death Benefit is the Contract Value on the date we receive due proof of death plus 40% of the lesser of Contract gain on that date and the cap. - If you and/or your Annuitant are age 70 or older on the date this rider is added to your Contract, the benefit is the Contract Value on the date we receive due proof of death plus 25% of the lesser of Contract gain on that date and the cap. We determine Contract gain by subtracting your Contract Value on the date you added this rider from the Contract Value on the date we receive due proof of death. We then deduct any Premium Payments and add adjustments for any partial Surrender made during that time. We make an adjustment for partial Surrenders if the amount of Surrender is greater than the Contract gain immediately prior to the Surrender. The adjustment is the difference between the two, but not less than zero. We calculate the adjustment to your Maximum Anniversary Value for any Surrenders by reducing your Maximum Anniversary Value on a dollar-for-dollar basis for any Surrenders within a Contract Year up to 10% of aggregate Premium Payments. After that, we reduce your Maximum Anniversary Value proportionately based on the amount of any Surrenders that exceed 10% of aggregate Premium Payments divided by your aggregate Contract Value at the time of Surrender. Please refer to the examples in Appendix I for illustrations of this adjustment. The Contract gain that is used to determine your Death Benefit has a limit or cap. The cap is 200% of the following: - the Contract Value on the date this rider was added to your Contract; plus - Premium Payments made after this rider was added to your Contract, excluding any Premium Payments made within 12 months of the date we receive due proof of death; minus - any adjustments for partial Surrenders. 29 ------------------------------------------------------------------------------- If you elect MAV Plus, the Death Benefit will be the greater of the Premium Security Death Benefit and the MAV Plus Death Benefit. WHEN CAN YOU BUY THIS RIDER? You may elect this rider only at the time of issue and once you do so, your choice is irrevocable. You may not choose this optional Death Benefit if the Owner(s) and/or Annuitant are age 76 or older on the Contract issue date. In states where the MAV Plus Death Benefit is not available, we offer the "Maximum Anniversary Value (MAV) Death Benefit" for the same additional fee. The MAV Death Benefit is the same as the MAV Plus Death Benefit but excludes the Earnings Protection Benefit. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? No. HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The annual charge for this rider is based on your daily Contract Value and is deducted daily. The charge for this rider continues to be deducted until we begin to make Annuity Payouts. DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? No. This rider is not affected by the Benefit Amount or Payment Base. IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? No. IS THIS RIDER DESIGNED TO PAY YOU DEATH BENEFITS? Yes. DOES THIS RIDER REPLACE STANDARD DEATH BENEFITS? No. CAN YOU REVOKE THIS RIDER? No. WHAT EFFECT DO PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Surrenders will reduce the MAV Plus Death Benefit and will be subject to CDSCs, if any. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? We reserve the right to approve all ownership changes, including any assignment of your Contract to others or the pledging of your Contract as collateral. Certain approved changes in ownership may cause a re-calculation of the benefits subject to applicable state law. Generally, we will not re-calculate the benefits under your Contract so long as the change in ownership does not affect the Owner and does not result in a change in the tax identification number under the Contract. Changes in ownership can also adversely affect your Death Benefits and optional withdrawal benefits. You may not change the named Annuitant. However, if the Annuitant is still living, the Contingent Annuitant may be changed at any time prior to the Annuity Commencement Date by sending us written notice. CAN YOUR SPOUSE CONTINUE YOUR CONTRACT RIGHTS? Yes. If your Spouse continues the Contract as Owner, we will use the date the Contract is continued with your Spouse as Owner as the effective date this rider was added to the Contract. This means we will use the date the Contract is continued with your Spouse as Owner as the effective date for calculating this Death Benefit going forward. The percentage used for this Death Benefit will be determined by the oldest age of any remaining joint Owner or Annuitant at the time the Contract is continued. Spousal Contract continuation can apply once during the term of this Contract. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? This rider will be terminated and the fee will no longer be assessed. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? No. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? No. 30 ------------------------------------------------------------------------------- CAN WE AGGREGATE CONTRACTS? Yes. We reserve the right to treat all deferred variable annuities that you buy from us or our affiliates as a single contract for the purposes of determining your total Death Benefits. These limits will be applied if you make $5 million or more in total aggregate Premium Payments. If applicable, the aggregate limit on total Death Benefits payable by us or our affiliates will never exceed a maximum of: - $5 million of Premium Payments (as reduced by an adjustment for Surrenders), or - Contract Value plus $1 million. Any reduction in Death Benefits will be in proportion to the Contract Value of each deferred variable annuity at the time of reduction. OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - This rider is not available in all states or is named differently in those states. - If your Contract has no gain, your Beneficiary will receive no additional benefit. - A Death Benefit is paid to Beneficiaries upon the death of the Annuitant or any Owner, whichever occurs first. - This rider may be used to supplement Death Benefits in other optional riders. In certain instances, however, this additional Death Benefit coverage could be superfluous. - Annuitizing your Contract will extinguish this rider. 7. OPTIONAL WITHDRAWAL BENEFITS A. THE HARTFORD'S PRINCIPAL FIRST PREFERRED OBJECTIVE Protect your Premium Payments from poor market performance through annual Benefit Payments until the Benefit Amount is reduced to zero. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? This rider protects Premium Payments by guaranteeing annual Benefit Payments until your Benefit Amount, rather than your Contract Value, has been exhausted. See Optional Benefit Comparisons in Appendix B. WHEN CAN YOU BUY THIS RIDER? You cannot elect The Hartford's Principal First Preferred after May 1, 2008. For investors purchasing a Contract after August 14, 2006, the maximum age of any Contract Owner or Annuitant when electing this rider is age 70. For all other investors, the maximum age of any Contract Owner or Annuitant electing this rider is age 85 for non-qualified plans and age 70 for IRA or qualified plans. If not elected at issue, Plus Contract Owners must wait until after the first Contract Anniversary before purchasing this benefit. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect this rider, you may not elect any optional riders other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The annual charge for this rider is based on your daily Account Value and is deducted daily. We will continue to deduct The Hartford's Principal First Preferred Charge until we begin to make Annuity Payouts or the rider is revoked. DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? Yes. Your Benefit Amount will fluctuate based on subsequent Premium Payments or partial Surrenders. If you elect the rider at a later date, your Contract Value on the date it is added to your Contract will be the initial Benefit Amount. Partial Surrenders in excess of your annual Benefit Payments may also trigger a recalculation of the Benefit Amount and future Benefit Payments. Your Benefit Amount can never be more than $5 million. 31 ------------------------------------------------------------------------------- IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? No. You can continue to take Benefit Payments until the Benefit Amount has been depleted. Once the initial Benefit Amount has been determined, we calculate Benefit Payments. If you elect the rider when purchasing the Contract, your initial Premium Payment is equal to the initial Benefit Amount. The maximum Benefit Payment is 5% of your Benefit Amount. Benefit Payments are available at any time and can be taken on any schedule that you request. Benefit Payments are non-cumulative, which means that your Benefit Payment will not increase in the future if you fail to take your full Benefit Payment for the current Contract Year. For example, if you do not take 5% one Contract Year, you may not take more than 5% the next Contract Year. If you elect this rider when you purchase your Contract, we count one year as the time between each Contract Anniversary. If you purchase this rider after you purchase your Contract, we count the first year as the time between the date you added this rider to your Contract and your next Contract Anniversary, which could be less than a year. Each time you add a Premium Payment, we increase your Benefit Amount by the amount of the subsequent Premium Payment on a dollar-for-dollar basis. When you make a subsequent Premium Payment, your Benefit Payments will increase by 5% of the amount of the subsequent Premium Payment. Your Benefit Amount cannot be less than $0 or more than $5 million. Any activities that would otherwise increase the Benefit Amount above this ceiling will not be included for any benefits under this rider. If, in one year, your Surrenders total more than your annual Benefit Payment, we will recalculate your Benefit Amount and your Benefit Payment could be significantly lower in the future. Any time we re-calculate your Benefit Amount and your Benefit Payment we count one year as the time between the date we recalculate and your next Contract Anniversary, which could be less than a year. Whenever a partial Surrender is made, the Benefit Amount will be equal to the amount determined in either (A) or (B) as follows: A. If the total partial Surrenders since the later of (i) the most recent Contract Anniversary, or (ii) the Valuation Day that the Benefit Payment was last established (excluding subsequent Premium Payments), are equal to or less than the Benefit Payment, the new Benefit Amount becomes the Benefit Amount immediately prior to the partial Surrender, less the amount of the partial Surrender. B. If the total partial Surrenders as determined in (A) above exceed the Benefit Payment, the Benefit Amount will have an automatic reset to the greater of zero or the lesser of (i) or (ii) as follows: (i) The Contract Value immediately following the partial Surrender; or (ii) The Benefit Amount immediately prior to the partial Surrender, less the amount of the partial Surrender. Please refer to examples 2 - 6 for The Hartford's Principal First Preferred in Appendix I for illustrations regarding recalculation of your Benefit Amount. Qualified Contracts are subject to certain federal tax rules requiring that minimum distributions be withdrawn from the Contract on a calendar year basis (i.e., compared to a Contract Year basis), usually beginning after age 70 1/2. These withdrawals are called Required Minimum Distributions ("RMD"). An RMD may exceed your Benefit Payment, which will cause a recalculation of your Benefit Amount. Recalculation of your Benefit Amount may result in a lower Benefit Payment in the future. If you enroll in our Automatic Income Program to satisfy the RMD from the Contract and, as a result, the withdrawals exceed your annual Benefit Payment, we will not recalculate your Benefit Amount or Benefit Payment. IS THIS RIDER DESIGNED TO PAY YOU A DEATH BENEFIT? No. However, partial Surrenders will reduce the standard Death Benefit. DOES THIS RIDER REPLACE STANDARD DEATH BENEFITS? No. CAN YOU REVOKE THIS RIDER? Yes. You may revoke this rider in writing anytime following the earlier of the 5th Contract Year (if elected at issuance) or the 5th anniversary of electing this rider post-issuance or at the time we exercise our right to impose investment restrictions. Annuitizing your Contract instead of receiving Benefit Payments will terminate this rider. If you revoke this rider you will not be able to elect any other optional benefit rider or participate in a Company-sponsored exchange program. However, a Company-sponsored exchange of this rider will not be considered to be a revocation or termination of this rider. WHAT EFFECT DO PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Benefit Payments are treated as partial Surrenders and are deducted from your Contract Value and Benefit Amount. Each Benefit Payment reduces the amount you may Surrender under your Annual Withdrawal Amount. Surrenders in excess of your annual Benefit Payment include any applicable CDSC. 32 ------------------------------------------------------------------------------- If, in one year, your Surrenders total more than your annual Benefit Payment, we will re-calculate your Benefit Amount and your Benefit Payment could be significantly lower in the future. Any time we re-calculate your Benefit Amount and your Benefit Payment we count one year as the time between the date we re-calculate and your next Contract Anniversary, which could be less than a year. If your Contract Value is reduced to zero due to receiving annual Benefit Payments, and you still have a Benefit Amount, you will continue to receive a Benefit Payment through a fixed Annuity Payout option until your Benefit Amount is depleted. While you are receiving payments under fixed Annuity Payout options, you may not make additional Premium Payments, and if you die before you receive all of your payments, your Beneficiary will continue to receive the remaining Benefit Payments. You can Surrender your entire Contract Value any time; however, you will receive your Contract Value at the time you request a full Surrender with any applicable charges deducted and not the Benefit Amount or the Benefit Payment amount that you would have received under this rider. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? If you change the ownership or assign this Contract to someone other than your Spouse after 12 months of electing this rider, we will recalculate the Benefit Amount and the Benefit Payment may be lower in the future. The Benefit Amount will be recalculated to equal the lesser of: - The Benefit Amount immediately prior to the ownership change or assignment; or - The Contract Value at the time of the ownership change or assignment. The Benefit Payment will then be reset to 5% of the new Benefit Amount. If the Owner dies and the sole Beneficiary is the Owner's Spouse, then the surviving Spouse can either become the Contract Owner or elect to receive the standard Death Benefit. You may not change the named Annuitant. However, if the Annuitant is still living, the Contingent Annuitant may be changed at any time prior to the Annuity Commencement Date by sending us written notice. CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT? Yes. If the Owner dies and the sole Beneficiary is the deceased Owner's Spouse at the time of death, that Spouse may continue the Contract and this rider. This right may be exercised only once during the term of the Contract. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? You may elect the annuitization option at any time. If you annuitize your Contract, you may choose this payout option in addition to those Annuity Payout Options offered in the Contract. Under this Annuity Payout Option (called the "PFP Annuity Payout Option"), we will pay a fixed dollar amount for a specific number of years ("Payout Period"). If you, the joint Owner or the Annuitant should die before the PFP Annuity Payout Period is complete, the remaining payments will be made to the Beneficiary. The PFP Annuity Payout Period is determined on the Annuity Calculation Date and it will equal the current Benefit Amount divided by the Benefit Payment. The total amount of the Annuity Payouts under this option will be equal to the Benefit Amount. We may offer other Payout Options. If you, the joint Owner or Annuitant die before the Annuity Calculation Date and all of the Benefit Payments guaranteed by us have not been made, the Beneficiary may elect to take the remaining Benefit Payments by electing the PFP Payout Option. Electing this option forfeits any right to Death Benefit values calculated under the standard Death Benefit or any optional death benefits you may have purchased. If the Annuitant dies after the Annuity Calculation Date and before all of the Benefit Payments guaranteed by us have been made, the payments will continue to be made to the Beneficiary. If your Contract Value is reduced to zero, you will receive a fixed Annuity Payout option until your Benefit Amount is depleted. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? Yes. We reserve the right to limit the Sub-Accounts into which you may allocate your Contract Value on and after the effective date. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? No; however, your Benefit Amount cannot be more than $5 million. Any activities that would otherwise increase the Benefit Amount above this ceiling will not be included for any benefits under this rider. CAN WE AGGREGATE CONTRACTS? Yes. We reserve the right to treat all Contracts issued to you by us or one of our affiliates as one Contract for purposes of this rider. This means that if you purchase two Contracts from us in any twelve month period and elect optional withdrawal benefits in such other Contracts, withdrawals from one Contract may be treated as withdrawals from the other Contract. 33 ------------------------------------------------------------------------------- OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - We can revoke this rider if you violate the investment restrictions requirements. Once revoked, you cannot reinstate this or any other optional benefit rider and the rider fee will cease. - The annual percentage used for determining Benefit Payments is not a fixed rate of return. The Contract Value used in the calculation of the Benefit Amount and Benefit Payment is based on the investment performance of your Sub-Accounts. - Benefit Payments can't be carried forward from one year to the next. - Annual Surrenders exceeding 5% accelerate depletion of your Benefit Amount even if you use the Automatic Income Program to meet RMD requirements. No reliable assumptions can be made that your payments will continue for any particular number of years. - Additional contributions made to your Contract after withdrawals have begun may not restore the previous amount of Benefit Payments, even if the additional contribution restores the Benefit Amount to the previous Benefit Amount. - If elected post-issuance, the first one year period will be considered to be the time period between election and the next following Contract Anniversary. - When the Contract Value is small in relation to the Benefit Amount, Surrenders may have a significant effect on future Benefit Payments. B. THE HARTFORD'S LIFETIME INCOME FOUNDATION OBJECTIVE Protect principal from poor market performance, provide longevity protection through Lifetime Benefit Payments, and ensure a Death Benefit equivalent to the greater of Premium Payments reduced for partial Surrenders or Contract Value. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? This rider provides two separate but bundled benefits that help achieve this goal. In other words, this rider is a guarantee that you can access two ways: - LIFETIME WITHDRAWAL BENEFIT. This rider provides a series of Lifetime Benefit Payments payable in each Contract Year following the Relevant Covered Life's 60th birthday, until the first death of any Covered Life ("Single Life Option") or the second death of any Covered Life ("Joint/Spousal Option"). Lifetime Benefit Payments are maximum amounts that can be withdrawn each year based on the higher of your Payment Base or Contract Value on each Contract Anniversary multiplied by the applicable Withdrawal Percent. In an Eligible Withdrawal Year, your initial Lifetime Benefit Payment is equal to the Payment Base multiplied by the applicable Withdrawal Percentage. Payments may continue even if the Contract Value has been reduced to below our minimum Contract Value. The Withdrawal Percent varies based upon the attained age of the Relevant Covered Life as of the Contract Anniversary prior to the first partial Surrender, and the survivor option chosen. Any partial Surrender taken prior to the Contract Anniversary following the Relevant Covered Life's 60th birthday will reduce the Payment Base and your future Lifetime Benefit Payment. Such partial Surrender may potentially eliminate your Lifetime Benefit Withdrawal Guarantee. - GUARANTEED MINIMUM DEATH BENEFIT. This guaranteed minimum Death Benefit provides a Death Benefit equal to the greater of Premium Payments reduced for partial Surrenders or Contract Value as of the date due proof of death is received for any Contract Owner or Annuitant. PARTIAL SURRENDERS WILL REDUCE OR ELIMINATE THE GUARANTEED MINIMUM DEATH BENEFIT. THIS GUARANTEED MINIMUM DEATH BENEFIT REPLACES THE STANDARD DEATH BENEFITS PROVIDED UNDER THIS CONTRACT. See Optional Benefit Comparisons in Appendix B. WHEN CAN YOU BUY THIS RIDER? Subject to State approval of The Hartford's Lifetime Income Builder Portfolios and The Hartford's Lifetime Income Builder Selects, this rider is closed to new investors. If applicable, you may elect this rider at the time of purchase, or at a later date, if you are eligible to participate in a designated company sponsored exchange program. The benefits comprising this rider may not be purchased separately. This rider may not be available through all Registered Representatives and may be subject to additional restrictions set by your Registered Representative or us. We reserve the right to withdraw this rider at any time. When you buy this rider, you must provide us with the names and ages of the Owner, any joint Owner, Annuitant and Beneficiary. A Covered Life must be a living person. If you choose the Joint/Spousal Option, we reserve the right to (a) prohibit non-natural entities from being designated as an Owner, (b) prohibit anyone other than your Spouse from being a joint Owner; and (c) impose other designation restrictions from time to time. 34 ------------------------------------------------------------------------------- For the Single Life Option, the Covered Life is most often the same as the Contract Owner and joint Owner (which could be two different people). In the Joint/Spousal Option, the Covered Life is most often the Contract Owner and his or her Spouse, as joint Owner or Beneficiary. The Relevant Covered Life will be one factor used to establish your Withdrawal Percent. When the Single Life Option is chosen, we use the older Covered Life as the Relevant Covered Life; and when the Joint/Spousal Option is chosen, we use the younger Covered Life as the Relevant Covered Life. The maximum age of any Contract Owner or Annuitant when electing this rider is 80. When the Joint/Spousal Option is chosen, the Beneficiary also must be younger than age 81. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect this rider, you may not elect any rider other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The fee for this rider is based on your then current Payment Base (not your Contract Value) as of each Contract Anniversary. This charge will automatically be deducted from your Contract Value on your Contract Anniversary AFTER your Anniversary Value and Payment Base have been computed and prior to all other financial transactions. In the event of a full Surrender, a prorated charge will be deducted from your Surrender Value. The charge for this rider will be withdrawn from each Sub-Account and the Fixed Accumulation Feature in the same proportion that the value of each Sub-Account bears to the total Contract Value. Except as otherwise provided below, we will continue to deduct this charge until we begin to make Annuity Payouts. The rider charge may limit access to the Fixed Accumulation Feature in certain states. DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? Yes. Your initial Payment Base equals your initial Premium Payment. Your Payment Base will fluctuate based on subsequent Premium Payments and partial Surrenders. Your Payment Base can never be less than $0 or more than $5 million. Any activities that would otherwise increase the Payment Base above this ceiling will not be included for any benefits under this rider. The Payment Base will be recalculated based on: - Subsequent Premium Payments. Subsequent Premium Payments increase your Payment Base on a dollar-for-dollar basis. - Partial Surrenders. Partial Surrenders may trigger a recalculation of the Payment Base depending on (a) whether the partial Surrender takes place prior or during an Eligible Withdrawal Year, and (b) if the aggregate amount of the partial Surrenders during any Contract Year exceeds the applicable Threshold, as discussed below: A. If cumulative partial Surrenders taken during any Contract Year and prior to an Eligible Withdrawal Year are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Payment Base on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are greater than the Threshold (subject to rounding), then we will reduce the Payment Base on a (i) dollar-for-dollar basis up to the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. B. If cumulative partial Surrenders during an Eligible Withdrawal Year are (i) equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will not reduce the Payment Base. C. For any partial Surrender that causes cumulative partial Surrenders in an Eligible Withdrawal Year to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Payment Base on a proportionate basis for the amount in excess of the Lifetime Benefit Payment. Partial Surrenders taken during any Contract Year that cumulatively exceed the Annual Withdrawal Amount but do not exceed the Lifetime Benefit Payment will be free of any applicable CDSC. Partial Surrenders will diminish the Guaranteed Minimum Death Benefit. Please refer to the Examples in Appendix I for a more complete description of these effects. IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? Yes. However, your Withdrawal Percent, and therefore the amount of your Lifetime Benefit Payment, is dependent upon when you take your first partial Surrender. For instance, - If you take your first partial Surrender before an Eligible Withdrawal Year, your Withdrawal Percent will never increase above 5% for Single Life Option or 4.5% for Joint/Spousal option for the remaining duration of your Contract. - If you take your first partial Surrender during an Eligible Withdrawal Year, your Withdrawal Percent will never increase above the Withdrawal Percent corresponding with the attained age of the Relevant Covered Life as of the Contract Anniversary prior to the 35 ------------------------------------------------------------------------------- first partial Surrender. If such a partial Surrender took place during the first Contract Year, we will use the attained age of the Relevant Covered Life as of Contract issue date to set the Withdrawal Percent. Once the Withdrawal Percent has been established, it will not change for the remaining duration of your Contract. In other words, prior to the Relevant Covered Life turning 80, the longer the first partial Surrender is delayed, the higher your Withdrawal Percent shall be.
ATTAINED AGE OF RELEVANT COVERED WITHDRAWAL PERCENT LIFE ON THE CONTRACT ANNIVERSARY SINGLE LIFE JOINT/SPOUSAL PRIOR TO THE FIRST PARTIAL SURRENDER OPTION OPTION -------------------------------------------------------------------------------- 60 - 64 5.0% 4.5% 65 - 69 5.5% 5.0% 70 - 74 6.0% 5.5% 75 - 79 6.5% 6.0% 80+ 7.0% 6.5%
Your Withdrawal Percent may change based on a permissible Covered Life change. If you choose to receive less than your full Lifetime Benefit Payment in any Contract Year; you will not be able to carry remaining amounts forward to future Contract Years. IS THIS RIDER DESIGNED TO PAY YOU A DEATH BENEFIT? Yes. This Guaranteed Minimum Death Benefit guarantees that we will pay a Death Benefit equal to the greater of Premium Payments reduced for partial Surrenders or Contract Value as of the date we receive due proof of death of the Contract Owner(s) or Annuitant. Termination of this rider will result in the rescission of the Guaranteed Minimum Death Benefit and result in your Beneficiary receiving the Contract Value as of the date we receive due proof of death. Partial Surrenders will affect the Guaranteed Minimum Death Benefit as follows: A. If cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are greater than the Threshold (subject to rounding), we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. B. If cumulative partial Surrenders during an Eligible Withdrawal Year are (i) equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. C. For any partial Surrender that causes cumulative partial Surrenders in an Eligible Withdrawal Year to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Lifetime Benefit Payment, and (ii) proportionate basis for the amount in excess of the Lifetime Benefit Payment. Please refer to the section labeled "CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT" for more information on the continuation of the Lifetime Benefit Payments by your Spouse. DOES THIS RIDER REPLACE THE STANDARD DEATH BENEFIT? Yes. CAN YOU REVOKE THIS RIDER? Yes. Anytime following the earlier of Spousal Contract continuation or the 5th Contract Year, the Contract Owner may also elect to revoke the Lifetime Withdrawal Benefits whereupon we will deduct one last pro-rated fee for this rider and only the Guaranteed Minimum Death Benefit shall continue to apply. Certain changes in the Covered Life will also constitute a revocation of the Withdrawal Benefits. A Company-sponsored exchange of this rider will not be considered to be a revocation or termination of this rider. In the event that this rider is terminated, whether as a result of your actions or ours, your Lifetime Benefit Payments will cease; your Payment Base will be eliminated, the Guaranteed Minimum Death Benefit will then be equal to the Contract Value, and you will not be allowed to elect any other optional benefit rider. 36 ------------------------------------------------------------------------------- WHAT EFFECT DO PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Please refer to the discussion under "DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER?" for the effect of partial Surrenders on your Payment Base, Guaranteed Minimum Death Benefit and Lifetime Benefit Payments. You may make a full Surrender of your entire Contract at any time. However, you will receive your Contract Value with any applicable charges deducted and not the Payment Base or any Lifetime Benefit Payment that you would have received under this rider. If Your Contract Value is reduced below our minimum Contract Value rules in effect on a particular Valuation Day, and your Lifetime Benefit Payment amount remains greater than zero, then we will consider this date as your Annuity Commencement Date and we will no longer accept subsequent Premium Payments. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? Inasmuch as this rider is affected only by changes to the Covered Life, only these types of changes are discussed below. We reserve the right to approve all Covered Life changes. Certain approved changes in the designation of the Covered Life may cause a re-calculation of the benefits. Covered Life changes also allow us, in our discretion, to impose investment restrictions, as described below. Any Covered Life change made within the first 6 months from the Contract Issue date will have no impact on the Payment Base or Guaranteed Minimum Death Benefit as long as each succeeding Covered Life is less than the maximum age limitation of the rider at the time of the change. The Withdrawal Percent and Lifetime Benefit Payment will thereafter change based on the age of the new Relevant Covered Life. After the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and partial Surrenders have not yet been taken, in the event that you and your Spouse become legally divorced, you may add a new Spouse to the Contract. Provided that the age limitation of the rider is not exceeded, the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will recalculate your Withdrawal Percent based on the age of the younger Covered Life as of the date of the change. Alternatively, if after the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and partial Surrenders have been taken, in the event that you and your Spouse become legally divorced, you may only remove your ex-Spouse from the Contract whereupon the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will then recalculate your Withdrawal Percent based on the age of the remaining Covered Life as of the date of the change. You may not convert your Joint/Spousal Option election to a Single Life Option. In addition, after the first six months following the Contract issue date, if any Covered Life change takes place that is not due to a divorce, then we will: A. If the older Covered Life after the change is equal to or less than the maximum age limitation of the rider at the time of the change, then we will revoke the Withdrawal Benefits of this rider and continue the Guaranteed Minimum Death Benefit only. The charge for this rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter. B. If the older Covered Life after the change exceeds the maximum age limitation of the rider at the time of the change, or we no longer offer this rider, then the rider will terminate. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. If you elected the Single Life Option and any Covered Life changes after the first 6 months from Contract Issue date, then: A. If we no longer offer this rider, we will continue the Guaranteed Minimum Death Benefit after resetting this benefit to the lower of the then applicable Guaranteed Minimum Death Benefit or Contract Value on the effective date of the Covered Life change; whereupon the Withdrawal Benefit will terminate. The charge for this rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter; or B. If we offer this rider and: (i) if partial Surrenders have been taken prior to the first Contract Anniversary, then we will use the attained age of the oldest Covered Life as of the rider effective date to reset the Withdrawal Percent, or (ii) if partial Surrenders have not been taken prior to the first Contract Anniversary, then we will use the attained age of the older Covered Life as of the Contract Anniversary prior to the first partial Surrender to reset the Withdrawal Percent. The Payment Base will be recalculated to be the lesser of the Contract Value or the Payment Base effective on the date of the change. The Guaranteed Minimum Death Benefit will be recalculated to be the lesser of the Contract Value or the Guaranteed Minimum Death Benefit effective on the date of the change; or C. If we offer this rider and the older Covered Life after the change exceeds the maximum age limitation of this rider at the time of the change; the rider will be terminated and removed from the Contract. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. 37 ------------------------------------------------------------------------------- If the rider is no longer available for sale, we will determine the issue age limitation of the rider on a non-discriminatory basis. The following tables illustrate only some of the various changes and the resulting outcomes associated with deaths of the Contract Owner(s) or Annuitant before and after the Annuity Commencement Date. SINGLE LIFE OPTION ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving The Annuitant is living or Joint Contract Owner receives non-spousal Contract Owner deceased the Death Benefit and this rider terminates Contract Owner There is a surviving spousal The Annuitant is living or Joint Contract Owner receives Contract Owner deceased the Death Benefit and this rider can continue under Spousal Contract continuation Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Designated Owner deceased Beneficiary receives the Death Benefit Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Estate Owner or Beneficiary deceased receives the Death Benefit Annuitant Contract Owner is living There is no Contingent Contract continues, no Death Annuitant and the Contract Benefit is paid, and this rider Owner becomes the Contingent continues Annuitant Annuitant Contract Owner is living There is no Contingent Rider terminates and Contract Annuitant and the Contract Owner receives the Death Owner waives their right to Benefit become the Contingent Annuitant Annuitant Contract Owner is Living Contingent Annuitant is Living Contingent Annuitant becomes the Annuitant and the Contract and this rider continues
JOINT/SPOUSAL ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving Contract The Annuitant is living or The surviving Contract Owner Owner deceased continues the Contract and rider; we will increase the Contract Value to the Death Benefit value Contract Owner There is no surviving Contract The Spouse is the sole primary Follow Spousal Contract Owner beneficiary continuation rules for joint life elections Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates and Contract Owner or Beneficiary deceased Owner's estate receives the Death Benefit Annuitant The Contract Owner is living There is a Contingent Annuitant The Rider continues; upon the death of the last surviving Covered Life, the rider will terminate.
38 ------------------------------------------------------------------------------- CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT? - SINGLE LIFE OPTION: If a Covered Life dies and the Beneficiary is the deceased Covered Life's Spouse at the time of death, such Spouse may continue the Contract. If the Spouse elects to continue the Contract and this rider, we will continue the rider with respect to all Lifetime Withdrawal Benefits at the charge that is currently being assessed for new sales of this rider at the time of continuation. We will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater. The Covered Life will be re-determined on the date of Spousal Contract continuation. If the new Covered Life is less than age 81 at the time of the Spousal Contract continuation, and the rider is still available for sale, the Payment Base and the Guaranteed Minimum Death Benefit will be set equal to the Contract Value, the Withdrawal Percent will be recalculated based on the age of the older remaining Covered Life on the effective date of the Spousal Contract continuation. If the new Covered Life is 81 or older at the time of the Spousal Contract continuation, the rider will terminate and the Guaranteed Minimum Death Benefit will be equal to the Contract Value. If we are no longer offering this rider at the time of Spousal Contract continuation, we will revoke the Lifetime Withdrawal Benefit, the Guaranteed Minimum Death Benefit will be set equal to the Contract Value and the rider charge will no longer be assessed. - JOINT/SPOUSAL OPTION: This rider is designed to facilitate the continuation of your rights under this rider by your Spouse through the inclusion of a Joint/Spousal Option. If a Covered Life dies and the Spouse elects to continue the Contract, we will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater and we will continue the rider with respect to all benefits at the current rider charge. The benefits will be reset as follows: - The Payment Base will be equal to the greater of Contract Value or the Payment Base on the Spousal Contract continuation date; - The Guaranteed Minimum Death Benefit will be equal to the Contract Value on the Spousal Contract continuation date; - The Withdrawal Percent will remain at the current percentage if partial Surrenders have commenced; otherwise the Withdrawal Percent will be based on the attained age of the remaining Covered Life on the Contract Anniversary prior to the first partial Surrender; and - The Lifetime Benefit Payment will be recalculated to equal the Withdrawal Percent multiplied by the greater of the Contract Value or Payment Base on the date of Spousal Contract continuation. The remaining Covered Life can not name a new Owner of the Contract. Any new beneficiary that is added to the Contract will not be taken into consideration as a Covered Life. The rider will then terminate upon the death of the remaining Covered Life. If the Spouse elects to continue the Contract and revoke the Lifetime Withdrawal Benefit, we will assess the charge on the revocation date and it will no longer be assessed thereafter. The Covered Life will be re-determined on the date of Spousal Contract continuation for purposes of the Guaranteed Minimum Death Benefit. If the age of the Covered Life is greater than the age limitation of the rider at the time of Spousal Contract continuation, the rider will terminate and the Guaranteed Minimum Death Benefit will equal the Contract Value. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? If you elect to annuitize your Contract prior to reaching the Annuity Commencement Date, you may only annuitize your Contract Value and will not be able to elect any of the annuitization options allowed under this rider. If your Contract reaches the Annuity Commencement Date, the Contract must be annuitized unless we agree to extend the Annuity Commencement Date, in our sole discretion. In this circumstance, the Contract may be annuitized under our standard annuitization rules or, alternatively, under the rules applicable when the Contract Value is below our minimum Contract Value then in effect. By annuitizing your Contract and choosing an income option, you will be exchanging your accumulated savings and Death Benefits for a guaranteed income stream. If your Contract Value is reduced below our minimum Contract Value then in effect, your Annuity Commencement Date will be attained and we will no longer accept subsequent Premium Payments. We will then issue you a payout annuity. You may elect the frequency of your payments from those offered by us at such time, but will not be less frequently than annually. - SINGLE LIFE OPTION: If you have elected the Single Life Option, we will issue you a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the Covered Life determined at Annuity Commencement Date. We treat the Covered Life as the Annuitant for this payout option. If there is more than one Covered Life, then the lifetime portion will be based on both Covered Lives. The Covered Lives will be the Annuitant and joint Annuitant for this payout option. The lifetime portion will terminate on the first death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit under this rider. 39 ------------------------------------------------------------------------------- If the older Annuitant is age 59 or younger, we will automatically defer the date the payments begin until the anniversary after the older Annuitant attains age 60 and is eligible to receive payments in a fixed dollar amount until the later of the death of any Annuitant or a minimum number of years. If the Annuitant is alive and the older Annuitant is age 60 or older, you will receive payments in a fixed dollar amount until the later of the death of any Annuitant or a period certain. The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of any Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of your Withdrawal Percent or 5%. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of any Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. This option may not be available if the Contract is issued to qualify under Code Section 401, 403, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. - JOINT/SPOUSAL OPTION: If you have elected the Joint/Spousal Option and both Spouses are alive, we will issue you a Fixed Joint & Survivor Lifetime and Period Certain Payout. If only one Spouse is alive, we will issue a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the surviving Covered Life. The Covered Lives will be the Annuitant and Joint Annuitant for this payout option. The lifetime benefit will terminate on the last death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit. If the younger Annuitant is alive and age 59 or younger, we will automatically defer the date that payments begin until the anniversary after the younger Annuitant attains age 60 and is eligible to receive payments in a fixed dollar amount until the death of the last surviving Annuitant or a period certain. If the Annuitant is alive and the younger Annuitant is age 60 or older, you will receive payments in a fixed dollar amount until the later of the death of the last surviving Annuitant or a minimum number of years. The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of the last Surviving Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of Withdrawal Percent or 4.5%. Therefore, the higher your then remaining Guaranteed Minimum Death Benefit is at the time of annuitization, the longer the time period you will be entitled to receive annuitization payments. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of the last surviving Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. These options may not be available if the Contract is issued to qualify under Code Sections 401, 403, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? Yes. We reserve the right to limit the Sub-Accounts into which you may allocate your Contract Value on and after the effective date of a Covered Life change. We may prohibit investment in any Sub-Account; require you to allocate your Contract Value in one of a number of asset allocation models, investment programs or fund of funds Sub-Accounts. Any transfers required to reallocate Contract Value will not be used in determining the number of transfers allowed during a Contract Year. If the restrictions are violated, the Withdrawal Benefit will be revoked but the Guaranteed Minimum Death Benefit will continue to apply. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? Yes. We reserve the right to require our approval on all subsequent Premium Payments received after the first twelve months. We will not accept any subsequent Premium Payment which brings the total of such cumulative subsequent Premium Payments to in excess of $100,000 without prior approval. Following your Annuity Commencement Date, we will no longer accept subsequent Premium Payments. This restriction is not currently enforced. 40 ------------------------------------------------------------------------------- CAN WE AGGREGATE CONTRACTS? Yes. For purposes of determining the Payment Base and Premium Payment limits, we reserve the right to treat as one all deferred variable annuity Contracts issued by us where you have elected any optional withdrawal benefit rider. If we elect to aggregate Contracts, we will change the period over which we measure Surrenders against future Lifetime Benefit Payments. We will treat the effective date of our aggregation election until the end of the applicable calendar year as a Contract Year for the purposes of the Lifetime Benefit Payment limit. A pro-rata rider fee will be taken at the end of that calendar year. After the first calendar year following aggregation, the Lifetime Benefit Payment limits will be aggregated and will thereafter be set on a calendar year (i.e., January 1 Contract Anniversary) basis. The rider fee then in effect will be taken at the end of each new Contract Anniversary. OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - The benefits under this rider cannot be directly or indirectly assigned, collateralized, pledged or securitized in any way. Any such actions will invalidate this rider and allow us to terminate the rider. - Your annual Lifetime Benefit Payment may fluctuate based on changes in the Payment Base and Contract Value. The Payment Base is sensitive to partial Surrenders in excess of the Lifetime Benefit Payment/Threshold. It is therefore possible that Surrenders and subsequent Premium Payments within the same Contract Year, whether or not equal to one another, can result in lower Lifetime Benefit Payments. - Annuitizing your Contract, whether voluntary or not, will impact and possibly eliminate these "lifetime" benefits. First, you may no longer invest additional Premium Payments. Second, any Death Benefit, whether standard or optional, will immediately terminate. Third, any Guaranteed Minimum Withdrawal Benefit guarantees you elect may end. In cases where you are required to annuitize (because you reach the Annuity Commencement Date or your Guaranteed Minimum Withdrawal Benefit requires annuitization because the Contract Value has fallen below our minimum Contract Value then in effect), lifetime annuitization payments may equal (or possibly exceed) Lifetime Benefit Payments. However, where you elect to annuitize before a required Annuity Commencement Date, lifetime annuitization payments might be less than the income guaranteed by your Guaranteed Minimum Withdrawal Benefit. - Even though this rider is designed to provide "living benefits," you should not assume that you will necessarily receive "payments for life" if you have violated any of the terms of this rider. - The amount of the Withdrawal Percent used to compute your Lifetime Benefit Payment is frozen based on the date of the first partial Surrender. - The determination of the "Relevant" Covered Life is established by the Company and is critical to the determination of many important benefits such as the Withdrawal Percent used to set Lifetime Benefit Payments. Applicants should confirm this determination and be sure they fully appreciate its importance before investing. - We may terminate this rider post-election based on your violation of benefit rules and may otherwise withdraw this rider for new sales at any time. - Because these benefits are bundled and interdependent upon one another, there is a risk that you may ultimately pay for benefits that you may never get to use. - You may select this rider only at the time of sale and once you do so, you may not add any other optional withdrawal benefits during the time you own this Contract. If you elect this rider you will not be eligible for the standard Death Benefits or be able to elect optional riders other than MAV Plus. - When the Single Life Option is chosen, your Spouse may find continuation of this rider to be unavailable or unattractive after the death of the Covered Life. Continuation of the benefits available in this optional rider is dependent upon its availability at the time of death of the first Covered Life and will be subject to then prevailing charges. - The Joint/Spousal Option provides that if you and your Spouse are no longer married for any reason other than death, the removal and replacement of your Spouse will constitute a Covered Life change. This can result in the resetting of all benefits under this rider. - Certain Covered Life changes may result in a reduction, recalculation or forfeiture of benefits. - This rider may not be suitable if a Covered Life is under attained age 60. - The purchase of an optional withdrawal benefit feature may not be appropriate for contracts owned by certain types of non-natural entities, including Charitable Trusts. Because many non-natural entities are required to make certain periodic distributions and 41 ------------------------------------------------------------------------------- those amounts may be different than the withdrawal amounts permitted by the optional withdrawal benefit feature, you may wish to consult with your tax advisor to help determine the appropriateness of this benefit. C. THE HARTFORD'S LIFETIME INCOME BUILDER II OBJECTIVE Protect your investment from poor market performance through potential annual automatic Payment Base increases, provide longevity protection through Lifetime Benefit Payments, and ensure a Death Benefit equivalent to the greater of Premium Payments reduced for partial Surrenders or Contract Value. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? This rider provides two separate but bundled benefits that help achieve this goal. In other words, this rider is a guarantee that you can access two ways: - LIFETIME WITHDRAWAL BENEFIT. This rider provides a series of Lifetime Benefit Payments payable in each Contract Year following the Relevant Covered Life's 60th birthday, until the first death of any Covered Life ("Single Life Option") or until the second death of any Covered Life ("Joint/Spousal Option"). Lifetime Benefit Payments are maximum amounts that can be withdrawn each year based on the higher of your Payment Base or Contract Value on each Contract Anniversary, as adjusted by annual Payment Base increases, multiplied by the applicable Withdrawal Percent. In an Eligible Withdrawal Year, your initial Lifetime Benefit Payment is equal to the Payment Base multiplied by the applicable Withdrawal Percentage. Payments may continue even if the Contract Value has been reduced to below our minimum Contract Value. The Withdrawal Percent varies based upon the attained age of the Relevant Covered Life as of the Contract Anniversary prior to the first partial Surrender, and the survivor option chosen. Any partial Surrender taken prior to the Contract Anniversary following the Relevant Covered Life's 60th birthday will reduce the Payment Base and your future Lifetime Benefit Payment. Such partial Surrender may potentially eliminate your Lifetime Benefit Withdrawal Guarantee. - GUARANTEED MINIMUM DEATH BENEFIT. This guaranteed minimum Death Benefit provides a Death Benefit equal to the greater of Premium Payments reduced for Partial Surrenders or Contract Value as of the date due proof of death is received for any Contract Owner or Annuitant. PARTIAL SURRENDERS WILL REDUCE OR ELIMINATE THE GUARANTEED MINIMUM DEATH BENEFIT. THIS GUARANTEED MINIMUM DEATH BENEFIT REPLACES THE STANDARD DEATH BENEFITS PROVIDED UNDER THIS CONTRACT. See Optional Benefit Comparisons in Appendix B. WHEN CAN YOU BUY THIS RIDER? Subject to State approval of The Hartford's Lifetime Income Builder Portfolios and The Hartford's Lifetime Income Builder Selects, this rider is closed to new investors. If available, you may elect this rider at the time of purchase, or may exchange the rider if you are eligible to participate in a designated company sponsored exchange program described in Appendix D. The benefits comprising this rider may not be purchased separately. This rider may not be available through all Registered Representatives and may be subject to additional restrictions set by your Registered Representative or us. We reserve the right to withdraw this rider at any time. When you buy this rider, you must provide us with the names and ages of the Owner, any joint Owner, Annuitant and Beneficiary. A Covered Life must be a living person. If you choose the Joint/Spousal Option, we reserve the right to (a) prohibit non-natural entities from being designated as an Owner, (b) prohibit anyone other than your Spouse from being a joint Owner; and (c) impose other designation restrictions from time to time. For the Single Life Option, the Covered Life is most often the same as the Contract Owner and joint Owner (which could be two different people). In the Joint/Spousal Option, the Covered Life is most often the Contract Owner and his or her Spouse, as joint Owner or Beneficiary. The Relevant Covered Life will be one factor used to establish your Withdrawal Percent. When the Single Life Option is chosen, we use the older Covered Life as the Relevant Covered Life; and when the Joint/Spousal Option is chosen, we use the younger Covered Life as the Relevant Covered Life. The maximum age of any Contract Owner or Annuitant when electing this rider is 75. When the Joint/Spousal Option is chosen, the Beneficiary also must be younger than age 76. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect this rider, you may not elect any rider other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The fee for this rider is based on your then current Payment Base (not your Contract Value) as of each Contract Anniversary. This charge will automatically be deducted from your Contract Value on your Contract Anniversary AFTER your Anniversary Value and 42 ------------------------------------------------------------------------------- Payment Base have been computed and prior to all other financial transactions. In the event of a full Surrender, a prorated charge will be deducted from your Surrender Value. The charge for this rider will be withdrawn from each Sub-Account and the Fixed Accumulation Feature in the same proportion that the value of each Sub-Account bears to the total Contract Value. Except as otherwise provided below, we will continue to deduct this charge until we begin to make Annuity Payouts. The rider charge may limit access to the Fixed Accumulation Feature in certain states. We reserve the right to increase the charge for this rider up to a maximum rate of 0.75% any time on or after the fifth anniversary of electing this rider or five years from the date from which we last notified you of a fee increase, whichever is later. The fee increase will only apply if you are eligible for future automatic Payment Base increases. Any future fee increase will be based on the charge that we are then currently charging other customers who have not previously elected this rider. If we cease sales of this rider, we will predetermine the rider charge on a non-discriminatory basis. Fee increases will not apply if (a) the age of the Relevant Covered Life is 80 or older; or (b) you notify us in writing of your election to permanently waive automatic Payment Base increases. This fee may not be the same as the fee that we charge new purchasers or the fee we set before we cease offering this rider. In no event will this charge exceed 0.75% annually. Subject to the foregoing limitation, we also reserve the right to charge a different fee for this rider to any new Contract Owners as a result of a change of Covered Life. Unless exempt, we will automatically deduct rider fees, as they may be increased from time to time. We may offer a lower fee to customers who agree to participate in any asset allocation models, investment programs, or fund-of-funds we may designate from time to time. DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? Yes. Your initial Payment Base equals your initial Premium Payment. Your Payment Base will fluctuate based on subsequent Premium Payments and partial Surrenders as well as automatic Payment Base increases. Your Payment Base can never be less than $0 or more than $5 million. Any activities that would otherwise increase the Payment Base above this ceiling will not be included for any benefits under this rider. The Payment Base will be recalculated based on certain changes in Covered Lives. - Automatic Payment Base increases. Your Payment Base may fluctuate based on annual "automatic Payment Base increases." You will be qualified for annual automatic Payment Base increases commencing on your first Contract Anniversary. Automatic Payment Base increases will cease upon the earlier of the Annuity Commencement Date or the Contract Anniversary immediately following the Relevant Covered Life's attained age of 80. Automatic Payment Base increases are based on your then current Anniversary Value (prior to the rider charge being taken) divided by your Maximum Contract Value and then reduced by 1. In no event will this factor be less than 0% or greater than 10%. Automatic Payment Base increases will not take place if the investment performance of your Sub-Accounts is neutral or negative. - Subsequent Premium Payments increase your Payment Base on a dollar-for-dollar basis. - Partial Surrenders may trigger a recalculation of the Payment Base depending on (a) whether the partial Surrender takes place prior or during an Eligible Withdrawal Year, and (b) if the cumulative amount of all partial Surrenders during any Contract Year exceeds the applicable Threshold, as discussed below: A. If cumulative partial Surrenders taken during any Contract Year and prior to an Eligible Withdrawal Year are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Payment Base on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are greater than the Threshold (subject to rounding), then we will reduce the Payment Base on a (i) dollar-for-dollar basis up to the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. B. If cumulative partial Surrenders during an Eligible Withdrawal Year are (i) equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will not reduce the Payment Base. C. For any partial Surrender that first causes cumulative partial Surrenders in an Eligible Withdrawal Year to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Payment Base on a proportionate basis for the amount in excess of the Lifetime Benefit Payment. Partial Surrenders taken during any Contract Year that cumulatively exceed the Annual Withdrawal Amount but do not exceed the Lifetime Benefit Payment will be free of any applicable CDSC. Partial Surrenders will diminish the Guaranteed Minimum Death Benefit. 43 ------------------------------------------------------------------------------- See Examples 7, 8 and 10-14 under The Hartford's Lifetime Income Builder II. IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? Yes. However, your Withdrawal Percentage and therefore the amount of your Lifetime Benefit Payment, is dependent upon when you take your first partial Surrender. For instance: - If you take your first partial Surrender before an Eligible Withdrawal Year, your Withdrawal Percent will never increase above 5% for Single Life Option or 4.5% for Joint/Spousal option for the remaining duration of your Contract. - If you take your first partial Surrender during an Eligible Withdrawal Year, your Withdrawal Percent will never increase above the Withdrawal Percent corresponding with the attained age of the Relevant Covered Life as of the Contract Anniversary prior to the first partial Surrender. If such a partial Surrender took place during the first Contract Year, we will use the attained age of the Relevant Covered Life as of Contract issuance to set the Withdrawal Percent. Once the Withdrawal Percent has been established, it will not change for the remaining duration of your Contract. In other words, prior to the Relevant Covered Life turning 80, the longer the first partial Surrender is delayed, the higher your Withdrawal Percent shall be.
ATTAINED AGE OF RELEVANT COVERED WITHDRAWAL PERCENT LIFE ON THE CONTRACT ANNIVERSARY SINGLE LIFE JOINT/SPOUSAL PRIOR TO THE FIRST PARTIAL SURRENDER OPTION OPTION -------------------------------------------------------------------------------- 60 - 64 5.0% 4.5% 65 - 69 5.5% 5.0% 70 - 74 6.0% 5.5% 75 - 79 6.5% 6.0% 80+ 7.0% 6.5%
Your Withdrawal Percent may change based on a permissible Covered Life change. If you choose to receive less than your full Lifetime Benefit Payment in any Contract Year, you will not be able to carry remaining amounts forward to future Contract Years. See Examples 1-6 and 11-14 under The Hartford's Lifetime Income Builder II. IS THIS RIDER DESIGNED TO PAY YOU DEATH BENEFITS? Yes. This Guaranteed Minimum Death Benefit guarantees that we will pay a Death Benefit equal to the greater of Premium Payments reduced for partial Surrenders or Contract Value as of the date we receive due proof of death of the Contract Owner(s) or Annuitant. Termination of this rider will result in the rescission of the Guaranteed Minimum Death Benefit and result in your Beneficiary receiving the Contract Value as of the date we receive due proof of death. Partial Surrenders will affect the Guaranteed Minimum Death Benefit as follows: A. If cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to an Eligible Withdrawal Year are greater than the Threshold (subject to rounding), then we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. B. If cumulative partial Surrenders during an Eligible Withdrawal Year are (i) equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. C. For any partial Surrender that causes cumulative partial Surrenders in an Eligible Withdrawal Year to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Lifetime Benefit Payment, and (ii) proportionate basis for the amount in excess of the Lifetime Benefit Payment. Please refer to the section labeled "CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT" for more information on the continuation of the Lifetime Benefit Payments by your Spouse. See Examples 9, 10 and under The Hartford's Lifetime Income Builder II. DOES THIS RIDER REPLACE THE STANDARD DEATH BENEFIT? Yes. CAN YOU REVOKE THIS RIDER? No. However, a Company-sponsored exchange of this rider will not be considered to be a revocation or termination of this rider. 44 ------------------------------------------------------------------------------- WHAT EFFECT DO PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Please refer to "DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER?" for the effect of partial Surrenders on your Payment Base, Guaranteed Minimum Death Benefit and Lifetime Benefit Payments. You may make a full Surrender of your entire Contract at any time. However, you will receive your Contract Value with any applicable charges deducted and not the Payment Base or any Lifetime Benefit Payment that you would have received under this rider. If Your Contract Value is reduced below our minimum Contract Value rules in effect on a particular Valuation Day, and your Lifetime Benefit Payment amount remains greater than zero, then we will consider this date as your Annuity Commencement Date and we will no longer accept subsequent Premium Payments. See Examples 7, 8 and 10-14 under The Hartford's Lifetime Income Builder II. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? Inasmuch as this rider is affected only by changes to the Covered Life, only these types of changes are discussed below. We reserve the right to approve all Covered Life changes. Certain approved changes in the designation of the Covered Life may cause a re-calculation of the benefits. Covered Life changes also allow us, in our discretion, to impose investment restrictions, as described below. Any Covered Life change made within the first 6 months from the Contract Issue date will have no impact on the Payment Base or Guaranteed Minimum Death Benefit as long as each succeeding Covered Life is less than the maximum age limitation of the rider at the time of the change. The Withdrawal Percent and Lifetime Benefit Payment will thereafter change based on the age of the new relevant Covered Life. After the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and partial Surrenders have not yet been taken, in the event that you and your Spouse become legally divorced, you may add a new Spouse to the Contract. Provided that the age limitation of the rider is not exceeded, the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will then recalculate your Withdrawal Percent based on the age of the younger Covered Life as of the date of the change. Alternatively, if after the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and Surrenders have been taken, in the event that you and your Spouse become legally divorced, you may only remove your ex-Spouse from the Contract whereupon the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will then recalculate your Withdrawal Percent based on the age of the remaining Covered Life as of the date of the change. You may not convert your Joint/Spousal Option election to a Single Life Option. In addition, after the first six months following the Contract issue date, if any Covered Life change takes place that is not due to a divorce, then: A. If the older Covered Life after the change is equal to or less than the maximum age limitation of the rider at the time of the change, then we will revoke the Withdrawal Benefits of this rider and continue the Guaranteed Minimum Death Benefit only. The charge for this rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter. B. If the older Covered Life after the change exceeds the maximum age limitation of the rider at the time of the change, or we no longer offer this rider, then the rider will terminate. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. If you elected the Single Life Option and any Covered Life changes after the first 6 months from Contract Issue date, then we will: A. If we no longer offer this rider, we will continue the Guaranteed Minimum Death Benefit after resetting this benefit to the lower of the then applicable Guaranteed Minimum Death Benefit or Contract Value on the effective date of the Covered Life change; whereupon the Withdrawal Benefit will terminate. The charge for this rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter; or B. If we offer this rider and: (i) if partial Surrenders have been taken prior to the first Contract Anniversary, then we will use the attained age of the oldest Covered Life as of the rider effective date to reset the Withdrawal Percent, or (ii) if partial Surrenders have not been taken prior to the first Contract Anniversary, then we will use the attained age of the older Covered Life as of the Contract Anniversary prior to the first partial Surrender to reset the Withdrawal Percent. The Payment Base will be recalculated to be the lesser of the Contract Value or the Payment Base effective on the date of the change. The Guaranteed Minimum Death Benefit will be recalculated to be the lesser of the Contract Value or the Guaranteed Minimum Death Benefit effective on the date of the change. The Maximum Contract Value will be recalculated to equal the Contract Value on the date of the change; or C. If we offer this rider and the older Covered Life after the change exceeds the maximum age limitation of this rider at the time of the change; the rider will be terminated and removed from the Contract. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. 45 ------------------------------------------------------------------------------- If the rider is no longer available for sale, we will determine the issue age limitation of the rider on a non-discriminatory basis. The following tables illustrate only some of the various changes and the resulting outcomes associated with deaths of the Contract Owner(s) or Annuitant before and after the Annuity Commencement Date. SINGLE LIFE OPTION ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving The Annuitant is living or Joint Contract Owner receives non-spousal Contract Owner deceased the Death Benefit and this rider terminates Contract Owner There is a surviving spousal The Annuitant is living or Joint Contract Owner receives Contract Owner deceased the Death Benefit and this rider can continue under Spousal Contract continuation Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Designated Owner deceased Beneficiary receives the Death Benefit Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Estate Owner or Beneficiary deceased receives the Death Benefit Annuitant Contract Owner is living There is no Contingent Contract continues, no Death Annuitant and the Contract Benefit is paid, and this rider Owner becomes the Contingent continues Annuitant Annuitant Contract Owner is living There is no Contingent Rider terminates and Contract Annuitant and the Contract Owner receives the Death Owner waives their right to Benefit become the Contingent Annuitant Annuitant Contract Owner is Living Contingent Annuitant is Living Contingent Annuitant becomes the Annuitant and the Contract and this rider continues
JOINT/SPOUSAL ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving Contract The Annuitant is living or The surviving Contract Owner Owner deceased continues the Contract and rider; we will increase the Contract Value to the Death Benefit value Contract Owner There is no surviving Contract The Spouse is the sole primary Follow Spousal Contract Owner beneficiary continuation rules for joint life elections Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates and Contract Owner or Beneficiary deceased Owner's estate receives the Death Benefit Annuitant The Contract Owner is living There is a Contingent Annuitant The Rider continues; upon the death of the last surviving Covered Life, the rider will terminate.
CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT? - SINGLE LIFE OPTION: If a Covered Life dies and the Beneficiary is the deceased Covered Life's Spouse at the time of death, such Spouse may continue the Contract. If the Spouse elects to continue the Contract and this rider, we will continue the rider with respect to all Lifetime 46 ------------------------------------------------------------------------------- Withdrawal Benefits at the charge that is currently being assessed for new sales at the time of continuation. We will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater. The Covered Life will be re-determined on the date of Spousal Contract continuation. If the new Covered Life is less than age 81 at the time of the Spousal Contract continuation, and the rider is still available for sale, the Payment Base and the Guaranteed Minimum Death Benefit will be set equal to the Contract Value, the Withdrawal Percent will be recalculated based on the age of the older remaining Covered Life on the effective date of the Spousal Contract continuation. If the new Covered Life is 81 or older at the time of the Spousal Contract continuation, the rider will terminate and the Guaranteed Minimum Death Benefit will be equal to the Contract Value. If we are no longer offering this rider at the time of Spousal Contract continuation, we will revoke the Lifetime Withdrawal Benefit, the Guaranteed Minimum Death Benefit will be set equal to the Contract Value and the rider charge will no longer be assessed. - JOINT/SPOUSAL OPTION: This rider is designed to facilitate the continuation of your rights under this rider by your Spouse through the inclusion of a Joint/Spousal Option. If a Covered Life dies and the Spouse elects to continue the Contract, we will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater and we will continue the rider with respect to all benefits at the current rider charge. The benefits will be reset as follows: - The Payment Base will be equal to the greater of Contract Value or the Payment Base on the Spousal Contract continuation date - The Guaranteed Minimum Death Benefit will be equal to the Contract Value on the Spousal Contract continuation date - The Withdrawal Percent will remain at the current percentage if partial Surrenders have commenced; otherwise the Withdrawal Percent will be based on the attained age of the remaining Covered Life on the Contract Anniversary prior to the first partial Surrender - The Lifetime Benefit Payment will be recalculated to equal the Withdrawal Percent multiplied by the greater of the Contract Value or Payment Base on the date of Spousal Contract continuation. The remaining Covered Life can not name a new owner on the Contract. Any new beneficiary that is added to the Contract will not be taken into consideration as a Covered Life. The rider will terminate upon the death of the remaining Covered Life. If the Spouse elects to continue the Contract and revoke the Lifetime Withdrawal Benefit, we will assess the charge on the revocation date and it will no longer be assessed thereafter. The Covered Life will be re-determined on the date of Spousal Contract continuation for purposes of the Guaranteed Minimum Death Benefit. If the Covered Life is greater than the age limitation of the rider at the time of Spousal Contract continuation, the rider will terminate and the Guaranteed Minimum Death Benefit will equal the Contract Value. See Example 17 under The Hartford's Lifetime Income Builder II. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? If you elect to annuitize your Contract prior to reaching the Annuity Commencement Date, you may only annuitize your Contract Value and will not be able to elect any of the annuitization options allowed under this rider. If your Contract reaches the Annuity Commencement Date, the Contract must be annuitized unless we agree to extend the Annuity Commencement Date, in our sole discretion. In this circumstance, the Contract may be annuitized under our standard annuitization rules or, alternatively, under the rules applicable when the Contract Value is below our minimum Contract Value then in effect. If your Contract Value is reduced below our minimum Contract Value then in effect, your Annuity Commencement Date will be attained and we will no longer accept subsequent Premium Payments. We will then issue you a payout annuity. You may elect the frequency of your payments from those offered by us at such time, but will not be less frequently than annually. - SINGLE LIFE OPTION: If you have elected the Single Life Option, we will issue you a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the Covered Life determined at Annuity Commencement Date. We treat the Covered Life as the Annuitant for this payout option. If there is more than one Covered Life, then the lifetime portion will be based on both Covered Lives. The Covered Lives will be the Annuitant and joint Annuitant for this payout option. The lifetime portion will terminate on the first death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit under this rider. If the older Annuitant is age 59 or younger, we will automatically defer the date the payments begin until the anniversary after the older Annuitant attains age 60 and is eligible to receive payments in a fixed dollar amount until the later of the death of any Annuitant or a minimum number of years. If the Annuitant and joint Annuitant are alive and the older Annuitant is age 60 or older, you will receive payments in a fixed dollar amount until the later of the death of any Annuitant or a period certain. 47 ------------------------------------------------------------------------------- The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of any Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of the Withdrawal Percent or 5%. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of any Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. This option may not be available if the Contract is issued to qualify under Code Sections 401, 403, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. - JOINT/SPOUSAL OPTION: If you have elected the Joint/Spousal Option and both Spouses are alive, we will issue you a Fixed Joint & Survivor Lifetime and Period Certain Payout. If only one Spouse is alive, we will issue a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the surviving Covered Life. The Covered Lives will be the Annuitant and Joint Annuitant for this payout option. The lifetime benefit will terminate on the last death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit. If the younger Annuitant is alive and age 59 or younger, we will automatically defer the date that payments begin until the anniversary after the younger Annuitant attains age 60 and is eligible to receive payments in a fixed dollar amount until the death of the last surviving Annuitant or a period certain. If the Annuitant is alive and the younger Annuitant is age 60 or older, you will receive payments in a fixed dollar amount until the later of the death of the last surviving Annuitant or a minimum number of years. The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of the last Surviving Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of the Withdrawal Percent or 4.5%. Therefore, the higher your then remaining Guaranteed Minimum Death Benefit is at the time of annuitization, the longer the time period you will be entitled to receive annuitization payments. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of the last surviving Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. These options may not be available if the Contract is issued to qualify under Code Sections 401, 403, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? Yes. We reserve the right to limit the Sub-Accounts into which you may allocate your Contract Value on and after the effective date of any Covered Life change. If there is a Covered Life change, we may prohibit investment in any Sub-Account; require you to allocate your Contract Value in one of a number of asset allocation models, investment programs or fund of funds Sub-Accounts. Any transfers required to reallocate Contract Value will not be used in determining the number of transfers allowed during a Contract Year. If the restrictions are violated, the Withdrawal Benefit will be revoked but the Guaranteed Minimum Death Benefit will continue to apply. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? Yes. We reserve the right to require our approval on all subsequent Premium Payments received after the first twelve months. We will not accept any subsequent Premium Payment which brings the total of such cumulative subsequent Premium Payments to in excess of $100,000 without prior approval. Following your Annuity Commencement Date, we will no longer accept subsequent Premium Payments. This restriction is not currently enforced. See Examples 9 and 10 under The Hartford's Lifetime Income Builder II. CAN WE AGGREGATE CONTRACTS? Yes. For purposes of determining the Payment Base and Premium Payment limits, we reserve the right to treat as one all deferred variable annuity Contracts issued by us where you have elected any optional withdrawal benefit rider. If we elect to aggregate Contracts, we will change the period over which we measure Surrenders against future Lifetime Benefit Payments. We will treat the effective date of our aggregation election until the end of the applicable calendar year as a Contract Year for the purposes of the Lifetime Benefit Payment limit. A pro-rata rider fee will be taken at the end of that calendar year. After the first calendar year following aggregation, the Lifetime Benefit Payment limits will be aggregated and will thereafter be set on a calendar 48 ------------------------------------------------------------------------------- year (i.e., January 1 Contract Anniversary) basis. The rider fee then in effect will be taken at the end of each new Contract Anniversary. OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - The benefits under this rider cannot be directly or indirectly assigned, collateralized, pledged or securitized in any way. Any such actions will invalidate this rider and allow us to terminate the rider. - Your annual Lifetime Benefit Payments may fluctuate based on changes in the Payment Base and Contract Value. The Payment Base is sensitive to partial Surrenders in excess of the Lifetime Benefit Payment/Threshold. It is therefore possible that Surrenders and subsequent Premium Payments within the same Contract Year, whether or not equal to one another, can result in lower Lifetime Benefit Payments. - Annuitizing your Contract, whether voluntary or not, will impact and possibly eliminate these "lifetime" benefits. First, you may no longer invest additional Premium Payments. Second, any Death Benefit, whether standard or optional, will immediately terminate. Third, any Guaranteed Minimum Withdrawal Benefit guarantees you elect may end. In cases where you are required to annuitize (because you reach the Annuity Commencement Date or your Guaranteed Minimum Withdrawal Benefit requires annuitization because the Contract Value has fallen below our minimum Contract Value then in effect), you will forfeit automatic Payment Base increases (if applicable) and lifetime annuitization payments may equal (or possibly exceed) Lifetime Benefit Payments. However, where you elect to annuitize before a required Annuity Commencement Date, lifetime annuitization payments might be less than the income guaranteed by your Guaranteed Minimum Withdrawal Benefit. - Even though this rider is designed to provide "living benefits," you should not assume that you will necessarily receive "payments for life" if you have violated any of the terms of this rider. - The amount of the Withdrawal Percent used to compute your Lifetime Benefit Payment is frozen based on the date of the first partial Surrender. - The determination of the "Relevant" Covered Life is established by the Company and is critical to the determination of many important benefits such as the Withdrawal Percent used to set Lifetime Benefit Payments. Applicants should confirm this determination and be sure they fully appreciate its importance before investing. - We may terminate this rider post-election based on your violation of benefit rules and may otherwise withdraw this rider for new sales at any time. In the event that this rider is terminated by us, your Lifetime Benefit Payments will cease; your Payment Base, including any automatic Payment Base increases will be eliminated, the Guaranteed Minimum Death Benefit will then be equal to the Contract Value, and you will not be allowed to elect any other optional benefit rider. - Because these benefits are bundled and interdependent upon one another, there is a risk that you may ultimately pay for benefits that you may never get to use. - You may select this rider only at the time of sale and once you do so, you may not add any other optional withdrawal benefits during the time you own this Contract. If you elect this rider you will not be eligible for the standard Death Benefits or able to elect optional riders other than MAV Plus. - When the Single Life Option is chosen, Spouses may find continuation of this rider to be unavailable or unattractive after the death of the Contract Owner. Continuation of the benefits available in this optional rider is dependent upon its availability at the time of death of the first Covered Life and will be subject to then prevailing charges. - The Joint/Spousal Option provides that if you and your Spouse are no longer married for any reason other than death, the removal and replacement of your Spouse will constitute a Covered Life change. This can result in the resetting of all benefits under this rider. - Certain Covered Life changes may result in a reduction, recalculation or forfeiture of benefits. - This rider may not be suitable if a Covered Life is under attained age 60. - Annuity pay-out options available subsequent to the Annuity Commencement Date may not necessarily provide a stream of income for your lifetime and may be less than Lifetime Benefit Payments. - The fee for this rider may increase if and when automatic Payment Base increases take place. There are no assurances as to the fee we will be charging at the time of each Payment Base increase. This is subject to the maximum fee disclosed in the Synopsis and this section. - The purchase of an optional withdrawal benefit feature may not be appropriate for contracts owned by certain types of non-natural entities, including Charitable Trusts. Because many non-natural entities are required to make certain periodic distributions and those amounts may be different than the withdrawal amounts permitted by the optional withdrawal benefit feature, you may wish to consult with your tax advisor to help determine the appropriateness of this benefit. 49 ------------------------------------------------------------------------------- D. THE HARTFORD'S PRINCIPAL FIRST OBJECTIVE Protect your investment from poor market performance through annual Benefit Payments until the Benefit Amount is reduced to zero. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? This rider protects your investment by guaranteeing Benefit Payments until your Benefit Amount, rather than your Contract Value, has been exhausted. You may also elect "step-ups" that reset your Benefit Amount to the then prevailing Contract Value. See Optional Benefit Comparisons in Appendix B. You or your Spouse (if Spousal Contract continuation has been chosen) may elect to step-up your Benefit Amount following the 5th Contract Year that you added this rider to your Contract and again on each fifth anniversary from the last time you elected to step-up your Benefit Amount (or upon Spousal Contract continuation, whichever is earlier)(these dates are called "election dates" in this section). Your Benefit Amount will then become the Contract Value as of the close of business on the Valuation Date that you properly made this election. Each time that you exercise step-up rights, your Benefit Payment will be reset to 7% of the new Benefit Amount, but will never be less than your then existing Benefit Payment. You must follow certain requirements to make this election: - We will accept requests for a step-up in writing, verbally or electronically, if available. - Written elections must be submitted using the forms we provide. For telephonic and Internet elections, if available, you must authenticate your identity and acknowledge your understanding of the implications of making this election. We are not responsible for lost investment opportunities associated with elections that are not in good order and for relying on the genuiness of any election. - We will not accept any election request prior to an election date. You may not post-date your election. - If an election form is received in good order on or after an election date, the step-up will occur as of the close of business on the Valuation Day that the request is received by us at our Administrative Office. We reserve the right to require you to elect step-ups only on Contract Anniversaries. - We will not honor any election request if your Contract Value is less than your Benefit Amount effective as of the step-up effective date. - Your election is irrevocable. This means that if your Contract Value increases after your step-up, you can not ask us to reset your Benefit Amount again until your next election date. The fee for this rider may also change when you make this election and will remain in effect until your next election, if any. WHEN CAN YOU BUY THIS RIDER? You may elect this benefit at any time, provided we are still offering this rider for new sales. Once elected, your choice is irrevocable. If not elected at issue, Plus Contract owners must wait until after the first Contract Anniversary before purchasing this benefit. The maximum age of any Contract Owner or Annuitant when electing this rider is 85 for non-qualified plans and age 80 for IRA or qualified plans. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect this rider, you may not elect any riders other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The annual charge for this rider is based on your daily Sub-Account Value and is deducted daily. The charge continues to be deducted until we begin to make Annuity Payouts. We will recalculate the charge each time that you step-up your Benefit Amount. The fee at the time of step-up will be the charge that we are then currently charging other customers who have previously elected this rider and have elected to step-up. This fee may not be the same as, but will not be more than, the fee that we charge new purchasers or the fee we set before we cease offering this rider. If we cease sales of this rider, we will predetermine the rider charge on a non-discriminatory basis. Before you decide to exercise your step-up privileges, you should request a current prospectus which will describe the then current charge effective upon exercising step-up rights. We also reserve the right to increase the charge for this rider up to a maximum rate of 0.75% any time on or after the fifth anniversary of electing this rider or five years from the date from which we last notified you of a fee increase, whichever is later. The fee increase will only apply if you are eligible for future step-ups. Subject to the foregoing limitation, we also reserve the right to charge a different fee for this rider to any new Contract Owners as a result of a change of ownership of this Contract. 50 ------------------------------------------------------------------------------- DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? Yes. If elected at the time of Contract issuance, your initial Benefit Amount is your initial Premium Payment. If elected after the Contract has been issued, your initial Benefit Amount will be the based on your Contract Value at the time the rider is elected. Any time after the 5th Contract Year that this rider has been in effect and thereafter on each fifth anniversary of the last step-up (or sooner upon Spousal Contract continuation); you (or your Spouse if Spousal Contract continuation rights have been elected) may elect to step-up the Benefit Amount to the Contract Value. Your Benefit Amount will fluctuate based on subsequent Premium Payments or partial Surrenders. Partial Surrenders in excess of your Benefit Payments may also trigger a recalculation of the Benefit Amount and future Benefit Payments. Your Benefit Amount can never be more than $5 million. You cannot elect the step-up privilege if your then current Benefit Amount is higher than your Contract Value on step-up dates. IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? No. You can continue to take Benefit Payments until the Benefit Amount has been depleted. Once the initial Benefit Amount has been determined, we calculate the Benefit Payment. The maximum Benefit Payment is 7% of your Benefit Amount on rider effective date, or if more recently, the last date on which a step up was elected, or the Benefit Amount was reduced due to a partial Surrender exceeding the Benefit Payment. Benefit Payments can begin at any time and can be taken on any schedule that you request. Benefit Payments are non-cumulative, which means that your Benefit Payment will not increase in the future if you fail to take your full Benefit Payment for the current year. For example, if you do not take 7% one year, you may not take more than 7% the next year. If you elect this rider when you purchase your Contract, we count one year as the time between each Contract Anniversary. If you purchase this rider after you purchase your Contract, we count the first year as the time between the date we added this rider to your Contract and your next Contract Anniversary, which could be less than a year. Each time you add a Premium Payment, we increase your Benefit Amount by the amount of the subsequent Premium Payment. When you make a subsequent Premium Payment, your Benefit Payments will increase by 7% of the amount of the subsequent Premium Payment. Your Benefit Amount cannot be less than $0 or more than $5 million. Any activities that would otherwise increase the Benefit Amount above this ceiling will not be included for any benefits under this rider. Benefit Payments are treated as partial Surrenders and are deducted from your Contract Value and Benefit Amount. Each Benefit Payment reduces the amount you may Surrender under your Annual Withdrawal Amount. Surrenders in excess of your annual Benefit Payment include any applicable Contingent Deferred Sales Charge. IF, IN ONE YEAR, YOUR SURRENDERS TOTAL MORE THAN YOUR BENEFIT PAYMENT, WE WILL RE-CALCULATE YOUR BENEFIT AMOUNT AND YOUR BENEFIT PAYMENT COULD BE SIGNIFICANTLY LOWER IN THE FUTURE. Any time we recalculate your Benefit Amount or your Benefit Payment, we count one year as the time between the date we re-calculate and your next Contract Anniversary, which could be less than a year. Whenever a partial Surrender is made, the Benefit Amount will be equal to the amount determined in either (A) or (B) as follows: A. If the total partial Surrenders since the later of (i) the most recent Contract Anniversary, or (ii) the Valuation Day that the Benefit Payment was last established (excluding establishments for subsequent Premium Payments), are equal to or less than the Benefit Payment, the Benefit Amount becomes the Benefit Amount immediately prior to the partial Surrender, less the amount of the partial Surrender. B. If the total partial Surrenders as determined in (A) above exceed the Benefit Payment, the Benefit Amount will have an automatic reset to the greater of zero or the lesser of (i) or (ii) as follows: (i) The Contract Value immediately following the partial Surrender; or (ii) The Benefit Amount immediately prior to the partial Surrender, less the amount of the partial Surrender. Please refer to examples 2 - 7 for The Hartford's Principal First in Appendix I for illustrations regarding recalculation of your Benefit Amount. Qualified Contracts are subject to certain federal tax rules requiring that minimum distributions be withdrawn from the Contract on a calendar year basis (i.e., compared to a Contract Year basis), usually beginning after age 70 1/2. These withdrawals are called Required Minimum Distributions. A Required Minimum Distribution may exceed your Benefit Payment, which will cause a recalculation of your Benefit Amount. Recalculation of your Benefit Amount may result in a lower Benefit Payment in the future. 51 ------------------------------------------------------------------------------- IS THIS RIDER DESIGNED TO PAY YOU DEATH BENEFITS? No. However, partial Surrenders will reduce the standard Death Benefit. DOES THIS RIDER REPLACE STANDARD DEATH BENEFITS? No. CAN YOU REVOKE THIS RIDER? No. However, a Company-sponsored exchange of this rider will not be considered to be a revocation or termination of this rider. WHAT EFFECT DO PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Benefit Payments are treated as partial Surrenders and are deducted from your Contract Value and Benefit Amount. Each Benefit Payment reduces the amount you may Surrender under your Annual Withdrawal Amount. Surrenders in excess of your Benefit Payment include any applicable CDSC. If, in one year, your Surrenders total more than your Benefit Payment, we will re-calculate your Benefit Amount and your Benefit Payment could be significantly lower in the future. Any time we re-calculate your Benefit Amount or your Benefit Payment, we count one year as the time between the date we re-calculate and your next Contract Anniversary, which could be less than a year. If your Contract Value is reduced to zero due to receiving Benefit Payments, and you still have a Benefit Amount, you will continue to receive a Benefit Payment through a fixed Annuity Payout option until your Benefit Amount is depleted. While you are receiving payments under fixed Annuity Payout options, you may not make additional Premium Payments, and if you die before you receive all of your payments, your Beneficiary will continue to receive the remaining Benefit Payments. You can Surrender your entire Contract Value any time; however, you will receive your Contract Value at the time you request a full Surrender with any applicable charges deducted and not the Benefit Amount or the Benefit Payment amount that you would have received under this rider. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? If you change the ownership or assign this Contract to someone other than your Spouse after 12 months of electing this rider, we will recalculate the Benefit Amount and the Benefit Payment may be lower in the future. The Benefit Amount will be recalculated to equal the lesser of: - The Benefit Amount immediately prior to the ownership change or assignment; or - The Contract Value at the time of the ownership change or assignment. The Benefit Payment will then be reset to 7% of the new Benefit Amount. If the Owner dies and the sole Beneficiary is the Owner's Spouse, then the surviving Spouse can either become the Contract Owner or elect to receive the standard Death Benefit. You may not change the named Annuitant. However, if the Annuitant is still living, the Contingent Annuitant may be changed at any time prior to the Annuity Commencement Date by sending us written notice. CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT? Yes. If the Owner dies and the Beneficiary is the deceased Owner's Spouse at the time of death, the Spouse may continue the Contract and this rider. This right may be exercised only once during the term of the Contract. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? You may elect the annuitization option at any time. If you annuitize your Contract, you may choose this Annuity Payout Option in addition to those Annuity Payout Options offered in the Contract. Under this Annuity Payout Option (called the "PF Annuity Payout Option"), we will pay a fixed dollar amount for a specific number of years ("Payout Period"). If you, the joint Owner or the Annuitant should die before the PF Annuity Payout Period is complete, the remaining payments will be made to the Beneficiary. The PF Annuity Payout Period is determined on the Annuity Calculation Date and it will equal the current Benefit Amount divided by the Benefit Payment. The total amount of the Annuity Payouts under this option will be equal to the Benefit Amount. We may offer other Payout Options. If you, the joint Owner or Annuitant die before the Annuity Calculation Date and all of the Benefit Payments guaranteed by us have not been made, the Beneficiary may elect to take the remaining Benefit Payments by electing the PF Annuity Payout Option or any of the Death Benefit options offered in your Contract. If the Annuitant dies after the Annuity Calculation Date and before all of the Benefit Payments guaranteed by us have been made, the payments will continue to be made to the Beneficiary. If your Contract Value is reduced to zero, you will receive a fixed dollar amount Annuity Payout option until your Benefit Amount is depleted. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? No. 52 ------------------------------------------------------------------------------- ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? No; however, your Benefit Amount cannot be more than $5 million. Any activities that would otherwise increase the Benefit Amount above this ceiling will not be included for any benefits under this rider. CAN WE AGGREGATE CONTRACTS? We reserve the right to treat all Contracts issued to you by us or one of our affiliates as one Contract for purposes of this rider. This means that if you purchase two Contracts from us in any twelve month period and elect any optional withdrawal benefit rider on both Contracts, withdrawals from one Contract may be treated as withdrawals from the other Contract. OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - The annual percentage used for determining Benefit Payments is not a fixed rate of return. The Contract Value used to set Benefit Payments is based on the investment performance of your Sub-Accounts. - Benefit Payments cannot be carried forward from one year to the next. You will not be warned if you take less than the maximum withdrawals available without triggering recalculation of your Benefit Payments. - Annual Surrenders exceeding 7% accelerate depletion of your Benefit Amount even if you use the Automatic Income Program to meet RMD requirements. No reliable assumptions can be made that your payments will continue for any particular number of years. - Additional contributions made to your Contract after withdrawals have begun may not restore the previous amount of Benefit Payments, even if the additional contribution restores the Benefit Amount to the previous Benefit Amount. - Voluntary or involuntary annuitization will terminate Benefit Payments. Annuity Payout options available subsequent to the Annuity Commencement Date may be less than Benefit Payments. - There are no assurances made or implied that automatic Benefit Amount increases will occur and if occurring, will be predictable. - The fee for this rider may increase if and when automatic Benefit Amount increases take place. There are no assurances as to the fee we will be charging at the time of each step-up. This is subject to the maximum fee disclosed in the Synopsis and this section. - When the Contract Value is small in relation to the Benefit Amount, Surrenders may have a significant effect on future Benefit Payments. 8. MISCELLANEOUS A. DEFINITIONS Except as provided elsewhere in this prospectus, the following capitalized terms shall have the meaning ascribed below: ACCOUNT: Any of the Sub-Accounts or the Fixed Accumulation Feature. ACCUMULATION UNITS: If you allocate your Premium Payment to any of the Sub-Accounts, we will convert those Payments into Accumulation Units in the selected Sub-Accounts. Accumulation Units are valued at the end of each Valuation Day and are used to calculate the value of your Contract prior to Annuitization. ACCUMULATION UNIT VALUE: The daily price of Accumulation Units on any Valuation Day. ADMINISTRATIVE OFFICE: Our location and overnight mailing address is: 200 Hopmeadow Street, Simsbury, Connecticut 06089. Our standard mailing address is: U.S. Wealth Management, P.O. Box 5085, Hartford, Connecticut 06102-5085. ANNIVERSARY VALUE: The value equal to the Contract Value as of a Contract Anniversary, as adjusted for subsequent Premium Payments and partial Surrenders. ANNUAL MAINTENANCE FEE: An annual $30 charge deducted on a Contract Anniversary or upon full Surrender if the Contract Value at either of those times is less than $50,000. The charge is deducted proportionately from each Sub-Account in which you are invested. ANNUAL WITHDRAWAL AMOUNT: This is the amount you can Surrender per Contract Year without paying a Contingent Deferred Sales Charge. This amount is non-cumulative, meaning that it cannot be carried over from one year to the next. ANNUITANT: The person on whose life the Contract is issued. Except as otherwise provided, the Annuitant may not be changed after your Contract is issued. 53 ------------------------------------------------------------------------------- ANNUITY CALCULATION DATE: The date we calculate the first Annuity Payout. ANNUITY COMMENCEMENT DATE: The later of the 10th Contract Anniversary or the date the Annuitant reaches age 90, unless we, in our sole discretion, agree to postpone to another date following our receipt of an extension request. ANNUITY PAYOUT: The money we pay out after the Annuity Commencement Date for the duration and frequency you select. ANNUITY PAYOUT OPTION: Any of the options available for payout after the Annuity Commencement Date or death of the Contract Owner or Annuitant. ANNUITY UNIT: The unit of measure we use to calculate the value of your Annuity Payouts under a variable dollar amount Annuity Payout Option. ANNUITY UNIT VALUE: The daily price of Annuity Units on any Valuation Day. BENEFICIARY: The person(s) entitled to receive benefits pursuant to the terms of the Contract upon the death of any Contract Owner and Annuitant as the case may be. BENEFIT AMOUNT: The basis used to determine the maximum payout guaranteed under The Hartford's Principal First, The Hartford's Principal First Preferred and The Hartford's Lifetime Income Builder. The Benefit Amount is comprised of net Premium Payments, less any Payment Enhancements, if applicable, and may be subject to periodic step ups when The Hartford's Principal First or The Hartford's Lifetime Income Builder have been elected. BENEFIT PAYMENT: The maximum guaranteed amount that may be withdrawn each Contract Year under The Hartford's Principal First, The Hartford's Principal First Preferred or The Hartford's Lifetime Income Builder. A Benefit Payment constitutes a partial Surrender. CHARITABLE REMAINDER TRUST: An irrevocable trust, where an individual donor makes a gift to the trust, and in return receives an income tax deduction. In addition, the individual donor has the right to receive a percentage of the trust earnings for a specified period of time. CODE: The Internal Revenue Code of 1986, as amended. COMMUTED VALUE: The present value of any remaining guaranteed Annuity Payouts. This amount is calculated using the Assumed Investment Return for variable dollar amount Annuity Payouts and a rate of return determined by us for fixed dollar amount Annuity Payouts. CONTINGENT ANNUITANT: The person you may designate to become the Annuitant if the original Annuitant dies before the Annuity Commencement Date. You must name a Contingent Annuitant before the original Annuitant's death. CONTINGENT DEFERRED SALES CHARGE: The deferred sales charge, if applicable, that may apply when you make a full or partial Surrender. CONTRACT: The individual Annuity Contract and any endorsements or riders. Group participants and some individuals may receive a certificate rather than a Contract. CONTRACT ANNIVERSARY: The anniversary of the date we issued your Contract. If the Contract Anniversary falls on a Non-Valuation Day, then the Contract Anniversary will be the next Valuation Day. CONTRACT OWNER, OWNER OR YOU: The owner or holder of the Contract described in this prospectus including any joint Owner(s). We do not capitalize "you" in the prospectus. CONTRACT VALUE: The total value of the Accounts on any Valuation Day. CONTRACT YEAR: Any 12 month period between Contract Anniversaries, beginning with the date the Contract was issued. COVERED LIFE: The governing life or lives used for determining the Lifetime Withdrawal Feature under The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios. DEATH BENEFIT: The amount payable if the Contract Owner, joint Contract Owner or the Annuitant dies before the Annuity Commencement Date. DOLLAR COST AVERAGING: A program that allows you to systematically make transfers between Accounts available in your Contract. ELIGIBLE WITHDRAWAL YEAR: As used in The Hartford's Lifetime Income Foundation and The Hartford's Lifetime Income Builder II, any Contract Year following the Relevant Covered Life's 60th birthday. 54 ------------------------------------------------------------------------------- FIXED ACCUMULATION FEATURE: Part of our General Account, where you may allocate all or a portion of your Contract Value. In your Contract, the Fixed Accumulation Feature may be called the Fixed Account. Not all forms of Contracts we offer contain a Fixed Accumulation Feature. FUND: A registered investment company or a series thereof in which assets of a Sub-Account may be invested. We sometimes call the Funds you select a "Sub-Account". GENERAL ACCOUNT: The General Account includes our company assets, including any money you may have invested in the Fixed Accumulation Feature, if available. The assets in the General Account are available to our creditors. JOINT ANNUITANT: The person on whose life Annuity Payouts are based if the Annuitant dies after Annuitization. You may name a Joint Annuitant only if your Annuity Payout Option provides for a survivor. The Joint Annuitant may not be changed. LIFETIME BENEFIT PAYMENT: The maximum guaranteed amount that can be withdrawn each year pursuant to The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios. A Lifetime Benefit Payment constitutes a partial Surrender. Withdrawals taken prior to an Eligible Withdrawal Year (The Hartford's Lifetime Income Foundation and The Hartford's Lifetime Income Builder II) or prior to the Lifetime Income Eligibility Date (The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios) are excluded from this definition. LIFETIME INCOME ELIGIBILITY DATE: Under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios, the date the relevant Covered Life attains age 59 1/2, at which point Lifetime Benefit Payments can begin. LIFETIME WITHDRAWAL FEATURE: Under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios, a series of Lifetime Benefit Payments in each Contract Year following the Lifetime Income Eligibility Date. MAXIMUM ANNIVERSARY VALUE: This is the highest Anniversary Value, adjusted for subsequent Premium Payments and partial Withdrawals, prior to the deceased's 81st birthday or the date of death, if earlier. MAXIMUM CONTRACT VALUE: The greatest of: (i) the Contract Value on the rider issue date, plus Premium Payments received after such date or (ii) the Contract Value on each subsequent Contract Anniversary, excluding the current Contract Anniversary, plus Premium Payments received after such Contract Anniversary date. MINIMUM CONTRACT VALUE: Subject to state variations, the Minimum Contract Value we establish from time to time. NET INVESTMENT FACTOR: This is used to measure the investment performance of a Sub-Account from one Valuation Day to the next, and is also used to calculate your Annuity Payout amount. 1933 ACT: The Securities Act of 1933, as amended. 1934 ACT: The Securities Exchange Act of 1934, as amended. 1940 ACT: The Investment Company Act of 1940, as amended. NON-VALUATION DAY: Any day the New York Stock Exchange is not open for trading. PAYEE: The person or party you designate to receive Annuity Payouts. PAYMENT BASE: The amount used to determine the Lifetime Benefit Payments for The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios. The Payment Base may be subject to automatic annual Payment Base increases when The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios has been elected. In The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios, Payment Base includes Payment Enhancements (Plus Contracts only) and front end sales charges (Edge Contracts only) but excludes any Employee Gross-Up. Your initial Payment Base equals your initial Premium Payment except in regard to a company sponsored exchange program. For Plus contracts, your initial Payment Base includes any Payment Enhancement, if applicable; provided, however, Payment Enhancements are not taken into consideration as such for the purposes of The Hartford's Lifetime Income Foundation or The Hartford's Lifetime Income Builder II. PAYMENT ENHANCEMENT: An amount we credit to your Contract Value at the time a Premium Payment is made for "Plus" Contracts only. The amount of a Payment Enhancement is based on the cumulative Premium Payments you make to your Contract. PREMIUM PAYMENT: Money sent to us to be invested in your Contract (not taking into consideration any applicable front-end charges, Payment Enhancements or Employee Gross Up). PREMIUM TAX: A tax charged by a state or municipality on Premium Payments. RELEVANT COVERED LIFE: When the Single Life option is chosen, the Relevant Covered Life will be the older of the Contract Owner(s) if the Contract Owner is a natural person or the Annuitant(s) if the Contract Owner is not a natural person. When the 55 ------------------------------------------------------------------------------- Joint/Spousal Option is chosen, however, the Relevant Covered Life will be the younger of the Contract Owner and his or her Spouse if the Contract Owner is a natural person or the Annuitant if the Contract Owner is not a natural person. As used herein, "attained age" means the chronological age of the Relevant Covered Life as of the most recent Contract Anniversary before requesting any partial Surrender or if a partial Surrender is requested during the first Contract Year, the chronological age of the Relevant Covered Life as of the Contract issuance date. REQUIRED MINIMUM DISTRIBUTION: A federal requirement that individuals age 70 1/2 and older must take a distribution from their tax-qualified retirement account by December 31, each year. For employer sponsored qualified Contracts, the individual must begin taking distributions at the age of 70 1/2 or upon retirement, whichever comes later. SPOUSE: A person related to a Contract Owner by marriage pursuant to the Code. SUB-ACCOUNT: A division of the Separate Account containing shares of a Fund. There is a Sub-Account for each Fund. We sometimes call the Funds you select your "Sub-Account". SUB-ACCOUNT VALUE: The value on or before the Annuity Calculation Date, which is determined on any day by multiplying the number of Accumulation Units by the Accumulation Unit Value for each Sub-Account. SURRENDER: A complete or partial withdrawal from your Contract. SURRENDER VALUE: The amount we pay you if you terminate your Contract before the Annuity Commencement Date. The Surrender Value is equal to the Contract Value minus any applicable charges (subject to rounding). THRESHOLD: For the purposes of The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios, the amount used to determine the change in the Payment Base following a partial Surrender in any Contract Year that is not an Eligible Withdrawal Year (The Hartford's Lifetime Income Foundation and The Hartford's Lifetime Income Builder II) or any Contract Year that is prior to the Lifetime Income Eligibility Date (The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios). For the purposes of these optional riders, the percentage used to determine your Threshold amount is 5% (Single Life Election) or 4.5% Joint/ Spousal Election) of the Payment Base. VALUATION DAY: Every day the New York Stock Exchange is open for trading. Values of the Separate Account are determined as of the close of the New York Stock Exchange. The Exchange generally closes at 4:00 p.m. Eastern Time but may close earlier on certain days and as conditions warrant. VALUATION PERIOD: The time span between the close of trading on the New York Stock Exchange from one Valuation Day to the next. WE, US OR OUR: Hartford Life and Annuity Insurance Company or Hartford Life Insurance Company, as the case may be. WITHDRAWAL PERCENT: The multiplier used in calculating Lifetime Benefit Payments under The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios. YOU: The Owner including any joint Owner(s). We do not capitalize "you" or "your" in this prospectus. 56 ------------------------------------------------------------------------------- B. STATE VARIATIONS The following section describes modifications to this prospectus required by one or more state insurance departments as of the date of this prospectus. Unless otherwise noted, variations apply to all forms of Contracts we issue. References to certain state's variations do not imply that we actually offer Contracts in each such state. These variations are subject to change without notice and additional variations may be imposed as specific states approve new riders. - CALIFORNIA -- Any Owner 60 years old or older when purchasing this Contract in California must either elect the Senior Protection Program, or elect to immediately allocate the initial Premium Payments to the other investment options. Under the Senior Protection Program, we will allocate your initial Premium Payment to a Money Market Fund Sub-Account (or comparable money market Sub-Account) for the first 35 days your initial Premium Payment is invested. After the 35th day we will automatically allocate your Contract Value according to your most current investment instructions. If you elect the Senior Protection Program you will not be able to participate in any InvestEase (if otherwise available) or Dollar Cost Averaging Program until after the Program has terminated. The Dollar Cost Averaging Plus, Static Asset Allocation Models and certain Automatic Income Programs are not available if you elect the Senior Protection Program. Under the Senior Protection Program any subsequent Premium Payment received during the 35 days after the initial Premium Payment is invested will also be invested in a Money Market Fund Sub-Account (or comparable money market Sub-Account) unless you direct otherwise. You may voluntarily terminate your participation in the Senior Protection Program by contacting us in writing or by telephone. You will automatically terminate your participation in the Senior Protection Program if you allocate a subsequent Premium Payment to any other investment option or transfer Account Value from a Money Market Fund Sub-Account (or comparable money market Sub-Account) to another investment option. When you terminate your participation in the Senior Protection Program you may reallocate your Contract Value in the Program to other investment options or we will automatically reallocate your Account Value in the Program according to your original instructions 35 days after your initial Premium Payment was invested. - CONNECTICUT -- There are no investment restrictions on the Sub-Accounts that you may invest in while subject to The Hartford's Principal First Preferred benefits. If you elect that rider, our approval is required for any subsequent Premium Payments if the Premium Payments for all deferred variable annuity Contracts issued by us or our affiliates to you equal or exceed $100,000. For Connecticut residents that elect The Hartford's Principle First Preferred, The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation, contract aggregation provisions do not apply. The Contingent Deferred Sales Charge is 8%, 8%, 8%, 7%, 6%, 5%, 4%, 3%, 0% for years 1-9. - FLORIDA -- The limit on Death Benefits imposed when aggregate Premium Payments total $5 million or more does not apply. - MASSACHUSETTS -- The Nursing Home Waiver is not available. - MINNESOTA -- MAV Plus is not available and the Maximum Anniversary Value (MAV) Death Benefit is offered instead. - NEW JERSEY -- The only AIRs available are 3% and 5%. The investment restrictions and the contract aggregation provisions of The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II and The Hartford's Lifetime Income Foundation are not applicable to New Jersey Owners electing such rider. The Nursing Home Waiver is not available. - NEW YORK -- We will not recalculate The Hartford's Principal First Preferred or The Hartford's Principal First Benefit Amounts if you change ownership or assign your Contract to someone other than your Spouse. The Minimum Contract Value is $1,000 after any Surrender. The minimum monthly Annuity Payout is $20. There are no investment restrictions for The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II and The Hartford's Lifetime Income Foundation. The rider charge for The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II and The Hartford's Lifetime Income Foundation is only deducted from the Sub-Accounts. MAV Plus is not available and the Maximum Anniversary Value (MAV) Death Benefit is offered instead. The Fixed Accumulation Feature is not available if you elect The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation. The only AIRs available are 3% and 5%. The Nursing Home Waiver is not available. - OKLAHOMA -- The only AIRs available are 3% and 5%. - OREGON -- We will accept subsequent Premium Payments during the first three Contract Years. Owners may only sign up for DCA Plus Programs that are 6 months or longer. You may not choose a fixed dollar amount Annuity Payout. The Life Annuity with a Cash Refund Annuity Payout Option is not available for Oregon residents and the only AIRs available are 3% and 5%. - PENNSYLVANIA -- The Nursing Home Waiver minimum confinement period is changed from 180 days to 90 days. Pennsylvania residents may not choose a fixed dollar amount Annuity Payout or the Life Annuity with a Cash Refund Annuity Payout Option. The Contingent Deferred Sales Charge is 8%, 8%, 8%, 7%, 6%, 5%, 4%, 3%, 0% for years 1-9. 57 ------------------------------------------------------------------------------- - WASHINGTON -- MAV Plus is not available and Maximum Anniversary Value (MAV) Death Benefit is offered instead. The Fixed Accumulation is not available if you elect The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation. The rider charge for The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II and The Hartford's Lifetime Income Foundation is only deducted from the Sub-Accounts. 58 ------------------------------------------------------------------------------- C. FINANCIAL STATEMENTS You can find financial statements for us and the Separate Account in the Statement of Additional Information. To receive a copy of the Statement of Additional Information free of charge, call your representative or complete the form at the end of this prospectus and mail the form to us at the address indicated on the form. D. MORE INFORMATION OWNERSHIP CHANGES -- We reserve the right to approve all ownership changes, including any assignment of your Contract (or any benefits) to others or the pledging of your Contract as collateral. Certain approved changes in ownership may cause a re-calculation of the benefits subject to applicable state law. Generally, we will not re-calculate the benefits under your Contract so long as the change in ownership does not affect the Owner and does not result in a change in the tax identification number under the Contract. Changes in ownership can also adversely affect your Death Benefits and optional withdrawal benefits. If the Owner dies and the sole Beneficiary is the Owner's Spouse, then the surviving Spouse can either become the Contract Owner or elect to receive the applicable Death Benefit. We will adjust the Contract Value in these circumstances to equal the amount that we would have paid as the Death Benefit payment, had the Spouse elected to receive the applicable Death Benefit as a lump sum payment. This privilege will only apply once for each Contract. You may not change the named Annuitant. However, if the Annuitant is still living, the Contingent Annuitant may be changed at any time prior to the Annuity Commencement Date by sending us written notice. ASSIGNMENT -- A non-qualified Contract may be assigned. We must be properly notified in writing of an assignment. Any Annuity Payouts or Surrenders requested or scheduled before we record an assignment will be made according to the instructions we have on record. We are not responsible for determining the validity of an assignment. Assigning a non-qualified Contract may require the payment of income taxes and certain penalty taxes. A qualified Contract may not be transferred or otherwise assigned (whether directly or used as collateral for a loan), unless allowed by applicable law and approved by us in writing. We can withhold our consent for any reason. We are not obligated to process any request for approval within any particular time frame. Please consult a qualified tax adviser before assigning your Contract. CONTRACT MODIFICATION -- We may modify the Contract, but no modification will affect the amount or term of any Contract unless a modification is required to conform the Contract to applicable federal or state law. No modification will affect the method by which Contract Values are determined. MEDICAID BENEFITS -- Medicaid is a program that covers most medical costs, including nursing home and home care for the elderly and certain persons with disabilities. To qualify, individuals must meet both income and resource tests. Subject to state law, income tests measure whether earned and unearned income such as benefit payments exceeds predetermined monthly caps. Resource tests look to the value of countable assets such as this Contract. Medicaid also allows the costs of benefits such as nursing home care, home and community based services, and related hospital prescription drug services to be recaptured from a recipient's estate after their death (or if the recipient has a surviving Spouse, the recapture is suspended until after the death of the recipient's surviving Spouse). Medicaid estate planning may be important to people who are concerned about long term care costs or the adequacy of their private LTC insurance. Benefits associated with this variable annuity may have an impact on your Medicaid eligibility and the assets considered for Medicaid benefits. Certain asset and/or trust transfers (or a "spend down" of assets) made to become eligible for Medicaid may trigger periods of potentially unlimited ineligibility and can be considered fraud. Each state examines the financial history of a person to determine whether he or she transferred funds at below market value in order to qualify for Medicaid. These look-back periods are currently 36-months for asset transfers and 60-months for Medicaid exempt trust transfers. Ownership interests or beneficiary status under this variable annuity can render you or your loved ones ineligible for Medicaid. This may be particularly troubling if your Spouse or Beneficiary is already receiving Medicaid benefits at the time of transfer or receipt of Death Benefits. As certain ownership changes are either impermissible or are subject to benefit resetting rules, you may want to carefully consider how you structure the ownership and beneficiary status of your Contract. This discussion is intended to provide a very general overview and does not constitute legal advice or in any way suggest that you circumvent these rules. You should seek advice from a competent elder law attorney to make informed decisions about how this variable annuity may affect your plans. E. LEGAL PROCEEDINGS There continues to be significant federal and state regulatory activity relating to financial services companies. Like other insurance companies, we are involved in lawsuits, arbitrations, and regulatory/legal proceedings. While it is not possible to predict with certainty the ultimate outcome of any pending or future legal proceeding or regulatory action, we do not expect any of these actions to result in a material adverse effect on the Company or its Separate Accounts. 59 ------------------------------------------------------------------------------- F. HOW CONTRACTS ARE SOLD We have entered into a distribution agreement with our affiliate Hartford Securities Distribution Company, Inc. ("HSD") under which HSD serves as the principal underwriter for the Contracts, which are offered on a continuous basis. HSD is registered with the Securities and Exchange Commission under the 1934 Act as a broker-dealer and is a member of the Financial Industry Regulatory Authority (FINRA). The principal business address of HSD is the same as ours. PLANCO Financial Services, LLC, a subsidiary of Hartford Life Insurance Company, provides marketing support for us. Woodbury Financial Services, Inc. is another affiliated broker-dealer that sells this Contract. HSD has entered into selling agreements with affiliated and unaffiliated broker-dealers, and financial institutions ("Financial Intermediaries") for the sale of the Contracts. We pay compensation to HSD for sales of the Contracts by Financial Intermediaries. HSD, in its role as principle underwriter, did not retain any underwriting commissions for the fiscal year ended December 31, 2007. Contracts will be sold by individuals who have been appointed by us as insurance agents and who are registered representatives of Financial Intermediaries ("Registered Representatives"). Core and Edge Contracts may be sold directly to the following individuals free of any commission ("Employee Gross-Up" on Core and no front-end sales charge on Edge): 1) current or retired officers, directors, trustees and employees (and their families) of our ultimate corporate parent and affiliates; and 2) employees and Registered Representatives (and their families) of Financial Intermediaries. If applicable, we will credit the Core Contract with a credit of 5.0% of the initial Premium Payment and each subsequent Premium Payment, if any. This additional percentage of Premium Payment in no way affects current or future charges, rights, benefits or account values of other Contract Owners. We list below types of arrangements that help to incentivize sales people to sell our suite of variable annuities. Not all arrangements necessarily affect each variable annuity. These types of arrangements could be viewed as creating conflicts of interest. Financial Intermediaries receive commissions (described below under "Commissions"). Certain selected Financial Intermediaries also receive additional compensation (described below under "Additional Payments"). All or a portion of the payments we make to Financial Intermediaries may be passed on to Registered Representatives according to a Financial Intermediaries' internal compensation practices. Affiliated broker-dealers also employ individuals called "wholesalers" in the sales process. Wholesalers typically receive commissions based on the type of Contract or optional benefits sold. Commissions are based on a specified amount of Premium Payments or Contract Value. COMMISSIONS Up front commissions paid to Financial Intermediaries generally range from 1% to up to 7% of each Premium Payment you pay for your Contract. Trail commissions (fees paid for customers that maintain their Contracts generally for more than 1 year) range up to 1.20% of your Contract Value. We pay different commissions based on the Contract variation that you buy. We may pay a lower commission for sales to people over age 80. Commission arrangements vary from one Financial Intermediary to another. We are not involved in determining your Registered Representative's compensation. Under certain circumstances, your Registered Representative may be required to return all or a portion of the commissions paid. Check with your Registered Representative to verify whether your account is a brokerage or an advisory account. Your interests may differ from ours and your Registered Representative (or the Financial Intermediary with which they are associated). Please ask questions to make sure you understand your rights and any potential conflicts of interest. If you are an advisory client, your Registered Representative (or the Financial Intermediary with which they are associated) can be paid both by you and by us based on what you buy. Therefore, profits, and your Registered Representative's (or their Financial Intermediary's) compensation, may vary by product and over time. Contact an appropriate person at your Financial Intermediary with whom you can discuss these differences. ADDITIONAL PAYMENTS Subject to FINRA and Financial Intermediary rules, we (or our affiliates) also pay the following types of fees to among other things encourage the sale of this Contract. These additional payments could create an incentive for your Registered Representative, and the Financial Intermediary with which they are associated, to recommend products that pay them more than others, which may not necessarily be to your benefit. 60 -------------------------------------------------------------------------------
ADDITIONAL PAYMENT TYPE WHAT IT'S USED FOR --------------------------------------------------------------------------------------------------------------------------------- Access Access to Registered Representatives and/or Financial Intermediaries such as one-on-one wholesaler visits or attendance at national sales meetings or similar events. Gifts & Entertainment Occasional meals and entertainment, tickets to sporting events and other gifts. Marketing Joint marketing campaigns and/or Financial Intermediary event advertising/ participation; sponsorship of Financial Intermediary sales contests and/or promotions in which participants (including Registered Representatives) receive prizes such as travel awards, merchandise and recognition; client generation expenses. Marketing Expense Allowances Pay Fund related parties for wholesaler support, training and marketing activities for certain Funds. Support Sales support through such things as providing hardware and software, operational and systems integration, links to our website from a Financial Intermediary's websites; shareholder services (including sub-accounting sponsorship of Financial Intermediary due diligence meetings; and/or expense allowances and reimbursements. Training Educational (due diligence), sales or training seminars, conferences and programs, sales and service desk training, and/or client or prospect seminar sponsorships. Visibility Inclusion of our products on a Financial Intermediary's "preferred list"; participation in, or visibility at, national and regional conferences; and/or articles in Financial Intermediary publications highlighting our products and services. Volume Pay for the overall volume of their sales or the amount of money investing in our products.
As of December 31, 2007, we have entered into ongoing contractual arrangements to make Additional Payments to the following Financial Intermediaries for our entire suite of variable annuities: A.G. Edwards & Sons, Inc., AIG Advisors Group, Inc., (Advantage Capital, AIG Financial Advisors, American General, FSC Securities Corporation, Royal Alliance Assoc., Inc.), Bancwest Investment Services, Inc., Cadaret, Grant & Co., Inc., Capital Analyst Inc., Centaurus Financial, Inc., Citigroup, Inc. (various divisions and affiliates), Comerica Securities, Commonwealth Financial Network, Compass Brokerage, Inc., Crown Capital Securities, L.P., Cuna Brokerage Services, Inc., Cuso Financial Services, L.P., Edward D. Jones & Co., L.P., FFP Securities, Inc., First Allied Securities, Inc., First Citizens Investor Services, First Montauk Securities Corp., First Tennessee Bank, First Tennessee Brokerage, Inc., Frost Brokerage Services, Inc., Great American Advisors, Inc., H. Beck, Inc., H.D. Vest Investment Services (subsidiary of Wells Fargo & Company), Harbour Investments, Inc., Heim & Young Securities, Huntington Investment Company, Independent Financial Group LLC, Infinex Financial Group, ING Advisors Network, (Financial Network Services (or Investment) Corp., ING Financial Partners, Multi-Financial Securities, Primevest Financial Services, Inc.,), Investacorp, Inc. , Investment Professionals, Inc., Investors Capital Corp., J.J.B. Hilliard, James T. Borello & Co., Janney Montgomery Scott, Inc., Jefferson Pilot Securities Corporation, Key Investment Services, LaSalle Financial Services, Inc., Lincoln Financial Advisors Corp. (marketing name for Lincoln National Corp.), LPL Financial Corporation, M&T Securities, Inc., Merrill Lynch Pierce Fenner & Smith, Morgan Keegan & Company, Inc., Morgan Keegan FID Division, Morgan Stanley & Co., Inc. (various divisions and affiliates), Mutual Service Corporation, NatCity Investments, National Planning Holdings (Invest Financial Corp., Investment Centers of America, Inc., National Planning Corp., SII Investments, Inc.), Newbridge Securities Corp., NEXT Financial Group, Inc., NFP Securities, Inc., Pension Planners Securities, Inc., Prime Capital Services, Inc., Prospera Financial Services, Inc., Raymond James & Associates, Inc., Raymond James FID Division, Raymond James Financial Services, RBC Dain FID Division, RBC Dain Rauscher Inc., RDM Investment Svcs Inc., Robert W. Baird & Co. Inc., Securities America, Inc., Sigma Financial Corporation, Sorrento Pacific, Stifel Nicolaus & Company, Incorporated, Summit Brokerage Services Inc., Sun Trust Bank, TFS Securities, Inc., The Investment Center, Inc., Thurston, Springer, Miller, Herd & Titak, Inc., Triad Advisors, Inc., U.S. Bancorp Investments, Inc., UBOC Investment Services, Inc. (Union Bank of California, N.A.), UBS Financial Services, Inc., Uvest Financial Services Group Inc., Vanderbilt Securities, LLC, Wachovia Securities, LLC (various divisions), Walnut Street Securities, Inc., Wells Fargo Brokerage Services, L.L.C., WaMu Investments, Inc., Woodbury Financial Services, Inc. (an affiliate of ours), XCU Capital Corporation, Inc. Inclusion on this list does not imply that these sums necessarily constitute "special cash compensation" as defined by FINRA Conduct Rule 2830(l)(4). We will endeavor to update this listing annually and interim arrangements may not be reflected. We assume no duty to notify any investor whether their Registered Representative is or should be included in any such listing. As of December 31, 2007, we have entered into arrangements to pay Marketing Expense Allowances to the following Fund Companies (or affiliated parties) for our entire suite of variable annuities: AIM Advisors, Inc., AllianceBernstein Variable Products Series Funds & Alliance Bernstein Investment Research and Management, Inc., American Variable Insurance Series & Capital Research and Management Company, Franklin Templeton Services, LLC, Oppenheimer Variable Account Funds & Oppenheimer Funds Distributor, Inc., Putnam Retail Management Limited Partnership. Marketing Expense Allowances may vary based on the form of Contract sold and the age of the purchaser. We will endeavor to update this listing annually and interim arrangements may not be reflected. We 61 ------------------------------------------------------------------------------- assume no duty to notify you whether any Financial Intermediary is or should be included in any such listing. You are encouraged to review the prospectus for each Fund for any other compensation arrangements pertaining to the distribution of Fund shares. For the fiscal year ended December 31, 2007, Additional Payments did not in the aggregate exceed approximately $66.4 million (excluding corporate-sponsorship related perquisites and Marketing Expense Allowances) or approximately 0.06% of average total individual variable annuity assets. Marketing Expense Allowances for this period did not exceed $15.8 million or approximately 0.25% of the Premium Payments invested in a particular Fund during this period. Financial Intermediaries that received Additional Payments in 2007, but do not have an ongoing contractual relationship, are listed in the Statement of Additional Information. 9. FEDERAL TAX CONSIDERATIONS A. INTRODUCTION The following summary of tax rules does not provide or constitute any tax advice. It provides only a general discussion of certain of the expected federal income tax consequences with respect to amounts contributed to, invested in or received from a Contract, based on our understanding of the existing provisions of the Code, Treasury Regulations thereunder, and public interpretations thereof by the IRS (e.g., Revenue Rulings, Revenue Procedures or Notices) or by published court decisions. This summary discusses only certain federal income tax consequences to United States Persons, and does not discuss state, local or foreign tax consequences. The term United States Persons means citizens or residents of the United States, domestic corporations, domestic partnerships, trust or estates that are subject to United States federal income tax, regardless of the source of their income. See "Annuity Purchases by Nonresident Aliens and Foreign Corporations," regarding annuity purchases by non-U.S. Persons or residents. This summary has been prepared by us after consultation with tax counsel, but no opinion of tax counsel has been obtained. We do not make any guarantee or representation regarding any tax status (e.g., federal, state, local or foreign) of any Contract or any transaction involving a Contract. In addition, there is always a possibility that the tax treatment of an annuity contract could change by legislation or other means (such as regulations, rulings or judicial decisions). Moreover, it is always possible that any such change in tax treatment could be made retroactive (that is, made effective prior to the date of the change). Accordingly, you should consult a qualified tax adviser for complete information and advice before purchasing a Contract. In addition, this discussion does not address many of the tax consequences if you use the Contract in various arrangements, including Charitable Remainder Trusts, tax-qualified retirement arrangements, deferred compensation plans, split-dollar insurance arrangements, or other employee benefit arrangements. The tax consequences of any such arrangement may vary depending on the particular facts and circumstances of each individual arrangement and whether the arrangement satisfies certain tax qualification or classification requirements. In addition, the tax rules affecting such an arrangement may have changed recently, e.g., by legislation or regulations that affect compensatory or employee benefit arrangements. Therefore, if you are contemplating the use of a Contract in any arrangement the value of which to you depends in part on its tax consequences, you should consult a qualified tax adviser regarding the tax treatment of the proposed arrangement and of any Contract used in it. THE DISCUSSION SET FORTH BELOW IS INCLUDED FOR GENERAL PURPOSES ONLY. SPECIAL TAX RULES MAY APPLY WITH RESPECT TO CERTAIN SITUATIONS THAT ARE NOT DISCUSSED HEREIN. EACH POTENTIAL PURCHASER OF A CONTRACT IS ADVISED TO CONSULT WITH A QUALIFIED TAX ADVISER AS TO THE CONSEQUENCES OF ANY AMOUNTS INVESTED IN A CONTRACT UNDER APPLICABLE FEDERAL, STATE, LOCAL OR FOREIGN TAX LAW. B. TAXATION OF HARTFORD AND THE SEPARATE ACCOUNT The Separate Account is taxed as part of Hartford which is taxed as a life insurance company under Subchapter L of Chapter 1 of the Code. Accordingly, the Separate Account will not be taxed as a "regulated investment company" under Subchapter M of Chapter 1 of the Code. Investment income and any realized capital gains on assets of the Separate Account are reinvested and taken into account in determining the value of the Accumulation and Annuity Units. As a result, such investment income and realized capital gains are automatically applied to increase reserves under the Contract. Currently, no taxes are due on interest, dividends and short-term or long-term capital gain earned by the Separate Account with respect to the Contracts. Hartford is entitled to certain tax benefits related to the investment of company assets, including assets of the Separate Account. These tax benefits, which may include the foreign tax credit and the corporate dividends received deduction, are not passed back to you since Hartford is the owner of the assets from which the tax benefits are derived. 62 ------------------------------------------------------------------------------- C. TAXATION OF ANNUITIES -- GENERAL PROVISIONS AFFECTING CONTRACTS NOT HELD IN TAX-QUALIFIED RETIREMENT PLANS Section 72 of the Code governs the taxation of annuities in general. 1. NON-NATURAL PERSONS AS OWNERS Pursuant to Code Section 72(u), an annuity contract held by a taxpayer other than a natural person generally is not treated as an annuity contract under the Code. Instead, such a non-natural Contract Owner generally could be required to include in gross income currently for each taxable year the excess of (a) the sum of the Contract Value as of the close of the taxable year and all previous distributions under the Contract over (b) the sum of net premiums paid for the taxable year and any prior taxable year and the amount includable in gross income for any prior taxable year with respect to the Contract under Section 72(u). However, Section 72(u) does not apply to: - A contract the nominal owner of which is a non-natural person but the beneficial owner of which is a natural person (e.g., where the non-natural owner holds the contract as an agent for the natural person), - A contract acquired by the estate of a decedent by reason of such decedent's death, - Certain contracts acquired with respect to tax-qualified retirement arrangements, - Certain contracts held in structured settlement arrangements that may qualify under Code Section 130, or - A single premium immediate annuity contract under Code Section 72(u)(4), which provides for substantially equal periodic payments and an annuity starting date that is no later than 1 year from the date of the contract's purchase. A non-natural Contract Owner that is a tax-exempt entity for federal tax purposes (e.g., a tax-qualified retirement trust or a Charitable Remainder Trust) generally would not be subject to federal income tax as a result of such current gross income under Code Section 72(u). However, such a tax-exempt entity, or any annuity contract that it holds, may need to satisfy certain tax requirements in order to maintain its qualification for such favorable tax treatment. See, e.g., IRS Tech. Adv. Memo. 9825001 for certain Charitable Remainder Trusts. Pursuant to Code Section 72(s), if the Contract Owner is a non-natural person, the primary annuitant is treated as the "holder" in applying the required distribution rules described below. These rules require that certain distributions be made upon the death of a "holder." In addition, for a non-natural owner, a change in the primary annuitant is treated as the death of the "holder." However, the provisions of Code Section 72(s) do not apply to certain contracts held in tax-qualified retirement arrangements or structured settlement arrangements. 2. OTHER CONTRACT OWNERS (NATURAL PERSONS). A Contract Owner is not taxed on increases in the value of the Contract until an amount is received or deemed received, e.g., in the form of a lump sum payment (full or partial value of a Contract) or as Annuity payments under the settlement option elected. Except as provided below, upon the death of the Contract Owner prior to the Annuity Commencement Date, if the designated beneficiary is the surviving spouse of the Contract Owner; (a) or the civil union partner of the Contract Owner in a civil union established under applicable state law (or any law succeeding or replacing such statute(s)); or (b) the civil union partner or member of a similar same sex relationship under the law of any state; and the Annuitant or Joint Annuitant, if any, is alive, then such designated beneficiary may continue the Contract as the succeeding Contract Owner. The right of the designated beneficiary (as spouse or civil union partner) to continue the Contract is contingent upon the treatment of the designated beneficiary as the "holder" of the Contract in accordance with the provisions of section 72(s)(3) of the Code (which under current tax law is limited to different sex spouses). In the event that the designated beneficiary continues the Contract, the distribution requirements of Code section 72(s) will only arise upon the death of such designated beneficiary, unless the designated beneficiary elects not to continue the Contract. If the designated beneficiary is not treated as the "holder" under section 72(s)(3) of the Code (as is the case under current federal tax law for a civil union partner), the distribution requirements of Code section 72(s)(1) and (2) outlined above shall apply at the time of the Contract Owner's death and the entire interest in the Contract must be distributed within five years of the Contract Owner's death or under the Alternative Election. Contract continuation under this provision may take effect only once with respect to this Contract. The provisions of Section 72 of the Code concerning distributions are summarized briefly below. Also summarized are special rules affecting distributions from Contracts obtained in a tax-free exchange for other annuity contracts or life insurance contracts which were purchased prior to August 14, 1982. a. DISTRIBUTIONS PRIOR TO THE ANNUITY COMMENCEMENT DATE. i. Total premium payments less amounts received which were not includable in gross income equal the "investment in the contract" under Section 72 of the Code. ii. To the extent that the value of the Contract (ignoring any surrender charges except on a full surrender) exceeds the "investment in the contract," such excess constitutes the "income on the contract." It is unclear what value should be used in determining the "income on the contract." We believe that the current Contract Value (determined without regard to surrender charges) generally is an appropriate measure. However, in some instances the IRS could take the position that the value 63 ------------------------------------------------------------------------------- should be the current Contract value (determined without regard to surrender charges) increased by some measure of the value of certain future cash-value type benefits. iii. Any amount received or deemed received prior to the Annuity Commencement Date (e.g., upon a withdrawal or partial surrender) is deemed to come first from any such "income on the contract" and then from "investment in the contract," and for these purposes such "income on the contract" shall be computed by reference to any aggregation rule in subparagraph 2.c. below. As a result, any such amount received or deemed received (1) shall be includable in gross income to the extent that such amount does not exceed any such "income on the contract," and (2) shall not be includable in gross income to the extent that such amount does exceed any such "income on the contract." If at the time that any amount is received or deemed received there is no "income on the contract" (e.g., because the gross value of the Contract does not exceed the "investment in the contract" and no aggregation rule applies), then such amount received or deemed received will not be includable in gross income, and will simply reduce the "investment in the contract." iv. The receipt of any amount as a loan under the Contract or the assignment or pledge of any portion of the value of the Contract shall be treated as an amount received for purposes of this subparagraph a. and the next subparagraph b. v. In general, the transfer of the Contract, without full and adequate consideration, will be treated as an amount received for purposes of this subparagraph a. and the next subparagraph b. This transfer rule does not apply, however, to certain transfers of property between Spouses or incident to divorce. vi. In general, any amount actually received under the Contract as a Death Benefit, including an optional Death Benefit, if any, will be treated as an amount received for purposes of this subparagraph a. and the next subparagraph b. b. DISTRIBUTIONS AFTER ANNUITY COMMENCEMENT DATE. Annuity payments made periodically after the Annuity Commencement Date are includable in gross income to the extent the payments exceed the amount determined by the application of the ratio of the "investment in the contract" to the total amount of the payments to be made after the Annuity Commencement Date (the "exclusion ratio"). i. When the total of amounts excluded from income by application of the exclusion ratio is equal to the investment in the contract as of the Annuity Commencement Date, any additional payments (including surrenders) will be entirely includable in gross income. ii. If the annuity payments cease by reason of the death of the Annuitant and, as of the date of death, the amount of annuity payments excluded from gross income by the exclusion ratio does not exceed the investment in the contract as of the Annuity Commencement Date, then the remaining portion of unrecovered investment shall be allowed as a deduction for the last taxable year of the Annuitant. iii. Generally, non-periodic amounts received or deemed received after the Annuity Commencement Date are not entitled to any exclusion ratio and shall be fully includable in gross income. However, upon a full surrender after such date, only the excess of the amount received (after any surrender charge) over the remaining "investment in the contract" shall be includable in gross income (except to the extent that the aggregation rule referred to in the next subparagraph c. may apply). c. AGGREGATION OF TWO OR MORE ANNUITY CONTRACTS. Contracts issued after October 21, 1988 by the same insurer (or affiliated insurer) to the same owner within the same calendar year (other than certain contracts held in connection with tax-qualified retirement arrangements) will be aggregated and treated as one annuity contract for the purpose of determining the taxation of distributions prior to the Annuity Commencement Date. An annuity contract received in a tax-free exchange for another annuity contract or life insurance contract may be treated as a new contract for this purpose. We believe that for any Contracts subject to such aggregation, the values under the Contracts and the investment in the contracts will be added together to determine the taxation under subparagraph 2.a., above, of amounts received or deemed received prior to the Annuity Commencement Date. Withdrawals will first be treated first as withdrawals of income until all of the income from all such Contracts is withdrawn. In addition, the Treasury Department has specific authority under the aggregation rules in Code Section 72(e)(12) to issue regulations to prevent the avoidance of the income-out-first rules for non-periodic distributions through the serial purchase of annuity contracts or otherwise. As of the date of this prospectus, there are no regulations interpreting these aggregation provisions. d. 10% PENALTY TAX -- APPLICABLE TO CERTAIN WITHDRAWALS AND ANNUITY PAYMENTS. i. If any amount is received or deemed received on the Contract (before or after the Annuity Commencement Date), the Code applies a penalty tax equal to ten percent of the portion of the amount includable in gross income, unless an exception applies. ii. The 10% penalty tax will not apply to the following distributions: 1. Distributions made on or after the date the recipient has attained the age of 59 1/2. 2. Distributions made on or after the death of the holder or where the holder is not an individual, the death of the primary annuitant. 64 ------------------------------------------------------------------------------- 3. Distributions attributable to a recipient's becoming disabled. 4. A distribution that is part of a scheduled series of substantially equal periodic payments (not less frequently than annually) for the life (or life expectancy) of the recipient (or the joint lives or life expectancies of the recipient and the recipient's designated Beneficiary). 5. Distributions made under certain annuities issued in connection with structured settlement agreements. 6. Distributions of amounts which are allocable to the "investment in the contract" prior to August 14, 1982 (see next subparagraph e.). 7. Distributions purchased by an employer upon termination of certain qualified plans and held by the employer until the employee separates from service. If the taxpayer avoids this 10% penalty tax by qualifying for the substantially equal periodic payments exception and later such series of payments is modified (other than by death or disability), the 10% penalty tax will be applied retroactively to all the prior periodic payments (i.e., penalty tax plus interest thereon), unless such modification is made after both (a) the taxpayer has reached age 59 1/2 and (b) 5 years have elapsed since the first of these periodic payments. e. SPECIAL PROVISIONS AFFECTING CONTRACTS OBTAINED THROUGH A TAX-FREE EXCHANGE OF OTHER ANNUITY OR LIFE INSURANCE CONTRACTS PURCHASED PRIOR TO AUGUST 14, 1982. If the Contract was obtained by a tax-free exchange of a life insurance or annuity Contract purchased prior to August 14, 1982, then any amount received or deemed received prior to the Annuity Commencement Date shall be deemed to come (1) first from the amount of the "investment in the contract" prior to August 14, 1982 ("pre-8/14/82 investment") carried over from the prior Contract, (2) then from the portion of the "income on the contract" (carried over to, as well as accumulating in, the successor Contract) that is attributable to such pre-8/14/82 investment, (3) then from the remaining "income on the contract" and (4) last from the remaining "investment in the contract." As a result, to the extent that such amount received or deemed received does not exceed such pre-8/14/82 investment, such amount is not includable in gross income. In addition, to the extent that such amount received or deemed received does not exceed the sum of (a) such pre-8/14/82 investment and (b) the "income on the contract" attributable thereto, such amount is not subject to the 10% penalty tax. In all other respects, amounts received or deemed received from such post-exchange Contracts are generally subject to the rules described in this subparagraph e. f. REQUIRED DISTRIBUTIONS i. Death of Contract Owner or Primary Annuitant Subject to the alternative election or Spouse beneficiary provisions in ii or iii below: 1. If any Contract Owner dies on or after the Annuity Commencement Date and before the entire interest in the Contract has been distributed, the remaining portion of such interest shall be distributed at least as rapidly as under the method of distribution being used as of the date of such death; 2. If any Contract Owner dies before the Annuity Commencement Date, the entire interest in the Contract shall be distributed within 5 years after such death; and 3. If the Contract Owner is not an individual, then for purposes of 1. or 2. above, the primary annuitant under the Contract shall be treated as the Contract Owner, and any change in the primary annuitant shall be treated as the death of the Contract Owner. The primary annuitant is the individual, the events in the life of whom are of primary importance in affecting the timing or amount of the payout under the Contract. ii. Alternative Election to Satisfy Distribution Requirements If any portion of the interest of a Contract Owner described in i. above is payable to or for the benefit of a designated beneficiary, such beneficiary may elect to have the portion distributed over a period that does not extend beyond the life or life expectancy of the beneficiary. Such distributions must begin within a year of the Contract Owner's death. iii. Spouse Beneficiary If any portion of the interest of a Contract Owner is payable to or for the benefit of his or her Spouse, and the Annuitant or Contingent Annuitant is living, such Spouse shall be treated as the Contract Owner of such portion for purposes of section i. above. This spousal contract continuation shall apply only once for this Contract. g. ADDITION OF RIDER OR MATERIAL CHANGE. The addition of a rider to the Contract, or a material change in the Contract's provisions, could cause it to be considered newly issued or entered into for tax purposes, and thus could cause the Contract to lose certain grandfathered tax status. Please contact your tax adviser for more information. 65 ------------------------------------------------------------------------------- h. PARTIAL EXCHANGES. The IRS in Rev. Rul. 2003-76 has confirmed that the owner of an annuity contract can direct its insurer to transfer a portion of the contract's cash value directly to another annuity contract (issued by the same insurer or by a different insurer), and such a direct transfer can qualify for tax-free exchange treatment under Code Section 1035 (a "partial exchange"). However, Rev. Rul. 2003-76 also refers to caveats and additional guidance in the companion Notice 2003-51, which discusses cases in which a partial exchange is followed by a surrender, withdrawal or other distribution from either the old contract or the new contract. Notice 2003-51 specifically indicates that the IRS is considering (1) under what circumstances it should treat a partial exchange followed by such a distribution within 24 months as presumptively for "tax avoidance" purposes (e.g., to avoid the income-out-first rules on amounts received under Code Section 72) and (2) what circumstances it should treat as rebutting such a presumption (e.g., death, disability, reaching age 59 1/2, divorce or loss of employment). Notice 2003-51 was superseded by Revenue Procedure 2008-24, effective for partial exchanges completed on or after June 30, 2008. Partial exchanges completed on or after this date will qualify for tax free treatment if: (1) no amounts are withdrawn from, or received in surrender of, either of the contracts involved in the exchange during the 12 months beginning on the date on which amounts are treated as received as premiums or other consideration paid for the contract received in the exchange (the date of transfer); or (2) the taxpayer demonstrates that certain conditions (e.g., death, disability, reaching age 50 1/2, divorce, loss of employment) occurred between the date of transfer and the date of the withdrawal or surrender. A transfer within the scope of the revenue procedure, but not treated as a tax-free exchange, will be treated as a taxable distribution, followed by a payment for a second contract. Two annuity contracts that are the subject of a tax-free exchange pursuant to the revenue procedure will not be aggregated, even if issued by the same insurance company. We advise you to consult with a qualified tax adviser as to potential tax consequences before attempting any partial exchange. 3. DIVERSIFICATION REQUIREMENTS. The Code requires that investments supporting your Contract be adequately diversified. Code Section 817(h) provides that a variable annuity contract will not be treated as an annuity contract for any period during which the investments made by the separate account or Fund are not adequately diversified. If a contract is not treated as an annuity contract, the contract owner will be subject to income tax on annual increases in cash value. The Treasury Department's diversification regulations under Code Section 817(h) require, among other things, that: - no more than 55% of the value of the total assets of the segregated asset account underlying a variable contract is represented by any one investment, - no more than 70% is represented by any two investments, - no more than 80% is represented by any three investments and - no more than 90% is represented by any four investments. In determining whether the diversification standards are met, all securities of the same issuer, all interests in the same real property project, and all interests in the same commodity are each treated as a single investment. In the case of government securities, each government agency or instrumentality is treated as a separate issuer. A separate account must be in compliance with the diversification standards on the last day of each calendar quarter or within 30 days after the quarter ends. If an insurance company inadvertently fails to meet the diversification requirements, the company may still comply within a reasonable period and avoid the taxation of contract income on an ongoing basis. However, either the insurer or the contract owner must agree to pay the tax due for the period during which the diversification requirements were not met. Fund shares may also be sold to tax-qualified plans pursuant to an exemptive order and applicable tax laws. If Fund shares are sold to non-qualified plans, or to tax-qualified plans that later lose their tax-qualified status, the affected Funds may fail the diversification requirements of Code Section 817(h), which could have adverse tax consequences for Contract Owners with premiums allocated to affected Funds. In order to prevent a Fund diversification failure from such an occurrence, Hartford obtained a private letter ruling ("PLR") from the IRS. As long as the Funds comply with certain terms and conditions contained in the PLR, Fund diversification will not be prevented if purported tax-qualified plans invest in the Funds. Hartford and the Funds will monitor the Funds' compliance with the terms and conditions contained in the PLR. 4. TAX OWNERSHIP OF THE ASSETS IN THE SEPARATE ACCOUNT. In order for a variable annuity contract to qualify for tax income deferral, assets in the separate account supporting the contract must be considered to be owned by the insurance company, and not by the contract owner, for tax purposes. The IRS has stated in published rulings that a variable contract owner will be considered the "owner" of separate account assets for income tax purposes if the contract owner possesses sufficient incidents of ownership in those assets, such as the ability to exercise investment control over the assets. In circumstances where the variable contract owner is treated as the "tax owner" of certain separate account assets, income and gain from such assets would be includable in the variable contract owner's gross income. The Treasury Department indicated in 1986 that, in regulations or revenue rulings under Code Section 817(d) (relating to the definition of a variable contract), it 66 ------------------------------------------------------------------------------- would provide guidance on the extent to which contract owners may direct their investments to particular Sub-Accounts without being treated as tax owners of the underlying shares. Although no such regulations have been issued to date, the IRS has issued a number of rulings that indicate that this issue remains subject to a facts and circumstances test for both variable annuity and life insurance contracts. For instance, the IRS in Rev. Rul. 2003-92, amplified by Rev. Rul. 2007-7, reiterated its position in prior rulings that, where shares in a fund offered in an insurer's separate account are not available exclusively through the purchase of a variable insurance contract (e.g., where such shares can be purchased directly by the general public or others without going through such a variable contract), such "public availability" means that such shares should be treated as owned directly by the contract owner (and not by the insurer) for tax purposes, as if such contract owner had chosen instead to purchase such shares directly (without going through the variable contract). None of the shares or other interests in the fund choices offered in our Separate Account for your Contract are available for purchase except through an insurer's variable contracts or by other permitted entities. The IRS in Rev. Rul. 2003-91 also indicated that an insurer could provide as many as 20 fund choices for its variable contract owners (each with a general investment strategy, e.g., a small company stock fund or a special industry fund) under certain circumstances, without causing such a contract owner to be treated as the tax owner of any of the Fund assets. The ruling does not specify the number of fund options, if any, that might prevent a variable contract owner from receiving favorable tax treatment. As a result, we believe that any owner of a Contract also should receive the same favorable tax treatment. However, there is necessarily some uncertainty here as long as the IRS continues to use a facts and circumstances test for investor control and other tax ownership issues. Therefore, we reserve the right to modify the Contract as necessary to prevent you from being treated as the tax owner of any underlying assets. D. FEDERAL INCOME TAX WITHHOLDING The portion of an amount received under a Contract that is taxable gross income to the Payee is also subject to federal income tax withholding, pursuant to Code Section 3405, which requires the following: 1. Non-Periodic Distributions. The portion of a non-periodic distribution that is includable in gross income is subject to federal income tax withholding unless an individual elects not to have such tax withheld ("election out"). We will provide such an "election out" form at the time such a distribution is requested. If the necessary "election out" form is not submitted to us in a timely manner, generally we are required to withhold 10 percent of the includable amount of distribution and remit it to the IRS. 2. Periodic Distributions (payable over a period greater than one year). The portion of a periodic distribution that is includable in gross income is generally subject to federal income tax withholding as if the Payee were a married individual claiming 3 exemptions, unless the individual elects otherwise. An individual generally may elect out of such withholding, or elect to have income tax withheld at a different rate, by providing a completed election form. We will provide such an election form at the time such a distribution is requested. If the necessary "election out" forms are not submitted to us in a timely manner, we are required to withhold tax as if the recipient were married claiming 3 exemptions, and remit this amount to the IRS. Generally no "election out" is permitted if the distribution is delivered outside the United States and any possession of the United States. Regardless of any "election out" (or any amount of tax actually withheld) on an amount received from a Contract, the Payee is generally liable for any failure to pay the full amount of tax due on the includable portion of such amount received. A Payee also may be required to pay penalties under estimated income tax rules, if the withholding and estimated tax payments are insufficient to satisfy the Payee's total tax liability. E. GENERAL PROVISIONS AFFECTING QUALIFIED RETIREMENT PLANS The Contract may be used for a number of qualified retirement plans. If the Contract is being purchased with respect to some form of qualified retirement plan, please refer to Section 10 for information relative to the types of plans for which it may be used and the general explanation of the tax features of such plans. F. ANNUITY PURCHASES BY NONRESIDENT ALIENS AND FOREIGN CORPORATIONS The discussion above provides general information regarding U.S. federal income tax consequences to annuity purchasers that are U.S. citizens or residents. Purchasers that are not U.S. citizens or residents will generally be subject to U.S. federal income tax and mandatory withholding on U.S. source taxable annuity distributions at a 30% rate, unless a lower treaty rate applies and any required tax forms are submitted to us. If withholding applies, we are required to withhold tax at the 30% rate, or a lower treaty rate if applicable, and remit it to the IRS. In addition, purchasers may be subject to state premium tax, other state and/or municipal taxes, and taxes that may be imposed by the purchaser's country of citizenship or residence. G. ESTATE, GIFT AND GENERATION-SKIPPING TAX AND RELATED TAX CONSIDERATIONS Any amount payable upon a Contract Owner's death, whether before or after the Annuity Commencement Date, is generally includable in the Contract Owner's estate for federal estate tax purposes. Similarly, prior to the Contract Owner's death, the 67 ------------------------------------------------------------------------------- payment of any amount from the Contract, or the transfer of any interest in the Contract, to a beneficiary or other person for less than adequate consideration may have federal gift tax consequences. In addition, any transfer to, or designation of, a non-Spouse beneficiary who either is (1) 37 1/2 or more years younger than a Contract Owner or (2) a grandchild (or more remote further descendent) of a Contract Owner may have federal generation-skipping-transfer ("GST") tax consequences under Code Section 2601. Regulations under Code Section 2662 may require us to deduct any such GST tax from your Contract, or from any applicable payment, and pay it directly to the IRS. However, any federal estate, gift or GST tax payment with respect to a Contract could produce an offsetting income tax deduction for a beneficiary or transferee under Code Section 691(c) (partially offsetting such federal estate or GST tax) or a basis increase for a beneficiary or transferee under Code Section 691(c) or Section 1015(d). In addition, as indicated above in "Distributions Prior to the Annuity Commencement Date," the transfer of a Contract for less than adequate consideration during the Contract Owner's lifetime generally is treated as producing an amount received by such Contract Owner that is subject to both income tax and the 10% penalty tax. To the extent that such an amount deemed received causes an amount to be includable currently in such Contract Owner's gross income, this same income amount could produce a corresponding increase in such Contract Owner's tax basis for such Contract that is carried over to the transferee's tax basis for such Contract under Code Section 72(e)(4)(C)(iii) and Section 1015. 10. INFORMATION REGARDING TAX-QUALIFIED RETIREMENT PLANS This summary does not attempt to provide more than general information about the federal income tax rules associated with use of a Contract by a tax-qualified retirement plan. State income tax rules applicable to tax-qualified retirement plans often differ from federal income tax rules, and this summary does not describe any of these differences. Because of the complexity of the tax rules, owners, participants and beneficiaries are encouraged to consult their own tax advisors as to specific tax consequences. The Contracts are available to a variety of tax-qualified retirement plans and arrangements (a "Qualified Plan" or "Plan"). Tax restrictions and consequences for Contracts or accounts under each type of Qualified Plan differ from each other and from those for Non-Qualified Contracts. In addition, individual Qualified Plans may have terms and conditions that impose additional rules. Therefore, no attempt is made herein to provide more than general information about the use of the Contract with the various types of Qualified Plans. Participants under such Qualified Plans, as well as Contract Owners, annuitants and beneficiaries, are cautioned that the rights of any person to any benefits under such Qualified Plans may be subject to terms and conditions of the Plans themselves or limited by applicable law, regardless of the terms and conditions of the Contract issued in connection therewith. Qualified Plans generally provide for the tax deferral of income regardless of whether the Qualified Plan invests in an annuity or other investment. You should consider if the Contract is a suitable investment if you are investing through a Qualified Plan. THE FOLLOWING IS ONLY A GENERAL DISCUSSION ABOUT TYPES OF QUALIFIED PLANS FOR WHICH THE CONTRACTS MAY BE AVAILABLE. WE ARE NOT THE PLAN ADMINISTRATOR FOR ANY QUALIFIED PLAN. THE PLAN ADMINISTRATOR OR CUSTODIAN, WHICHEVER IS APPLICABLE, (BUT NOT US) IS RESPONSIBLE FOR ALL PLAN ADMINISTRATIVE DUTIES INCLUDING, BUT NOT LIMITED TO, NOTIFICATION OF DISTRIBUTION OPTIONS, DISBURSEMENT OF PLAN BENEFITS, HANDLING ANY PROCESSING AND ADMINISTRATION OF QUALIFIED PLAN LOANS, COMPLIANCE REGULATORY REQUIREMENTS AND FEDERAL AND STATE TAX REPORTING OF INCOME/DISTRIBUTIONS FROM THE PLAN TO PLAN PARTICIPANTS AND, IF APPLICABLE, BENEFICIARIES OF PLAN PARTICIPANTS AND IRA CONTRIBUTIONS FROM PLAN PARTICIPANTS. OUR ADMINISTRATIVE DUTIES ARE LIMITED TO ADMINISTRATION OF THE CONTRACT AND ANY DISBURSEMENTS OF ANY CONTRACT BENEFITS TO THE OWNER, ANNUITANT OR BENEFICIARY OF THE CONTRACT, AS APPLICABLE. OUR TAX REPORTING RESPONSIBILITY IS LIMITED TO FEDERAL AND STATE TAX REPORTING OF INCOME/DISTRIBUTIONS TO THE APPLICABLE PAYEE AND IRA CONTRIBUTIONS FROM THE OWNER OF A CONTRACT, AS RECORDED ON OUR BOOKS AND RECORDS. IF YOU ARE PURCHASING A QUALIFIED CONTRACT, YOU SHOULD CONSULT WITH YOUR PLAN ADMINISTRATOR AND/OR A QUALIFIED TAX ADVISER. YOU ALSO SHOULD CONSULT WITH A QUALIFIED TAX ADVISER AND/OR PLAN ADMINISTRATOR BEFORE YOU WITHDRAW ANY PORTION OF YOUR CONTRACT VALUE. The tax rules applicable to Qualified Contracts and Qualified Plans, including restrictions on contributions and distributions, taxation of distributions and tax penalties, vary according to the type of Qualified Plan, as well as the terms and conditions of the Plan itself. Various tax penalties may apply to contributions in excess of specified limits, plan distributions (including loans) that do not comply with specified limits, and certain other transactions relating to such Plans. Accordingly, this summary provides only general information about the tax rules associated with use of a Qualified Contract in such a Qualified Plan. In addition, some Qualified Plans are subject to distribution and other requirements that are not incorporated into our administrative procedures. Owners, participants, and beneficiaries are responsible for determining that contributions, distributions and other transactions comply with applicable tax (and non-tax) law. Because of the complexity of these rules, Owners, participants and beneficiaries are advised to consult with a qualified tax adviser as to specific tax consequences. We do not currently offer the Contracts in connection with all of the types of Qualified Plans discussed below, and may not offer the Contracts for all types of Qualified Plans in the future. 1. INDIVIDUAL RETIREMENT ANNUITIES ("IRAS"). In addition to "traditional" IRAs governed by Code Sections 408(a) and (b) ("Traditional IRAs"), there are Roth IRAs governed by Code Section 408A, SEP IRAs governed by Code Section 408(k), and SIMPLE IRAs governed by Code Section 408(p). Also, Qualified Plans under Code Section 401, 403(b) or 457(b) that include after-tax employee contributions may be treated as deemed IRAs 68 ------------------------------------------------------------------------------- subject to the same rules and limitations as Traditional IRAs. Contributions to each of these types of IRAs are subject to differing limitations. The following is a very general description of each type of IRA for which a Contract is available. a. TRADITIONAL IRAS Traditional IRAs are subject to limits on the amounts that may be contributed each year, the persons who may be eligible, and the time when minimum distributions must begin. Depending upon the circumstances of the individual, contributions to a Traditional IRA may be made on a deductible or non-deductible basis. Failure to make required minimum distributions ("RMDs") when the Owner reaches age 70 1/2 or dies, as described below, may result in imposition of a 50% penalty tax on any excess of the RMD amount over the amount actually distributed. In addition, any amount received before the Owner reaches age 59 1/2 or dies is subject to a 10% penalty tax on premature distributions, unless a special exception applies, as described below. Under Code Section 408(e), an IRA may not be used for borrowing (or as security for any loan) or in certain prohibited transactions, and such a transaction could lead to the complete tax disqualification of an IRA. You (or your surviving spouse if you die) may rollover funds tax-free from certain existing Qualified Plans (such as proceeds from existing insurance contracts, annuity contracts or securities) into a Traditional IRA under certain circumstances, as indicated below. However, mandatory tax withholding of 20% may apply to any eligible rollover distribution from certain types of Qualified Plans if the distribution is not transferred directly to the Traditional IRA. In addition, under Code Section 402(c)(11) a non-spouse "designated beneficiary" of a deceased Plan participant may make a tax-free "direct rollover" (in the form of a direct transfer between Plan fiduciaries, as described below in "Rollover Distributions") from certain Qualified Plans to a Traditional IRA for such beneficiary, but such Traditional IRA must be designated and treated as an "inherited IRA" that remains subject to applicable RMD rules (as if such IRA had been inherited from the deceased Plan participant). In addition, such a Plan is not required to permit such a rollover. IRAs generally may not invest in life insurance contracts. However, an annuity contract that is used as an IRA may provide a death benefit that equals the greater of the premiums paid or the contract's cash value. The Contract offers an enhanced death benefit that may exceed the greater of the Contract Value or total premium payments. The tax rules are unclear as to what extent an IRA can provide a death benefit that exceeds the greater of the IRA's cash value or the sum of the premiums paid and other contributions into the IRA. Please note that the IRA rider for the Contract has provisions that are designed to maintain the Contract's tax qualification as an IRA, and therefore could limit certain benefits under the Contract (including endorsement, rider or option benefits) to maintain the Contract's tax qualification. b. SEP IRAS Code Section 408(k) provides for a Traditional IRA in the form of an employer-sponsored defined contribution plan known as a Simplified Employee Pension ("SEP") or a SEP IRA. A SEP IRA can have employer, employee and salary reduction contributions, as well as higher overall contribution limits than a Traditional IRA, but a SEP is also subject to special tax-qualification requirements (e.g., on participation, nondiscrimination and withdrawals) and sanctions. Otherwise, a SEP IRA is generally subject to the same tax rules as for a Traditional IRA, which are described above. Please note that the IRA rider for the Contract has provisions that are designed to maintain the Contract's tax qualification as an IRA, and therefore could limit certain benefits under the Contract (including endorsement, rider or option benefits) to maintain the Contract's tax qualification. c. SIMPLE IRAS The Savings Incentive Match Plan for Employees of small employers ("SIMPLE Plan") is a form of an employer-sponsored Qualified Plan that provides IRA benefits for the participating employees ("SIMPLE IRAs"). Depending upon the SIMPLE Plan, employers may make plan contributions into a SIMPLE IRA established by each eligible participant. Like a Traditional IRA, a SIMPLE IRA is subject to the 50% penalty tax for failure to make a full RMD, and to the 10% penalty tax on premature distributions, as described below. In addition, the 10% penalty tax is increased to 25% for amounts received during the 2-year period beginning on the date you first participated in a qualified salary reduction arrangement pursuant to a SIMPLE Plan maintained by your employer under Code Section 408(p)(2). Contributions to a SIMPLE IRA may be either salary deferral contributions or employer contributions, and these are subject to different tax limits from those for a Traditional IRA. Please note that the SIMPLE IRA rider for the Contract has provisions that are designed to maintain the Contract's tax qualification as an SIMPLE IRA, and therefore could limit certain benefits under the Contract (including endorsement, rider or option benefits) to maintain the Contract's tax qualification. A SIMPLE Plan may designate a single financial institution (a Designated Financial Institution) as the initial trustee, custodian or issuer (in the case of an annuity contract) of the SIMPLE IRA set up for each eligible participant. However, any such Plan also must allow each eligible participant to have the balance in his SIMPLE IRA held by the Designated Financial Institution transferred without cost or penalty to a SIMPLE IRA maintained by a different financial institution. Absent a Designated Financial Institution, each eligible participant must select the financial institution to hold his SIMPLE IRA, and notify his employer of this selection. If we do not serve as the Designated Financial Institution for your employer's SIMPLE Plan, for you to use one of our Contracts as a SIMPLE IRA, you need to provide your employer with appropriate notification of such a selection under the SIMPLE Plan. If you 69 ------------------------------------------------------------------------------- choose, you may arrange for a qualifying transfer of any amounts currently held in another SIMPLE IRA for your benefit to your SIMPLE IRA with us. d. ROTH IRAS Code Section 408A permits eligible individuals to establish a Roth IRA. Contributions to a Roth IRA are not deductible, but withdrawals of amounts contributed and the earnings thereon that meet certain requirements are not subject to federal income tax. In general, Roth IRAs are subject to limitations on the amounts that may be contributed by the persons who may be eligible to contribute, certain Traditional IRA restrictions, and certain RMD rules on the death of the Contract Owner. Unlike a Traditional IRA, Roth IRAs are not subject to RMD rules during the Contract Owner's lifetime. Generally, however, upon the Owner's death the amount remaining in a Roth IRA must be distributed by the end of the fifth year after such death or distributed over the life expectancy of a designated beneficiary. The Owner of a Traditional IRA may convert a Traditional IRA into a Roth IRA under certain circumstances. The conversion of a Traditional IRA to a Roth IRA will subject the fair market value of the converted Traditional IRA to federal income tax. In addition to the amount held in the converted Traditional IRA, the fair market value may include the value of additional benefits provided by the annuity contract on the date of conversion, based on reasonable actuarial assumptions. Tax-free rollovers from a Roth IRA can be made only to another Roth IRA under limited circumstances, as indicated below. After 2007, distributions from eligible Qualified Plans can be "rolled over" directly (subject to tax) into a Roth IRA under certain circumstances. Anyone considering the purchase of a Qualified Contract as a Roth IRA or a "conversion" Roth IRA should consult with a qualified tax adviser. Please note that the Roth IRA rider for the Contract has provisions that are designed to maintain the Contract's tax qualification as a Roth IRA, and therefore could limit certain benefits under the Contract (including endorsement, rider or option benefits) to maintain the Contract's tax qualification. 2. QUALIFIED PENSION OR PROFIT-SHARING PLAN OR SECTION 401(k) PLAN Provisions of the Code permit eligible employers to establish a tax-qualified pension or profit sharing plan (described in Section 401(a), and Section 401(k) if applicable, and exempt from taxation under Section 501(a)). Such a Plan is subject to limitations on the amounts that may be contributed, the persons who may be eligible to participate, the amounts of "incidental" death benefits, and the time when RMDs must commence. In addition, a Plan's provision of incidental benefits may result in currently taxable income to the participant for some or all of such benefits. Amounts may be rolled over tax-free from a Qualified Plan to another Qualified Plan under certain circumstances, as described below. Anyone considering the use of a Qualified Contract in connection with such a Qualified Plan should seek competent tax and other legal advice. In particular, please note that these tax rules provide for limits on death benefits provided by a Qualified Plan (to keep such death benefits "incidental" to qualified retirement benefits), and a Qualified Plan (or a Qualified Contract) often contains provisions that effectively limit such death benefits to preserve the tax qualification of the Qualified Plan (or Qualified Contract). In addition, various tax-qualification rules for Qualified Plans specifically limit increases in benefits once RMDs begin, and Qualified Contracts are subject to such limits. As a result, the amounts of certain benefits that can be provided by any option under a Qualified Contract may be limited by the provisions of the Qualified Contract or governing Qualified Plan that are designed to preserve its tax qualification. 3. TAX SHELTERED ANNUITY UNDER SECTION 403(B) ("TSA") Code Section 403(b) permits public school employees and employees of certain types of charitable, educational and scientific organizations described in Code Section 501(c)(3) to purchase a "tax-sheltered annuity" ("TSA") contract and, subject to certain limitations, exclude employer contributions to a TSA from such an employee's gross income. Generally, total contributions may not exceed the lesser of an annual dollar limit (e.g., $46,000 in 2008) or 100% of the employee's "includable compensation" for the most recent full year of service, subject to other adjustments. The general annual elective deferral limit for a TSA participant after 2005 is $15,000. In addition, for years after 2006 this $15,000 limit will be indexed for cost-of-living adjustments under Code Section 402(g)(4) at $500 increments. For any such participant age 50 or older, the contribution limit after 2005 generally is increased by an additional $5,000 under Code Section 414(v). For years after 2006 this "over-50 catch-up" $5,000 limit also will be indexed for cost-of-living adjustments under Code Section 414(v)(2)(C) at $500 increments. Special provisions may allow certain employees different overall limitations. A TSA is subject to a prohibition against distributions from the TSA attributable to contributions made pursuant to a salary reduction agreement, unless such distribution is made: a. after the employee reaches age 59 1/2; b. upon the employee's separation from service; c. upon the employee's death or disability; d. in the case of hardship (and in the case of hardship, any income attributable to such contributions may not be distributed); or e. as a qualified reservist distribution upon certain calls to active duty. 70 ------------------------------------------------------------------------------- Please note that the TSA rider for the Contract has provisions that are designed to maintain the Contract's tax qualification as a TSA, and therefore could limit certain benefits under the Contract (including endorsement, rider or option benefits) to maintain the Contract's tax qualification. In particular, please note that tax rules provide for limits on death benefits provided by a Qualified Plan (to keep such death benefits "incidental" to qualified retirement benefits), and a Qualified Plan (or a Qualified Contract) often contains provisions that effectively limit such death benefits to preserve the tax qualification of the Qualified Plan (or Qualified Contract). In addition, various tax-qualification rules for Qualified Plans specifically limit increases in benefits once RMDs begin, and Qualified Contracts are subject to such limits. As a result, the amounts of certain benefits that can be provided by any option under a Qualified Contract may be limited by the provisions of the Qualified Contract or governing Qualified Plan that are designed to preserve its tax qualification. In addition, a life insurance contract issued after September 23, 2007 is generally ineligible to qualify as a TSA under Reg. Section 1.403(b)-8(c)(2). Amounts may be rolled over tax-free from a TSA to another TSA or Qualified Plan (or from a Qualified Plan to a TSA) under certain circumstances, as described below. However, effective for TSA contract exchanges after September 24, 2007, Reg. ' 1.403(b)-10(b) allows a TSA contract of a participant or beneficiary under a TSA Plan to be exchanged tax-free for another eligible TSA contract under that same TSA Plan, but only if all of the following conditions are satisfied: (1) such TSA Plan allows such an exchange, (2) the participant or beneficiary has an accumulated benefit after such exchange that is no less than such participant's or beneficiary's accumulated benefit immediately before such exchange (taking into account such participant's or beneficiary's accumulated benefit under both TSA contracts immediately before such exchange), (3) the second TSA contract is subject to distribution restrictions with respect to the participant that are no less stringent than those imposed on the TSA contract being exchanged, and (4) the employer for such TSA Plan enters into an agreement with the issuer of the second TSA contract under which such issuer and employer will provide each other from time to time with certain information necessary for such second TSA contract (or any other TSA contract that has contributions from such employer) to satisfy the TSA requirements under Code Section 403(b) and other federal tax requirements (e.g., plan loan conditions under Code Section 72(p) to avoid deemed distributions). Such necessary information could include information about the participant's employment, information about other Qualified Plans of such employer, and whether a severance has occurred, or hardship rules are satisfied, for purposes of the TSA distribution restrictions. Consequently, you are advised to consult with a qualified tax advisor before attempting any such TSA exchange, particularly because it requires an agreement between the employer and issuer to provide each other with certain information. We are no longer accepting any incoming exchange request, or new contract application, for any individual TSA contract. 4. DEFERRED COMPENSATION PLANS UNDER SECTION 457 ("SECTION 457 PLANS") Certain governmental employers, or tax-exempt employers other than a governmental entity, can establish a Deferred Compensation Plan under Code Section 457. For these purposes, a "governmental employer" is a State, a political subdivision of a State, or an agency or an instrumentality of a State or political subdivision of a State. A Deferred Compensation Plan that meets the requirements of Code Section 457(b) is called an "Eligible Deferred Compensation Plan" or "Section 457(b) Plan." Code Section 457(b) limits the amount of contributions that can be made to an Eligible Deferred Compensation Plan on behalf of a participant. Generally, the limitation on contributions is the lesser of (1) 100% of a participant's includible compensation or (2) the applicable dollar amount, equal to $15,000 for 2006 and thereafter. The $15,000 limit will be indexed for cost-of-living adjustments at $500 increments. The Plan may provide for additional "catch-up" contributions during the three taxable years ending before the year in which the participant attains normal retirement age. In addition, with an eligible Deferred Compensation Plan for a governmental employer, the contribution limitation may be increased under Code Section 457(e)(18) to allow certain "catch-up" contributions for individuals who have attained age 50, but only one "catch-up" may be used in a particular year. In addition, under Code Section 457(d) a Section 457(b) Plan may not make amounts available for distribution to participants or beneficiaries before (1) the calendar year in which the participant attains age 70 1/2, (2) the participant has a severance from employment (including death), or (3) the participant is faced with an unforeseeable emergency (as determined in accordance with regulations). Under Code Section 457(g) all of the assets and income of an Eligible Deferred Compensation Plan for a governmental employer must be held in trust for the exclusive benefit of participants and their beneficiaries. For this purpose, annuity contracts and custodial accounts described in Code Section 401(f) are treated as trusts. This trust requirement does not apply to amounts under an Eligible Deferred Compensation Plan of a tax-exempt (non-governmental) employer. In addition, this trust requirement does not apply to amounts held under a Deferred Compensation Plan of a governmental employer that is not a Section 457(b) Plan. However, where the trust requirement does not apply, amounts held under a Section 457 Plan must remain subject to the claims of the employer's general creditors under Code Section 457(b)(6). 5. TAXATION OF AMOUNTS RECEIVED FROM QUALIFIED PLANS Except under certain circumstances in the case of Roth IRAs, amounts received from Qualified Contracts or Plans generally are taxed as ordinary income under Code Section 72, to the extent that they are not treated as a tax-free recovery of after-tax contributions or other "investment in the contract." For annuity payments and other amounts received after the Annuity Commencement Date from a Qualified Contract or Plan, the tax rules for determining what portion of each amount received represents a tax-free recovery of "investment in the contract" are generally the same as for Non-Qualified Contracts, as described above. 71 ------------------------------------------------------------------------------- For non-periodic amounts from certain Qualified Contracts or Plans, Code Section 72(e)(8) provides special rules that generally treat a portion of each amount received as a tax-free recovery of the "investment in the contract," based on the ratio of the "investment in the contract" over the Contract Value at the time of distribution. However, in determining such a ratio, certain aggregation rules may apply and may vary, depending on the type of Qualified Contract or Plan. For instance, all Traditional IRAs owned by the same individual are generally aggregated for these purposes, but such an aggregation does not include any IRA inherited by such individual or any Roth IRA owned by such individual. In addition, penalty taxes, mandatory tax withholding or rollover rules may apply to amounts received from a Qualified Contract or Plan, as indicated below, and certain exclusions may apply to certain distributions (e.g., distributions from an eligible Government Plan to pay qualified health insurance premiums of an eligible retired public safety officer). Accordingly, you are advised to consult with a qualified tax adviser before taking or receiving any amount (including a loan) from a Qualified Contract or Plan. 6. PENALTY TAXES FOR QUALIFIED PLANS Unlike Non-Qualified Contracts, Qualified Contracts are subject to federal penalty taxes not just on premature distributions, but also on excess contributions and failures to make required minimum distributions ("RMDs"). Penalty taxes on excess contributions can vary by type of Qualified Plan and which person made the excess contribution (e.g., employer or an employee). The penalty taxes on premature distributions and failures to make timely RMDs are more uniform, and are described in more detail below. a. PENALTY TAXES ON PREMATURE DISTRIBUTIONS Code Section 72(t) imposes a penalty income tax equal to 10% of the taxable portion of a distribution from certain types of Qualified Plans that is made before the employee reaches age 59 1/2. However, this 10% penalty tax does not apply to a distribution that is either: (i) made to a beneficiary (or to the employee's estate) on or after the employee's death; (ii) attributable to the employee's becoming disabled under Code Section 72(m)(7); (iii) part of a series of substantially equal periodic payments (not less frequently than annually -- "SEPPs") made for the life (or life expectancy) of the employee or the joint lives (or joint life expectancies) of such employee and a designated beneficiary ("SEPP Exception"), and for certain Qualified Plans (other than IRAs) such a series must begin after the employee separates from service; (iv) (except for IRAs) made to an employee after separation from service after reaching age 55 (or made after age 50 in the case of a qualified public safety employee separated from certain government plans); (v) (except for IRAs) made to an alternate payee pursuant to a qualified domestic relations order under Code Section 414(p) (a similar exception for IRAs in Code Section 408(d)(6) covers certain transfers for the benefit of a spouse or ex-spouse); (vi) not greater than the amount allowable as a deduction to the employee for eligible medical expenses during the taxable year; or (vii) certain qualified reservist distributions under Code Section 72(t)(2)(G) upon a call to active duty. In addition, the 10% penalty tax does not apply to a distribution from an IRA that is either: (viii) made after separation from employment to an unemployed IRA owner for health insurance premiums, if certain conditions are met; (ix) not in excess of the amount of certain qualifying higher education expenses, as defined by Code Section 72(t)(7); or (x) for a qualified first-time home buyer and meets the requirements of Code Section 72(t)(8). If the taxpayer avoids this 10% penalty tax by qualifying for the SEPP Exception and later such series of payments is modified (other than by death or disability), the 10% penalty tax will be applied retroactively to all the prior periodic payments (i.e., penalty tax plus interest thereon), unless such modification is made after both (a) the employee has reached age 59 1/2 and (b) 5 years have elapsed since the first of these periodic payments. For any premature distribution from a SIMPLE IRA during the first 2 years that an individual participates in a salary reduction arrangement maintained by that individual's employer under a SIMPLE Plan, the 10% penalty tax rate is increased to 25%. b. RMDS AND 50% PENALTY TAX If the amount distributed from a Qualified Contract or Plan is less than the amount of the required minimum distribution ("RMD") for the year, the participant is subject to a 50% penalty tax on the amount that has not been timely distributed. An individual's interest in a Qualified Plan generally must be distributed, or begin to be distributed, not later than the Required Beginning Date. Generally, the Required Beginning Date is April 1 of the calendar year following the later of -- (i) the calendar year in which the individual attains age 70 1/2, or 72 ------------------------------------------------------------------------------- (ii) (except in the case of an IRA or a 5% owner, as defined in the Code) the calendar year in which a participant retires from service with the employer sponsoring a Qualified Plan that allows such a later Required Beginning Date. The entire interest of the individual must be distributed beginning no later than the Required Beginning Date over -- (a) the life of the individual or the lives of the individual and a designated beneficiary (as specified in the Code), or (b) over a period not extending beyond the life expectancy of the individual or the joint life expectancy of the individual and a designated beneficiary. If an individual dies before reaching the Required Beginning Date, the individual's entire interest generally must be distributed within 5 years after the individual's death. However, this RMD rule will be deemed satisfied if distributions begin before the close of the calendar year following the individual's death to a designated beneficiary and distribution is over the life of such designated beneficiary (or over a period not extending beyond the life expectancy of such beneficiary). If such beneficiary is the individual's surviving spouse, distributions may be delayed until the deceased individual would have attained age 70 1/2. If an individual dies after RMDs have begun for such individual, any remainder of the individual's interest generally must be distributed at least as rapidly as under the method of distribution in effect at the time of the individual's death. The RMD rules that apply while the Contract Owner is alive do not apply with respect to Roth IRAs. The RMD rules applicable after the death of the Owner apply to all Qualified Plans, including Roth IRAs. In addition, if the Owner of a Traditional or Roth IRA dies and the Owner's surviving spouse is the sole designated beneficiary, this surviving spouse may elect to treat the Traditional or Roth IRA as his or her own. The RMD amount for each year is determined generally by dividing the account balance by the applicable life expectancy. This account balance is generally based upon the account value as of the close of business on the last day of the previous calendar year. RMD incidental benefit rules also may require a larger annual RMD amount, particularly when distributions are made over the joint lives of the Owner and an individual other than his or her spouse. RMDs also can be made in the form of annuity payments that satisfy the rules set forth in Regulations under the Code relating to RMDs. In addition, in computing any RMD amount based on a contract's account value, such account value must include the actuarial value of certain additional benefits provided by the contract. As a result, electing an optional benefit under a Qualified Contract may require the RMD amount for such Qualified Contract to be increased each year, and expose such additional RMD amount to the 50% penalty tax for RMDs if such additional RMD amount is not timely distributed. 7. TAX WITHHOLDING FOR QUALIFIED PLANS Distributions from a Qualified Contract or Qualified Plan generally are subject to federal income tax withholding requirements. These federal income tax withholding requirements, including any "elections out" and the rate at which withholding applies, generally are the same as for periodic and non-periodic distributions from a Non-Qualified Contract, as described above, except where the distribution is an "eligible rollover distribution" (described below in "ROLLOVER DISTRIBUTIONS"). In the latter case, tax withholding is mandatory at a rate of 20% of the taxable portion of the "eligible rollover distribution," to the extent it is not directly rolled over to an IRA or other Eligible Retirement Plan (described below in "ROLLOVER DISTRIBUTIONS"). Payees cannot elect out of this mandatory 20% withholding in the case of such an "eligible rollover distribution." Also, special withholding rules apply with respect to distributions from non-governmental Section 457(b) Plans, and to distributions made to individuals who are neither citizens nor resident aliens of the United States. Regardless of any "election out" (or any actual amount of tax actually withheld) on an amount received from a Qualified Contract or Plan, the payee is generally liable for any failure to pay the full amount of tax due on the includable portion of such amount received. A payee also may be required to pay penalties under estimated income tax rules, if the withholding and estimated tax payments are insufficient to satisfy the payee's total tax liability. 8. ROLLOVER DISTRIBUTIONS The current tax rules and limits for tax-free rollovers and transfers between Qualified Plans vary according to (1) the type of transferor Plan and transferee Plan, (2) whether the amount involved is transferred directly between Plan fiduciaries (a "direct transfer" or a "direct rollover") or is distributed first to a participant or beneficiary who then transfers that amount back into another eligible Plan within 60 days (a "60-day rollover"), and (3) whether the distribution is made to a participant, spouse or other beneficiary. Accordingly, we advise you to consult with a qualified tax adviser before receiving any amount from a Qualified Contract or Plan or attempting some form of rollover or transfer with a Qualified Contract or Plan. For instance, generally any amount can be transferred directly from one type of Qualified Plan (e.g., a TSA) to the same type of Plan for the benefit of the same individual, without limit (or federal income tax), if the transferee Plan is subject to the same kinds of restrictions as the transferor Plan (e.g., a TSA that is subject to the same kinds of salary reduction restrictions) and certain other conditions to maintain the applicable tax qualification are satisfied (e.g., as described above for TSA exchanges after September 24, 73 ------------------------------------------------------------------------------- 2007). Such a "direct transfer" between the same kinds of Plan is generally not treated as any form of "distribution" out of such a Plan for federal income tax purposes. By contrast, an amount distributed from one type of Plan (e.g., a TSA) into a different type of Plan (e.g., a Traditional IRA) generally is treated as a "distribution" out of the first Plan for federal income tax purposes, and therefore to avoid being subject to such tax, such a distribution must qualify either as a "direct rollover" (made directly to another Plan fiduciary) or as a "60-day rollover." The tax restrictions and other rules for a "direct rollover" and a "60-day rollover" are similar in many ways, but if any "eligible rollover distribution" made from certain types of Qualified Plan is not transferred directly to another Plan fiduciary by a "direct rollover," then it is subject to mandatory 20% withholding, even if it is later contributed to that same Plan in a "60-day rollover" by the recipient. If any amount less than 100% of such a distribution (e.g., the net amount after the 20% withholding) is transferred to another Plan in a "60-day rollover", the missing amount that is not rolled over remains subject to normal income tax plus any applicable penalty tax. Under Code Sections 402(f)(2)(A) and 3405(c)(3) an "eligible rollover distribution" (which is both eligible for rollover treatment and subject to 20% mandatory withholding absent a "direct rollover") is generally any distribution to an employee of any portion (or all) of the balance to the employee's credit in any of the following types of "Eligible Retirement Plan": (1) a Qualified Plan under Code Section 401(a) ("Qualified 401(a) Plan"), (2) a qualified annuity plan under Code Section 403(a) ("Qualified Annuity Plan"), (3) a TSA under Code Section 403(b), or (4) a governmental Section 457(b) Plan. However, an "eligible rollover distribution" does not include any distribution that is either -- a. an RMD amount; b. one of a series of substantially equal periodic payments (not less frequently than annually) made either (i) for the life (or life expectancy) of the employee or the joint lives (or joint life expectancies) of the employee and a designated beneficiary, or (ii) for a specified period of 10 years or more; or c. any distribution made upon hardship of the employee. Before making an "eligible rollover distribution," a Plan administrator generally is required under Code Section 402(f) to provide the recipient with advance written notice of the "direct rollover" and "60-day rollover" rules and the distribution's exposure to the 20% mandatory withholding if it is not made by "direct rollover." Generally, under Code Sections 402(c), 403(b)(8) and 457 (e)(16), a "direct rollover" or a "60-day rollover" of an "eligible rollover distribution" can be made to a Traditional IRA or to another Eligible Retirement Plan that agrees to accept such a rollover. However, the maximum amount of an "eligible rollover distribution" that can qualify for a tax-free "60-day rollover" is limited to the amount that otherwise would be includable in gross income. By contrast, a "direct rollover" of an "eligible rollover distribution" can include after-tax contributions as well, if the direct rollover is made either to a Traditional IRA or to another form of Eligible Retirement Plan that agrees to account separately for such a rollover, including accounting for such after-tax amounts separately from the otherwise taxable portion of this rollover. Separate accounting also is required for all amounts (taxable or not) that are rolled into a governmental Section 457(b) Plan from either a Qualified Section 401(a) Plan, Qualified Annuity Plan, TSA or IRA. These amounts, when later distributed from the governmental Section 457(b) Plan, are subject to any premature distribution penalty tax applicable to distributions from such a "predecessor" Qualified Plan. Rollover rules for distributions from IRAs under Code Sections 408(d)(3) and 408A(d)(3) also vary according to the type of transferor IRA and type of transferee IRA or other Plan. For instance, generally no tax-free "direct rollover" or "60-day rollover" can be made between a "NonRoth IRA" (Traditional, SEP or SIMPLE IRA) and a Roth IRA, and a transfer from NonRoth IRA to a Roth IRA, or a "conversion" of a NonRoth IRA to a Roth IRA, is subject to special rules. In addition, generally no tax-free "direct rollover" or "60-day rollover" can be made between an "inherited IRA" (NonRoth or Roth) for a beneficiary and an IRA set up by that same individual as the original owner. Generally, any amount other than an RMD distributed from a Traditional or SEP IRA is eligible for a "direct rollover" or a "60-day rollover" to another Traditional IRA for the same individual. Similarly, any amount other than an RMD distributed from a Roth IRA is generally eligible for a "direct rollover" or a "60-day rollover" to another Roth IRA for the same individual. However, in either case such a tax-free 60-day rollover is limited to 1 per year (365-day period); whereas no 1-year limit applies to any such "direct rollover." Similar rules apply to a "direct rollover" or a "60-day rollover" of a distribution from a SIMPLE IRA to another SIMPLE IRA or a Traditional IRA, except that any distribution of employer contributions from a SIMPLE IRA during the initial 2-year period in which the individual participates in the employer's SIMPLE Plan is generally disqualified (and subject to the 25% penalty tax on premature distributions) if it is not rolled into another SIMPLE IRA for that individual. Amounts other than RMDs distributed from a Traditional or SEP IRA (or SIMPLE IRA after the initial 2-year period) also are eligible for a "direct rollover" or a "60-day rollover" to an Eligible Retirement Plan (e.g., a TSA) that accepts such a rollover, but any such rollover is limited to the amount of the distribution that otherwise would be includable in gross income (i.e., after-tax contributions are not eligible). Special rules also apply to transfers or rollovers for the benefit of a spouse (or ex-spouse) or a nonspouse designated beneficiary, Plan distributions of property, and obtaining a waiver of the 60-day limit for a tax-free rollover from the IRS. The Katrina Emergency Tax Relief Act of 2005 (KETRA) allows certain amounts to be recontributed within three years as a rollover contribution to a plan from which a KETRA distribution was taken. 74 ------------------------------------------------------------------------------- TABLE OF CONTENTS TO STATEMENT OF ADDITIONAL INFORMATION GENERAL INFORMATION Safekeeping of Assets Experts Non-Participating Misstatement of Age or Sex Principal Underwriter Additional Payments PERFORMANCE RELATED INFORMATION Total Return for all Sub-Accounts Yield for Sub-Accounts Money Market Sub-Accounts Additional Materials Performance Comparisons ACCUMULATION UNIT VALUES FINANCIAL STATEMENTS
APP I-1 ------------------------------------------------------------------------------- APPENDIX I -- EXAMPLES TABLE OF CONTENTS
PAGE -------------------------------------------------------------------------------- Premium Security Death Benefit APP 1-2 Asset Protection Death Benefit APP 1-4 The Hartford's Principal First APP 1-6 The Hartford's Principal First Preferred APP 1-7 The Hartford's Lifetime Income Builder APP 1-8 The Hartford's Lifetime Income Foundation APP 1-10 The Hartford's Lifetime Income Builder II APP 1-14 The Hartford's Lifetime Income Builder Selects and The Hartford's APP 1-20 Lifetime Income Builder Portfolios MAV Plus APP 1-31
APP I-2 ------------------------------------------------------------------------------- PREMIUM SECURITY DEATH BENEFIT EXAMPLE 1 Assume that: - You purchased your Contract with the Premium Security Death Benefit, because You and Your Annuitant were both no older than age 80 on the issue date, - You made an initial Premium Payment of $100,000, - In your fourth Contract Year, you made a withdrawal of $8,000, - Your Contract Value in your fourth Contract Year immediately before your withdrawal was $109,273, - On the day we receive proof of Death, your Contract Value was $117,403, and your Maximum Anniversary Value was $106,000. CALCULATION OF PREMIUM SECURITY DEATH BENEFIT To calculate the Premium Security Death Benefit, we calculate the following three values: - The Contract Value of your Contract on the day we receive proof of Death [$117,403], - Total Premium Payments adjusted for any partial Surrenders [$100,000 - $8,000 = $92,000], - The lesser of (a) Your Maximum Anniversary Value [$106,000] and (b) Your Contract Value on the day we calculate the Death Benefit, plus 25% of Your Maximum Anniversary Value excluding any subsequent Premium Payments we receive within 12 months of death [$117,403 + 25% x $106,000 = $143,903]; the lesser (a) and (b) is $106,000. The Premium Security Death Benefit is the greatest of these three values, which is $117,403. APP I-3 ------------------------------------------------------------------------------- EXAMPLE 2 Assume that: - You purchased your Contract with the Premium Security Death Benefit, because You and Your Annuitant were both no older than age 80 on the issue date, - You made an initial Premium Payment of $100,000, - In your fourth Contract Year, you made a partial Surrender of $60,000, - Your Contract Value in the fourth year immediately before your Surrender was $150,000, - On the day we receive proof of Death, your Contract Value was $120,000, - Your Maximum Anniversary Value is $83,571 (based on an adjustment to an anniversary value that was $140,000 before the partial Surrender (see below)). CALCULATION OF PREMIUM SECURITY DEATH BENEFIT To calculate the Premium Security Death Benefit, we calculate the following three values: - The Contract Value of your Contract on the day we receive proof of Death [$120,000], - Total Premium Payments adjusted for any partial Surrenders [$57,857 (see below)], - The lesser of (a) Your Maximum Anniversary Value [$83,571 (see below)] and (b) Your Contract Value on the day we receive proof of Death plus 25% of Your Maximum Anniversary Value excluding any subsequent Premium Payments we receive within 12 months of death [$120,000 + 25% (83,571) = $140,893]; the lesser (a) and (b) is $83,571. The Premium Security Death Benefit is the greatest of these three values, which is $120,000. ADJUSTMENT FOR PARTIAL SURRENDER FOR TOTAL PREMIUM PAYMENTS The adjustment to your total Premium Payments for partial Surrenders is on a dollar for dollar basis up to 10% of total Premium Payments. 10% of total Premium Payments is $10,000. Total Premium Payments adjusted for dollar for dollar partial Surrenders is $90,000. The remaining partial Surrenders equal $50,000. This amount will reduce your total Premium Payments by a factor. To determine this factor, we take your Contract Value immediately before the Surrender [$150,000] and subtract the $10,000 dollar for dollar adjustment to get $140,000. The proportional factor is 1 - (50,000/140,000) = .64286. This factor is multiplied by $90,000. The result is an adjusted total Premium Payment of $57,857. ADJUSTMENT FOR PARTIAL SURRENDER FOR MAXIMUM ANNIVERSARY VALUE The adjustment to your Maximum Anniversary Value for partial Surrenders is on a dollar for dollar basis up to 10% of total Premium Payments. 10% of Premium Payments is $10,000. Your Maximum Anniversary Value adjusted for partial Surrenders on a dollar for dollar basis up to 10% of Premium Payments is $140,000 - $10,000 = $130,000. Remaining partial Surrenders are $50,000. We use this amount to reduce your Maximum Anniversary Value by a factor. To determine this factor, we take your Contract Value immediately before the Surrender [$150,000] and subtract the $10,000 dollar for dollar adjustment to get $140,000. The proportional factor is 1 - (50,000/140,000) = .64286. This factor is multiplied by $130,000. The result is an adjusted Maximum Anniversary Value of $83,571. APP I-4 ------------------------------------------------------------------------------- ASSET PROTECTION DEATH BENEFIT EXAMPLE 1 Assume that: - You purchased your Contract with the Asset Protection Death Benefit, because You and/or Your Annuitant were over age 80 on the issue date, - You made an initial Premium Payment of $100,000, - In your fourth Contract Year, you made a withdrawal of $8,000, - Your Contract Value in your fourth Contract Year immediately before your withdrawal was $109,273, - On the day we receive proof of Death, your Contract Value was $117,403, - Your Maximum Anniversary Value was $106,000. CALCULATION OF ASSET PROTECTION DEATH BENEFIT To calculate the Asset Protection Death Benefit, we calculate the following three values: - The Contract Value of your Contract on the day we receive proof of Death [$117,403], - The lesser of (a) total Premium Payments adjusted for any partial Surrenders [$100,000 - $8,000 = $92,000] or (b) Your Contract Value on the day we calculate the Death Benefit, plus 25% of Your total Premium Payments adjusted for any partial Surrenders and excluding any subsequent Premium Payments we receive within 12 months of death [$117,403 + 25% x $92,000 = $140,403]; the lesser of (a) and (b) is $92,000. - The lesser of (a) Your Maximum Anniversary Value [$106,000] and (b) Your Contract Value on the day we calculate the Death Benefit, plus 25% of Your Maximum Anniversary Value excluding any subsequent Premium Payments we receive within 12 months of death [$117,403 + 25% x $106,000 = $143,903]; the lesser (a) and (b) is $106,000. The Asset Protection Death Benefit is the greatest of these three values, which is $117,403. EXAMPLE 2 Assume that: - You purchased your Contract with the Asset Protection Death Benefit because You and/or Your Annuitant were over age 80 on the issue date, - You made an initial Premium Payment of $100,000, - In your fourth Contract Year, you made a partial Surrender of $60,000, - Your Contract Value in the fourth year immediately before your Surrender was $150,000, - On the day we receive proof of Death, your Contract Value was $120,000, - Your Maximum Anniversary Value is $83,571 (based on an adjustment to an anniversary value that was $140,000 before the partial Surrender (see below)). CALCULATION OF ASSET PROTECTION DEATH BENEFIT To calculate the Asset Protection Death Benefit, we calculate the following three values: - The Contract Value of your Contract on the day we receive proof of Death [$120,000], - The lesser of (a) total Premium Payments adjusted for any partial Surrenders [$57,857 (see Example 1 under Premium Security Death Benefit)] or (b) Your Contract Value on the day we calculate the Death Benefit, plus 25% of Your total Premium Payments adjusted for any partial Surrenders and excluding any subsequent Premium Payments we receive within 12 months of death [$120,000 + 25% x $57,857 = $134,464]; the lesser (a) and (b) is $57,857, - The lesser of (a) Your Maximum Anniversary Value [$83,571 (see Example 1 under Premium Security Death Benefit)] and (b) Your Contract Value on the day we receive proof of Death plus 25% of Your Maximum Anniversary Value excluding any subsequent Premium Payments we receive within 12 months of death [$120,000 + 25% (83,571) = $140,893]; the lesser (a) and (b) is $83,571. The Asset Protection Death Benefit is the greatest of these three values, which is $120,000. APP I-5 ------------------------------------------------------------------------------- EXAMPLE 3 ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $60,000, AND YOUR CONTRACT VALUE IS $150,000 AT THE TIME OF THE SURRENDER, THEN WE RECALCULATE YOUR BENEFIT AMOUNT BY COMPARING THE RESULTS OF TWO CALCULATIONS AND TAKING THE LESSER OF THE TWO: - First we deduct the amount of the Surrender ($60,000) from your Contract Value ($150,000). This equals $90,000 and is your "New Contract Value." CALCULATION OF ASSET PROTECTION DEATH BENEFIT To calculate the Asset Protection Death Benefit, we calculate the following three values: - The Contract Value of your Contract on the day we receive proof of Death [$120,000], - The lesser of (a) total Premium Payments adjusted for any partial Surrenders [$57,857 (see Example 1 under Premium Security Death Benefit)] or (b) Your Contract Value on the day we calculate the Death Benefit, plus 25% of Your total Premium Payments adjusted for any partial Surrenders and excluding any subsequent Premium Payments we receive within 12 months of death [$120,000 + 25% x $57,857 = $134,464]; the lesser (a) and (b) is $57,857. - The lesser of (a) Your Maximum Anniversary Value [$83,571 (see Example 1 under Premium Security Death Benefit)] and (b) Your Contract Value on the day we receive proof of Death plus 25% of Your Maximum Anniversary Value excluding any subsequent Premium Payments we receive within 12 months of death [$120,000 + 25% ($83,571) = $140,893]; the lesser (a) and (b) is $83,571. The Asset Protection Death Benefit is the greatest of these three values, which is $120,000. APP I-6 ------------------------------------------------------------------------------- THE HARTFORD'S PRINCIPAL FIRST EXAMPLE 1: ASSUME YOU SELECT THE HARTFORD'S PRINCIPAL FIRST WHEN YOU PURCHASE YOUR CONTRACT AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Benefit Amount is $100,000, which is your initial Premium Payment. - Your Benefit Payment is $7,000, which is 7% of your Benefit Amount. EXAMPLE 2: IF YOU MAKE AN ADDITIONAL PREMIUM PAYMENT OF $50,000, THEN - Your Benefit Amount is $150,000, which is your prior Benefit Amount ($100,000) plus your additional Premium Payment ($50,000). - Your Benefit Payment is $10,500, which is your prior Benefit Payment ($7,000) plus 7% of your additional Premium Payment ($3,500). EXAMPLE 3: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU TAKE THE MAXIMUM BENEFIT PAYMENT BEFORE THE END OF THE FIRST CONTRACT YEAR, THEN - Your Benefit Amount becomes $93,000, which is your prior Benefit Amount ($100,000) minus the Benefit Payment ($7,000). - Your Benefit Payment for the next year remains $7,000, because you did not take more than your maximum Benefit Payment ($7,000). EXAMPLE 4: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $50,000, AND YOUR CONTRACT VALUE IS $150,000 AT THE TIME OF THE SURRENDER, THEN We recalculate your Benefit Amount by comparing the results of two calculations: - First we deduct the amount of the Surrender ($50,000) from your Contract Value ($150,000). This equals $100,000 and is your "New Contract Value." - Second, we deduct the amount of the Surrender ($50,000) from your Benefit Amount ($100,000). This is $50,000 and is your "New Benefit Amount." Since the New Contract Value ($100,000) is more than or equal to the New Benefit Amount ($50,000), and it is more than or equal to your Premium Payments invested in the Contract before the Surrender ($100,000), the Benefit Payment is unchanged and remains $7,000. EXAMPLE 6: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $50,000, AND YOUR CONTRACT VALUE IS $80,000 AT THE TIME OF THE SURRENDER, THEN We recalculate your Benefit Amount by comparing the results of two calculations: - First we deduct the amount of the Surrender ($50,000) from your Contract Value ($80,000). This equals $30,000 and is your "New Contract Value." - Second, we deduct the amount of the Surrender ($50,000) from your Benefit Amount ($100,000). This is $50,000 and is your "New Benefit Amount." Since the New Contract Value ($30,000) is less than the New Benefit Amount ($50,000), your "New Benefit Amount" becomes the New Contract Value ($30,000), as we have to recalculate your Benefit Payment. We recalculate the Benefit Payment by comparing the "old" Benefit Payment ($7,000) to 7% of the New Benefit Amount ($2,100). Your Benefit Payment becomes the lower of those two values, or $2,100. EXAMPLE 7: IF YOU ELECT TO "STEP UP" THE HARTFORD'S PRINCIPAL FIRST AFTER THE 5TH YEAR, ASSUMING YOU HAVE MADE NO WITHDRAWALS, AND YOUR CONTRACT VALUE AT THE TIME OF STEP UP IS $200,000, THEN - We recalculate your Benefit Amount to equal your Contract Value, which is $200,000. - Your new Benefit Payment is equal to 7% of your new Benefit Amount, or $14,000. APP I-7 ------------------------------------------------------------------------------- THE HARTFORD'S PRINCIPAL FIRST PREFERRED EXAMPLE 1: ASSUME YOU SELECT THE HARTFORD'S PRINCIPAL FIRST PREFERRED WHEN YOU PURCHASE YOUR CONTRACT AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Benefit Amount is $100,000, which is your initial Premium Payment. - Your Benefit Payment is $5,000, which is 5% of your Benefit Amount. EXAMPLE 2: IF YOU MAKE AN ADDITIONAL PREMIUM PAYMENT OF $50,000, THEN - Your Benefit Amount is $150,000, which is your prior Benefit Amount ($100,000) plus your additional Premium Payment ($50,000). - Your Benefit Payment is $7,500, which is your new Benefit Amount ($150,000) multiplied by 5%. EXAMPLE 3: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU TAKE THE MAXIMUM BENEFIT PAYMENT BEFORE THE END OF THE FIRST CONTRACT YEAR, THEN - Your Benefit Amount becomes $95,000, which is your prior Benefit Amount ($100,000) minus the Benefit Payment ($5,000). - Your Benefit Payment for the next year remains $5,000, because you did not take more than your maximum Benefit Payment ($5,000). EXAMPLE 4: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $50,000, AND YOUR CONTRACT VALUE IS $150,000 AT THE TIME OF THE SURRENDER, THEN We recalculate your Benefit Amount by comparing the results of two calculations and taking the lesser of the two: - First we deduct the amount of the Surrender ($50,000) from your Contract Value ($150,000). This equals $100,000 and is your "New Contract Value." - Second, we deduct the amount of the Surrender ($50,000) from your Benefit Amount ($100,000). This is $50,000 and is your "New Benefit Amount." Since the New Contract Value ($100,000) is more than or equal to the New Benefit Amount ($50,000), and it is more than or equal to your Premium Payments invested in the Contract before the Surrender ($100,000), the Benefit Payment is unchanged and remains $5,000. EXAMPLE 5: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $60,000, AND YOUR CONTRACT VALUE IS $150,000 AT THE TIME OF THE SURRENDER, THEN We recalculate your Benefit Amount by comparing the results of two calculations: - First we deduct the amount of the Surrender ($60,000) from your Contract Value ($150,000). This equals $90,000 and is your "New Contract Value." - Second, we deduct the amount of the Surrender ($60,000) from your Benefit Amount ($100,000). This is $40,000 and is your "New Benefit Amount." Since the New Contract Value ($90,000) is more than or equal to the New Benefit Amount ($40,000), but less than the Premium Payments invested in the Contract before the Surrender ($100,000), the Benefit Payment is reduced. The new Benefit Payment is 5% of the greater of your New Contract Value and New Benefit Amount, which is $4,500. EXAMPLE 6: ASSUME THE SAME FACTS AS EXAMPLE 1. IF YOU SURRENDER $50,000, AND YOUR CONTRACT VALUE IS $80,000 AT THE TIME OF THE SURRENDER, THEN We recalculate your Benefit Amount by comparing the results of two calculations and taking the lesser of the two: - First we deduct the amount of the Surrender ($50,000) from your Contract Value ($80,000). This equals $30,000 and is your "New Contract Value." - Second, we deduct the amount of the Surrender ($50,000) from your Benefit Amount ($100,000). This is $50,000 and is your "New Benefit Amount." Since the New Contract Value ($30,000) is less than the New Benefit Amount ($50,000), your "New Benefit Amount" becomes the New Contract Value ($30,000), as we have to recalculate your Benefit Payment. We recalculate the Benefit Payment by comparing the "old" Benefit Payment ($5,000) to 5% of the New Benefit Amount ($1,500). Your Benefit Payment becomes the lower of those two values, or $1,500. APP I-8 ------------------------------------------------------------------------------- THE HARTFORD'S LIFETIME INCOME BUILDER THIS OPTIONAL WITHDRAWAL BENEFIT IS CLOSED. FOR ALL EXAMPLES YOUR GUARANTEED MINIMUM DEATH BENEFIT IS THE GREATER OF THE BENEFIT AMOUNT AND THE CONTRACT VALUE ON THE DATE OF DUE PROOF OF DEATH. EXAMPLE 1: ASSUME YOU SELECT THE HARTFORD'S LIFETIME INCOME BUILDER WHEN YOU PURCHASE YOUR CONTRACT, YOU ARE YOUNGER THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Benefit Amount is $100,000, which is your initial Premium Payment. - Your Benefit Payment is $5,000, which is 5% of your Benefit Amount. - Your Lifetime Benefit Payment is zero. The Lifetime Benefit Payment will be set equal to the Benefit Amount multiplied by 5% on the Contract Anniversary immediately following the Older Owner's 60th birthday. EXAMPLE 2: ASSUME THE SAME FACTS AS EXAMPLE 1. ALSO ASSUME THAT YOU MAKE NO ADDITIONAL PREMIUM PAYMENTS AND TAKE NO WITHDRAWALS DURING THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $105,000. - At the anniversary, we calculate the automatic Benefit Amount Increase. The ratio is the Contract Value ($105,000) divided by the Maximum Contract Value ($100,000), less 1 subject to a minimum of 0% and a maximum of 10%. - ($105,000 / $100,000) - 1 = .05 = 5%. - Your Benefit Amount is $105,000, which is your previous Benefit Amount plus the automatic Benefit Amount increase. - Your Benefit Payment is $5,250, which is 5% of your Benefit Amount. - The annual charge for The Hartford's Lifetime Income Builder is 40 bps of the Benefit Amount after the automatic increase calculation. - $105,000 x .004 = $420, this amount is deducted from the Contract Value. EXAMPLE 3: ASSUME THE SAME FACTS AS EXAMPLE 1. ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $95,000. - Your initial Benefit Amount is $100,000. - Your Benefit Payment is $5,000. - After the partial Surrenders of $1,000, your Benefit Amount is $99,000. - There is no change to the annual Benefit Payment since the partial Surrender is less than the Benefit Payment. - At the anniversary, we calculate the automatic Benefit Amount Increase. The ratio is the Contract Value ($99,000) divided by the Maximum Contract Value ($100,000), less 1 subject to a minimum of 0% and a maximum of 10%. - ($99,000 / $100,000) - 1 = -.01 subject to the minimum of 0%. - Your Benefit Amount is $99,000, which is your previous Benefit Amount since the automatic Benefit Amount increase was 0%. - Your Benefit Payment will remain at $5,000. Because your Benefit Amount did not increase because of the automatic Benefit Amount increase provision on the anniversary, the Benefit Payment will not increase. And because the remaining Benefit Amount ($99,000) is not less than the Benefit Payment immediately prior to the anniversary, the Benefit Payment will not be reduced. - The annual charge for The Hartford's Lifetime Income Builder is 40 bps of the Benefit Amount after the automatic increase calculation. - $99,000 x .004 = $396, this amount is deducted from the Contract Value. EXAMPLE 4: ASSUME THE SAME FACTS AS EXAMPLE 3. ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2 AND THAT, JUST PRIOR TO THE PAYMENT, THE CONTRACT VALUE WAS $96,000. - At the beginning of Contract Year 2, your initial Benefit Amount is $99,000. - Your Benefit Payment is $5,000. - Your Benefit Amount after the premium payment is $119,000. - Your Benefit Payment is $5,950, which is 5% of your Benefit Amount. APP I-9 ------------------------------------------------------------------------------- EXAMPLE 5: ASSUME THE SAME FACTS AS EXAMPLE 4. ASSUME THAT AT THE ON THE FOLLOWING ANNIVERSARY (THE END OF CONTRACT YEAR 2) THE CONTRACT VALUE IS $118,000 AND THAT NO WITHDRAWALS WERE TAKEN IN CONTRACT YEAR 2. - After premium payment, your Benefit Amount is $119,000. - Your Benefit Payment is $5,950. - At the anniversary, we calculate the automatic Benefit Amount Increase. The ratio is the Contract Value ($118,000) divided by the Maximum Contract Value ($120,000), less 1 subject to a minimum of 0% and a maximum of 10%. - ($118,000 / $120,000) - 1 = -.01667 subject to a minimum of 0% - Your Benefit Amount is $119,000, which is your previous Benefit Amount since the automatic Benefit Amount increase is 0%. - Your Benefit Payment is $5,950, which is 5% of your Benefit Amount. - The annual charge for The Hartford's Lifetime Income Builder is 40 bps of the Benefit Amount after the automatic increase calculation. - $119,000 x .004 = $476, this amount is deducted from the Contract Value. EXAMPLE 6: ASSUME THE SAME FACTS AS EXAMPLE 5. ASSUME THAT IN THE THIRD CONTRACT YEAR, A $35,000 PARTIAL SURRENDER IS TAKEN. THE PARTIAL SURRENDER INCLUDES A CONTINGENT DEFERRED SALES CHARGE. THE WITHDRAWAL LOWERED THE CONTRACT VALUE FROM $115,000 TO $80,000. - At the beginning of Contract Year 3, your initial Benefit Amount is $119,000. - Your Benefit Payment is $5,950. - Since the total partial Surrender exceeds the Benefit Payment, the Benefit Amount is reset to the lesser of (i) or (ii) as follows - (i) the Contract Value immediately following the partial withdrawal: $80,000. - (ii) the Benefit Amount prior to the partial Surrender, less the amount of the Surrender: $119,000 - $35,000 = $84,000. - Your new Benefit Amount is $80,000. - Your new Benefit Payment is $4,000, which is 5% of the new Benefit Amount. EXAMPLE 7: ASSUME THAT ON THE CONTRACT ANNIVERSARY IMMEDIATELY FOLLOWING THE OLDER OWNER'S 60TH BIRTHDAY, THE CONTRACT VALUE IS $200,000. - Your Benefit Amount after the automatic increase calculation is $200,000. - Your Lifetime Benefit Payment is $10,000 which is 5% of your Benefit Amount. - The annual charge for The Hartford's Lifetime Income Builder is 40 bps of the Benefit Amount after the automatic increase calculation. - $200,000 x .004 = $800, this amount is deducted from the Contract Value. EXAMPLE 8: ASSUME THE OWNER WITHDRAWS $9,000 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE BENEFIT PAYMENT IS $10,000; THE LIFETIME BENEFIT PAYMENT IS $7,000; THE BENEFIT AMOUNT $80,000 AND THE CONTRACT VALUE IS $85,000. - Your Benefit Amount is $80,000 before the partial Surrender. - Your Benefit Amount after the partial Surrender is $71,000, since the partial Surrender is less than your Benefit Payment. - There is no change to the annual Benefit Payment since the partial Surrender is less than the Benefit Payment. - Your Lifetime Benefit Payment will be reset to $3,550 which is 5% of the Benefit Amount after the partial Surrender. This reset occurs because partial Surrender is greater that the annual Lifetime Benefit Payment. EXAMPLE 9: ASSUME THE OWNER WITHDRAWS $12,000 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE BENEFIT PAYMENT IS $10,000; THE LIFETIME BENEFIT PAYMENT IS $7,000; THE BENEFIT AMOUNT $80,000 AND THE CONTRACT VALUE IS $85,000. - Your Benefit Amount is $80,000 before the partial Surrender. - Your Benefit Amount after the partial Surrender is $68,000. - It is the lesser of Contract Value after the partial Surrender ($73,000) and the Benefit Amount immediately prior the partial Surrender, less the partial Surrender amount ($68,000). This comparison is done because the partial Surrender is greater than your Benefit Payment. - Your Benefit Amount will reset to $3,400 which is 5% of the Benefit Amount after the partial Surrenders. This reset occurs because the partial Surrender is greater than the annual Benefit Payment. - Your Lifetime Benefit Payment will reset to $3,400 which is 5% of the Benefit Amount after the partial Surrender. This reset occurs because partial Surrender is greater that the annual Lifetime Benefit Payment. APP I-10 ------------------------------------------------------------------------------- THE HARTFORD'S LIFETIME INCOME FOUNDATION THIS OPTIONAL WITHDRAWAL BENEFIT IS CLOSED TO NEW INVESTORS IF THE HARTFORD'S LIFETIME INCOME SELECTS OR THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS IS APPROVED IN YOUR STATE. EXAMPLE 1: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $5,000, which is 5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 2: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $4,500, which is 4.5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 3: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Withdrawal Percent is 5%, which is based on your age. - Your Lifetime Benefit Payment is $5,000, which is 5% of your Payment Base. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 4: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 3, HOWEVER YOUR FIRST PARTIAL SURRENDER IS TAKEN AT AGE 70. YOUR WITHDRAWAL PERCENT IS 6% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE YEAR IS $105,000. - Your Lifetime Benefit Payment is $6,300, which is the product of your Withdrawal Percent multiplied by $105,000, which is the greater of your Contract Value at the beginning of the year and your Payment Base. - You take a partial Surrender of $6,000. - Your Payment Base remains at $100,000, since the withdrawal did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent will remain at 6% for the duration of your Contract; this is based on your age on the most recent Contract Anniversary prior to your first partial Surrender. - Your remaining Lifetime Benefit Payment for the Contract Year is $300. - Your Contract Value after the withdrawal is $99,000. - Your Guaranteed Minimum Death Benefit is $94,000, which is your prior Death Benefit reduced by the amount of the withdrawal. EXAMPLE 5: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Withdrawal Percent is 4.5%, which is based on your age. - Your Lifetime Benefit Payment is $4,500, which is 4.5% of your Payment Base. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. APP I-11 ------------------------------------------------------------------------------- EXAMPLE 6: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 5, HOWEVER YOUR FIRST PARTIAL SURRENDER AT AGE 70. YOUR WITHDRAWAL PERCENT IS 5.5% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE YEAR IS $106,500. - Your Lifetime Benefit Payment is $5,857.50, which is the product of your Withdrawal Percent multiplied by $106,500, which is the greater of your Contract Value at the beginning of the year and your Payment Base. - You take a partial Surrender of $5,500. - Your Payment Base remains at $100,000, since the withdrawal did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent will remain at 5.5% for the duration of your Contract; this is based on your age on the most recent Contract Anniversary prior to your first partial Surrender. - Your remaining Lifetime Benefit Payment for the Contract Year is $357.50. - Your Contract Value after the withdrawal is $101,000. - Your Guaranteed Minimum Death Benefit is $94,500, which is your prior Death Benefit reduced by the withdrawal. EXAMPLE 7: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $95,000. PRIOR TO THE SURRENDER: - Your initial Payment Base is $100,000. - Your Threshold is $5,000. - Your Guaranteed Minimum Death Benefit is $100,000. AFTER THE SURRENDER: - Your Payment Base is $99,000, which is your prior Payment Base reduced by the amount of the partial Surrender. - Your Withdrawal Percentage, used to determine Lifetime Benefit Payments when you are in an Eligible Withdrawal Year, will remain at 5% for the duration of your Contract. - Your remaining Threshold amount for the Contract Year is $4,000, which is your prior Threshold amount reduced by the amount of the partial Surrender. - The annual charge for The Hartford's Lifetime Income Foundation is 0.30% of the Payment Base. - $99,000 x 0.30% = $297, this amount is deducted from the Contract Value. - Your Guaranteed Minimum Death Benefit is $99,000, which is your prior Death Benefit reduced by the amount of the partial Surrender. EXAMPLE 8: ASSUME THE SAME FACTS AS EXAMPLE 2 (JOINT/SPOUSAL). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $95,000. PRIOR TO THE SURRENDER: - Your initial Payment Base is $100,000. - Your Threshold is $4,500. - Your Guaranteed Minimum Death Benefit is $100,000. AFTER THE SURRENDER: - Your Payment Base is $99,000, which is your prior Payment Base reduced by the amount of the partial Surrender. - Your Withdrawal Percentage, used to determine Lifetime Benefit Payments when you are in an Eligible Withdrawal Year, will remain at 4.5% for the duration of your Contract. - Your remaining Threshold amount for the Contract Year is $3,500, which is your prior Threshold amount reduced by the amount of the partial Surrender. - The annual charge for The Hartford's Lifetime Income Foundation is 0.30% of the Payment Base. - $99,000 x 0.30% = $297, this amount is deducted from the Contract Value. - Your Guaranteed Minimum Death Benefit is $99,000, which is your prior Death Benefit reduced by the amount of the partial Surrender. APP I-12 ------------------------------------------------------------------------------- EXAMPLE 9: ASSUME THE SAME FACTS AS EXAMPLE 7 (SINGLE LIFE). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, JUST PRIOR TO THE PAYMENT, THE CONTRACT VALUE WAS $96,000. PRIOR TO THE PREMIUM PAYMENT: - At the beginning of Contract Year 2, your initial Payment Base is $99,000. - Your Threshold amount is $4,950. - Your Guaranteed Minimum Death Benefit is $99,000. AFTER THE PREMIUM PAYMENT: - Your Payment Base is $119,000, which is your prior Payment Base increased by the amount of the Premium Payment. - Your Threshold amount is $5,950, which is 5% of the greater of your Contract Value immediately following the Premium Payment or your Payment Base immediately following the Premium Payment. - Your Guaranteed Minimum Death Benefit is $119,000, which is your prior Death Benefit increased by the amount of the Premium Payment. EXAMPLE 10: ASSUME THE SAME FACTS AS EXAMPLE 8 (JOINT/SPOUSAL). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, JUST PRIOR TO THE PAYMENT, THE CONTRACT VALUE WAS $96,000. PRIOR TO THE PREMIUM PAYMENT: - At the beginning of Contract Year 2, your initial Payment Base is $99,000. - Your Threshold amount is $4,455. - Your Guaranteed Minimum Death Benefit is $99,000. AFTER THE PREMIUM PAYMENT: - Your Payment Base is $119,000, which is your prior Payment Base increased by the amount of the Premium Payment. - Your Threshold amount is $5,355, which is 4.5% of the greater of your Contract Value immediately following the Premium Payment or your Payment Base immediately following the Premium Payment. - Your Guaranteed Minimum Death Benefit is $119,000, which is your prior Death Benefit increased by the amount of the Premium Payment. EXAMPLE 11: ASSUME THE OLDER COVERED LIFE IS 74 (SINGLE LIFE). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $3,300 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 6%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000; THE LIFETIME BENEFIT PAYMENT IS 6% MULTIPLIED BY THE GREATER OF THE PAYMENT BASE OR CONTRACT VALUE, OR $3,300. AFTER THE PARTIAL SURRENDER: - Your Payment Base remains at $50,000, which is the Payment Base prior to the partial Surrender, since the partial Surrender did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent is 6% for the duration of your Contract. - Your Lifetime Benefit Payment for the remainder of the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,700, which is your prior Death Benefit reduced by the amount of the partial Surrender. APP I-13 ------------------------------------------------------------------------------- EXAMPLE 12: ASSUME THE YOUNGER COVERED LIFE IS 74 (JOINT/SPOUSAL). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $3,025 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 5.5%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000; THE LIFETIME BENEFIT PAYMENT IS 5.5% MULTIPLIED BY THE GREATER OF PAYMENT BASE OR CONTRACT VALUE, OR $3,025. AFTER THE PARTIAL SURRENDER: - Your Payment Base remains at $50,000, which is the Payment Base prior to the partial Surrender, since the partial Surrender did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent is 5.5% for the duration of your Contract. - Your Lifetime Benefit Payment for the remainder of the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,975, which is your prior Death Benefit reduced by the amount of the partial Surrender. EXAMPLE 13: ASSUME THE SAME FACTS AS EXAMPLE 11 (SINGLE LIFE). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $1,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $52,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $51,000. PRIOR TO THE PARTIAL SURRENDER: - Your Payment Base is $50,000. - Your Withdrawal Percent was previously locked in at 6%. - Your remaining Lifetime Benefit Payment for this Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,700. AFTER THE PARTIAL SURRENDER: - Your Payment Base is $49,038, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment/Contract Value prior to the Surrender); then this factor is multiplied by the prior Payment Base. - Your Lifetime Benefit Payment remaining for the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $45,802, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment /Contract Value prior to the Surrender); then this factor is multiplied by the prior Death Benefit. EXAMPLE 14: ASSUME THE SAME FACTS AS EXAMPLE 12 (JOINT/SPOUSAL). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $2,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $49,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $47,000. PRIOR TO THE PARTIAL SURRENDER: - Your Payment Base is $50,000. - Your Withdrawal Percent was previously locked in at 5.5%. - Your remaining Lifetime Benefit Payment for this Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,975. AFTER THE PARTIAL SURRENDER: - Your new Payment Base is $47,959, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment /Contract Value prior to the Surrender); then this factor is multiplied by the prior Payment Base. - Your Lifetime Benefit Payment remaining for the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $45,058, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment /Contract Value prior to the Surrender); then this factor is multiplied by the prior Death Benefit. APP I-14 ------------------------------------------------------------------------------- THE HARTFORD'S LIFETIME INCOME BUILDER II THIS OPTIONAL WITHDRAWAL BENEFIT IS CLOSED TO NEW INVESTORS IF THE HARTFORD'S LIFETIME INCOME SELECTS OR THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS IS APPROVED IN YOUR STATE. EXAMPLE 1: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $5,000, which is 5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 2: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $4,500, which is 4.5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 3: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Withdrawal Percent is 5%, which is based on your age. - Your Lifetime Benefit Payment is $5,000, which is 5% of your Payment Base. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. EXAMPLE 4: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 3, HOWEVER YOUR FIRST PARTIAL SURRENDER IS TAKEN AT AGE 70. YOUR WITHDRAWAL PERCENT IS 6% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE YEAR IS $105,000. - Your Lifetime Benefit Payment is $6,300, which is the product of your Withdrawal Percent multiplied by $105,000, which is the greater of your Contract Value at the beginning of the year and your Payment Base. - You take a partial Surrender of $6,000. - Your Payment Base remains at $100,000, since the withdrawal did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent will remain at 6% for the duration of your Contract; this is based on your age on the most recent Contract Anniversary prior to your first partial Surrender. - Your remaining Lifetime Benefit Payment for the Contract Year is $300. - Your Contract Value after the withdrawal is $99,000. - Your Guaranteed Minimum Death Benefit is $94,000, which is your prior Death Benefit reduced by the amount of the withdrawal. EXAMPLE 5: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000. - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Withdrawal Percent is 4.5%, which is based on your age. - Your Lifetime Benefit Payment is $4,500, which is 4.5% of your Payment Base. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. APP I-15 ------------------------------------------------------------------------------- EXAMPLE 6: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 5, HOWEVER YOUR FIRST PARTIAL SURRENDER AT AGE 70. YOUR WITHDRAWAL PERCENT IS 5.5% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE YEAR IS $106,500. - Your Lifetime Benefit Payment is $5,857.50, which is the product of your Withdrawal Percent multiplied by $106,500, which is the greater of your Contract Value at the beginning of the year and your Payment Base. - You take a partial Surrender of $5,500. - Your Payment Base remains at $100,000, since the withdrawal did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent will remain at 5.5% for the duration of your Contract; this is based on your age on the most recent Contract Anniversary prior to your first partial Surrender. - Your remaining Lifetime Benefit Payment for the Contract Year is $357.50. - Your Contract Value after the withdrawal is $101,000. - Your Guaranteed Minimum Death Benefit is $94,500, which is your prior Death Benefit reduced by the withdrawal. EXAMPLE 7: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $95,000. PRIOR TO THE SURRENDER: - Your initial Payment Base is $100,000. - Your Threshold is $5,000. - Your Guaranteed Minimum Death Benefit is $100,000. AFTER THE SURRENDER: - At the anniversary, we calculate the automatic Payment Base increase. The ratio is the Contract Value ($95,000) divided by the Maximum Contract Value ($100,000), less 1. Subject to a minimum of 0% and a maximum of 10%. - ($95,000/$100,000) - 1 = -.05 subject to the minimum of 0%. - Your Payment Base is $99,000, which is your prior Payment Base reduced by the amount of the partial Surrender, since the automatic Payment Base increase was 0%. - Your Withdrawal Percentage, used to determine Lifetime Benefit Payments when you are in an Eligible Withdrawal Year, will remain at 5% for the duration of your Contract. - Your remaining Threshold amount for the Contract Year is $4,000, which is your prior Threshold amount reduced by the amount of the partial Surrender. - The annual charge for The Hartford's Lifetime Income Builder II is 0.40% of the Payment Base after the automatic increase calculation. - $99,000 x 0.40% = $396, this amount is deducted from the Contract Value. - Your Guaranteed Minimum Death Benefit is $99,000, which is your prior Death Benefit reduced by the amount of the partial Surrender. APP I-16 ------------------------------------------------------------------------------- EXAMPLE 8: ASSUME THE SAME FACTS AS EXAMPLE 2 (JOINT/SPOUSAL). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE ON YOUR FIRST ANNIVERSARY IS $95,000. PRIOR TO THE SURRENDER: - Your initial Payment Base is $100,000. - Your Threshold is $4,500. - Your Guaranteed Minimum Death Benefit is $100,000. AFTER THE SURRENDER: - At the anniversary, we calculate the automatic Payment Base increase. The ratio is the Contract Value ($95,000) divided by the Maximum Contract Value ($100,000), less 1. Subject to a minimum of 0% and a maximum of 10%. - ($95,000/$100,000) - 1 = -.05 subject to the minimum of 0%. - Your Payment Base is $99,000, which is your prior Payment Base reduced by the amount of the partial Surrender, since the automatic Payment Base increase was 0%. - Your Withdrawal Percentage, used to determine Lifetime Benefit Payments when you are in an Eligible Withdrawal Year, will remain at 4.5% for the duration of your Contract. - Your remaining Threshold amount for the Contract Year is $3,500, which is your prior Threshold amount reduced by the amount of the partial Surrender. - The annual charge for The Hartford's Lifetime Income Builder II is 0.40% of the Payment Base after the automatic increase calculation. - $99,000 x 0.40% = $396, this amount is deducted from the Contract Value. - Your Guaranteed Minimum Death Benefit is $99,000, which is your prior Death Benefit reduced by the amount of the partial Surrender. EXAMPLE 9: ASSUME THE SAME FACTS AS EXAMPLE 7 (SINGLE LIFE). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, JUST PRIOR TO THE PAYMENT, THE CONTRACT VALUE WAS $96,000. PRIOR TO THE PREMIUM PAYMENT: - At the beginning of Contract Year 2, your initial Payment Base is $99,000. - Your Threshold amount is $4,950. - Your Guaranteed Minimum Death Benefit is $99,000. AFTER THE PREMIUM PAYMENT: - Your Payment Base is $119,000, which is your prior Payment Base increased by the amount of the Premium Payment. - Your Threshold amount is $5,950, which is 5% of the greater of your Contract Value immediately following the Premium Payment or your Payment Base immediately following the Premium Payment. - Your Guaranteed Minimum Death Benefit is $119,000, which is your prior Death Benefit increased by the amount of the Premium Payment. EXAMPLE 10: ASSUME THE SAME FACTS AS EXAMPLE 8 (JOINT/SPOUSAL). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, JUST PRIOR TO THE PAYMENT, THE CONTRACT VALUE WAS $96,000. PRIOR TO THE PREMIUM PAYMENT: - At the beginning of Contract Year 2, your initial Payment Base is $99,000. - Your Threshold amount is $4,455. - Your Guaranteed Minimum Death Benefit is $99,000. AFTER THE PREMIUM PAYMENT: - Your Payment Base is $119,000, which is your prior Payment Base increased by the amount of the Premium Payment. - Your Threshold amount is $5,355, which is 4.5% of the greater of your Contract Value immediately following the Premium Payment or your Payment Base immediately following the Premium Payment. - Your Guaranteed Minimum Death Benefit is $119,000, which is your prior Death Benefit increased by the amount of the Premium Payment. APP I-17 ------------------------------------------------------------------------------- EXAMPLE 11: ASSUME THE OLDER COVERED LIFE IS 74 (SINGLE LIFE). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $3,300 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 6%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000; THE LIFETIME BENEFIT PAYMENT IS 6% MULTIPLIED BY THE GREATER OF THE PAYMENT BASE OR CONTRACT VALUE, OR $3,300. AFTER THE PARTIAL SURRENDER: - Your Payment Base remains at $50,000, which is the Payment Base prior to the partial Surrender, since the partial Surrender did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent is 6% for the duration of your Contract. - Your Lifetime Benefit Payment for the remainder of the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,700, which is your prior Death Benefit reduced by the amount of the partial Surrender. EXAMPLE 12: ASSUME THE YOUNGER COVERED LIFE IS 74 (JOINT/SPOUSAL). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $3,025 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 5.5%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000; THE LIFETIME BENEFIT PAYMENT IS 5.5% MULTIPLIED BY THE GREATER OF PAYMENT BASE OR CONTRACT VALUE, OR $3,025. AFTER THE PARTIAL SURRENDER: - Your Payment Base remains at $50,000, which is the Payment Base prior to the partial Surrender, since the partial Surrender did not exceed your Lifetime Benefit Payment. - Your Withdrawal Percent is 5.5% for the duration of your Contract. - Your Lifetime Benefit Payment for the remainder of the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,975, which is your prior Death Benefit reduced by the amount of the partial Surrender. EXAMPLE 13: ASSUME THE SAME FACTS AS EXAMPLE 11 (SINGLE LIFE). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $1,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $52,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $51,000. PRIOR TO THE PARTIAL SURRENDER: - Your Payment Base is $50,000. - Your Withdrawal Percent was previously locked in at 6%. - Your remaining Lifetime Benefit Payment for this Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,700. AFTER THE PARTIAL SURRENDER: - Your Payment Base is $49,038, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment/Contract Value prior to the Surrender); then this factor is multiplied by the prior Payment Base. - Your Lifetime Benefit Payment remaining for the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $45,802, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment/Contract Value prior to the Surrender); then this factor is multiplied by the prior Death Benefit. APP I-18 ------------------------------------------------------------------------------- EXAMPLE 14: ASSUME THE SAME FACTS AS EXAMPLE 12 (JOINT/SPOUSAL). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $2,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $49,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $47,000. PRIOR TO THE PARTIAL SURRENDER: - Your Payment Base is $50,000. - Your Withdrawal Percent was previously locked in at 5.5%. - Your remaining Lifetime Benefit Payment for this Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $46,975. AFTER THE PARTIAL SURRENDER: - Your new Payment Base is $47,959, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment/Contract Value prior to the Surrender); then this factor is multiplied by the prior Payment Base. - Your Lifetime Benefit Payment remaining for the Contract Year is $0. - Your Guaranteed Minimum Death Benefit is $45,058, which is calculated by determining the proportional reduction 1 - (Surrender exceeding the Lifetime Benefit Payment/Contract Value prior to the Surrender); then this factor is multiplied by the prior Death Benefit. EXAMPLE 15: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). NOW ASSUME YOU HAVE REACHED YOUR FIRST CONTRACT ANNIVERSARY. YOUR CONTRACT VALUE ON THE CONTRACT ANNIVERSARY IS $110,000. PRIOR TO THE CONTRACT ANNIVERSARY: - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $5,000, which is 5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. AFTER THE CONTRACT ANNIVERSARY: - At the anniversary, we calculate the automatic Payment Base increase. The ratio is the Contract Value ($110,000) divided by the Maximum Contract Value ($100,000), less 1. Subject to a minimum of 0% and a maximum of 10%. - ($110,000/$100,000) - 1 = .10 subject to the maximum of 10%. - Your Payment Base is $110,000, which is your prior Payment Base multiplied by the automatic Payment Base increase. - Your Threshold amount for the Contract Year is $5,500, which is your new Payment Base multiplied by 5%. - Your Guaranteed Minimum Death Benefit remains $100,000, as it is not impacted by the automatic Payment Base increase. APP I-19 ------------------------------------------------------------------------------- EXAMPLE 16: ASSUME THE SAME FACTS AS EXAMPLE 2 (JOINT/SPOUSAL). NOW ASSUME YOU HAVE REACHED YOUR FIRST CONTRACT ANNIVERSARY. YOUR CONTRACT VALUE ON THE ANNIVERSARY IS $105,000. PRIOR TO THE CONTRACT ANNIVERSARY: - Your Payment Base is $100,000, which is your initial Premium Payment. - Your Threshold is $4,500, which is 4.5% of your Payment Base. - Your Lifetime Benefit Payment is not calculated. The Lifetime Benefit Payment will be determined in the first Eligible Withdrawal Year in which you take a partial Surrender. - Your Guaranteed Minimum Death Benefit is $100,000, which is your initial Premium Payment. AFTER THE CONTRACT ANNIVERSARY: - At the anniversary, we calculate the automatic Payment Base increase. The ratio is the Contract Value ($105,000) divided by the Maximum Contract Value ($100,000), less 1. Subject to a minimum of 0% and a maximum of 10%. - ($105,000/$100,000) - 1 = .05 subject to the maximum of 10%. - Your Payment Base is $105,000, which is your prior Payment Base multiplied by the automatic Payment Base increase. - Your Threshold amount for the Contract Year is $4,725, which is your new Payment Base multiplied by 4.5%. - Your Guaranteed Minimum Death Benefit remains $100,000, as it is not impacted by the automatic Payment Base increase. EXAMPLE 17: SPOUSAL CONTRACT CONTINUATION On date of Spousal Contract continuation, we increase the Contract Value to equal the Death Benefit (if greater). For illustration purposes, we will assume the Contract Value on the date of continuation is set equal to the Death Benefit of $150,000 and the Payment Base is $125,000. The values for the rider are impacted as follows: Payment Base = $150,000 (greater of Contract Value or Payment Base on date of continuation) WP = existing Withdrawal Percent if partial Surrender have been taken, or else it is set using the remaining Spouse's attained age on the Contract Anniversary prior to the first partial Surrender (for this example we will say it is 6%). Lifetime Benefit Payment = $9,000 (WP x greater of Payment Base or Contract Value on date of continuation) Death Benefit = $150,000 (Contract Value on date of continuation) Maximum Contract Value (LIB II Only) = $150,000 (greater of Contract Value or Payment Base on date of continuation) APP I-20 ------------------------------------------------------------------------------- THE HARTFORD'S LIFETIME INCOME BUILDER SELECTS AND THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS EXAMPLE 1: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000.
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment THRESHOLD $5,000 $5,000 - 5% of your Payment Base - 5% of your Payment Base LIFETIME BENEFIT PAYMENT N/A N/A GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
EXAMPLE 2: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS LESS THAN AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000.
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment THRESHOLD $4,500 $4,500 - 4.5% of your Payment Base - 4.5% of your Payment Base LIFETIME BENEFIT PAYMENT N/A N/A GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
EXAMPLE 3: ASSUME YOU SELECT SINGLE LIFE OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE OLDER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000.
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment WITHDRAWAL PERCENT 5% 5% - Based on your age - Based on your age LIFETIME BENEFIT PAYMENT $5,000 $5,000 - 5% of your Payment Base - 5% of your Payment Base GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
EXAMPLE 4: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 3 (SINGLE LIFE), HOWEVER YOUR FIRST PARTIAL SURRENDER IS TAKEN AT AGE 70. YOUR WITHDRAWAL PERCENT IS 6% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE YEAR IS $105,000. YOUR CONTRACT VALUE UPON ATTAINING AGE 70 IS $105,500. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $105,000 $105,000 LIFETIME BENEFIT PAYMENT $6,330 $6,300 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by your greater of your Payment Base or Contract Payment Base Value upon attaining age 70
APP I-21 ------------------------------------------------------------------------------- YOU TAKE A PARTIAL SURRENDER OF $6,000, VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $105,000 $105,000 WITHDRAWAL PERCENT 6%(1) 6%(1) LIFETIME BENEFIT PAYMENT $330 $300 - Remaining for Contract Year - Remaining for Contract Year CONTRACT VALUE AFTER THE WITHDRAWAL $99,000 $99,000 GUARANTEED MINIMUM DEATH BENEFIT $94,000 $94,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the withdrawal withdrawal
EXAMPLE 5: ASSUME YOU SELECT JOINT/SPOUSAL OPTION WHEN YOU PURCHASE YOUR CONTRACT, THE YOUNGER COVERED LIFE IS AGE 60, AND YOUR INITIAL PREMIUM PAYMENT IS $100,000.
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment WITHDRAWAL PERCENT 4.5% 4.5% - Based on your age - Based on your age LIFETIME BENEFIT PAYMENT $4,500 $4,500 - 4.5% of your Payment Base - 4.5% of your Payment Base GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
(1) The Withdrawal Percentage will remain for the duration of your Contract unless an automatic Payment Base increase occurs on a future anniversary and a new Withdrawal Percent age band is applicable; if no automatic Payment Base increase occurs on a future anniversary where a new Withdrawal Percent age band is applicable, your Withdrawal Percent will remain as is. EXAMPLE 6: ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 5 (JOINT/SPOUSAL), HOWEVER YOUR FIRST PARTIAL SURRENDER IS TAKEN AT AGE 70. YOUR WITHDRAWAL PERCENT IS 5.5% BASED ON YOUR AGE. YOUR CONTRACT VALUE AT THE BEGINNING OF THE CONTRACT YEAR IS $110,000. YOUR CONTRACT VALUE UPON ATTAINING AGE 70 IS $111,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $110,000 $110,000 LIFETIME BENEFIT PAYMENT $6,105 $6,050 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by your greater of your Payment Base or Contract Payment Base Value upon attaining age 70
YOU TAKE A PARTIAL SURRENDER OF $6,000, VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $110,000 $110,000 WITHDRAWAL PERCENT 5.5%(1) 5.5%(1) LIFETIME BENEFIT PAYMENT $105 $50 - Remaining for Contract Year - REMAINING FOR CONTRACT YEAR CONTRACT VALUE AFTER THE WITHDRAWAL $105,000 $105,000 GUARANTEED MINIMUM DEATH BENEFIT $94,000 $94,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the withdrawal withdrawal
APP I-22 ------------------------------------------------------------------------------- EXAMPLE 7: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE PRIOR TO THE RIDER CHARGE BEING DEDUCTED ON YOUR FIRST ANNIVERSARY IS $95,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 THRESHOLD $5,000 $5,000 GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000
VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 - Prior Payment Base reduced by - Prior Payment Base reduced by withdrawal withdrawal WITHDRAWAL PERCENT 5%(1) 5%(1) THRESHOLD $4,000 $4,000 - Remaining for the Contract Year - Remaining for the Contract Year GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the withdrawal withdrawal
VALUES AFTER THE ANNIVERSARY PROCESSING:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($95,000) divided by your current Payment the rider charge being taken, or Base ($99,000), less 1 - Your current Payment Base - Resulting in -0.04%, subject to minimum of 0%, No change to the Payment Base THRESHOLD $4,950 $4,950 - 5% of your Payment Base - 5% of your Payment Base RIDER CHARGE $544.50 $643.50 - Rider charge of 0.55% multiplied by - Rider charge of 0.65% multiplied by your current Payment Base your current Payment Base GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - No change due to anniversary processing - No change due to anniversary processing
EXAMPLE 8: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE PRIOR TO THE RIDER CHARGE BEING DEDUCTED ON YOUR FIRST ANNIVERSARY IS $105,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 THRESHOLD $5,000 $5,000 GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000
APP I-23 ------------------------------------------------------------------------------- VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 - Prior Payment Base reduced by - Prior Payment Base reduced by withdrawal withdrawal WITHDRAWAL PERCENT 5%(1) 5%(1) THRESHOLD $4,000 $4,000 - Remaining for the Contract Year - Remaining for the Contract Year GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the withdrawal withdrawal
VALUES AFTER THE ANNIVERSARY PROCESSING:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $105,000 $105,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($105,000) divided by your current the rider charge being taken, or Payment Base ($99,000), less 1 - Your current Payment Base - Resulting in 0.06%, subject to minimum of 0% and maximum of 10% THRESHOLD $5,250 $5,250 - 5% of your Payment Base - 5% of your Payment Base RIDER CHARGE $577.50 $682.50 - Rider charge of 0.55% multiplied by - Rider charge of 0.65% multiplied by your current Payment Base your current Payment Base GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - No change due to anniversary processing - No change due to anniversary processing
EXAMPLE 9: ASSUME THE SAME FACTS AS EXAMPLE 2 (JOINT/SPOUSAL). ALSO ASSUME THAT YOU TAKE A $1,000 PARTIAL SURRENDER IN THE FIRST CONTRACT YEAR AND THAT THE CONTRACT VALUE PRIOR TO THE RIDER CHARGE BEING DEDUCTED ON YOUR FIRST ANNIVERSARY IS $95,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 THRESHOLD $4,500 $4,500 GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000
VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 - Prior Payment Base reduced by - Prior Payment Base reduced by withdrawal withdrawal WITHDRAWAL PERCENT 4.5%(1) 4.5%(1) THRESHOLD $3,500 $3,500 - Remaining for the Contract Year - Remaining for the Contract Year GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the withdrawal withdrawal
APP I-24 ------------------------------------------------------------------------------- VALUES AFTER THE ANNIVERSARY PROCESSING:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($95,000) divided by your current Payment the rider charge being taken, or Base ($99,000), less 1 - Your current Payment Base - Resulting in -0.04%, subject to minimum of 0%, No change to the Payment Base THRESHOLD $4,455 $4,455 - 4.5% of your Payment Base - 4.5% of your Payment Base RIDER CHARGE $544.50 $643.50 - Rider charge of 0.55% multiplied by - Rider charge of 0.65% multiplied by your current Payment Base your current Payment Base GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000 - No change due to anniversary processing - No change due to anniversary processing
EXAMPLE 10: ASSUME THE SAME FACTS AS EXAMPLE 7 (SINGLE LIFE). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, THE CONTRACT VALUE AFTER THE PAYMENT IS $121,000. VALUES PRIOR TO THE PREMIUM PAYMENT:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 THRESHOLD $4,950 $4,950 GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000
VALUES AFTER THE PREMIUM PAYMENT:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $119,000 $119,000 - Prior Payment Base increased by the - Prior Payment Base increased by the Premium Payment Premium Payment THRESHOLD $6,050 $5,950 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by your greater of your current Payment Base or current Payment Base Contract Value GUARANTEED MINIMUM DEATH BENEFIT $119,000 $119,000 - Prior Death Benefit increased by the - Prior Death Benefit increased by the Premium Payment Premium Payment
APP I-25 ------------------------------------------------------------------------------- EXAMPLE 11: ASSUME THE SAME FACTS AS EXAMPLE 9 (JOINT/SPOUSAL). ASSUME THAT AN ADDITIONAL PREMIUM PAYMENT OF $20,000 IS MADE IN CONTRACT YEAR 2, THE CONTRACT VALUE AFTER THE PAYMENT IS $125,000. VALUES PRIOR TO THE PREMIUM PAYMENT:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $99,000 $99,000 THRESHOLD $4,455 $4,455 GUARANTEED MINIMUM DEATH BENEFIT $99,000 $99,000
VALUES AFTER THE PREMIUM PAYMENT:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $119,000 $119,000 - Prior Payment Base increased by the - Prior Payment Base increased by the Premium Payment Premium Payment THRESHOLD $5,625 $5,355 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by your greater of your current Payment Base or current Payment Base Contract Value GUARANTEED MINIMUM DEATH BENEFIT $119,000 $119,000 - Prior Death Benefit increased by the - Prior Death Benefit increased by the Premium Payment Premium Payment
EXAMPLE 12: ASSUME THE OLDER COVERED LIFE IS 74 (SINGLE LIFE). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $3,000 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 6%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000. VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $50,000 $50,000 - Partial Surrender did not exceed the - Partial Surrender did not exceed the Lifetime Benefit Payment Lifetime Benefit Payment WITHDRAWAL PERCENT 6%(1) 6%(1) LIFETIME BENEFIT PAYMENT $300 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was 6% multiplied by the greater of the 6% multiplied by the Payment Base on the Payment Base or Contract Value on the Contract Anniversary Contract Anniversary - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was $3,000 $3,300 GUARANTEED MINIMUM DEATH BENEFIT $47,000 $47,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the partial Surrender partial Surrender
APP I-26 ------------------------------------------------------------------------------- EXAMPLE 13: ASSUME THE YOUNGER COVERED LIFE IS 74 (JOINT/SPOUSAL). ASSUME THE OWNER MAKES THE FIRST PARTIAL SURRENDER UNDER THE CONTRACT OF $2,750 WHEN, JUST PRIOR TO THE PARTIAL SURRENDER, THE PAYMENT BASE IS $50,000; THE CONTRACT VALUE (ON ANNIVERSARY) IS $55,000; THE WITHDRAWAL PERCENT IS 5.5%; THE GUARANTEED MINIMUM DEATH BENEFIT IS $50,000. VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $50,000 $50,000 - Partial Surrender did not exceed the - Partial Surrender did not exceed the Lifetime Benefit Payment Lifetime Benefit Payment WITHDRAWAL PERCENT 5.5%(1) 5.5%(1) LIFETIME BENEFIT PAYMENT $275 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was 5.5% multiplied by the greater of the 5.5% multiplied by the Payment Base on Payment Base or Contract Value on the the Contract Anniversary Contract Anniversary - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was $2,750 $3,025 GUARANTEED MINIMUM DEATH BENEFIT $47,250 $47,250 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the partial Surrender partial Surrender
EXAMPLE 14: ASSUME THE SAME FACTS AS EXAMPLE 12 (SINGLE LIFE). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $1,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $52,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $51,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $50,000 $50,000 - Partial Surrender did not exceed the - Partial Surrender did not exceed the Lifetime Benefit Payment Lifetime Benefit Payment WITHDRAWAL PERCENT 6% 6% LIFETIME BENEFIT PAYMENT $300 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was 6% multiplied by the greater of the 6% multiplied by the Payment Base on the Payment Base or Contract Value on the Contract Anniversary Contract Anniversary - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was $3,000 $3,300 GUARANTEED MINIMUM DEATH BENEFIT $47,000 $47,000 - Prior Death Benefit reduced by the - Prior Death Benefit reduced by the partial Surrender partial Surrender
APP I-27 ------------------------------------------------------------------------------- VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $49,323 $49,038 - Proportional reduction: - Proportional reduction: 1-($700/($52,000-$300) 1-($1000/$52,000) LIFETIME BENEFIT PAYMENT $0 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year GUARANTEED MINIMUM DEATH BENEFIT $46,068 $46,096 - Prior Death Benefit reduced by partial - Prior Death Benefit reduced by partial surrender NOT exceeding the Lifetime surrender NOT exceeding the Lifetime Benefit Payment. Then, proportional Benefit Payment. Then, proportional reduction multiplied by the result of the reduction multiplied by the result of the above above
EXAMPLE 15: ASSUME THE SAME FACTS AS EXAMPLE 13 (JOINT/SPOUSAL). ASSUME THAT A SECOND PARTIAL SURRENDER IS TAKEN IN THE SAME CONTRACT YEAR FOR $2,000; THE CONTRACT VALUE PRIOR TO THE PARTIAL SURRENDER IS $49,000; THE CONTRACT VALUE AFTER THE PARTIAL SURRENDER IS $47,000. VALUES PRIOR TO THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $50,000 $50,000 WITHDRAWAL PERCENT 5.5% 5.5% LIFETIME BENEFIT PAYMENT $275 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was 5.5% multiplied by the greater of the 5.5% multiplied by the Payment Base on Payment Base or Contract Value on the the Contract Anniversary Contract Anniversary - Available Lifetime Benefit Payment was - Available Lifetime Benefit Payment was $2,750 $3,025 GUARANTEED MINIMUM DEATH BENEFIT $47,250 $47,250
VALUES AFTER THE PARTIAL SURRENDER:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $48,230 $47,959 - Proportional reduction: - Proportional reduction: 1-($1,725/($49,000-$275) 1-($2,000/$49,000) LIFETIME BENEFIT PAYMENT $0 $0 - Remaining Lifetime Benefit Payment for - Remaining Lifetime Benefit Payment for the Contract Year the Contract Year GUARANTEED MINIMUM DEATH BENEFIT $45,312 $45,321 - Prior Death Benefit reduced by partial - Prior Death Benefit reduced by partial surrender NOT exceeding the Lifetime surrender NOT exceeding the Lifetime Benefit Payment. Then, proportional Benefit Payment. Then, proportional reduction multiplied by the result of the reduction multiplied by the result of the above above
APP I-28 ------------------------------------------------------------------------------- EXAMPLE 16: ASSUME THE SAME FACTS AS EXAMPLE 1 (SINGLE LIFE). NOW ASSUME YOU HAVE REACHED YOUR FIRST CONTRACT ANNIVERSARY. YOUR CONTRACT VALUE ON THE CONTRACT ANNIVERSARY IS $115,000. VALUES PRIOR TO THE CONTRACT ANNIVERSARY:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment THRESHOLD $5,000 $5,000 - 5% of your Payment Base - 5% of your Payment Base LIFETIME BENEFIT PAYMENT N/A N/A GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
VALUES AFTER THE ANNIVERSARY PROCESSING:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $110,000 $115,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($115,000) divided by your current the rider charge being taken, or Payment Base ($100,000), less 1 - Your current Payment Base - Resulting in 0.15%, capped at 10%. Subject to minimum of 0% and maximum of 10% THRESHOLD $5,500 $5,750 - 5% of your Payment Base - 5% of your Payment Base GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - No change due to anniversary processing - No change due to anniversary processing
EXAMPLE 17: ASSUME THE SAME FACTS AS EXAMPLE 2 (JOINT/SPOUSAL). NOW ASSUME YOU HAVE REACHED YOUR FIRST CONTRACT ANNIVERSARY. YOUR CONTRACT VALUE ON THE ANNIVERSARY IS $115,000. VALUES PRIOR TO THE CONTRACT ANNIVERSARY:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment THRESHOLD $4,500 $4,500 - 4.5% of your Payment Base - 4.5% of your Payment Base LIFETIME BENEFIT PAYMENT N/A N/A GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - Equal to your initial Premium Payment - Equal to your initial Premium Payment
VALUES AFTER THE CONTRACT ANNIVERSARY: PAYMENT BASE $110,000 $115,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($115,000) divided by your current the rider charge being taken, or Payment Base ($100,000), less 1 - Your current Payment Base - Resulting in 0.15%, capped at 10%. Subject to minimum of 0% and maximum of 10% THRESHOLD $4,950 $5,175 - 4.5% of your Payment Base - 4.5% of your Payment Base GUARANTEED MINIMUM DEATH BENEFIT $100,000 $100,000 - No change due to anniversary processing - No change due to anniversary processing
APP I-29 ------------------------------------------------------------------------------- EXAMPLE 18: SPOUSAL CONTRACT CONTINUATION (SINGLE LIFE) On date of Spousal Contract continuation, we increase the Contract Value to equal the Death Benefit (if greater). For illustration purposes, we will assume the Contract Value on the date of continuation is set equal to the Death Benefit of $150,000 and the Payment Base is $125,000. VALUES UPON SPOUSAL CONTINUATION:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $150,000 $150,000 - Equal to the Contract Value on date of - Equal to Contract Value on date of continuation continuation WITHDRAWAL PERCENTAGE 6% 6% - Withdrawal Percent is set using the - Withdrawal Percent is set using the oldest Covered Life's age on the oldest Covered Life's age on the effective date of continuation effective date of continuation LIFETIME BENEFIT PAYMENT $9,000 $9,000 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by the Payment Base on date of continuation Payment Base on date of continuation GUARANTEED MINIMUM DEATH BENEFIT $150,000 $150,000 - Equal to Contract Value on date of - Equal to Contract Value on date of continuation continuation
EXAMPLE 19: SPOUSAL CONTRACT CONTINUATION (JOINT/SPOUSAL) On date of Spousal Contract continuation, we increase the Contract Value to equal the Death Benefit (if greater). For illustration purposes, we will assume the Contract Value on the date of continuation is set equal to the Death Benefit of $150,000 and the Payment Base is $125,000. VALUES UPON SPOUSAL CONTRACT CONTINUATION:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $150,000 $150,000 - Greater of Contract Value or Payment - Greater of Contract Value or Payment Base on date of continuation Base on date of continuation WITHDRAWAL PERCENTAGE 5.5% 5.5% - Withdrawal Percent is set using the - Withdrawal Percent is set using the oldest Covered Life's age on the oldest Covered Life's age on the effective date of continuation effective date of continuation LIFETIME BENEFIT PAYMENT $8,250 $8,250 - Withdrawal Percent multiplied by the - Withdrawal Percent multiplied by greater of the Contract Value or Payment Payment Base on date of continuation Base on date of continuation GUARANTEED MINIMUM DEATH BENEFIT $150,000 $150,000 - Equal to Contract Value on date of - Equal to Contract Value on date of continuation continuation
APP I-30 ------------------------------------------------------------------------------- EXAMPLE 20: WITHDRAWAL PERCENT INCREASE; ASSUME THE SAME CONTRACT ISSUE FACTS AS EXAMPLE 4 (SINGLE LIFE). YOUR WITHDRAWAL PERCENT IS 6%, WHICH WAS BASED ON YOUR AGE (70) AT THE TIME OF FIRST WITHDRAWAL. YOUR LIFETIME BENEFIT PAYMENT PRIOR TO THE CONTRACT ANNIVERSARY IS $6,300. YOU ARE NOW AGE 75 AND YOUR ANNIVERSARY IS BEING PROCESSED. YOUR CONTRACT VALUE ON ANNIVERSARY IS $117,000. VALUES PRIOR TO THE ANNIVERSARY:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $105,000 $105,000 WITHDRAWAL PERCENT 6% 6% LIFETIME BENEFIT PAYMENT $6,300 $6,300 GUARANTEED MINIMUM DEATH BENEFIT $94,000 $94,000
VALUES AFTER THE ANNIVERSARY PROCESSING:
THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME FEATURE BUILDER SELECTS BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------- PAYMENT BASE $115,500 $117,000 - The ratio is the Contract Value - Greater of the Contract Value prior to ($117,000) divided by your current the rider charge being taken, or Payment Base ($105,000), less 1 - Your current Payment Base - Resulting in 0.11%, capped at 10%. Subject to minimum of 0% and maximum of 10% WITHDRAWAL PERCENT 6.5% 6.5% - Due to the automatic increase and - Due to the automatic increase and client reaching a new age band, the client reaching a new age band, the Withdrawal Percent has increased Withdrawal Percent has increased LIFETIME BENEFIT PAYMENT $7,507.50 $7,605 RIDER CHARGE $635.25 $760.50 - Rider charge of 0.55% multiplied by - Rider charge of 0.65% multiplied by your current Payment Base your current Payment Base GUARANTEED MINIMUM DEATH BENEFIT $94,000 $94,000 - No change due to anniversary processing - No change due to anniversary processing
EXAMPLE 21 Assume the following Contract values: Contract Value = $3,000 Lifetime Benefit Payment = $2,000 Client takes a partial Surrender of $2,000 (within rider limit) New Contract Value = $1,000 - Minimum Amount Rule is reached as remaining Contract Value is reduced below one Lifetime Benefit Payment and the Partial Surrender was within the rider limit - Contract Value is transferred to approved investment program - We will no longer accept subsequent Premium Payments - We will begin to automatically pay the annual Lifetime Benefit Payment via the Automatic Income Program. The Lifetime Benefit Payment will be paid out of our General Account - The payout of the Lifetime Benefit Payment will no longer reduce the Contract Value, however, the Death Benefit will continue to be reduced - We will waive the Annual Maintenance Fee and rider fee - Benefit Increases will no longer be applied NOTE: If the Contract Value is reduced below one Lifetime Benefit Payment on any Contract Anniversary due to performance the above scenario would occur. APP I-31 ------------------------------------------------------------------------------- EXAMPLE 22 Assume the following Contract values: Contract Value = $3,000 Lifetime Benefit Payment = $2,000 Client takes a partial Surrender of $2,800 (exceeds rider limit) New Contract Value = $200 - Minimum Account Rule is reached as remaining Contract Value is reduced below the Minimum Account Rule under the contract, $500 (varies by state) and the Partial Surrender exceeded the rider limit - Contract is fully liquidated MAV PLUS EXAMPLE 1 Assume that: - You elected the MAV Plus Death Benefit when you purchased your Contract with the Premium Security Death Benefit, - You made a single Premium Payment of $100,000, - In your fourth Contract Year, you made a withdrawal of $8,000, - Your Contract Value in your fourth Contract Year immediately before your withdrawal was $109,273, - On the day we receive proof of Death, your Contract Value was $117,403, - Your Maximum Anniversary Value was $106,000, - The Contract Value on the date we calculate the Death Benefit plus 40% of the Contract gain was greater than the Premium Security Death Benefit, your adjusted total Premium Payments, and your Maximum Anniversary Value. ADJUSTMENT FOR PARTIAL SURRENDERS FOR EARNINGS PROTECTION BENEFIT To calculate the Earnings Protection Benefit, we make an adjustment for partial Surrenders if the amount of a Surrender is greater than the Contract gain in the Contract immediately prior to the Surrender. To determine if the partial Surrender is greater than the Contract gain: - We determine Contract gain by subtracting the Contract Value on the date you added the MAV Plus Death Benefit from the Contract Value immediately before the partial surrender, then deduct any premium payments and add any adjustments for partial Surrenders made during that time [$109,273 - $100,000 - $0 + $0 = $9,273]. Since the Contract gain at the time of partial Surrender [$9,273] exceeds the partial Surrender [$8,000], there is no adjustment for the partial Surrender in this case. CALCULATION OF CONTRACT GAIN We would calculate the Contract gain as follows: - Contract Value on the day we receive proof of Death [$117,403], - Subtract the Contract Value on the date the MAV Plus Death Benefit was added to your Contract [$100,000], - Add any adjustments for partial Surrenders [$0], So the Contract gain equals $17,403. CALCULATION OF EARNINGS PROTECTION BENEFIT CAP To determine if the cap applies: - We calculate the Contract Value on the date the MAV Plus Death Benefit was added to your Contract ($100,000), - plus Premium Payments made since that date excluding Premium Payments made in the 12 months prior to death ($0), - minus any adjustments for partial Surrenders ($0), Which equals $100,000. The cap is 200% of $100,000, which is $200,000. MAV PLUS DEATH BENEFIT AMOUNT IS $106,000. (See Example 1 under Premium Security Death Benefit for details of calculation.) ADJUSTED TOTAL PREMIUM PAYMENT AMOUNT IS $92,000. (See Example 1 under MAV PLUS/EPB Death Benefit for details of calculation.) APP I-32 ------------------------------------------------------------------------------- MAV PLUS DEATH BENEFIT In this situation the cap does not apply, so we take the Contract Value on the date we receive proof of death and adds 40% of gain [$117,403 + 40% (17,403)] which totals $124,364. This is the greatest of the four values compared, and so is the Death Benefit. EXAMPLE 2 Assume that: - You elected the MAV Plus Death Benefit when you purchased your Contract with the Premium Security Death Benefit, - You made a single Premium Payment of $100,000, - In your fourth Contract Year, you made a partial Surrender of $60,000, - Your Contract Value in the fourth year immediately before your Surrender was $150,000, - Your Maximum Anniversary Value is $83,571 (based on an adjustment to an anniversary value that was $140,000 before the partial Surrender (see below)), - On the day we receive proof of Death, your Contract Value was $120,000, - The Contract Value on the date we calculate the Death Benefit plus 40% of the Contract gain was the greatest of the Death Benefit calculations. ADJUSTMENT FOR PARTIAL SURRENDERS To calculate the Earnings Protection Benefit, we make an adjustment for partial Surrenders if the amount of a Surrender is greater than the Contract gain in the Contract immediately prior to the Surrender. To determine if the partial Surrender is greater than the Contract gain: - We determine Contract gain by subtracting the Contract Value on the date you added the MAV Plus Death Benefit from the Contract Value immediately before the partial surrender, then deduct any premium payments and add any adjustments for partial Surrenders made during that time [$150,000 - $100,000 - $0 + $0 = $50,000]. Since the partial Surrender [$60,000] exceeds the Contract gain at the time of partial Surrender [$50,000], the adjustment for the partial Surrender is the difference, or $10,000. CALCULATION OF CONTRACT GAIN We would calculate the Contract gain as follows: - Contract Value on the day we receive proof of Death [$120,000], - Subtract the Contract Value on the date the MAV Plus Death Benefit was added to your Contract [$100,000], - Add any adjustments for partial Surrenders [$10,000], So the Contract gain equals $30,000. CALCULATION OF EARNINGS PROTECTION BENEFIT CAP To determine if the cap applies: - We calculate the Contract Value on the date the MAV Plus Death Benefit was added to your Contract ($100,000), - plus Premium Payments made since that date excluding Premium Payments made in the 12 months prior to death ($0), - minus any adjustments for partial Surrenders ($10,000), Which equals $90,000. The cap is 200% of $90,000, which is $180,000. ADJUSTMENT FOR PARTIAL SURRENDERS FOR MAXIMUM ANNIVERSARY VALUE The adjustment to your Maximum Anniversary Value for partial Surrenders is on a dollar for dollar basis up to 10% of total Premium Payments. 10% of Premium Payments is $10,000. Maximum Anniversary Value adjusted for dollar for dollar Surrenders is $140,000 - $10,000 = $130,000. Remaining Surrenders equal $50,000. This amount will reduce the Maximum Anniversary Value proportionally. Contract Value immediately before Surrender is $150,000 minus $10,000 = $140,000. The proportional factor is 1 - (50,000/140,000) = .64286. This factor is multiplied by $130,000. The result is an adjusted Maximum Anniversary Value of $83,571. DEATH BENEFIT WITH EARNINGS PROTECTION BENEFIT In this situation the cap does not apply, so we take 40% of Contract gain on the day we receive proof of death $30,000 or $12,000 and add that to the Contract Value on the date we receive proof of death. Therefore, the Earnings Protection Benefit is [40% ($30,000) + $120,000], which equals $132,000. APP II-1 ------------------------------------------------------------------------------- APPENDIX II -- ACCUMULATION UNIT VALUES The following information should be read in conjunction with the financial statements for the Separate Account included in the Statement of Additional Information. There are several classes of Accumulation Unit Values under the Contract depending on the number of optional benefits you select. There are two tables below reflecting the Accumulation Unit Values for Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company. The tables show only the highest and lowest possible Accumulation Unit Value, assuming you select no optional benefits or assuming you select all optional benefits. Tables showing all classes of Accumulation Unit Values corresponding to all combinations of optional benefits appear in the Statement of Additional Information, which you may obtain free of charge by contacting us. HARTFORD LIFE INSURANCE COMPANY
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS BALANCED WEALTH STRATEGY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.910 $10.638 $9.737 Accumulation Unit Value at end of period $12.337 $11.910 $10.638 Number of Accumulation Units outstanding at end of period (in thousands) 384 99 32 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.736 $10.567 $9.724 Accumulation Unit Value at end of period $12.060 $11.736 $10.567 Number of Accumulation Units outstanding at end of period (in thousands) 46 42 7 ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.507 $11.962 $10.000 Accumulation Unit Value at end of period $14.910 $13.507 $11.962 Number of Accumulation Units outstanding at end of period (in thousands) 14 5 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.328 $11.899 $10.000 Accumulation Unit Value at end of period $14.596 $13.328 $11.899 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 -- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.365 -- -- (a) Accumulation Unit Value at end of period $10.517 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 8 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.353 -- -- (a) Accumulation Unit Value at end of period $10.493 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $14.678 $11.038 $9.315 Accumulation Unit Value at end of period $15.252 $14.678 $11.038 Number of Accumulation Units outstanding at end of period (in thousands) 1,202 751 142 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.464 $10.964 $9.302 Accumulation Unit Value at end of period $14.910 $14.464 $10.964 Number of Accumulation Units outstanding at end of period (in thousands) 121 117 82 ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.853 $10.546 $9.413 Accumulation Unit Value at end of period $11.843 $11.853 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 198 91 16 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.680 $10.476 $9.400 Accumulation Unit Value at end of period $11.577 $11.680 $10.476 Number of Accumulation Units outstanding at end of period (in thousands) 5 3 2
APP II-2 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.259 $10.293 $9.626 Accumulation Unit Value at end of period $11.562 $12.259 $10.293 Number of Accumulation Units outstanding at end of period (in thousands) 686 386 97 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.081 $10.224 $9.613 Accumulation Unit Value at end of period $11.303 $12.081 $10.224 Number of Accumulation Units outstanding at end of period (in thousands) 67 61 42 FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.414 $11.320 $9.562 Accumulation Unit Value at end of period $14.331 $12.414 $11.320 Number of Accumulation Units outstanding at end of period (in thousands) 2,886 1,381 190 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.233 $11.245 $9.549 Accumulation Unit Value at end of period $14.009 $12.233 $11.245 Number of Accumulation Units outstanding at end of period (in thousands) 218 181 66 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.642 -- -- (a) Accumulation Unit Value at end of period $9.548 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.630 -- -- (a) Accumulation Unit Value at end of period $9.527 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP EQUITY-INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.249 $10.378 $9.543 Accumulation Unit Value at end of period $12.208 $12.249 $10.378 Number of Accumulation Units outstanding at end of period (in thousands) 803 422 91 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.070 $10.309 $9.530 Accumulation Unit Value at end of period $11.934 $12.070 $10.309 Number of Accumulation Units outstanding at end of period (in thousands) 85 84 42 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.145 $10.627 $9.553 Accumulation Unit Value at end of period $13.892 $11.145 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) 176 109 15 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.983 $10.556 $9.540 Accumulation Unit Value at end of period $13.581 $10.983 $10.556 Number of Accumulation Units outstanding at end of period (in thousands) 24 18 7 FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.362 $11.176 $9.318 Accumulation Unit Value at end of period $14.032 $12.362 $11.176 Number of Accumulation Units outstanding at end of period (in thousands) 643 399 54 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.182 $11.101 $9.305 Accumulation Unit Value at end of period $13.717 $12.182 $11.101 Number of Accumulation Units outstanding at end of period (in thousands) 51 46 30
APP II-3 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.874 $10.401 $8.953 Accumulation Unit Value at end of period $12.322 $11.874 $10.401 Number of Accumulation Units outstanding at end of period (in thousands) 40 11 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.701 $10.332 $8.940 Accumulation Unit Value at end of period $12.045 $11.701 $10.332 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 1 HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.119 $4.699 $4.355 Accumulation Unit Value at end of period $5.372 $5.119 $4.699 Number of Accumulation Units outstanding at end of period (in thousands) 682 468 254 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.169 $1.082 $1.008 Accumulation Unit Value at end of period $1.217 $1.169 $1.082 Number of Accumulation Units outstanding at end of period (in thousands) 284 285 44 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.393 $1.259 $1.157 Accumulation Unit Value at end of period $1.485 $1.393 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 22,274 14,696 2,914 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.052 $0.972 Accumulation Unit Value at end of period $1.222 $1.155 $1.052 Number of Accumulation Units outstanding at end of period (in thousands) 2,878 2,553 1,677 HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.819 $3.224 $3.001 Accumulation Unit Value at end of period $4.069 $3.819 $3.224 Number of Accumulation Units outstanding at end of period (in thousands) 7,933 3,708 745 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.512 $1.287 $1.204 Accumulation Unit Value at end of period $1.598 $1.512 $1.287 Number of Accumulation Units outstanding at end of period (in thousands) 1,526 1,369 305 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.418 $1.193 $1.147 Accumulation Unit Value at end of period $1.492 $1.418 $1.193 Number of Accumulation Units outstanding at end of period (in thousands) 640 345 76 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.392 $1.180 $1.141 Accumulation Unit Value at end of period $1.453 $1.392 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 29 24 24 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.058 $0.937 Accumulation Unit Value at end of period $1.294 $1.143 $1.058 Number of Accumulation Units outstanding at end of period (in thousands) 143 17 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.114 $1.040 $0.926 Accumulation Unit Value at end of period $1.253 $1.114 $1.040 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
APP II-4 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD GLOBAL ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.987 $1.855 $1.723 Accumulation Unit Value at end of period $2.279 $1.987 $1.855 Number of Accumulation Units outstanding at end of period (in thousands) 147 80 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.268 $1.194 $1.115 Accumulation Unit Value at end of period $1.444 $1.268 $1.194 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD GLOBAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.064 $1.837 $1.628 Accumulation Unit Value at end of period $2.539 $2.064 $1.837 Number of Accumulation Units outstanding at end of period (in thousands) 183 71 27 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.249 $1.113 Accumulation Unit Value at end of period $1.699 $1.391 $1.249 Number of Accumulation Units outstanding at end of period (in thousands) 117 109 57 HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.314 $1.277 $1.135 Accumulation Unit Value at end of period $1.510 $1.314 $1.277 Number of Accumulation Units outstanding at end of period (in thousands) 677 394 86 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.285 $1.258 $1.125 Accumulation Unit Value at end of period $1.465 $1.285 $1.258 Number of Accumulation Units outstanding at end of period (in thousands) 35 28 19 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.579 $1.432 $1.148 Accumulation Unit Value at end of period $2.014 $1.579 $1.432 Number of Accumulation Units outstanding at end of period (in thousands) 2,148 1,296 136 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.585 $1.449 $1.168 Accumulation Unit Value at end of period $2.006 $1.585 $1.449 Number of Accumulation Units outstanding at end of period (in thousands) 506 395 75 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.270 $1.220 Accumulation Unit Value at end of period $1.406 $1.390 $1.270 Number of Accumulation Units outstanding at end of period (in thousands) 1,866 832 222 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.242 $1.199 Accumulation Unit Value at end of period $1.353 $1.348 $1.242 Number of Accumulation Units outstanding at end of period (in thousands) 254 218 105 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.272 $4.640 $4.321 Accumulation Unit Value at end of period $5.458 $5.272 $4.640 Number of Accumulation Units outstanding at end of period (in thousands) 134 65 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.134 $1.006 $0.942 Accumulation Unit Value at end of period $1.165 $1.134 $1.006 Number of Accumulation Units outstanding at end of period (in thousands) 96 103 79
APP II-5 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.616 $1.324 $1.153 Accumulation Unit Value at end of period $1.971 $1.616 $1.324 Number of Accumulation Units outstanding at end of period (in thousands) 2,080 1,032 277 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.301 $1.140 Accumulation Unit Value at end of period $1.907 $1.577 $1.301 Number of Accumulation Units outstanding at end of period (in thousands) 216 271 68 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.053 $1.761 Accumulation Unit Value at end of period $3.154 $2.515 $2.053 Number of Accumulation Units outstanding at end of period (in thousands) 2,854 2,023 385 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.131 $0.975 Accumulation Unit Value at end of period $1.710 $1.375 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 593 596 463 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.247 $1.765 $1.498 Accumulation Unit Value at end of period $2.411 $2.247 $1.765 Number of Accumulation Units outstanding at end of period (in thousands) 784 355 46 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.192 $1.736 $1.481 Accumulation Unit Value at end of period $2.333 $2.192 $1.736 Number of Accumulation Units outstanding at end of period (in thousands) 28 30 12 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.526 -- -- (a) Accumulation Unit Value at end of period $9.804 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.515 -- -- (a) Accumulation Unit Value at end of period $9.783 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MIDCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.510 -- -- (a) Accumulation Unit Value at end of period $9.785 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.499 -- -- (a) Accumulation Unit Value at end of period $9.764 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MONEY MARKET HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.948 $1.891 $1.871 Accumulation Unit Value at end of period $2.012 $1.948 $1.891 Number of Accumulation Units outstanding at end of period (in thousands) 4,639 2,397 901 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.016 $0.994 $0.989 Accumulation Unit Value at end of period $1.041 $1.016 $0.994 Number of Accumulation Units outstanding at end of period (in thousands) 945 414 179
APP II-6 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.903 $2.818 $2.811 Accumulation Unit Value at end of period $2.954 $2.903 $2.818 Number of Accumulation Units outstanding at end of period (in thousands) 125 76 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.275 $1.278 Accumulation Unit Value at end of period $1.315 $1.303 $1.275 Number of Accumulation Units outstanding at end of period (in thousands) 28 28 39 HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.463 -- Accumulation Unit Value at end of period $2.828 $2.515 -- Number of Accumulation Units outstanding at end of period (in thousands) 891 44 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.368 -- Accumulation Unit Value at end of period $1.551 $1.391 -- Number of Accumulation Units outstanding at end of period (in thousands) 22 -- -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.403 $1.334 $1.140 Accumulation Unit Value at end of period $1.356 $1.403 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 1,345 833 300 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.409 $1.350 $1.159 Accumulation Unit Value at end of period $1.350 $1.409 $1.350 Number of Accumulation Units outstanding at end of period (in thousands) 155 99 91 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.324 -- -- (a) Accumulation Unit Value at end of period $9.109 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.314 -- -- (a) Accumulation Unit Value at end of period $9.088 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD STOCK HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $6.573 $5.825 $5.211 Accumulation Unit Value at end of period $6.850 $6.573 $5.825 Number of Accumulation Units outstanding at end of period (in thousands) 286 169 51 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.974 $0.876 Accumulation Unit Value at end of period $1.127 $1.090 $0.974 Number of Accumulation Units outstanding at end of period (in thousands) 130 102 47 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.174 $3.077 $3.066 Accumulation Unit Value at end of period $3.269 $3.174 $3.077 Number of Accumulation Units outstanding at end of period (in thousands) 12,395 6,762 1,443 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.489 $1.456 $1.458 Accumulation Unit Value at end of period $1.522 $1.489 $1.456 Number of Accumulation Units outstanding at end of period (in thousands) 2,013 1,586 834
APP II-7 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.105 $1.080 $1.081 Accumulation Unit Value at end of period $1.135 $1.105 $1.080 Number of Accumulation Units outstanding at end of period (in thousands) 18,579 9,068 1,727 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.064 $1.071 Accumulation Unit Value at end of period $1.101 $1.081 $1.064 Number of Accumulation Units outstanding at end of period (in thousands) 1,610 1,268 693 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.337 $1.115 $1.037 Accumulation Unit Value at end of period $1.433 $1.337 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) 2,425 167 81 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.096 $1.025 Accumulation Unit Value at end of period $1.387 $1.304 $1.096 Number of Accumulation Units outstanding at end of period (in thousands) 154 126 3 HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.622 $1.385 $1.237 Accumulation Unit Value at end of period $1.496 $1.622 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 910 480 135 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.628 $1.401 $1.258 Accumulation Unit Value at end of period $1.490 $1.628 $1.401 Number of Accumulation Units outstanding at end of period (in thousands) 334 289 167 LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.889 $10.538 $9.508 Accumulation Unit Value at end of period $12.486 $11.889 $10.538 Number of Accumulation Units outstanding at end of period (in thousands) 91 51 10 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.715 $10.467 $9.495 Accumulation Unit Value at end of period $12.206 $11.715 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) 13 13 4 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.511 $10.211 $9.642 Accumulation Unit Value at end of period $11.687 $11.511 $10.211 Number of Accumulation Units outstanding at end of period (in thousands) 47 34 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.343 $10.142 $9.628 Accumulation Unit Value at end of period $11.424 $11.343 $10.142 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.702 $9.946 $9.561 Accumulation Unit Value at end of period $11.183 $10.702 $9.946 Number of Accumulation Units outstanding at end of period (in thousands) 283 114 10 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.545 $9.880 $9.547 Accumulation Unit Value at end of period $10.932 $10.545 $9.880 Number of Accumulation Units outstanding at end of period (in thousands) 32 26 16
APP II-8 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.770 $10.198 $9.583 Accumulation Unit Value at end of period $11.982 $11.770 $10.198 Number of Accumulation Units outstanding at end of period (in thousands) 1,421 600 30 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.598 $10.130 $9.570 Accumulation Unit Value at end of period $11.713 $11.598 $10.130 Number of Accumulation Units outstanding at end of period (in thousands) 79 95 9 LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.758 $10.581 $10.000 Accumulation Unit Value at end of period $12.807 $11.758 $10.581 Number of Accumulation Units outstanding at end of period (in thousands) 43 28 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.603 $10.525 $10.000 Accumulation Unit Value at end of period $12.537 $11.603 $10.525 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.159 $10.530 $9.696 Accumulation Unit Value at end of period $12.504 $11.159 $10.530 Number of Accumulation Units outstanding at end of period (in thousands) 539 254 44 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.996 $10.460 $9.683 Accumulation Unit Value at end of period $12.223 $10.996 $10.460 Number of Accumulation Units outstanding at end of period (in thousands) 52 44 20 OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.219 $11.445 $9.607 Accumulation Unit Value at end of period $13.801 $13.219 $11.445 Number of Accumulation Units outstanding at end of period (in thousands) 1,829 771 42 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.026 $11.369 $9.594 Accumulation Unit Value at end of period $13.491 $13.026 $11.369 Number of Accumulation Units outstanding at end of period (in thousands) 118 90 18 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.757 $10.410 $9.592 Accumulation Unit Value at end of period $12.051 $11.757 $10.410 Number of Accumulation Units outstanding at end of period (in thousands) 79 56 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.585 $10.340 $9.579 Accumulation Unit Value at end of period $11.780 $11.585 $10.340 Number of Accumulation Units outstanding at end of period (in thousands) 31 32 12 OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.292 $10.893 $9.300 Accumulation Unit Value at end of period $11.929 $12.292 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 767 425 69 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.113 $10.821 $9.287 Accumulation Unit Value at end of period $11.661 $12.113 $10.821 Number of Accumulation Units outstanding at end of period (in thousands) 68 57 34
APP II-9 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.168 $11.049 $9.483 Accumulation Unit Value at end of period $11.654 $11.168 $11.049 Number of Accumulation Units outstanding at end of period (in thousands) 29 15 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.005 $10.975 $9.470 Accumulation Unit Value at end of period $11.392 $11.005 $10.975 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 2 PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $17.671 $16.893 $16.626 Accumulation Unit Value at end of period $18.109 $17.671 $16.893 Number of Accumulation Units outstanding at end of period (in thousands) 228 114 15 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.716 $13.218 $13.078 Accumulation Unit Value at end of period $13.944 $13.716 $13.218 Number of Accumulation Units outstanding at end of period (in thousands) 59 14 9 PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $36.452 $32.820 $30.837 Accumulation Unit Value at end of period $36.928 $36.452 $32.820 Number of Accumulation Units outstanding at end of period (in thousands) 7 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.181 $10.148 $9.585 Accumulation Unit Value at end of period $11.237 $11.181 $10.148 Number of Accumulation Units outstanding at end of period (in thousands) 10 10 5 PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $57.815 $50.684 $47.143 Accumulation Unit Value at end of period $53.461 $57.815 $50.684 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.149 $10.736 $10.039 Accumulation Unit Value at end of period $11.145 $12.149 $10.736 Number of Accumulation Units outstanding at end of period (in thousands) 13 10 1 PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.003 $19.096 $16.749 Accumulation Unit Value at end of period $25.598 $24.003 $19.096 Number of Accumulation Units outstanding at end of period (in thousands) 375 241 53 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.560 $10.073 $8.882 Accumulation Unit Value at end of period $13.288 $12.560 $10.073 Number of Accumulation Units outstanding at end of period (in thousands) 81 75 51 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.864 -- -- (a) Accumulation Unit Value at end of period $9.748 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.853 -- -- (a) Accumulation Unit Value at end of period $9.726 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
APP II-10 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- PUTNAM VT INVESTORS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.876 $9.700 $8.601 Accumulation Unit Value at end of period $10.150 $10.876 $9.700 Number of Accumulation Units outstanding at end of period (in thousands) 341 25 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $7.890 $7.093 $6.323 Accumulation Unit Value at end of period $7.304 $7.890 $7.093 Number of Accumulation Units outstanding at end of period (in thousands) 26 21 10 PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $21.580 $18.901 $17.431 Accumulation Unit Value at end of period $20.199 $21.580 $18.901 Number of Accumulation Units outstanding at end of period (in thousands) 48 17 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.921 $14.057 $13.033 Accumulation Unit Value at end of period $14.784 $15.921 $14.057 Number of Accumulation Units outstanding at end of period (in thousands) 17 15 11 PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $26.199 $22.697 $19.908 Accumulation Unit Value at end of period $22.504 $26.199 $22.697 Number of Accumulation Units outstanding at end of period (in thousands) 242 149 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $22.627 $19.760 $17.424 Accumulation Unit Value at end of period $19.281 $22.627 $19.760 Number of Accumulation Units outstanding at end of period (in thousands) 50 44 23 PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.365 $12.134 $11.639 Accumulation Unit Value at end of period $13.278 $13.365 $12.134 Number of Accumulation Units outstanding at end of period (in thousands) 27 8 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.487 $11.428 $11.020 Accumulation Unit Value at end of period $12.307 $12.487 $11.428 Number of Accumulation Units outstanding at end of period (in thousands) 12 9 2 PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $15.980 $15.398 $13.196 Accumulation Unit Value at end of period $16.325 $15.980 $15.398 Number of Accumulation Units outstanding at end of period (in thousands) 2 4 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.439 $6.255 $5.389 Accumulation Unit Value at end of period $6.526 $6.439 $6.255 Number of Accumulation Units outstanding at end of period (in thousands) 23 24 17 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $53.906 $51.952 $46.089 Accumulation Unit Value at end of period $55.979 $53.906 $51.952 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.595 $6.407 $5.714 Accumulation Unit Value at end of period $6.794 $6.595 $6.407 Number of Accumulation Units outstanding at end of period (in thousands) 16 20 9
APP II-11 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.270 $12.052 $9.032 Accumulation Unit Value at end of period $22.490 $16.270 $12.052 Number of Accumulation Units outstanding at end of period (in thousands) 168 75 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.032 $11.972 $9.020 Accumulation Unit Value at end of period $21.986 $16.032 $11.972 Number of Accumulation Units outstanding at end of period (in thousands) 16 16 6 VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.601 $11.732 $9.494 Accumulation Unit Value at end of period $15.205 $12.601 $11.732 Number of Accumulation Units outstanding at end of period (in thousands) 96 29 6 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.417 $11.654 $9.481 Accumulation Unit Value at end of period $14.864 $12.417 $11.654 Number of Accumulation Units outstanding at end of period (in thousands) 4 2 -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.952 $10.911 $9.630 Accumulation Unit Value at end of period $13.734 $12.952 $10.911 Number of Accumulation Units outstanding at end of period (in thousands) 69 31 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.763 $10.838 $9.617 Accumulation Unit Value at end of period $13.425 $12.763 $10.838 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 2 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.920 $14.816 $14.064 Accumulation Unit Value at end of period $16.264 $16.920 $14.816 Number of Accumulation Units outstanding at end of period (in thousands) 466 298 65 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.447 $14.517 $13.854 Accumulation Unit Value at end of period $15.683 $16.447 $14.517 Number of Accumulation Units outstanding at end of period (in thousands) 70 64 46 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.971 $14.870 $13.596 Accumulation Unit Value at end of period $17.123 $16.971 $14.870 Number of Accumulation Units outstanding at end of period (in thousands) 270 67 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.380 $14.467 $13.299 Accumulation Unit Value at end of period $16.395 $16.380 $14.467 Number of Accumulation Units outstanding at end of period (in thousands) 20 7 5
(a) Inception date November 12, 2007. APP II-12 ------------------------------------------------------------------------------- HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS BALANCED WEALTH STRATEGY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.910 $10.638 $9.737 Accumulation Unit Value at end of period $12.337 $11.910 $10.638 Number of Accumulation Units outstanding at end of period (in thousands) 1,977 838 136 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.736 $10.567 $9.724 Accumulation Unit Value at end of period $12.060 $11.736 $10.567 Number of Accumulation Units outstanding at end of period (in thousands) 78 51 6 ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.507 $11.962 $10.000 Accumulation Unit Value at end of period $14.910 $13.507 $11.962 Number of Accumulation Units outstanding at end of period (in thousands) 128 48 6 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.328 $11.899 $10.000 Accumulation Unit Value at end of period $14.596 $13.328 $11.899 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 1 ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.365 -- -- (a) Accumulation Unit Value at end of period $10.517 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 35 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.353 -- -- (a) Accumulation Unit Value at end of period $10.493 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $14.678 $11.038 $9.315 Accumulation Unit Value at end of period $15.252 $14.678 $11.038 Number of Accumulation Units outstanding at end of period (in thousands) 5,796 3,145 706 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.464 $10.964 $9.302 Accumulation Unit Value at end of period $14.910 $14.464 $10.964 Number of Accumulation Units outstanding at end of period (in thousands) 525 539 220 ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.853 $10.546 $9.413 Accumulation Unit Value at end of period $11.843 $11.853 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 878 369 83 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.680 $10.476 $9.400 Accumulation Unit Value at end of period $11.577 $11.680 $10.476 Number of Accumulation Units outstanding at end of period (in thousands) 96 65 34 ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.259 $10.293 $9.626 Accumulation Unit Value at end of period $11.562 $12.259 $10.293 Number of Accumulation Units outstanding at end of period (in thousands) 2,773 1,530 395 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.081 $10.224 $9.613 Accumulation Unit Value at end of period $11.303 $12.081 $10.224 Number of Accumulation Units outstanding at end of period (in thousands) 286 239 119
APP II-13 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.414 $11.320 $9.562 Accumulation Unit Value at end of period $14.331 $12.414 $11.320 Number of Accumulation Units outstanding at end of period (in thousands) 11,162 5,354 748 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.233 $11.245 $9.549 Accumulation Unit Value at end of period $14.009 $12.233 $11.245 Number of Accumulation Units outstanding at end of period (in thousands) 549 512 300 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.642 -- -- (a) Accumulation Unit Value at end of period $9.548 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 4 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.630 -- -- (a) Accumulation Unit Value at end of period $9.527 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP EQUITY-INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.249 $10.378 $9.543 Accumulation Unit Value at end of period $12.208 $12.249 $10.378 Number of Accumulation Units outstanding at end of period (in thousands) 2,463 1,476 397 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.070 $10.309 $9.530 Accumulation Unit Value at end of period $11.934 $12.070 $10.309 Number of Accumulation Units outstanding at end of period (in thousands) 292 276 112 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.145 $10.627 $9.553 Accumulation Unit Value at end of period $13.892 $11.145 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) 1,140 547 70 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.983 $10.556 $9.540 Accumulation Unit Value at end of period $13.581 $10.983 $10.556 Number of Accumulation Units outstanding at end of period (in thousands) 333 81 27 FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.362 $11.176 $9.318 Accumulation Unit Value at end of period $14.032 $12.362 $11.176 Number of Accumulation Units outstanding at end of period (in thousands) 2,559 1,641 413 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.182 $11.101 $9.305 Accumulation Unit Value at end of period $13.717 $12.182 $11.101 Number of Accumulation Units outstanding at end of period (in thousands) 268 516 319 FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.874 $10.401 $8.953 Accumulation Unit Value at end of period $12.322 $11.874 $10.401 Number of Accumulation Units outstanding at end of period (in thousands) 310 65 16 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.701 $10.332 $8.940 Accumulation Unit Value at end of period $12.045 $11.701 $10.332 Number of Accumulation Units outstanding at end of period (in thousands) 69 12 3
APP II-14 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.119 $4.699 $4.355 Accumulation Unit Value at end of period $5.372 $5.119 $4.699 Number of Accumulation Units outstanding at end of period (in thousands) 1,621 1,207 380 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.169 $1.082 $1.008 Accumulation Unit Value at end of period $1.217 $1.169 $1.082 Number of Accumulation Units outstanding at end of period (in thousands) 719 611 334 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.393 $1.259 $1.157 Accumulation Unit Value at end of period $1.485 $1.393 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 81,084 55,296 12,076 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.052 $0.972 Accumulation Unit Value at end of period $1.222 $1.155 $1.052 Number of Accumulation Units outstanding at end of period (in thousands) 11,291 10,039 4,391 HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.819 $3.224 $3.001 Accumulation Unit Value at end of period $4.069 $3.819 $3.224 Number of Accumulation Units outstanding at end of period (in thousands) 30,091 13,978 2,160 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.512 $1.287 $1.204 Accumulation Unit Value at end of period $1.598 $1.512 $1.287 Number of Accumulation Units outstanding at end of period (in thousands) 3,791 3,881 2,508 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.418 $1.193 $1.147 Accumulation Unit Value at end of period $1.492 $1.418 $1.193 Number of Accumulation Units outstanding at end of period (in thousands) 2,725 1,573 381 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.392 $1.180 $1.141 Accumulation Unit Value at end of period $1.453 $1.392 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 455 409 76 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.058 $0.937 Accumulation Unit Value at end of period $1.294 $1.143 $1.058 Number of Accumulation Units outstanding at end of period (in thousands) 607 257 143 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.114 $1.040 $0.926 Accumulation Unit Value at end of period $1.253 $1.114 $1.040 Number of Accumulation Units outstanding at end of period (in thousands) 163 99 95 HARTFORD GLOBAL ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.987 $1.855 $1.723 Accumulation Unit Value at end of period $2.279 $1.987 $1.855 Number of Accumulation Units outstanding at end of period (in thousands) 955 359 185 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.268 $1.194 $1.115 Accumulation Unit Value at end of period $1.444 $1.268 $1.194 Number of Accumulation Units outstanding at end of period (in thousands) 107 78 19
APP II-15 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD GLOBAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.064 $1.837 $1.628 Accumulation Unit Value at end of period $2.539 $2.064 $1.837 Number of Accumulation Units outstanding at end of period (in thousands) 2,183 1,154 292 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.249 $1.113 Accumulation Unit Value at end of period $1.699 $1.391 $1.249 Number of Accumulation Units outstanding at end of period (in thousands) 1,436 379 84 HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.314 $1.277 $1.135 Accumulation Unit Value at end of period $1.510 $1.314 $1.277 Number of Accumulation Units outstanding at end of period (in thousands) 4,802 2,764 992 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.285 $1.258 $1.125 Accumulation Unit Value at end of period $1.465 $1.285 $1.258 Number of Accumulation Units outstanding at end of period (in thousands) 280 191 86 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.579 $1.432 $1.148 Accumulation Unit Value at end of period $2.014 $1.579 $1.432 Number of Accumulation Units outstanding at end of period (in thousands) 16,275 6,715 1,702 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.585 $1.449 $1.168 Accumulation Unit Value at end of period $2.006 $1.585 $1.449 Number of Accumulation Units outstanding at end of period (in thousands) 3,271 1,160 1,327 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.270 $1.220 Accumulation Unit Value at end of period $1.406 $1.390 $1.270 Number of Accumulation Units outstanding at end of period (in thousands) 7,498 3,969 846 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.242 $1.199 Accumulation Unit Value at end of period $1.353 $1.348 $1.242 Number of Accumulation Units outstanding at end of period (in thousands) 764 1,347 204 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.272 $4.640 $4.321 Accumulation Unit Value at end of period $5.458 $5.272 $4.640 Number of Accumulation Units outstanding at end of period (in thousands) 1,315 670 99 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.134 $1.006 $0.942 Accumulation Unit Value at end of period $1.165 $1.134 $1.006 Number of Accumulation Units outstanding at end of period (in thousands) 705 702 590 HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.616 $1.324 $1.153 Accumulation Unit Value at end of period $1.971 $1.616 $1.324 Number of Accumulation Units outstanding at end of period (in thousands) 10,566 5,022 1,245 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.301 $1.140 Accumulation Unit Value at end of period $1.907 $1.577 $1.301 Number of Accumulation Units outstanding at end of period (in thousands) 1,339 981 421
APP II-16 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.053 $1.761 Accumulation Unit Value at end of period $3.154 $2.515 $2.053 Number of Accumulation Units outstanding at end of period (in thousands) 12,333 7,858 1,782 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.131 $0.975 Accumulation Unit Value at end of period $1.710 $1.375 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 3,526 2,516 1,049 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.247 $1.765 $1.498 Accumulation Unit Value at end of period $2.411 $2.247 $1.765 Number of Accumulation Units outstanding at end of period (in thousands) 5,127 2,648 526 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.192 $1.736 $1.481 Accumulation Unit Value at end of period $2.333 $2.192 $1.736 Number of Accumulation Units outstanding at end of period (in thousands) 915 955 170 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.526 -- -- (a) Accumulation Unit Value at end of period $9.804 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.515 -- -- (a) Accumulation Unit Value at end of period $9.783 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MIDCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.510 -- -- (a) Accumulation Unit Value at end of period $9.785 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.499 -- -- (a) Accumulation Unit Value at end of period $9.764 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MONEY MARKET HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.948 $1.891 $1.871 Accumulation Unit Value at end of period $2.012 $1.948 $1.891 Number of Accumulation Units outstanding at end of period (in thousands) 13,113 6,472 2,184 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.016 $0.994 $0.989 Accumulation Unit Value at end of period $1.041 $1.016 $0.994 Number of Accumulation Units outstanding at end of period (in thousands) 1,595 828 626 HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.903 $2.818 $2.811 Accumulation Unit Value at end of period $2.954 $2.903 $2.818 Number of Accumulation Units outstanding at end of period (in thousands) 1,290 664 112 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.275 $1.278 Accumulation Unit Value at end of period $1.315 $1.303 $1.275 Number of Accumulation Units outstanding at end of period (in thousands) 60 68 17
APP II-17 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.463 -- Accumulation Unit Value at end of period $2.828 $2.515 -- Number of Accumulation Units outstanding at end of period (in thousands) 3,981 401 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.716 $1.687 -- Accumulation Unit Value at end of period $1.913 $1.716 -- Number of Accumulation Units outstanding at end of period (in thousands) 1,185 410 -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.403 $1.334 $1.140 Accumulation Unit Value at end of period $1.356 $1.403 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 5,427 4,123 1,786 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.409 $1.350 $1.159 Accumulation Unit Value at end of period $1.350 $1.409 $1.350 Number of Accumulation Units outstanding at end of period (in thousands) 851 1,413 1,255 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.324 -- -- (a) Accumulation Unit Value at end of period $9.109 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.314 -- -- (a) Accumulation Unit Value at end of period $9.088 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD STOCK HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $6.573 $5.825 $5.211 Accumulation Unit Value at end of period $6.850 $6.573 $5.825 Number of Accumulation Units outstanding at end of period (in thousands) 1,388 941 269 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.974 $0.876 Accumulation Unit Value at end of period $1.127 $1.090 $0.974 Number of Accumulation Units outstanding at end of period (in thousands) 820 977 653 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.174 $3.077 $3.066 Accumulation Unit Value at end of period $3.269 $3.174 $3.077 Number of Accumulation Units outstanding at end of period (in thousands) 42,451 22,682 5,008 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.489 $1.456 $1.458 Accumulation Unit Value at end of period $1.522 $1.489 $1.456 Number of Accumulation Units outstanding at end of period (in thousands) 5,935 4,694 3,152 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.105 $1.080 $1.081 Accumulation Unit Value at end of period $1.135 $1.105 $1.080 Number of Accumulation Units outstanding at end of period (in thousands) 60,999 29,837 6,100 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.064 $1.071 Accumulation Unit Value at end of period $1.101 $1.081 $1.064 Number of Accumulation Units outstanding at end of period (in thousands) 5,303 3,695 1,449
APP II-18 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.337 $1.115 $1.037 Accumulation Unit Value at end of period $1.433 $1.337 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) 10,834 2,201 343 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.096 $1.025 Accumulation Unit Value at end of period $1.387 $1.304 $1.096 Number of Accumulation Units outstanding at end of period (in thousands) 1,039 709 139 HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.622 $1.385 $1.237 Accumulation Unit Value at end of period $1.496 $1.622 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 11,440 5,721 1,006 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.628 $1.401 $1.258 Accumulation Unit Value at end of period $1.490 $1.628 $1.401 Number of Accumulation Units outstanding at end of period (in thousands) 442 1,341 336 LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.889 $10.538 $9.508 Accumulation Unit Value at end of period $12.486 $11.889 $10.538 Number of Accumulation Units outstanding at end of period (in thousands) 414 292 57 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.715 $10.467 $9.495 Accumulation Unit Value at end of period $12.206 $11.715 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) 58 41 14 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.511 $10.211 $9.642 Accumulation Unit Value at end of period $11.687 $11.511 $10.211 Number of Accumulation Units outstanding at end of period (in thousands) 175 92 32 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.343 $10.142 $9.628 Accumulation Unit Value at end of period $11.424 $11.343 $10.142 Number of Accumulation Units outstanding at end of period (in thousands) 25 22 9 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.702 $9.946 $9.561 Accumulation Unit Value at end of period $11.183 $10.702 $9.946 Number of Accumulation Units outstanding at end of period (in thousands) 1,224 528 82 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.545 $9.880 $9.547 Accumulation Unit Value at end of period $10.932 $10.545 $9.880 Number of Accumulation Units outstanding at end of period (in thousands) 53 28 10 LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.770 $10.198 $9.583 Accumulation Unit Value at end of period $11.982 $11.770 $10.198 Number of Accumulation Units outstanding at end of period (in thousands) 5,787 2,448 183 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.598 $10.130 $9.570 Accumulation Unit Value at end of period $11.713 $11.598 $10.130 Number of Accumulation Units outstanding at end of period (in thousands) 205 179 68
APP II-19 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.758 $10.581 $10.000 Accumulation Unit Value at end of period $12.807 $11.758 $10.581 Number of Accumulation Units outstanding at end of period (in thousands) 151 79 16 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.603 $10.525 $10.000 Accumulation Unit Value at end of period $12.537 $11.603 $10.525 Number of Accumulation Units outstanding at end of period (in thousands) 12 17 5 OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.159 $10.530 $9.696 Accumulation Unit Value at end of period $12.504 $11.159 $10.530 Number of Accumulation Units outstanding at end of period (in thousands) 2,064 973 216 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.996 $10.460 $9.683 Accumulation Unit Value at end of period $12.223 $10.996 $10.460 Number of Accumulation Units outstanding at end of period (in thousands) 220 186 104 OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.219 $11.445 $9.607 Accumulation Unit Value at end of period $13.801 $13.219 $11.445 Number of Accumulation Units outstanding at end of period (in thousands) 6,504 3,030 344 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.026 $11.369 $9.594 Accumulation Unit Value at end of period $13.491 $13.026 $11.369 Number of Accumulation Units outstanding at end of period (in thousands) 274 207 97 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.757 $10.410 $9.592 Accumulation Unit Value at end of period $12.051 $11.757 $10.410 Number of Accumulation Units outstanding at end of period (in thousands) 439 202 35 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.585 $10.340 $9.579 Accumulation Unit Value at end of period $11.780 $11.585 $10.340 Number of Accumulation Units outstanding at end of period (in thousands) 40 27 14 OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.292 $10.893 $9.300 Accumulation Unit Value at end of period $11.929 $12.292 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 3,542 2,022 320 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.113 $10.821 $9.287 Accumulation Unit Value at end of period $11.661 $12.113 $10.821 Number of Accumulation Units outstanding at end of period (in thousands) 325 264 85 OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.168 $11.049 $9.483 Accumulation Unit Value at end of period $11.654 $11.168 $11.049 Number of Accumulation Units outstanding at end of period (in thousands) 91 49 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.005 $10.975 $9.470 Accumulation Unit Value at end of period $11.392 $11.005 $10.975 Number of Accumulation Units outstanding at end of period (in thousands) 12 8 2
APP II-20 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $17.671 $16.893 $16.626 Accumulation Unit Value at end of period $18.109 $17.671 $16.893 Number of Accumulation Units outstanding at end of period (in thousands) 917 366 90 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.716 $13.218 $13.078 Accumulation Unit Value at end of period $13.944 $13.716 $13.218 Number of Accumulation Units outstanding at end of period (in thousands) 22 17 14 PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $36.452 $32.820 $30.837 Accumulation Unit Value at end of period $36.928 $36.452 $32.820 Number of Accumulation Units outstanding at end of period (in thousands) 164 85 18 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.181 $10.148 $9.585 Accumulation Unit Value at end of period $11.237 $11.181 $10.148 Number of Accumulation Units outstanding at end of period (in thousands) 45 55 32 PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $57.815 $50.684 $47.143 Accumulation Unit Value at end of period $53.461 $57.815 $50.684 Number of Accumulation Units outstanding at end of period (in thousands) 37 18 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.149 $10.736 $10.039 Accumulation Unit Value at end of period $11.145 $12.149 $10.736 Number of Accumulation Units outstanding at end of period (in thousands) 21 22 14 PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.003 $19.096 $16.749 Accumulation Unit Value at end of period $25.598 $24.003 $19.096 Number of Accumulation Units outstanding at end of period (in thousands) 1,496 970 222 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.560 $10.073 $8.882 Accumulation Unit Value at end of period $13.288 $12.560 $10.073 Number of Accumulation Units outstanding at end of period (in thousands) 322 283 140 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.864 -- -- (a) Accumulation Unit Value at end of period $9.748 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.853 -- -- (a) Accumulation Unit Value at end of period $9.726 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INVESTORS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.876 $9.700 $8.601 Accumulation Unit Value at end of period $10.150 $10.876 $9.700 Number of Accumulation Units outstanding at end of period (in thousands) 1,194 207 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $7.890 $7.093 $6.323 Accumulation Unit Value at end of period $7.304 $7.890 $7.093 Number of Accumulation Units outstanding at end of period (in thousands) 75 17 14
APP II-21 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $21.580 $18.901 $17.431 Accumulation Unit Value at end of period $20.199 $21.580 $18.901 Number of Accumulation Units outstanding at end of period (in thousands) 157 101 27 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.921 $14.057 $13.033 Accumulation Unit Value at end of period $14.784 $15.921 $14.057 Number of Accumulation Units outstanding at end of period (in thousands) 25 19 16 PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $26.199 $22.697 $19.908 Accumulation Unit Value at end of period $22.504 $26.199 $22.697 Number of Accumulation Units outstanding at end of period (in thousands) 1,189 721 138 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $22.627 $19.760 $17.424 Accumulation Unit Value at end of period $19.281 $22.627 $19.760 Number of Accumulation Units outstanding at end of period (in thousands) 162 187 67 PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.365 $12.134 $11.639 Accumulation Unit Value at end of period $13.278 $13.365 $12.134 Number of Accumulation Units outstanding at end of period (in thousands) 515 210 41 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.487 $11.428 $11.020 Accumulation Unit Value at end of period $12.307 $12.487 $11.428 Number of Accumulation Units outstanding at end of period (in thousands) 61 73 10 PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $15.980 $15.398 $13.196 Accumulation Unit Value at end of period $16.325 $15.980 $15.398 Number of Accumulation Units outstanding at end of period (in thousands) 38 26 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.439 $6.255 $5.389 Accumulation Unit Value at end of period $6.526 $6.439 $6.255 Number of Accumulation Units outstanding at end of period (in thousands) 16 12 13 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $53.906 $51.952 $46.089 Accumulation Unit Value at end of period $55.979 $53.906 $51.952 Number of Accumulation Units outstanding at end of period (in thousands) 7 6 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.595 $6.407 $5.714 Accumulation Unit Value at end of period $6.794 $6.595 $6.407 Number of Accumulation Units outstanding at end of period (in thousands) 14 15 17 VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.270 $12.052 $9.032 Accumulation Unit Value at end of period $22.490 $16.270 $12.052 Number of Accumulation Units outstanding at end of period (in thousands) 859 360 110 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.032 $11.972 $9.020 Accumulation Unit Value at end of period $21.986 $16.032 $11.972 Number of Accumulation Units outstanding at end of period (in thousands) 183 123 82
APP II-22 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.601 $11.732 $9.494 Accumulation Unit Value at end of period $15.205 $12.601 $11.732 Number of Accumulation Units outstanding at end of period (in thousands) 400 135 21 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.417 $11.654 $9.481 Accumulation Unit Value at end of period $14.864 $12.417 $11.654 Number of Accumulation Units outstanding at end of period (in thousands) 147 67 14 VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.952 $10.911 $9.630 Accumulation Unit Value at end of period $13.734 $12.952 $10.911 Number of Accumulation Units outstanding at end of period (in thousands) 325 126 38 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.763 $10.838 $9.617 Accumulation Unit Value at end of period $13.425 $12.763 $10.838 Number of Accumulation Units outstanding at end of period (in thousands) 44 129 32 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.920 $14.816 $14.064 Accumulation Unit Value at end of period $16.264 $16.920 $14.816 Number of Accumulation Units outstanding at end of period (in thousands) 1,751 1,167 329 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.447 $14.517 $13.854 Accumulation Unit Value at end of period $15.683 $16.447 $14.517 Number of Accumulation Units outstanding at end of period (in thousands) 196 171 93 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.971 $14.870 $13.596 Accumulation Unit Value at end of period $17.123 $16.971 $14.870 Number of Accumulation Units outstanding at end of period (in thousands) 956 405 91 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.380 $14.467 $13.299 Accumulation Unit Value at end of period $16.395 $16.380 $14.467 Number of Accumulation Units outstanding at end of period (in thousands) 64 57 23
(a) Inception date November 12, 2007. APP A-1 -------------------------------------------------------------------------------- APPENDIX A -- PRODUCT COMPARISON INFORMATION In addition to the variable annuity Contract described in this prospectus, we offer other deferred individual variable annuities, each having different sales charges (if any), fees and investment options. The primary differences between the "Director M" and "Leaders" suites of variable annuities we currently offer generally relate to the investment options offered and mortality expense risk charges. We offer three contract variations that have a contingent deferred sales charge (these forms of contract are called "Outlook", "Plus" and our base contract (which does not have a separate marketing name, but is sometimes referred to in this prospectus as the "Core" version)), one contract version has a front end sales charge (called "Edge") and one contract version has no sales charge (called "Access"). We have not included information regarding our Edge Contract because it is offered through a very limited number of Financial Intermediaries. Your Registered Representative can help you decide which contract variation may be appropriate for you based on your individual circumstances, time horizon, policy feature preferences and risk tolerance. You should consider these differences and discuss them with your Registered Representative to choose a variable annuity. Not all forms of contract are offered by all Financial Intermediaries. This Appendix does not constitute, and may not be used for the purposes of making, any offer or solicitation by anyone of any form of variable annuity other than as specifically provided in this prospectus. Presented below are some, but certainly not all, of the differentiating features between our individual deferred variable annuities. The form of Contract you select will be identified on your application and the contract issued to you. Consider the investment objectives, risks, charges and expenses of an investment carefully before investing. Both the variable annuity product and underlying Fund prospectuses contain other information about variable annuities and investment options. Your Registered Representative can provide you with prospectuses or you can contact us to receive one. This and any of the other variable annuities referenced in this Appendix are underwritten and distributed by Hartford Securities Distribution Company, Inc. Member SIPC. Please read the prospectus carefully before investing. I. KEY DIFFERENCES
MINIMUM INITIAL PREMIUM NON- QUALIFIED QUALIFIED CONTRACT CONTRACT CONTRACT SALES CHARGE ---------------------------------------------------------------------------------------- ACCESS $10,000 $2,000 None CORE $1,000 $1,000 Year 1 2 3 4 5 CDSC(2) 7% 7% 7% 6% 5% OUTLOOK $10,000 $2,000 Year 1 2 3 4 5+ CDSC(2) 7% 6% 5% 4% 0% PLUS $10,000 $2,000 Year 1 2 3 4 5 CDSC(2) 8% 8% 8% 8% 7% MORTALITY & MAXIMUM EXPENSE RISK PAYMENT UP-FRONT CONTRACT SALES CHARGE CHARGE(1) ENHANCEMENT COMMISSION -------- ------------------------------------------------------------------------- ACCESS 1.45% No 2% CORE 6 7 8+ 4% 3% 0% 0.95% No 7% OUTLOOK 1.40% No 5.75% PLUS 6 7 8 9+ 6% 5% 4% 0% 1.40% Yes(3) 6.5%
(1) Excluded fees include administrative charges (up to 0.20%), annual maintenance fees (applies to contracts with anniversary/surrender contract values less than $50,000), premium taxes (0 - 3.5%) and optional benefit fees. (2) Each Premium Payment has its own CDSC schedule. Only amounts invested for less than the requisite holding period are subject to a CDSC. When a CDSC is applicable, only Surrenders in excess of the Annual Withdrawal Amount (AWA) will be subject to a CDSC. After the AWA deduction, surrenders will then be taken first: from earnings, second: from Premium Payments not subject to a CDSC, third: from 10% of Premium Payments still subject to a CDSC, fourth: from Premium Payments subject to a CDSC on a first-in-first- out basis, and fifth: from Payment Enhancements for Plus contracts only. A CDSC will not exceed your total Premium Payments. APP A-2 -------------------------------------------------------------------------------- (3) We add an additional sum to your Account Value equal to 3% of the Premium Payment if cumulative Premium Payments are less than $50,000 or 4% of the Premium Payment if cumulative Premium Payments are more than $50,000. If a subsequent Premium Payment increases cumulative Premium Payments to $50,000 or more, we will credit an additional Payment Enhancement to your Account Value equal to 1% of your Premium Payments. Payment Enhancements will be allocated to the same Accounts and in the same proportion as your Premium Payment. The cost of providing Payment Enhancements is included in the higher Mortality and Expense Risk Charges. Payment Enhancements will be recaptured if you: - Cancel your Contract during any "Free Look" period. - Annuitize your Contract, you will forfeit Payment Enhancements credited in the 24 months prior to the Annuity Commencement Date. - Request a full or partial Surrender under the CDSC exemption applicable when you are a patient in a certified long-term care facility or other eligible facility. THE FOLLOWING SURRENDERS ARE NOT SUBJECT TO A CDSC: - Annual Withdrawal Amount -- During the Contract Years when a CDSC applies, you may take partial Surrenders up to 10% of the total Premium Payments otherwise subject to a CDSC. If you do not take 10% one year, you may not take more than 10% the next year. These amounts are different for group unallocated Contracts and Contracts issued to a Charitable Remainder Trust. - If you are a patient in a certified long-term care facility or other eligible facility -- We will waive any CDSC for a partial or full Surrender if you, the joint Contract Owner or the Annuitant, are confined for at least 180 calendar days to a: - facility recognized as a general hospital by the proper authority of the state in which it is located or the Joint Commission on the Accreditation of Hospitals; - facility certified as a hospital or long-term care facility; or - nursing home licensed by the state in which it is located and offers the services of a registered nurse 24 hours a day. - Exchanges -- As an accommodation, we may, in our sole discretion, credit the time that you held an annuity previously issued by us against otherwise applicable CDSCs. For this waiver to apply, you must: - have owned the Contract continuously since it was issued, - provide written proof of your eligibility satisfactory to us, and - request the Surrender within 91 calendar days of the last day that you are an eligible patient in a recognized facility or nursing home. This waiver is not available if you, the joint Contract Owner or the Annuitant is in a facility or nursing home when you purchase or upgrade the Contract. We will not waive any CDSC applicable to any Premium Payments made while you are in an eligible facility or nursing home. This waiver may not be available in all states. - Upon death of the Annuitant or any Contract Owner(s) -- No CDSC will be deducted if the Annuitant or any Contract Owner(s) dies. - Upon Annuitization -- The CDSC is not deducted when you annuitize the Contract. However, we will charge a CDSC if the Contract is Surrendered during the CDSC period under an Annuity Payout Option which allows Surrenders. - For Required Minimum Distributions -- This allows Annuitants who are age 70 1/2 or older, with a Contract held under an IRA or 403(b) plan, to Surrender an amount equal to the Required Minimum Distribution for the Contract without a CDSC for one year's required minimum distribution for that Contract Year. All requests for Required Minimum Distributions must be in writing. - For substantially equal periodic payments -- We will waive the CDSC if you take partial Surrenders under the Automatic Income Program where you receive a scheduled series of substantially equal periodic payments for the greater of five years or to age 59 1/2. - Upon cancellation during the Right to Cancel Period -- No CDSC will be deducted if you cancel your Contract during the Right to Cancel Period. APP A-3 -------------------------------------------------------------------------------- II. EXPENSES The following Example is intended to help you compare the cost of investing in any of these forms of contract. The Example uses the same assumptions referenced in Section 2. The data reflected does not take into account Funds available in proprietary versions of our variable annuities. (1) If you Surrender your variable annuity at the end of the applicable time period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------- Access $694 $2,049 $3,358 $6,440 Core $1,306 $2,548 $3,583 $6,088 Outlook $1,352 $2,488 $3,337 $6,406 Plus $1,447 $2,761 $3,945 $6,406
(2) If you annuitize at the end of the applicable time period:
1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------- Access $589 $1,944 $3,253 $6,335 Core $538 $1,801 $3,034 $5,983 Outlook $584 $1,930 $3,232 $6,301 Plus $584 $1,930 $3,232 $6,301
(3) If you do not Surrender your variable annuity:
1 YEAR 3 YEARS 5 YEARS 10 YEARS -------------------------------------------------------------------------------- Access $694 $2,049 $3,358 $6,440 Core $643 $1,906 $3,139 $6,088 Outlook $689 $2,035 $3,337 $6,406 Plus $689 $2,035 $3,337 $6,406
APP A-4 -------------------------------------------------------------------------------- III. INVESTMENT OPTIONS(4) (STANDARD)
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK ------------------------------------------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. AllianceBernstein VPS Maximize total return AllianceBernstein L.P. X X X X Balanced Wealth Strategy consistent with Advisor's Portfolio -- Class B determination ofreasonable risk AllianceBernstein VPS Global Long-term growth of capital AllianceBernstein L.P. X X X X Research Growth Portfolio - - Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X International Growth Portfolio --Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X International Value Portfolio --Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X Small/Mid Cap Value Portfolio --Class B AllianceBernstein VPS Value Long-term growth of capital AllianceBernstein L.P. X X X X Portfolio -- Class B FIDELITY VARIABLE INSURANCE PRODUCTS FUNDS Fidelity VIP Contrafund(R) Long-term capital appreciation Fidelity Management & Research X X X X Portfolio -- Service Class 2 Company Fidelity VIP Dynamic Capital Seeks capital appreciation FMR Sub-advised by FMR Co., X X X X Appreciation Portfolio -- Inc. and Fidelity Research Service Class 2 andAnalysis Company Fidelity VIP Equity-Income Reasonable income. Fund will Fidelity Management & Research X X X X Portfolio -- Service Class 2 also consider potential for Company capitalappreciation. Fidelity VIP Growth Portfolio Capital appreciation Fidelity Management & Research X X X X -- Service Class 2 Company Fidelity VIP Mid Cap Long-term growth of capital Fidelity Management & Research X X X X Portfolio -- Service Class 2 Company Fidelity VIP Value Strategies Seeks capital appreciation Fidelity Management & Research X X X X Portfolio -- Service Class 2 Company HARTFORD HLS SERIES FUND II, INC. Hartford Growth Opportunities Capital appreciation HL Investment Advisors, LLC X X X X HLS Fund -- Class IA Sub-advised by Wellington ManagementCompany, LLP
APP A-5 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford LargeCap Growth Long-term growth of capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA Sub-advised by Hartford Investment Management Company Hartford MidCap Growth Long-term growth of capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA Sub-advised by Hartford Investment Management Company Hartford SmallCap Growth Maximize capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA appreciation Sub-advised by Wellington Management Company, LLP and Hartford Investment Management Company Hartford SmallCap Value Capital appreciation HL Investment Advisors, LLC X X X X HLS Fund -- Class IA Sub-advised by Kayne Anderson Rudnick Investment Management, LLC, Metropolitan West Capital Management, LLC and SSgA Funds Management, Inc. Hartford U.S. Government Maximize total return with a HL Investment Advisors, LLC X X X X Securities HLS Fund -- high level of current income Sub-advised by Hartford Class IA consistent with prudent Investment Management investment risk Company Hartford Value Capital appreciation HL Investment Advisors, LLC X X X X Opportunities HLS Fund Sub-advised by Wellington -- Class IA Management Company, LLP HARTFORD SERIES FUND, INC. Hartford Advisers HLS Maximum long-term total HL Investment Advisors, LLC X X X X Fund -- Class IA return Sub-advised by Wellington Management Company, LLP Hartford Disciplined Growth of capital HL Investment Advisors, LLC X X X X Equity HLS Fund -- Class Sub-advised by Wellington IA Management Company, LLP Hartford Dividend and High level of current income HL Investment Advisors, LLC X X X X Growth HLS Fund -- Class consistent with growth of Sub-advised by Wellington IA capital Management Company, LLP Hartford Equity Income High level of current income HL Investment Advisors, LLC X X X X HLS Fund -- Class IA consistent with growth of Sub-advised by Wellington capital Management Company, LLP Hartford Fundamental Long-term capital HL Investment Advisors, LLC X X X X Growth HLS Fund -- Class appreciation Sub-advised by Wellington IA (1) Management Company, LLP
APP A-6 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford Global Advisers Maximum long-term total rate HL Investment Advisors, LLC X X X X HLS Fund -- Class IA of return Sub-advised by Wellington Management Company, LLP Hartford Global Equity Seeks long term capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA appreciation Sub-advised by Wellington Management Company, LLP Hartford Global Growth Growth of capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA (2) Sub-advised by Wellington Management Company, LLP Hartford Growth HLS Fund Long-term capital HL Investment Advisors, LLC X X X X -- Class IA appreciation Sub-advised by Wellington Management Company, LLP Hartford High Yield HLS High current income with HL Investment Advisors, LLC X X X X Fund -- Class IA growth of capital as a Sub-advised by Hartford secondary objective Investment Management Company Hartford Index HLS Fund Seeks to provide investment HL Investment Advisors, LLC X X X X -- Class IA results which approximate Sub-advised by Hartford the price and yield Investment Management performance of publicly Company traded common stocks in the aggregate Hartford International Capital appreciation HL Investment Advisors, LLC X X X X Growth HLS Fund -- Class Sub-advised by Wellington IA (3) Management Company, LLP Hartford International Long-term growth of capital HL Investment Advisors, LLC X X X X Opportunities HLS Fund Sub-advised by Wellington --Class IA Management Company, LLP Hartford International Capital appreciation HL Investment Advisors, LLC X X X X Small Company HLS Fund Sub-advised by Wellington --Class IA Management Company, LLP Hartford Money Market HLS Maximum current income HL Investment Advisors, LLC X X X X Fund -- Class IA* consistent with liquidity Sub-advised by Hartford and preservation of capital Investment Management Company Hartford Mortgage Maximum current income HL Investment Advisors, LLC X X X X Securities HLS Fund -- consistent with safety of Sub-advised by Hartford Class IA principal and maintenance of Investment Management liquidity by investing Company primarily in mortgage related securities Hartford Small Company Growth of capital HL Investment Advisors, LLC X X X X HLS Fund -- Class IA Sub-advised by Wellington Management Company, LLP and Hartford Investment Management Company
APP A-7 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford Stock HLS Fund Long-term growth of capital HL Investment Advisors, LLC X X X X -- Class IA Sub-advised by Wellington Management Company, LLP Hartford Total Return Competitive total return, HL Investment Advisors, LLC X X X X Bond HLS Fund -- Class with income as a secondary Sub-advised by Hartford IA objective Investment Management Company Hartford Value HLS Fund Long-term total return HL Investment Advisors, LLC X X X X -- Class IA Sub-advised by Wellington Management Company, LLP LORD ABBETT SERIES FUND, INC. Lord Abbett All Value Long-term growth of capital Lord, Abbett & Co. LLC X X X X Portfolio -- Class VC and income without excessive fluctuations in market value Lord Abbett America's Current income and capital Lord, Abbett & Co. LLC X X X X Value Portfolio -- Class appreciation VC Lord Abbett High current income and Lord, Abbett & Co. LLC X X X X Bond-Debenture Portfolio capital appreciation to -- Class VC produce a high total return Lord Abbett Growth and Long-term growth of capital Lord, Abbett & Co. LLC X X X X Income Portfolio -- and income without excessive Class VC fluctuations in market value Lord Abbett Large-Cap Growth of capital and growth Lord, Abbett & Co. LLC X X X X Core Portfolio -- Class of income consistent with VC reasonable risk OPPENHEIMER VARIABLE ACCOUNT FUNDS Oppenheimer Capital Seeks to achieve capital OppenheimerFunds, Inc. X X X X Appreciation Fund/VA -- appreciation by investing in Service Shares securities of well-known established companies. Oppenheimer Global Seeks long-term capital OppenheimerFunds, Inc. X X X X Securities Fund/VA -- appreciation by investing a Service Shares substantial portion of its assets in securities of foreign issuers, "growth- type" companies, cyclical industries and special situations which are considered to have appreciation possibilities, but which may be considered to be speculative.
APP A-8 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Oppenheimer Main Street Seeks a high total return OppenheimerFunds, Inc. X X X X Fund(R)/VA -- Service (which includes growth in Shares the value of its shares as well as current income) from equity and debt securities. From time to time the Fund may focus on small to medium capitalization common stocks, bonds and convertible securities. Oppenheimer Main Street The Fund seeks capital OppenheimerFunds, Inc. X X X X Small Cap Fund(R)/VA -- appreciation from small Service Shares company stocks. Oppenheimer MidCap Seeks to achieve capital OppenheimerFunds, Inc. X X X X Fund/VA -- Service appreciation by investing in Shares "growth-type" companies. PUTNAM VARIABLE TRUST Putnam VT Diversified As high a level of current Putnam Investment X X X X Income Fund -- Class IB income as Putnam Management Management, LLC believes is consistent with Sub-advised by Putnam preservation of capital Investments Limited Putnam VT Global Asset High level of long-term Putnam Investment X X X X Allocation Fund -- Class total return consistent with Management, LLC IB preservation of capital Putnam VT Growth and Capital growth and current Putnam Investment X X X X Income Fund -- Class IB+ income Management, LLC Putnam VT International Capital appreciation Putnam Investment X X X X Equity Fund -- Class IB Management, LLC Sub-advised by Putnam Investments Limited Putnam VT International Capital growth. Current Putnam Management X X X X Growth and Income Fund income is a secondary Sub-advised by Putnam -- Class IB objective Investments Limited Putnam VT Investors Fund Long-term growth of capital Putnam Investment X X X X -- Class IB and any increased income Management, LLC that results from this growth Putnam VT New Value Fund Long-term capital Putnam Investment X X X X -- Class IB appreciation Management, LLC Putnam VT Small Cap Value Capital appreciation Putnam Investment X X X X Fund -- Class IB Management, LLC Putnam VT The George A balanced investment Putnam Investment X X X X Putnam Fund of Boston -- composed of a well Management, LLC Class IB diversified portfolio of stocks and bonds which provide both capital growth and current income Putnam VT Vista Fund -- Capital appreciation Putnam Investment X X X X Class IB Management, LLC Putnam VT Voyager Fund -- Capital appreciation Putnam Investment X X X X Class IB+ Management, LLC
APP A-9 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- THE UNIVERSAL INSTITUTIONAL FUNDS, INC. Van Kampen -- UIF Long-term capital Morgan Stanley Investment X X X X Emerging Markets Equity appreciation by investing Management Inc. Portfolio -- Class II primarily in growth- Sub-advised by Morgan oriented equity securities Stanley Investment of issuers in emerging Management Company market countries. Van Kampen -- UIF Mid Cap Long-term capital growth by Morgan Stanley Investment X X X X Growth Portfolio -- investing primarily in Management Inc. Class II common stocks and other equity securities. Van Kampen -- UIF U.S. Above-average total return Morgan Stanley Investment X X X X Mid Cap Value Portfolio over a market cycle of three Management Inc. - - Class II to five years by investing primarily in common stocks and other equity securities. VAN KAMPEN LIFE INVESTMENT TRUST Van Kampen LIT Comstock Capital growth and income Van Kampen Asset Management X X X X Portfolio -- Class II through investments in equity securities, including common stocks, preferred stocks and securities convertible into common and preferred stocks. Van Kampen LIT Growth and Seeks to provide long-term Van Kampen Asset Management X X X X Income Portfolio -- growth of capital and income Class II primarily through investments in common stocks. Fixed Accumulation Preservation of capital General Account X X X Feature**
+ Closed to Contracts issued on or after 11/12/2007 NOTES (1) Formerly Hartford Focus HLS Fund -- Class IA (2) Formerly Hartford Global Leaders HLS Fund -- Class IA (3) Formerly Hartford International Capital Appreciation HLS Fund -- Class IA * In a low interest rate environment, yields for money market funds, after deduction of Contract charges may be negative even though the fund's yield, before deducting for such charges, is positive. If you allocate a portion of your Contract Value to a money market Sub-Account or participate in an Asset Allocation Program where Contract Value is allocated to a money market Sub-Account, that portion of your Contract Value may decrease in value. ** The Fixed Accumulation Feature is not a Sub-Account and the Company does not provide investment advice in connection with this feature. The Fixed Accumulation Feature is currently not available to Plus and Outlook products. APP A-10 -------------------------------------------------------------------------------- IV. UNDERLYING FUNDS (PROPRIETARY) [Reserved] APP B-1 -------------------------------------------------------------------------------- APPENDIX B -- OPTIONAL BENEFITS COMPARISONS
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- OBJECTIVES Guaranteed income - Guaranteed income THE HARTFORD'S LIFETIME - Guaranteed income for life for life INCOME BUILDER SELECTS: for life or a set - Potential - Guaranteed income for life time period automatic annual - Potential automatic annual - Potential Payment Base Payment Base increases automatic annual increases (0 - 10%) Benefit Amount (0 - 10%) THE HARTFORD'S LIFETIME increases INCOME BUILDER PORTFOLIOS: (0 - 10%) - Guaranteed income for life - Potential automatic annual Payment Base adjustment DEATH BENEFIT - Greater of Same as The Same as The Hartford's - Greater of Contract Value or Hartford's Lifetime Lifetime Income Foundation Contract Value or Premium Payments Income Foundation for both options Benefit Amount adjusted for partial - Replaces the Surrenders standard Death - Replaces the Benefit standard Death - MAV Plus (MAV Benefit only) may be - MAV Plus (MAV purchased with this only) may be rider purchased with this rider AVAILABILITY - Available at Same as The - Available at Contract - Available at Contract issue only Hartford's Lifetime issue only Contract issue only - Available subject Income Foundation - Available subject to state - Closed to new to state approval approval investors - No longer available if The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios are approved in your state MAXIMUM ISSUE AGE Qualified, Qualified, Qualified, Non-Qualified Qualified, Non-Qualified Non-Qualified maximum issue age is 80 for Non-Qualified maximum issue age is maximum issue age is any Covered Life and maximum issue age is 80 for any Covered 75 for any Covered Annuitant 75 Life and Annuitant Life and Annuitant. (owner(s)/annuitant) REVOCABILITY - Only the Lifetime - Irrevocable FOR BOTH OPTIONS: - Irrevocable Withdrawal Feature - We may terminate - Irrevocable - We may terminate is revocable by the Rider upon Owner - We may terminate the Rider the Rider upon Owner client, revocation default upon Owner default default can be requested in writing anytime after the 5th Contract Year or upon Spousal Contract Continuation - We may terminate the Rider upon Owner default
APP B-2 --------------------------------------------------------------------------------
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- RIDER COMPATIBILITY Cannot be elected Cannot be elected THE HARTFORD'S LIFETIME Cannot be elected with any of the with any of the INCOME BUILDER SELECTS: with any of the following: following: Cannot be elected with any following: - The Hartford's - The Hartford's of the following: - The Hartford's Principal First Principal First - The Hartford's Principal Principal First - The Hartford's - The Hartford's First - The Hartford's Principal First Principal First - The Hartford's Principal Principal First Preferred Preferred First Preferred Preferred - The Hartford's - The Hartford's - The Hartford's Lifetime - The Hartford's Lifetime Income Lifetime Income Income Foundation Lifetime Income Builder I Builder - The Hartford's Lifetime Builder II - The Hartford's - The Hartford's Income Builder II - The Hartford's Lifetime Income Lifetime Income - The Hartford's Lifetime Lifetime Income Builder II Foundation Income Builder Foundation - The Hartford's - The Hartford's Portfolios - The Hartford's Lifetime Income Lifetime Income THE HARTFORD'S LIFETIME Lifetime Income Builder Selects Builder Selects INCOME BUILDER PORTFOLIOS: Builder Selects - The Hartford's - The Hartford's Cannot be elected with any - The Hartford's Lifetime Income Lifetime Income of the following: Lifetime Income Builder Portfolios Builder Portfolios - The Hartford's Principal Builder Portfolios First - The Hartford's Principal First Preferred - The Hartford's Lifetime Income Foundation - The Hartford's Lifetime Income Builder II - The Hartford's Lifetime Income Builder Selects - The Hartford's Lifetime Income Builder Portfolios
APP B-3 --------------------------------------------------------------------------------
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- ADDITIONAL CHARGE 0.30% (30 bps) of - 0.40% (40 bps) of THE HARTFORD'S LIFETIME - 0.40% (40 bps) of the Payment Base the Payment Base INCOME BUILDER SELECTS: the Benefit Amount charged annually on charged annually on - 0.55% of the Payment Base charged annually on each Contract the Contract charged annually on the the contract Anniversary (flat Anniversary (flat Contract Anniversary (flat anniversary (flat dollar) dollar) dollar) dollar) - Can increase the - Can increase the fee on or - Can increase the fee on or after the after 12 months from the fee on or after the 5th anniversary from rider effective date or upon 5th contract the rider effective Covered Life changes anniversary and then date and then every - Maximum charge of 1.50% every 5 years 5 years thereafter THE HARTFORD'S LIFETIME thereafter only if or upon Covered Life INCOME BUILDER PORTFOLIOS: annual Benefit changes - 0.65% of the Payment Base Amount increases - Maximum charge of charged annually on the elected 0.75% Contract Anniversary (flat - Maximum charge of dollar) 0.75% - Can increase the fee on or after 12 months from the rider effective date or upon Covered Life changes - Maximum charge of 1.50% BENEFIT AMOUNT Not applicable Not applicable Not applicable 100% of Premium Payment when added at issue
APP B-4 --------------------------------------------------------------------------------
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- PAYMENT BASE 100% of Premium 100% of Premium BOTH OPTIONS: Not applicable Payment when added Payment when added 100% of Premium Payment plus at issue at issue any Payment Enhancements (Plus Contracts) when added at issue. WITHDRAWAL - Varies based on: Same as The BOTH OPTIONS: Not applicable PERCENTAGE - attained age of Hartford's Lifetime - Varies based on: Relevant Covered Income Foundation - attained age of Relevant Life Covered Life - survivor option - survivor option chosen chosen - Withdrawal Percent for - date of first Single Life Option starts at partial Surrender 5% and increases by 0.5% for - Withdrawal Percent every 5 year increment for Single Life between the Relevant Covered Option starts at 5% Life's attained ages 60 - 80 and increases by - Withdrawal Percent for 0.5% for every 5 Joint/Spousal Life Option year increment starts at 4.5% and increases between the Relevant by 0.5% for every 5 year Covered Life's increment between the attained ages 60 - Relevant Covered Life's 80 attained ages 60 - 80 - Withdrawal Percent - The Withdrawal Percent for Joint/Spousal will be set at the time of Life Option starts the first partial Surrender at 4.5% and and is based on the attained increases by 0.5% age of the Relevant Covered for every 5 year Life increment between - Potential to increase the Relevant Covered Withdrawal Percent if a new Life's attained ages age band is reached and 60 - 80 there is an automatic - The Withdrawal Payment Base Increase on the Percent will be set anniversary. at the time of the first partial Surrender and is based on the attained age of the Relevant Covered Life
APP B-5 --------------------------------------------------------------------------------
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- ANNUAL AMOUNT PRIOR TO AN ELIGIBLE Same as The THE HARTFORD'S LIFETIME PRIOR TO OWNER'S AVAILABLE FOR WITHDRAWAL YEAR: Hartford's Lifetime INCOME BUILDER SELECTS: 60TH BIRTHDAY: SURRENDER Partial Income Foundation PRIOR TO THE LIFETIME INCOME Benefit Payments Surrenders(1) equal ELIGIBILITY DATE: equal 5% multiplied either: Partial Surrenders (1) equal by the Benefit SINGLE LIFE OPTION either: Amount -- 5% multiplied by SINGLE LIFE OPTION -- 5% CONTRACT the greater of multiplied by the greater of ANNIVERSARIES Payment Base or Payment Base or Contract IMMEDIATELY Contract Value (on Value (on the Contract FOLLOWING THE the Contract Anniversary) OWNER'S 60TH Anniversary) JOINT/SPOUSAL OPTION -- 4.5% BIRTHDAY -- ONLY IF JOINT/SPOUSAL OPTION multiplied by the greater of ELECTED: Lifetime -- 4.5% multiplied Payment Base or Contract Benefit Payments(2) by the greater of Value (on the Contract equal 5% of the Payment Base or Anniversary) Benefit Amount Contract Value (on ON OR AFTER THE LIFETIME the Contract INCOME ELIGIBILITY DATE: Anniversary) Lifetime Benefit Payments DURING AN ELIGIBLE equal applicable Withdrawal WITHDRAWAL YEAR: Percent (varies by option Lifetime Benefit elected, Single Life vs. Payments equal Joint/ Spousal) multiplied applicable by the greater of Payment Withdrawal Percent Base or Contract Value (on (varies by option the Contract Anniversary) elected, Single Life THE HARTFORD'S LIFETIME vs. Joint/ Spousal) INCOME BUILDER PORTFOLIOS: multiplied by the PRIOR TO THE LIFETIME INCOME greater of Payment ELIGIBILITY DATE: Base or Contract Partial Surrenders (1) equal Value (on the either: Contract SINGLE LIFE OPTION -- 5% Anniversary) multiplied by the Payment Base JOINT/SPOUSAL OPTION -- 4.5% multiplied by the Payment Base ON OR AFTER THE LIFETIME INCOME ELIGIBILITY DATE: Lifetime Benefit Payments equal applicable Withdrawal Percent (varies by option elected, Single Life vs. Joint/ Spousal) multiplied by the Payment Base (on the Contract Anniversary)
(1) As in the case of any partial Surrender, taking partial Surrenders prior to an Eligible Withdrawal Year will reduce the Payment Base and your future Lifetime Benefit Payment. Such partial Surrender may potentially eliminate your Lifetime Benefit Withdrawal Guarantee and Guaranteed Minimum Death Benefit. (2) Benefit Payments are still available after age 60 and may be different than the Lifetime Benefit Payment. The annual amount withdrawn can not exceed the greater of these two values. APP B-6 --------------------------------------------------------------------------------
THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S THE HARTFORD'S LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME LIFETIME INCOME FEATURES FOUNDATION BUILDER II BUILDER SELECTS / PORTFOLIOS BUILDER -------------------------------------------------------------------------------------------------------------------- RMD RESET - Contracts enrolled Same as The BOTH RIDERS: - Contracts enrolled in automatic RMD Hartford's Lifetime Same as The Hartford's in automatic RMD (AIP) that go over Income Foundation Lifetime Income Foundation (AIP) that go over the annual Lifetime the 5% allowed will Benefit Payment not result in a amount will not reset of the Benefit result in a reset of Payment or Lifetime the Lifetime Benefit Benefit Payment if Payment if no other no other partial partial Surrenders Surrenders have have occurred during occurred during the the Contract Year Contract Year - NOT 72t/q friendly - NOT 72t/q friendly INVESTMENT - Not currently Same as The THE HARTFORD'S LIFETIME Not currently RESTRICTIONS enforced Hartford's Lifetime INCOME BUILDER SELECTS: enforced - Can be triggered Income Foundation Same as The Hartford's by changes in Lifetime Income Foundation Covered Life THE HARTFORD'S LIFETIME - If the INCOME BUILDER PORTFOLIOS: restrictions are - Contract Value must be violated, the invested in an approved Lifetime Withdrawal asset allocation model, Benefit of this fund-of-funds or rider will be Sub-Accounts -- failure to revoked and the do so will result in the Death Benefit only termination of this rider will continue OWNERSHIP CHANGES Refer to Covered Refer to Covered Refer to Covered Life change - Ownership changes Life change feature Life change feature feature below in the first 12 below below months from the effective date of the rider will have no impact on the rider benefits as long as age limitation is met - Ownership changes after the first 12 months from the effective date of the rider may cause the Benefit Amount, Benefit Payment and Lifetime Benefit Payment to be recalculated SPOUSAL CONTRACT Refer to Spousal Refer to Spousal Refer to Covered Life change If Spousal Contract CONTINUATION Contract Contract feature below continuation is Continuation feature Continuation feature elected, there may below below be a Benefit Amount increase to equal the then current Benefit Amount (this is automatic, NOT elected) providing he/she is younger than 76 years old and the rider is currently available for sale
APP B-7 --------------------------------------------------------------------------------
THE HARTFORD'S LIFETIME INCOME THE HARTFORD'S LIFETIME INCOME THE HARTFORD'S LIFETIME INCOME FOUNDATION -- SINGLE BUILDER II -- SINGLE FOUNDATION -- FEATURES LIFE OPTION LIFE OPTION JOINT/SPOUSAL OPTION -------------------------------------------------------------------------------------------------------------------- COVERED LIFE - Natural Owner -- Owner and Same as The Hartford's - Natural Owner -- The Covered Joint Owner (if any) on rider Lifetime Income Foundation -- Life is both Spouses (as effective date Single Life option defined by Federal Law) - Non-Natural Owner -- the - Non-Natural Owner -- the Annuitant on rider effective Annuitant on rider effective date date - All age based benefit - All age based provisions provisions based on the based on the attained age of attained age of the OLDER the YOUNGER Covered Life Covered Life ISSUE RULES No Additional Requirements Same as The Hartford's - The sole primary beneficiary Lifetime Income Foundation -- (defined as the individual to Single Life option receive the Death Benefit) must be the Owner's Spouse. If the Joint Owner is the Spouse, the primary beneficiary can be someone other than the Spouse - A joint Owner who is not the Owner's Spouse is not allowed. - We reserve the right to prohibit non-natural entities from being listed as Owner COVERED LIFE CHANGE - Covered Life changes within Same as The Hartford's - Covered Life changes within the first 6 months have no Lifetime Income Foundation -- the first 6 months have no impact to the Death Benefit or Single Life option impact to the Death Benefit or Payment Base, however, the Payment Base, however, the Withdrawal Percent and Withdrawal Percent and Lifetime Benefit Payment may Lifetime Benefit Payment may change based on the attained change based on the attained age of new Relevant Covered age of new Relevant Covered Life Life - After the first 6 months: - If Owner and their Spouse - Covered Life changes will are no longer married, for cause a reset in the benefits reasons other than death, - Allow us to impose Covered Life changes may investment restrictions occur: - May cause an increase in - If Surrenders have not been rider charge taken, Owner may remove their Spouse and replace with new Spouse (both events do not need to occur at the same time)(3) - If Surrenders have been taken, Owner may remove their Spouse but may not add a new Spouse - Any other contractual change which causes a change in the Covered Life will cause the Withdrawal Feature to terminate THE HARTFORD'S LIFETIME INCOME BUILDER II -- FEATURES JOINT/SPOUSAL OPTION -------------------- COVERED LIFE Same as The Hartford's Lifetime Income Foundation -- Joint/Spousal option ISSUE RULES Same as The Hartford's Lifetime Income Foundation -- Joint/Spousal option COVERED LIFE CHANGE Same as The Hartford's Lifetime Income Foundation -- Joint/Spousal option except Covered Life changes within the first 6 months have no impact to the Maximum Contract Value
(3) The Covered Life will be reset at time of removal and time of replacement. The Withdrawal Percent scale will be based on the younger Covered Life. APP B-8 --------------------------------------------------------------------------------
THE HARTFORD'S LIFETIME INCOME THE HARTFORD'S LIFETIME INCOME THE HARTFORD'S LIFETIME INCOME FOUNDATION -- SINGLE BUILDER II -- SINGLE FOUNDATION -- FEATURES LIFE OPTION LIFE OPTION JOINT/SPOUSAL OPTION -------------------------------------------------------------------------------------------------------------------- SPOUSAL - We will increase the Same as The Hartford's - We will increase the CONTRACT Contract Value to the Death Lifetime Income Foundation -- Contract Value to the Death CONTINUATION Benefit value Single Life option Benefit value - The Relevant Covered Life - The Spouse may elect to will be re-determined on the either: date of the continuation A) Continue the Contract and - The Payment Base will be set rider; or equal to the Contract Value, B) Continue the Contract and the Death Benefit will be set revoke the Withdrawal Feature equal to the Contract Value of the rider and the Lifetime Benefit If the Spouse elects to Payment and Withdrawal Percent continue the Contract and will be recalculated on the rider: continuation date - The Payment Base will be set - If Relevant Covered Life is equal to the greater of greater than or equal to 81 at Contract Value or Payment Base the time of continuation, the on the continuation date Rider will terminate. The - The Withdrawal Percent will Death Benefit will be equal to remain frozen at the current the Contract Value Withdrawal Percent if there have been partial Surrenders since the rider effective date. If not, the Withdrawal Percent will be based on the attained age of the remaining Covered Life on the Contract Anniversary prior to the first partial Surrender - The Lifetime Benefit Payment will be recalculated to equal the Withdrawal Percent multiplied by the greater of Contract Value or Payment Base on the continuation date THE HARTFORD'S LIFETIME INCOME BUILDER II -- FEATURES JOINT/SPOUSAL OPTION -------------------- SPOUSAL Same as The Hartford's CONTRACT Lifetime Income Foundation -- CONTINUATION Joint/Spousal option except the Maximum Contract Value will be the greater of Contract Value or Payment Base on the continuation date
The discussion above is qualified in its entirety by the terms and provisions of the prospectus attached and in the event of any conflict between the discussion above and the prospectus, the prospectus shall prevail. APP B-9 --------------------------------------------------------------------------------
THE HARTFORD'S PRINCIPAL FIRST THE HARTFORD'S FEATURES PREFERRED PRINCIPAL FIRST ------------------------------------------------------------------------------------------------------------------------------ OBJECTIVES - Guaranteed income for a set time period (20 - Guaranteed income for a set time period (14 years estimated) years estimated) - Principal protection - Potential step-ups every 5 years - Principal protection DEATH BENEFIT Not Applicable Not Applicable AVAILABILITY - Available at Contract issue or post issue on - Available at Contract issue or post-issue on contracts effective on or after 11/1/04 current products - Plus contracts must reach the 1st anniversary - Plus contracts must reach the 1st anniversary before adding post-issue. before adding post-issue. MAXIMUM ISSUE AGE Qualified, Non-Qualified maximum issue age is 70 - Non-Qualified and Roth IRA -- age 85 except for (owner(s)/annuitant) Outlook and Access contracts which have a maximum issue age of 90 - IRA/Qualified -- age 80 REVOCABILITY Revocable in writing anytime after the 5th Irrevocable anniversary of the rider effective date (6th rider year) RIDER COMPATIBILITY Cannot be elected with any of the following: Cannot be elected with any of the following: - The Hartford's Principal First - The Hartford's Principal First Preferred - The Hartford's Lifetime Income Builder - The Hartford's Lifetime Income Builder - The Hartford's Lifetime Income Builder II - The Hartford's Lifetime Income Builder II - The Hartford's Lifetime Income Foundation - The Hartford's Lifetime Income Foundation - The Hartford's Lifetime Income Builder Selects - The Hartford's Lifetime Income Builder Selects - The Hartford's Lifetime Income Builder - The Hartford's Lifetime Income Builder Portfolios Portfolios ADDITIONAL CHARGE Annual charge of 0.20% (20 bps) assessed daily - Annual charge of 0.50% (50 bps) assessed daily - Can increase the fee on or after the 5th contract anniversary and then every 5 years thereafter only of step-up elected - Maximum charge of 0.75% BENEFIT AMOUNT - 100% of Premium Payment when added at issue - 100% of Premium Payment when added at issue - Contract Value on the rider effective date when - Contract Value on the rider effective date when added post-issue added post-issue PAYMENT BASE Not applicable Not applicable WITHDRAWAL PERCENTAGE Not applicable Not applicable ANNUAL AMOUNT AVAILABLE BEGINNING IMMEDIATELY: BEGINNING IMMEDIATELY: FOR SURRENDER BENEFIT PAYMENTS EQUAL 5% OF THE BENEFIT AMOUNT BENEFIT PAYMENTS EQUAL 7% OF THE BENEFIT AMOUNT RMD RESET - Contracts enrolled in automatic RMD (AIP) that - All partial Surrenders that go over the 7% go over the 5% allowed will not result in a reset allowed will result in a reset of the Benefit of the Benefit Payment amount if no other partial Amount and possibly a reset of the Benefit Payment Surrenders have occurred during the Contract amount Year. - NOT 72t/q friendly - NOT 72t/q friendly
APP B-10 --------------------------------------------------------------------------------
THE HARTFORD'S PRINCIPAL FIRST THE HARTFORD'S FEATURES PREFERRED PRINCIPAL FIRST ------------------------------------------------------------------------------------------------------------------------------ INVESTMENT RESTRICTIONS - Not currently enforced None - If the restrictions are violated, the withdrawal feature of this rider will be revoked OWNERSHIP CHANGES - Ownership changes in the first 12 months from Same as Principal First Preferred the effective date of the rider will have no impact on the rider benefits as long as age limitation is met - Ownership changes after the first 12 months to someone other than the Spouse will cause a recalculation of the Benefit Amount SPOUSAL There is no option for the Spouse to step up the Spouse may choose to step up the Benefit Amount to CONTRACT Benefit Amount upon Spousal Contract continuation the current Contract Value CONTINUATION
APP C-1 ------------------------------------------------------------------------------- APPENDIX C -- THE HARTFORD'S LIFETIME INCOME BUILDER OBJECTIVE Protect your investment from poor market performance through potential annual Benefit Amount increases and provide income through predetermined periodic payments based either on a set schedule or your lifetime. HOW DOES THIS RIDER HELP ACHIEVE THIS GOAL? This rider (called the Unified Benefit Design in your Contract) provides a single Benefit Amount payable as two separate but bundled benefits which form the entire benefit. In other words, this rider is a guarantee of the Benefit Amount that you can access two ways: - WITHDRAWAL BENEFIT allows (a) BENEFIT PAYMENTS: a series of withdrawals which may be paid annually until the Benefit Amount is reduced to zero or (b) LIFETIME BENEFIT PAYMENTS: a series of withdrawals which may be paid annually until the death of any Owner if the older Owner (or Annuitant if the Contract Owner is a trust) is age 60 or older. The Benefit Payments and Lifetime Benefit Payments may continue even if the Contract Value is reduced to zero; and/or - GUARANTEED MINIMUM DEATH BENEFIT ("GMDB"). The GMDB is equal to the greater of the Benefit Amount or the Contract Value if the Contract Value is greater than zero. DEPLETING THE BENEFIT AMOUNT BY TAKING SURRENDERS WILL REDUCE OR ELIMINATE THE GUARANTEED MINIMUM DEATH BENEFIT. THIS GUARANTEED MINIMUM DEATH BENEFIT REPLACES THE STANDARD DEATH BENEFITS PROVIDED UNDER THIS CONTRACT. See Optional Benefit Comparisons in Appendix B. WHEN CAN YOU BUY THIS RIDER? The Hartford's Lifetime Income Builder is closed to new investors. This rider may not be available in all states or through all Registered Representatives. We reserve the right to withdraw this rider at any time. DOES ELECTING THIS RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect this rider, you may not elect any rider other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR THIS RIDER CALCULATED? The fee for this rider is based on your then current Benefit Amount. . This additional charge will automatically be deducted from your Contract Value on each Contract Anniversary. The charge is withdrawn from each Sub-Account and the Fixed Account in the same proportion that the value of the Sub-Account bears to the total Contract Value. The rider fee will not be taken from the DCA Plus account. The charge is deducted after all other financial transactions and any Benefit Amount increases are made. Once you elect this benefit, we will continue to deduct the charge until we begin to make Annuity Payouts. The rider charge may limit access to Fixed Accounts in certain states. We reserve the right to increase the charge up to a maximum rate of 0.75% any time on or after your fifth Contract Anniversary or five years from the date from which we last notified you of a fee increase, whichever is later. If we increase this charge, you will receive advance notice of the increase and will be given the opportunity to suspend this and future charge increases. If you suspend any charge increase, you will no longer receive automatic Benefit Amount increases. If we do not receive notice from you to suspend the increase, we will automatically assume that automatic Benefit Amount increases will continue and the new charge will apply. Within 30 days prior to subsequent Contract Anniversaries, you may re-start automatic Benefit Amount increases at the charge in effect since your most recent notification. If you Surrender prior to a Contract Anniversary, a pro rata share of the charge will be assessed and will be equal to the charge multiplied by the Benefit Amount prior to the Surrender, multiplied by the number of days since the last charge was assessed, divided by 365. DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER THIS RIDER? Yes. The initial Benefit Amount equals your initial Premium Payment. The Benefit Amount will be adjusted in the future through your actions as well as ours. The Benefit Amount will be increased as a result of automatic Benefit Amount increases or subsequent Premium Payments; However, if Surrenders have been taken, your new Benefit Payment may not be greater than your Benefit Amount prior to the Surrender. The Benefit Amount will be decreased as a result of any Surrenders and potentially, any changes in ownership. - Automatic Benefit Amount increases. We may increase the Benefit Amount on each Contract Anniversary (referred to as "automatic Benefit Amount increases"), depending on the investment performance of your Contract. To compute this percentage, we will divide your Contract Value on the then current Contract Anniversary by the Maximum Contract Value and then reduced by 1. In no event will this factor be less than 0% or greater than 10%. Automatic Benefit Amount increases will not take place if the investment performance of your Sub-Accounts is neutral or negative. Automatic Benefit Amount increases will continue until the earlier of the Contract Anniversary immediately following the older Owner's or Annuitant's 75th birthday or the Annuity Commencement Date. APP C-2 ------------------------------------------------------------------------------- - Subsequent Premium Payments. When subsequent Premium Payments are received, the Benefit Amount will be increased by the dollar amount of the subsequent Premium Payment. However, if Surrenders have been taken your new Benefit Payment may not be greater than your Benefit Amount prior to the Surrender. - Surrenders. When a Surrender is made, the Benefit Amount will be equal to the amount determined in either (A), (B) or (C) as follows: A. If total Surrenders since the most recent Contract Anniversary are equal to or less than the Benefit Payment, the Benefit Amount becomes the Benefit Amount immediately prior to the Surrender, less the amount of Surrender. B. If total Surrenders since the most recent Contract Anniversary exceed the Benefit Payment as a result of enrollment in our Automatic Income program to satisfy Required Minimum Distributions, the Benefit Amount becomes the Benefit Amount immediately prior to the Surrender, less the amount of Surrender. C. If total Surrenders since the most recent Contract Anniversary exceed the Benefit Payment and the Required Minimum Distribution exception in (B) does not apply, the Benefit Amount is re-calculated to the greater of zero or the lesser of (i) or (ii) as follows: (i) the Contract Value immediately following the Surrender; or (ii) the Benefit Amount immediately prior to the Surrender, less the amount of Surrender. - Benefit Amount limits. Your Benefit Amount can not be less than zero or more than $5 million. Any sums in excess of this ceiling will not be included for any benefits under this rider. Since the Benefit Amount is a central source for both benefits under this rider, taking withdrawals will lessen or eliminate the Guaranteed Minimum Death Benefit. Refer to the Examples included in Appendix I for a more complete description of these effects. IS THIS RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? Yes. The following section describes both Benefit Payments and Lifetime Benefit Payments which together comprise the Withdrawal Benefit. - BENEFIT PAYMENTS Under this option, Surrenders may be taken immediately as a Benefit Payment that is initially set equal to 5% annually of the initial Benefit Amount. The Benefit Payment is the amount guaranteed for withdrawal each Contract Year until the Benefit Amount is reduced to zero (even if the Contract Value is first reduced to zero). We support this guaranteed payment through our General Account which is subject to our claims paying ability and other liabilities as a company. The Benefit Payment can be taken on any payment schedule that you request. You can continue to take Benefit Payments until the Benefit Amount has been depleted. Benefit Payments are treated as partial Surrenders and are deducted from your Contract Value. Each Benefit Payment reduces the amount you may Surrender under your Annual Withdrawal Amount. Surrenders in excess of your Benefit Payment include any applicable Contingent Deferred Sales Charge. Whenever a Surrender is taken during any Contract Year, the Benefit Payment will be adjusted to equal the amount in either (A), (B) or (C) as follows: A. If total Surrenders since the most recent Contract Anniversary are equal to or less than the Benefit Payment, the Benefit Payment until the next Contract Anniversary is equal to the lesser of the Benefit Payment immediately prior to the Surrender or the Benefit Amount immediately after the Surrender. B. If total Surrenders since the most recent Contract Anniversary exceed the Benefit Payment as a result of enrollment in our Automatic Income Program to satisfy Required Minimum Distributions, the provisions of (A) will apply. C. If total Surrenders since the most recent Contract Anniversary are more than the Benefit Payment and the Required Minimum Distribution exception in (B) does not apply, the Benefit Payment will be re-calculated to equal the Benefit Amount immediately following the Surrender multiplied by 5%. If you choose an amount less than the Benefit Payment in any Contract Year, the remaining annual Benefit Payment cannot be carried forward to the next Contract Year. You may elect to take Benefit Payments at any time provided that the Benefit Amount is greater than zero. If you make a subsequent Premium Payment, the Benefit Payment will be re-calculated to equal 5% of the Benefit Amount immediately after the subsequent Premium Payment is made. APP C-3 ------------------------------------------------------------------------------- If there is an increase in the Benefit Amount due to an automatic Benefit Amount increase on any Contract Anniversary, we will automatically re-calculate the Benefit Payment to the greater of the Benefit Payment immediately prior to the increase or the Benefit Amount immediately after the increase multiplied by 5%. If you are enrolled in our Automatic Income Program you must request in writing to increase the amount being withdrawn. If Surrenders are less than or equal to the Benefit Payment but result in the Contract Value remaining after such Surrender to be less than our minimum amount rules then in effect, we will not terminate the Contract under our minimum amount rules if the Benefit Amount is greater than zero. However, if the Benefit Amount is zero and the Contract Value remaining after any Surrender is also less than our minimum amount rules then in effect, we may terminate the Contract and pay you the Surrender Value. - LIFETIME BENEFIT PAYMENTS Under this option, Surrenders may be taken as Lifetime Benefit Payments that are initially equal to 5% annually of the Benefit Amount on the Contract Anniversary immediately following the older Owner's 60th birthday or 5% of the initial Benefit Amount if the older Owner is 60 or older at the rider's effective date The Lifetime Benefit Payment is the amount guaranteed to be available for withdrawal each Contract Year until the first death of any Owner (even if the Contract Value is reduced to zero). We support this payment through our General Account which is subject to our claims paying ability and other liabilities as a company. The Lifetime Benefit Payment can be taken on any payment schedule that you request. Lifetime Benefit Payments are treated as partial Surrenders and are deducted from your Contract Value. Each Lifetime Benefit Payment reduces the amount you may Surrender under your Annual Withdrawal Amount. Surrenders in excess of your Lifetime Benefit Payment include any applicable Contingent Deferred Sales Charge. Whenever a Surrender is taken after the Contract Anniversary immediately following the older Owner's 60th Birthday, the Lifetime Benefit Payment will be equal to the amount determined in either (A), (B) or (C) as follows: A. If total Surrenders since the most recent Contract Anniversary are equal to or less than the Lifetime Benefit Payment, the Lifetime Benefit Payment is equal to the Lifetime Benefit Payment immediately prior to the Surrender. B. If total Surrenders since the most recent Contract Anniversary exceed the Lifetime Benefit Payment as a result of enrollment in our Automatic Income program to satisfy Required Minimum Distributions, the provisions of (A) will apply. C. If total Surrenders since the most recent Contract Anniversary are more than the Lifetime Benefit Payment and the Required Minimum Distribution exception in (B) does not apply, the Lifetime Benefit Payments will be re-calculated to equal the Benefit Amount immediately following the partial Surrender multiplied by 5%. If you choose an amount less than the Lifetime Benefit Payment in any Contract Year, the remaining annual Lifetime Benefit Payment cannot be carried forward to the next Contract Year. Lifetime Benefit Payments will be available until the first death of any Owner. If the Contract Value is reduced to zero, Lifetime Benefit Payments will automatically continue under this Fixed Lifetime and Period Certain Annuity Payout. If you make a subsequent Premium Payment after the Contract Anniversary immediately following the older Owner's 60th birthday, the Lifetime Benefit Payment will be re-calculated to equal 5% of the Benefit Amount after the subsequent Premium Payment is made. If Surrenders are not taken prior to the Contract Anniversary immediately following the older Owner's 60th birthday, the Lifetime Benefit Payment will equal the Benefit Payment. If Surrenders are taken prior to the Contract Anniversary immediately following the older Owner's 60th birthday, the Lifetime Benefit Payment may be less than the Benefit Payment. If there is an increase in the Benefit Amount due to an automatic Benefit Amount increase on any Contract Anniversary after the older Owner's 60th birthday, we will automatically re-calculate the Lifetime Benefit Payment to equal the greater of the Lifetime Benefit Payment immediately prior to the increase or the Benefit Amount immediately after the increase multiplied by 5%. If a Surrender is less than or equal to the Lifetime Benefit Payment but results in the Contract Value remaining after such Surrender to be less than our minimum amount rules then in effect, we will not terminate the Contract under our minimum amount rules. However, if the Contract Value remaining after any Surrender is less than our minimum amount rules then in effect and the Benefit Amount and your Lifetime Benefit Payments have been reduced to zero, we may terminate the Contract and pay the Surrender Value. IS THIS RIDER DESIGNED TO PAY YOU DEATH BENEFITS? Yes. This rider includes a Guaranteed Minimum Death Benefit that replaces the standard Death Benefit. The GMDB is equal to the greater of the Benefit Amount or the Contract Value IF the Contract Value is greater than zero. APP C-4 ------------------------------------------------------------------------------- The Death Benefit is payable at the first death of an Owner or Annuitant. We will pay to the Beneficiary the greater of the Benefit Amount or the Contract Value (as long as the Contract Value is greater than zero) as of the date due proof of death is received by us. If the Contract Value is zero as of the date of due proof of death, there will be no Death Benefit. Otherwise, the Death Benefit will fluctuate based on the Benefit Amount as reduced by Surrenders, Withdrawal Benefits and expenses as discussed above. DOES THIS RIDER REPLACE STANDARD DEATH BENEFITS? Yes. This rider replaces the standard Death Benefit. This rider can be elected along with MAV Plus. CAN YOU REVOKE THIS RIDER? No. However, a Company-sponsored exchange of this rider will not be considered to be a revocation or termination of this rider. WHAT EFFECT DO FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? You may make a full Surrender of your entire Contract at any time. However, you will receive your Contract Value at the time you request a Surrender with any applicable charges deducted and not the Benefit Amount, Lifetime Benefit Payment or the Benefit Payment amount you would have received under this rider. If you still have a Benefit Amount or Lifetime Benefit Payment Amount after you Surrender all of your Contract Value (following the provisions or the rider) or your Contract Value is reduced to zero, we will issue a payout annuity. If the Owner is a natural person we will treat the Owners(s) as the Annuitant for purposes of this annuity. If there is more than one Annuitant, the annuity will be on a first-to-die basis (joint and 0% survivor annuity). You may elect to have the Benefit Amount or Lifetime Benefit Payment paid to you under either the Fixed Period Certain Annuity Payout or the Fixed Lifetime and Period Certain Annuity Payout Option. The election is irrevocable. Subject to our approval, which approval may be withheld or delayed for any reason, you may elect to defer the Annuity Commencement Date until you are eligible for the Fixed Lifetime and Period Certain Annuity Payout. If your Benefit Payment or your Lifetime Benefit Payment on your most recent Contract Anniversary exceeds the Annual Withdrawal Amount, we will waive any applicable Contingent Deferred Sales Charge for withdrawals up to that Benefit Payment amount. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? Any ownership change made prior to the first anniversary of the rider effective date will have no impact on the Benefit Amount, but the Lifetime Benefit Payment may change as long as the new Owner(s) and Annuitant are less than age 76 at the time of the change. The Lifetime Benefit Payment may change based on the age of the new owner. An ownership change after the first Contract Anniversary that causes a re-calculation in the benefits as long as the older Owner after the change is less than age 76 at the time of the change will automatically result in either (A) or (B): (A) If this rider is not currently available for sale, we will continue the existing rider for the GMDB only and the Withdrawal Benefit will terminate. This rider charge will then discontinue. (B) If this rider is currently available for sale, we will continue the existing rider with respect to all benefits at your current charge. The Benefit Amount will be re-calculated to the lesser of the Contract Value or the Benefit Amount on the date of the change. The Benefit Payment and Lifetime Benefit Payment will be re-calculated on the date of the change. If the older Owner is age 76 or greater at the time of an ownership change, this rider will continue with respect to the GMDB only and the Withdrawal Benefit will terminate. The GMDB will be modified to equal Contract Value only and the Rider charge will discontinue. CAN YOUR SPOUSE CONTINUE YOUR WITHDRAWAL BENEFIT? Yes. If the Owner dies and the Beneficiary is the deceased Owner's Spouse at the time of death, the Spouse may continue the Contract and we will adjust the Contract Value to the amount we would have paid as a Death Benefit payment (the greater of the Contract Value and the Benefit Amount). If the Spouse elects to continue the Contract and is less than age 76 at the time of the continuation, then either (A) or (B) will automatically apply: (A) If this rider is not currently available for sale, we will continue the existing The Hartford's Lifetime Income Builder for the GMDB only and the Withdrawal Benefit will terminate and the rider charge will discontinue. (B) If this rider is currently available for sale, we will continue the existing rider with respect to all benefits at the current charge. The Benefit Amount and Maximum Contract Value will be re-calculated to the Contract Value on the continuation date. The Benefit Payments and Lifetime Benefit Payments will be re-calculated on the continuation date. APP C-5 ------------------------------------------------------------------------------- If the Spouse elects to continue the Contract and is age 76 or greater at the time of the continuation, this rider will continue with respect to the GMDB only and the Withdrawal Benefits will terminate. The GMDB will be modified to equal Contract Value only and the rider charge will discontinue. Spousal Contract continuation will only apply one time for each Contract. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? If you annuitize your Contract, you may choose any of those Annuity Payout Options offered in the Contract. The amount used for calculating Annuity Payout Options will be the Contract Value. In other words, you will forfeit any difference between your Contract Value and Benefit Amount by voluntarily annuitizing before the maximum Annuity Commencement Date. If the annuity reaches the maximum Annuity Commencement Date the Contract will automatically be annuitized unless we and the Owner(s) agree to extend the Annuity Commencement Date, which approval may be withheld or delayed for any reason. In this circumstance, the Contract may be annuitized under our standard annuitization rules or, alternatively, under The Hartford's Lifetime Income Builder rules applicable when the Contract Value equals zero. - FIXED PERIOD CERTAIN PAYOUT OPTION If your Contract Value goes to zero, you are entitled to receive payments in a fixed dollar amount for a stated number of years. The actual number of years that payments will be made is determined by dividing the Benefit Amount by the Benefit Payment. The total amount payable under this Annuity Payout Option will equal the Benefit Amount. This annualized amount will be paid over the determined number of years. The frequency of payments you may elect will be among those offered by us at that time but will be no less frequently than annually. The amount payable in the final year of payments may be less than the prior year's annual amount payable so that the total amount of the payouts will be equal to the Benefit Amount. If, at the death of the any Annuitant, payments have been made for less than the stated number of years, the remaining scheduled payments will be made to the Beneficiary as scheduled payments in accordance with the Code and the Owner's last instructions on record. - FIXED LIFETIME AND PERIOD CERTAIN PAYOUT OPTION If your Contract Value goes to zero and the Owner(s) are alive and age 60 or older, you are entitled to receive payments in a fixed dollar amount until the later of the death of any Annuitant or a minimum number of years. The minimum number of years that payments will be made is determined on the Annuity Calculation Date by dividing the Benefit Amount by the Lifetime Benefit Payment. The total minimum amount payable under this option will equal the Benefit Amount. This Lifetime Benefit Payment amount will be paid over the greater of the minimum number of years, or until the death of any Annuitant. The frequency of payments you may elect will be among those offered by us at that time but will be no less frequently than annually. If, at the death of any Annuitant, payments have been made for less than the minimum number of years, the remaining scheduled payments will be made to the Beneficiary as scheduled payments in accordance with the Code and the Owner's last instructions on record. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? We reserve the right to limit the Sub-Accounts into which you may allocate your Contract Value on and after the ownership change effective date. We may prohibit investment in any Sub-Account, require you to allocate your Contract Value in one of a number of asset allocation models, investment programs or fund-of-funds Sub-Accounts. If you violate the restrictions, then this rider, its benefits and its charges will terminate. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? No. CAN WE AGGREGATE CONTRACTS? For purposes of determining the Benefit Amount under this rider, we reserve the right to treat one or more Contracts issued by us to you with any optional Withdrawal Benefit rider in the same calendar year as one Contract. Accordingly, if we elect to aggregate Contracts, we will change the period over which we measure withdrawals against the Benefit Payment. OTHER INFORMATION For examples of how this rider works, see "Appendix I." This rider may not be appropriate for all investors. Several factors, among others, should be considered: - This rider is no longer actively marketed and is not available in any State where The Hartford's Lifetime Income Builder II is approved for sale. - The benefits under this rider cannot be directly or indirectly assigned, pledged, collateralized or securitized in any way. Any such actions will invalidate this rider. APP C-6 ------------------------------------------------------------------------------- - Because these benefits are bundled and interdependent upon one another, there is a risk that you may ultimately pay for benefits that you may never get to use. For instance, if you deplete your Benefit Amount through Surrenders, whether voluntarily or as a result of Required Minimum Distributions, you will reduce your Death Benefit. If your Contract Value is zero as of the date of due proof of death, there will be no Death Benefit. This may be of special concern to seniors. - Inasmuch as Withdrawal Benefits may reduce or eliminate the GMDB, electing this rider as part of an investment program involving a qualified plan may not make sense unless, for instance, other features of this Contract such as Withdrawal Benefits and access to Funds, outweigh the absence of additional tax advantages from a variable annuity. - Annuitizing your Contract, whether voluntarily or not, will impact these benefits. First, annuitization shall eliminate the Guaranteed Minimum Death Benefit. Second, annuitization will terminate any Withdrawal Benefits which will be converted into annuity payments according to the annuitization option chosen. Accordingly, Lifetime Benefit Payments could be replaced by another "lifetime" payout option and will not be subject to automatic Benefit Amount increases. - Even though this rider is designed to provide "living benefits," you should not assume that you will necessarily receive "payments for life" if you have violated any of the terms of this rider. - Purchasing this rider is a one time only event and cannot be undone later. If you elect this rider you will not be able to elect standard Death Benefits or optional riders other than MAV Plus. - Any additional contributions made to your Contract after withdrawals have begun will cause the Benefit Amount to be recalculated. If an additional contribution is made, the Benefit Amount will be recalculated to equal the remaining Benefit Amount plus the additional contribution, which could be more or less than the original Benefit Amount and could change the amount of your Benefit Payments or Lifetime Benefit Payments, as the case may be. - Spouses who are not a joint Owner or Beneficiary may find continuation of this rider to be unavailable or unattractive after the death of the Owner-Spouse. Continuation of the options available in this rider is dependent upon its availability at the time of death of the first Owner-Spouse and will be subject to then prevailing charges. - Certain ownership changes may result in a reduction of benefits. - Annuitizing your Contract instead of receiving Benefit Payments or Lifetime Benefit Payments will forfeit any increases in your Benefit Amount over your Contract Value. Voluntary or involuntary annuitization will terminate Lifetime Benefit Payments. Annuity Payout Options available subsequent to the Annuity Commencement Date may not necessarily provide a stream of income for your lifetime and may be less than Lifetime Benefit Payments. - Finally, we may increase the charge for this rider on or after the fifth Contract Anniversary or five years since your last increase notification, whichever is later. - There are no assurances made or implied that automatic Benefit Amount increases will occur and if occurring, will be predictable. - The fee for this rider may increase if and when automatic Benefit Amount increases take place. There are no assurances as to the fee we will be charging at the time of each automatic Benefit Amount increase. APP D-1 ------------------------------------------------------------------------------- APPENDIX D -- EXCHANGE PROGRAMS TABLE OF CONTENTS
PAGE -------------------------------------------------------------------------------- A. The Hartford's Lifetime Income Builder Conversion Program APP D-2 B. The Hartford's Lifetime Income Builder Selects and The Hartford's APP D-9 Lifetime Income Builder Portfolios Conversion Program C. The Hartford's Lifetime Income Builder Selects and The Hartford's APP D-11 Lifetime Income Builder Portfolios
APP D-2 ------------------------------------------------------------------------------- A. THE HARTFORD'S LIFETIME INCOME BUILDER CONVERSION PROGRAM We are offering Eligible Contract Owners (as defined below) the opportunity to exchange The Hartford's Lifetime Income Builder rider for The Hartford's Lifetime Income Builder II. The availability of the conversion program is at the discretion of the Company and will discontinue once The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios are approved in your state. You should convert your rider only if it is appropriate for your needs and financial considerations. Please read the prospectus carefully and discuss this conversion with your Registered Representative prior to converting. I. WHO IS ELIGIBLE TO PARTICIPATE IN THIS CONVERSION PROGRAM? This exchange program is available to Contract Owners who meet ALL of the following qualifications ("Eligible Contract Owners"): - You must: - own an annuity contract (including any proprietary versions) ("Eligible Contract") as of the conversion date (defined below); - have chosen The Hartford's Lifetime Income Builder rider at the time of purchase; and - be a customer of a financial intermediary that is currently authorized to sell Hartford Life and Annuity Insurance Company or Hartford Life Insurance Company variable annuity Contracts that includes The Hartford's Lifetime Income Builder II optional benefit. - You must not: - be age 76 or older as of the conversion date (including any other Covered Life); II. WHAT ARE KEY DIFFERENCES BETWEEN THE HARTFORD'S LIFETIME INCOME BUILDER AND THE HARTFORD'S LIFETIME INCOME BUILDER II? - The chart below describes some key differences between The Hartford's Lifetime Income Builder and The Hartford's Lifetime Income Builder II and the meaning upon conversion. See Section III for additional considerations.
THE HARTFORD'S LIFETIME THE HARTFORD'S LIFETIME FEATURE INCOME BUILDER II INCOME BUILDER ---------------------------------------------------------------------------------------------------------------------------- FEE Currently equal to 0.40% of Payment Currently equal to 0.40% of Benefit Base. Maximum fee is 0.75%. WITHDRAWALS Amount. Maximum fee is 0.75%. THAT DO NOT EXCEED THE LIFETIME BENEFIT WITHDRAWALS REDUCE THE BENEFIT AMOUNT PAYMENT DO NOT REDUCE THE PAYMENT BASE AND STEP UPS MAY INCREASE THE BENEFIT AND STEP-UPS INCREASE THE PAYMENT BASE; AMOUNT; THEREFORE THE VALUE THAT THE THEREFORE THE VALUE THAT THE 0.40% FEE 0.40% FEE IS APPLIED TO CAN CHANGE OVER IS APPLIED TO CAN CHANGE OVER TIME. TIME. RELEVANT COVERED LIFE The governing life for determining the N/A living benefits provided under the rider BENEFIT AMOUNT N/A (Refer to Payment Base) 100% of premium when added at issue PAYMENT BASE UPON CONVERSION: N/A (Refer to Benefit Amount) - Payment Base will be equal to the Contract Value on the conversion date - PAYMENT BASE MAY BE LESS THAN BENEFIT AMOUNT DEATH BENEFIT UPON CONVERSION: Death Benefit will be Greater of Contract Value or Benefit equal to the Contract Value on the Amount conversion date. If MAV or MAV plus was previously elected, there will be no change to these values BENEFIT PAYMENT/THRESHOLD Allows up to a 5% withdrawal (Single Allows up to a 5% withdrawal of the Life), or 4.5% withdrawal (Joint Life) initial Benefit Amount per year prior to of the Payment Base per year prior to age 60 adjusted for Withdrawals and age 60 adjusted for Withdrawals and Automatic Benefit Amount increases Automatic Payment Base increases
APP D-3 -------------------------------------------------------------------------------
THE HARTFORD'S LIFETIME THE HARTFORD'S LIFETIME FEATURE INCOME BUILDER II INCOME BUILDER ---------------------------------------------------------------------------------------------------------------------------- LIFETIME BENEFIT PAYMENT - The Lifetime Benefit Payment will be - The Lifetime Benefit Payment is equal to the Payment Base multiplied by initially set to equal the initial the applicable Withdrawal Percent (4.5 - Benefit Amount multiplied by 5% 7% depending on Relevant Covered Life's - Available at issue if the oldest Owner attained age as of first Surrender and is age 60 or older whether the Single Life or Joint Life - Available after the Contract Option is selected.) Anniversary immediately following the - Allows you to withdraw on each oldest Owners' 60th birthday if at issue Contract up to the greater of Payment the age of the oldest owner is under 60 Base or Contract Value on the anniversary multiplied by the Withdrawal Percentage per year once the amount is established AUTOMATIC BENEFIT AMOUNT / PAYMENT BASE Automatic Payment Base increases will Automatic Benefit Amount increases INCREASES cease upon the earlier of the Annuity continue until the earlier of the Commencement Date or the Contract Contract Anniversary immediately Anniversary immediately following the following the older Owner's or Relevant Covered Life's attained age of Annuitant's 75th birthday or the or the 80 Annuity Commencement Date NON-EXCESSIVE PARTIAL SURRENDERS Withdrawals within the Lifetime Benefit Withdrawals within the Lifetime Benefit Payment do not reduce the Payment Base. Payment or Benefit Payment reduce the Withdrawals within the Threshold reduce Benefit Amount by the amount of the the Payment Base by the amount of partial surrender partial surrender EXCESSIVE PARTIAL SURRENDERS Withdrawals IN EXCESS of the Lifetime Withdrawals IN EXCESS of the Lifetime Benefit Payment or Threshold will reduce Benefit Payment or Benefit Payment will the Payment Base in proportion to the reduce the Benefit Amount to the minimum reduction in Contract Value due to such of Contract Value immediately following Surrender the partial Surrender; or the Benefit Amount immediately prior to the partial Surrender, less the amount of partial Surrender EXCESSIVE PARTIAL SURRENDERS & THE DEATH Withdrawals IN EXCESS of the Lifetime Withdrawals IN EXCESS of the Lifetime BENEFIT Benefit Payment or Threshold will reduce Benefit Payment or Benefit Payment will the Death Benefit in proportion to the reduce the Death Benefit to the minimum reduction in Contract Value due to such of Contract Value immediately following Surrender the partial Surrender; or the Benefit Amount immediately prior to the partial Surrender, less the amount of partial Surrender SUBSEQUENT PAYMENT LIMITATION None We reserve the right to approve subsequent Premium Payments after the first 12 months Subsequent Premium Payments with a cumulative total of $100,000 or greater require prior approval by the Company. This restriction is not currently enforced. JOINT OWNERSHIP Rider may be elected as a Single Life Single Life only Option or Joint Life Option
STATE VARIATIONS. THE FOREGOING DISCUSSION DOES NOT TAKE INTO CONSIDERATION STATE VARIATIONS, IF ANY. DEFINITIONS. ALL INITIAL CAPITALIZED TERMS SHALL HAVE SUCH MEANING AS PROVIDED IN YOUR PROSPECTUS. APP D-4 ------------------------------------------------------------------------------- III. OTHER KEY CONSIDERATIONS. - THIS CONVERSION OFFER IS DESIGNED FOR CONTRACT OWNERS THAT INTEND TO DEFER TAKING PARTIAL SURRENDERS IN ORDER TO INCREASE THE WITHDRAWAL PERCENT AVAILABLE TO SET LIFETIME BENEFIT PAYMENTS AND WHO OTHERWISE SEEK THE ADDED FLEXIBILITY OF PROVIDING POTENTIAL LIFETIME WITHDRAWALS FOR THEIR SPOUSE. THIS CONVERSION MAY NOT BE SUITABLE FOR ANYONE WHO MAY BE ANTICIPATING AN IMMINENT CHANGE IN THE RELEVANT COVERED LIFE OR ANY OTHER PERTINENT CONTRACT PARTIES. - LIFETIME BENEFIT PAYMENTS WILL NOT NECESSARILY BE THE SAME AS, OR HIGHER THAN, BENEFIT PAYMENTS OR LIFETIME BENEFIT PAYMENTS AVAILABLE UNDER THE HARTFORD'S LIFETIME INCOME BUILDER. WITHDRAWALS FROM THE LIFETIME INCOME BUILDER II RIDER MAY AFFECT THE GUARANTEES IF THE RELEVANT COVERED LIFE IS AGE 60 OR YOUNGER. - LIFETIME BENEFIT PAYMENTS UNDER THE HARTFORD'S LIFETIME INCOME BUILDER II DO NOT REDUCE THE PAYMENT BASE; THEREFORE THE FEE OF 0.40% OF PAYMENT BASE WILL NEVER BE APPLIED TO AN AMOUNT LESS THAN YOUR INITIAL PAYMENT BASE. HOWEVER, IN THE EVENT THAT AN EXCESS WITHDRAWAL IS TAKEN, OR A WITHDRAWAL IS MADE IN A NON-ELIGIBLE WITHDRAWAL YEAR, THE PAYMENT BASE WILL BE REDUCED BY THE METHODS DESCRIBED IN YOUR PROSPECTUS. - After the conversion date, your death benefit will no longer be The Hartford's Lifetime Income Builder Guaranteed Minimum Death Benefit. Your new death benefit will be your Contract Value on the conversion date. If you previously elected the optional death benefits MAV or MAV Plus, there will be no change to your death benefit. YOUR DEATH BENEFIT MAY BE REDUCED IF AS OF THE CONVERSION DATE YOUR CONTRACT VALUE AND PREMIUM PAYMENTS ARE LESS THAN YOUR BENEFIT AMOUNT. - You should discuss with your registered representative whether or not converting your rider is suitable for you and your particular needs, investment horizon and financial plans. YOU SHOULD DISCUSS YOUR PARTICULAR CIRCUMSTANCES AND THE TAX CONSEQUENCES OF THIS CONVERSION WITH YOUR TAX ADVISER, AS WE MAKE NO REPRESENTATION REGARDING THE TAX CONSEQUENCES OF AN EXCHANGE OF THESE RIDERS. - Please read your prospectus carefully and particularly the description of each rider and Appendix B -- Optional Benefits Comparison for a more complete description of the differences between The Hartford's Lifetime Income Builder and The Hartford's Lifetime Income Builder II. - We are not obligated to offer rider exchange privileges if and once this offer is withdrawn. - This offer is not available through all broker/dealers. - Your annuitization options for each rider may differ and your guarantee period under The Hartford's Lifetime Income Builder II may be less than under The Hartford's Lifetime Income Builder. If you select The Hartford's Lifetime Income Builder II Joint Life Option, the payment will be based on both Covered Lives. Please refer to your prospectus for details. IV. HOW DOES THE EXCHANGE PROCESS WORK? - You must complete The Hartford's Lifetime Income Builder Conversion Program Form to exchange your The Hartford's Lifetime Income Builder rider. The date that you comply with all our requirements to exchange your existing The Hartford's Lifetime Income Builder rider ("conversion date") will be the date we use to set your benefits under your The Hartford's Lifetime Income Builder II rider. We will also use the conversion date for establishing your eligibility for this offer. - Except as modified by this election, your existing Contract and all other features and functions previously selected will be and remain in full force and effect. - You may not cancel your election after the conversion date. - A prorated final The Hartford's Lifetime Income Builder rider charge will be assessed as of the conversion date. You will not be charged for The Hartford's Lifetime Income Builder II until your first conversion date anniversary and each annual anniversary thereafter. There are no exchange or transfer fees associated with making this election. - Your Contract Value as of the conversion date will become your new Payment Base. IF YOUR BENEFIT AMOUNT UNDER THE HARTFORD'S LIFETIME INCOME BUILDER WAS HIGHER THAN YOUR CONTRACT VALUE, YOU WILL NOT RECEIVE THAT AMOUNT. - We will not provide any credit for the time that you owned The Hartford's Lifetime Income Builder rider. Therefore, annual automatic Payment Base increases will commence on conversion date anniversaries rather than Contract Anniversaries. - There are no additional cancellation privileges afforded to you by participating in this conversion program. - All joint Owners must consent to this conversion. APP D-5 -------------------------------------------------------------------------------- LIFETIME INCOME BUILDER The following example is intended to reflect the effect of positive market performance on The Hartford's Lifetime Income Builder Benefit Amount, Death Benefit, and Rider Fee, and on The Hartford's Lifetime Income Builder II Payment Base, Death Benefit, and Rider Fee.
AGE ACCOUNT BENEFIT GUARANTEED BOY RETURN VALUE BOY AMOUNT BOY WD ACTUAL WD ---------------------------------------------------------------------- 60 0.06 $100,000 $100,000 $5,000 $5,000 61 0.06 $100,317 $95,665 $5,000 $5,000 62 0.06 $100,673 $90,968 $5,000 $5,000 63 0.06 $101,068 $86,288 $5,000 $5,000 64 0.06 $101,505 $81,624 $5,000 $5,000 65 0.06 $101,988 $76,973 $5,000 $5,000 66 0.06 $102,518 $72,333 $5,000 $5,000 67 0.06 $103,098 $67,701 $5,000 $5,000 68 0.06 $103,731 $63,074 $5,000 $5,000 69 0.06 $104,422 $58,449 $5,000 $5,000 70 0.06 $105,172 $53,822 $5,000 $5,000 71 0.06 $105,985 $49,191 $5,000 $5,000 72 0.06 $106,866 $44,550 $5,000 $5,000 73 0.06 $107,818 $39,895 $5,000 $5,000 74 0.06 $108,847 $35,221 $5,000 $5,000 75 0.06 $109,955 $30,523 $5,000 $5,000 76 0.06 $111,149 $25,796 $5,000 $5,000 77 0.06 $112,435 $20,796 $5,000 $5,000 78 0.06 $113,818 $15,796 $5,000 $5,000 79 0.06 $115,304 $10,796 $5,000 $5,000 80 0.06 $116,899 $5,796 $5,000 $5,000 81 0.06 $118,610 $796 $5,000 $5,000 82 0.06 $120,426 $0 $5,000 $5,000 83 0.06 $122,352 $0 $5,000 $5,000 84 0.06 $124,393 $0 $5,000 $5,000 85 0.06 $126,557 $0 $5,000 $5,000 AGE BENEFIT DEATH BENEFIT ACCOUNT BOY AMOUNT EOY EOY VALUE EOY FEE --------- ---------------------------------------------- 60 $95,665 $95,665 $100,700 $383 61 $90,968 $90,968 $101,036 $364 62 $86,288 $86,288 $101,413 $345 63 $81,624 $81,624 $101,832 $326 64 $76,973 $76,973 $102,296 $308 65 $72,333 $72,333 $102,807 $289 66 $67,701 $67,701 $103,369 $271 67 $63,074 $63,074 $103,984 $252 68 $58,449 $58,449 $104,655 $234 69 $53,822 $53,822 $105,387 $215 70 $49,191 $49,191 $106,182 $197 71 $44,550 $44,550 $107,044 $178 72 $39,895 $39,895 $107,978 $160 73 $35,221 $35,221 $108,987 $141 74 $30,523 $30,523 $110,077 $122 75 $25,796 $25,796 $111,253 $103 76 $20,796 $20,796 $112,518 $83 77 $15,796 $15,796 $113,881 $63 78 $10,796 $10,796 $115,347 $43 79 $5,796 $5,796 $116,922 $23 80 $796 $796 $118,613 $3 81 $0 $0 $120,426 $0 82 $0 $0 $122,352 $0 83 $0 $0 $124,393 $0 84 $0 $0 $126,557 $0 85 $0 $0 $128,850 $0
ASSUMPTIONS: LEGEND: -------------------------------------------------------------------------------------------- Age 60 BOY Beginning of Year Annual withdrawals taken, within limit EOY End of Year Market Performance = Annual 6% Gain WD Withdrawal
APP D-6 -------------------------------------------------------------------------------- LIFETIME INCOME BUILDER II The following example is intended to reflect the effect of positive market performance on The Hartford's Lifetime Income Builder Benefit Amount, Death Benefit, and Rider Fee, and on The Hartford's Lifetime Income Builder II Payment Base, Death Benefit, and Rider Fee.
AGE ACCOUNT PAYMENT GUARANTEED MAXIMUM BOY RETURN VALUE BOY BASE BOY WD WD -------------------------------------------------------------------- 60 0.06 $100,000 $100,000 $5,000 $5,000 61 0.06 $100,297 $100,700 $5,035 $5,035 62 0.06 $100,611 $101,015 $5,051 $5,051 63 0.06 $100,942 $101,348 $5,067 $5,067 64 0.06 $101,292 $101,699 $5,085 $5,085 65 0.06 $101,661 $102,069 $5,103 $5,103 66 0.06 $102,051 $102,461 $5,123 $5,123 67 0.06 $102,463 $102,874 $5,144 $5,144 68 0.06 $102,897 $103,310 $5,166 $5,166 69 0.06 $103,356 $103,771 $5,189 $5,189 70 0.06 $103,840 $104,257 $5,213 $5,213 71 0.06 $104,352 $104,771 $5,239 $5,239 72 0.06 $104,891 $105,313 $5,266 $5,266 73 0.06 $105,461 $105,885 $5,294 $5,294 74 0.06 $106,063 $106,489 $5,324 $5,324 75 0.06 $106,698 $107,127 $5,356 $5,356 76 0.06 $107,369 $107,800 $5,390 $5,390 77 0.06 $108,077 $108,511 $5,426 $5,426 78 0.06 $108,825 $109,262 $5,463 $5,463 79 0.06 $109,614 $110,054 $5,503 $5,503 80 0.06 $110,447 $110,891 $5,545 $5,545 81 0.06 $111,330 $110,891 $5,545 $5,567 82 0.06 $112,267 $110,891 $5,545 $5,613 83 0.06 $113,259 $110,891 $5,545 $5,663 84 0.06 $114,311 $110,891 $5,545 $5,716 85 0.06 $115,426 $110,891 $5,545 $5,771 AGE PAYMENT DEATH ACCOUNT BOY ACTUAL WD BASE EOY BENEFIT EOY VALUE EOY FEE ------- ------------------------------------------------------- 60 $5,000 $100,000 $95,000 $100,700 $403 61 $5,000 $100,700 $90,000 $101,015 $404 62 $5,000 $101,015 $85,000 $101,348 $405 63 $5,000 $101,348 $80,000 $101,699 $407 64 $5,000 $101,699 $75,000 $102,069 $408 65 $5,000 $102,069 $70,000 $102,461 $410 66 $5,000 $102,461 $65,000 $102,874 $411 67 $5,000 $102,874 $60,000 $103,310 $413 68 $5,000 $103,310 $55,000 $103,771 $415 69 $5,000 $103,771 $50,000 $104,257 $417 70 $5,000 $104,257 $45,000 $104,771 $419 71 $5,000 $104,771 $40,000 $105,313 $421 72 $5,000 $105,313 $35,000 $105,885 $424 73 $5,000 $105,885 $30,000 $106,489 $426 74 $5,000 $106,489 $25,000 $107,127 $429 75 $5,000 $107,127 $20,000 $107,800 $431 76 $5,000 $107,800 $15,000 $108,511 $434 77 $5,000 $108,511 $10,000 $109,262 $437 78 $5,000 $109,262 $5,000 $110,054 $440 79 $5,000 $110,054 $0 $110,891 $444 80 $5,000 $110,891 $0 $111,774 $444 81 $5,000 $110,891 $0 $112,710 $444 82 $5,000 $110,891 $0 $113,703 $444 83 $5,000 $110,891 $0 $114,755 $444 84 $5,000 $110,891 $0 $115,870 $444 85 $5,000 $110,891 $0 $117,052 $444
ASSUMPTIONS: LEGEND: --------------------------------------------------------------------------------------- Age 60 BOY Beginning of Year Annual withdrawals taken, within limit EOY End of Year Market Performance = Annual 6% Gain WD Withdrawal
APP D-7 -------------------------------------------------------------------------------- LIFETIME INCOME BUILDER The following table is intended to reflect the effect of negative market performance on The Hartford's Lifetime Income Builder Benefit Amount Death Benefit and Rider Fee, and on The Hartford's Lifetime Income Builder II Payment Base, Death Benefit and Rider Fee.
AGE ACCOUNT BENEFIT GUARANTEED BOY RETURN VALUE BOY AMOUNT BOY WD ACTUAL WD ----------------------------------------------------------------------------------- 60 -0.06 $100,000 $100,000 $5,000 $5,000 61 -0.06 $88,920 $95,000 $5,000 $5,000 62 -0.06 $78,525 $90,000 $5,000 $5,000 63 -0.06 $68,773 $85,000 $5,000 $5,000 64 -0.06 $59,627 $80,000 $5,000 $5,000 65 -0.06 $51,049 $75,000 $5,000 $5,000 66 -0.06 $43,006 $70,000 $5,000 $5,000 67 -0.06 $35,466 $65,000 $5,000 $5,000 68 -0.06 $28,398 $60,000 $5,000 $5,000 69 -0.06 $21,774 $55,000 $5,000 $5,000 70 -0.06 $15,568 $50,000 $5,000 $5,000 71 -0.06 $9,754 $45,000 $5,000 $5,000 72 -0.06 $4,308 $40,000 $5,000 $5,000 73 -0.06 $0 $35,000 $5,000 $5,000 74 -0.06 $0 $30,000 $5,000 $5,000 75 -0.06 $0 $25,000 $5,000 $5,000 76 -0.06 $0 $20,000 $5,000 $5,000 77 -0.06 $0 $15,000 $5,000 $5,000 78 -0.06 $0 $10,000 $5,000 $5,000 79 -0.06 $0 $5,000 $5,000 $5,000 80 -0.06 $0 $0 $5,000 $5,000 81 -0.06 $0 $0 $5,000 $5,000 82 -0.06 $0 $0 $5,000 $5,000 83 -0.06 $0 $0 $5,000 $5,000 84 -0.06 $0 $0 $5,000 $5,000 85 -0.06 $0 $0 $5,000 $5,000 DEATH BENEFIT AGE BENEFIT EOY = BA ACCOUNT BOY AMOUNT EOY EOY VALUE EOY FEE --------- ------------------------------------------------------------------ 60 $95,000 $95,000 $89,300 $380 61 $90,000 $90,000 $78,885 $360 62 $85,000 $85,000 $69,113 $340 63 $80,000 $80,000 $59,947 $320 64 $75,000 $75,000 $51,349 $300 65 $70,000 $70,000 $43,286 $280 66 $65,000 $65,000 $35,726 $260 67 $60,000 $60,000 $28,638 $240 68 $55,000 $55,000 $21,994 $220 69 $50,000 $50,000 $15,768 $200 70 $45,000 $45,000 $9,934 $180 71 $40,000 $40,000 $4,468 $160 72 $35,000 $35,000 $0 $0 73 $30,000 $30,000 $0 $0 74 $25,000 $25,000 $0 $0 75 $20,000 $20,000 $0 $0 76 $15,000 $15,000 $0 $0 77 $10,000 $10,000 $0 $0 78 $5,000 $5,000 $0 $0 79 $0 $0 $0 $0 80 $0 $0 $0 $0 81 $0 $0 $0 $0 82 $0 $0 $0 $0 83 $0 $0 $0 $0 84 $0 $0 $0 $0 85 $0 $0 $0 $0
ASSUMPTIONS: LEGEND: --------------------------------------------------------------------------------------- Age 60 BOY Beginning of Year Annual withdrawals taken, within limit EOY End of Year Market Performance = Annual 6% Loss WD Withdrawal
APP D-8 -------------------------------------------------------------------------------- LIFETIME INCOME BUILDER II The following example is intended to reflect the effect of negative market performance on The Hartford's Lifetime Income Builder Benefit Amount, Death Benefit, and Rider Fee, and on The Hartford's Lifetime Income Builder II Payment Base, Death Benefit, and Rider Fee.
AGE ACCOUNT PAYMENT GUARANTEED MAXIMUM BOY RETURN VALUE BOY BASE BOY WD WD ------------------------------------------------------------------ 60 -0.06 $100,000 $100,000 $5,000 $5,000 61 -0.06 $88,900 $100,000 $5,000 $5,000 62 -0.06 $78,466 $100,000 $5,000 $5,000 63 -0.06 $68,658 $100,000 $5,000 $5,000 64 -0.06 $59,439 $100,000 $5,000 $5,000 65 -0.06 $50,772 $100,000 $5,000 $5,000 66 -0.06 $42,626 $100,000 $5,000 $5,000 67 -0.06 $34,968 $100,000 $5,000 $5,000 68 -0.06 $27,770 $100,000 $5,000 $5,000 69 -0.06 $21,004 $100,000 $5,000 $5,000 70 -0.06 $14,644 $100,000 $5,000 $5,000 71 -0.06 $8,665 $100,000 $5,000 $5,000 72 -0.06 $3,045 $100,000 $5,000 $5,000 73 -0.06 $0 $100,000 $5,000 $5,000 74 -0.06 $0 $100,000 $5,000 $5,000 75 -0.06 $0 $100,000 $5,000 $5,000 76 -0.06 $0 $100,000 $5,000 $5,000 77 -0.06 $0 $100,000 $5,000 $5,000 78 -0.06 $0 $100,000 $5,000 $5,000 79 -0.06 $0 $100,000 $5,000 $5,000 80 -0.06 $0 $100,000 $5,000 $5,000 81 -0.06 $0 $100,000 $5,000 $5,000 82 -0.06 $0 $100,000 $5,000 $5,000 83 -0.06 $0 $100,000 $5,000 $5,000 84 -0.06 $0 $100,000 $5,000 $5,000 85 -0.06 $0 $100,000 $5,000 $5,000 AGE PAYMENT DEATH ACCOUNT BOY ACTUAL WD BASE EOY BENEFIT EOY VALUE EOY FEE ------- ------------------------------------------------------- 60 $5,000 $100,000 $95,000 $89,300 $400 61 $5,000 $100,000 $90,000 $78,866 $400 62 $5,000 $100,000 $85,000 $69,058 $400 63 $5,000 $100,000 $80,000 $59,839 $400 64 $5,000 $100,000 $75,000 $51,172 $400 65 $5,000 $100,000 $70,000 $43,026 $400 66 $5,000 $100,000 $65,000 $35,368 $400 67 $5,000 $100,000 $60,000 $28,170 $400 68 $5,000 $100,000 $55,000 $21,404 $400 69 $5,000 $100,000 $50,000 $15,044 $400 70 $5,000 $100,000 $45,000 $9,065 $400 71 $5,000 $100,000 $40,000 $3,445 $400 72 $5,000 $100,000 $35,000 $0 $400 73 $5,000 $100,000 $30,000 $0 $0 74 $5,000 $100,000 $25,000 $0 $0 75 $5,000 $100,000 $20,000 $0 $0 76 $5,000 $100,000 $15,000 $0 $0 77 $5,000 $100,000 $10,000 $0 $0 78 $5,000 $100,000 $5,000 $0 $0 79 $5,000 $100,000 $0 $0 $0 80 $5,000 $100,000 $0 $0 $0 81 $5,000 $100,000 $0 $0 $0 82 $5,000 $100,000 $0 $0 $0 83 $5,000 $100,000 $0 $0 $0 84 $5,000 $100,000 $0 $0 $0 85 $5,000 $100,000 $0 $0 $0
ASSUMPTIONS: LEGEND: --------------------------------------------------------------------------------------- Age 60 BOY Beginning of Year Annual withdrawals taken, within limit EOY End of Year Market Performance = Annual 6% Loss WD Withdrawal
APP D-9 ------------------------------------------------------------------------------- B. THE HARTFORD'S LIFETIME INCOME BUILDER SELECTS AND THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS CONVERSION PROGRAM We reserve the right, in our sole discretion, to offer Eligible Contract Owners the opportunity to exchange The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation for the currently issued version of either The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios subject to the terms and conditions below. The availability of the conversion program is at our discretion and may be withdrawn in whole, or in part, at any time without notice. The opportunity to convert your rider to The Hartford's Lifetime Income Builder Portfolios will expire 90 days after the effective date of this rider exchange program. You should convert your rider only if it is appropriate for your needs and financial considerations. Please read this prospectus carefully and discuss this conversion with your Registered Representative prior to electing to participate in this conversion program. I. WHO IS ELIGIBLE TO PARTICIPATE IN THIS CONVERSION PROGRAM? This conversion program is available to Owners who meet ALL of the following qualifications ("Eligible Contract Owners"): You must: - If electing The Hartford's Lifetime Income Builder Portfolios, you must have purchased a deferred individual annuity contract from us between 1/1/08 - 5/3/08 (or later if The Hartford's Lifetime Income Builder Portfolios was not approved in your state). If electing The Hartford's Lifetime Income Builder Selects, you must have purchased a deferred individual annuity contract from us after 11/01/05 (each, an "Eligible Contract"). You must still own such Contract as of the conversion date (defined below); and - Have previously elected The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation at the time of purchase or as a result of a Company-sponsored exchange program; and - Be a customer of a Financial Intermediary that has approved the sale of The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios; and - The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios are approved for sale in your state. You must not be age 81 or older as of the conversion date (including any other Covered Life). II. WHAT ARE KEY DIFFERENCES BETWEEN THE NEW RIDERS AND MY CURRENT RIDER? Please refer to Appendix B for a table describing some of the key differences between The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Foundation, The Hartford's Lifetime Income Builder II, The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios. III. HOW DOES THE CONVERSION PROCESS WORK? - You must complete a Conversion Program Form to exchange your The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation rider. The date that you comply with all our requirements to exchange your existing rider ("conversion date") will be the date we use to set your benefits under your The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios rider selected. We will also use the conversion date for establishing your eligibility for this conversion program. Your request for conversion will not be in good order until the requisite fund transfers are made. - If you elect either The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios, you must abide by all restrictions applicable to these riders, including, but not limited to, investment restrictions described in this prospectus. - Except as modified by this election, your existing Contract and all other features and functions previously selected will be and remain in full force and effect after the conversion date. - You may not cancel your election after the conversion date. - A prorated final rider charge for your pre-conversion rider will be assessed as of the conversion date. There are no exchange or transfer fees associated with making this election. - Your Contract Value as of the conversion date will become your new Payment Base. YOUR PAYMENT BASE UNDER YOUR EXISTING RIDER WILL NOT CARRY OVER AS YOUR NEW PAYMENT BASE. APP D-10 ------------------------------------------------------------------------------- - Your Withdrawal Percent under The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios is based on the attained age of the relevant Covered Life on the effective date of the conversion. If the Withdrawal Percent had been locked in under The Hartford's Lifetime Income Builder, The Hartford's Lifetime Income Builder II or The Hartford's Lifetime Income Foundation, it will be unlocked and reset upon conversion. - Your new death benefit will equal your Contract Value on the effective date of the conversion and thereafter will operate under the terms of the Guaranteed Minimum Death Benefit. CONVERSION OF YOUR RIDER MAY HAVE THE AFFECT OF REDUCING YOUR DEATH BENEFIT. - Your Lifetime Benefit Payment will be equal to your Payment Base multiplied by your Withdrawal Percent for the remainder of the rider year. Your Lifetime Benefit Payment will reset upon the next Contract Anniversary according to the terms of the rider you selected. - All Joint Owners and the Annuitant must consent to this conversion. - Any changes in Covered Lives will affect your benefits under your new riders. - The survivorship option selected under your existing riders may not be amended in connection with your exercising your conversion privileges. IV. WHAT OTHER THINGS SHOULD BE CONSIDERED? - YOUR PAYMENT BASE, GUARANTEED MINIMUM DEATH BENEFIT, AND LIFETIME BENEFIT PAYMENTS MAY BE LOWER AND RIDER CHARGES MAY BE HIGHER THAN, THOSE AVAILABLE UNDER YOUR CURRENT RIDER. - You should discuss with your Registered Representative whether or not converting your rider is suitable for you and your particular needs, investment horizon and financial plans. You should discuss your particular circumstances and the tax consequences of this conversion with your tax advisor, as we make no representation regarding the tax consequences of an exchange of these riders. - We are not obligated to offer rider conversion privileges if and once this offer is withdrawn. - These conversion privileges may not be available through all Financial Intermediaries. - For a comparison of the features of each rider, please see Appendix B, and read sections describing each rider below. APP D-11 ------------------------------------------------------------------------------- C. THE HARTFORD'S LIFETIME INCOME BUILDER SELECTS AND THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS OBJECTIVE The objective of these two different riders is to (i) protect your investment from poor market performance; (ii) provide longevity protection through Lifetime Benefit Payments; and (iii) provide Death Benefit protection. HOW DO THE RIDERS HELP ACHIEVE THIS GOAL? - LIFETIME WITHDRAWAL FEATURE. Provided you follow the rules below, the riders provide a series of Lifetime Benefit Payments payable in each Contract Year following the Relevant Covered Life's Lifetime Income Eligibility Date until the first death of any Covered Life ("Single Life Option") or until the second death of any Covered Life ("Joint/Spousal Option"). Lifetime Benefit Payments are maximum amounts that can be withdrawn each year based on the rider chosen: Lifetime Income = Payment Base or Contract x Withdrawal Percent Builder Selects Value, whichever is higher - or - Lifetime Income = Payment Base x Withdrawal Percent Builder Portfolios
- GUARANTEED MINIMUM DEATH BENEFIT. This guaranteed minimum Death Benefit provides a Death Benefit equal to the greater of Premium Payments (adjusted for partial Surrenders) or Contract Value as of the date due proof of death is received by us for any Contract Owner or Annuitant. PARTIAL SURRENDERS WILL REDUCE OR ELIMINATE THE GUARANTEED MINIMUM DEATH BENEFIT. THIS GUARANTEED MINIMUM DEATH BENEFIT REPLACES THE STANDARD DEATH BENEFITS PROVIDED UNDER THIS CONTRACT. See Optional Benefit Comparisons in Appendix B. WHEN CAN YOU BUY THE RIDERS? Subject to state availability, you may elect either rider if you are eligible to participate in a designated Company sponsored exchange program. The benefits comprising either rider may not be purchased separately. The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios riders are sold separately. These riders may not be available through all Registered Representatives and may be subject to additional restrictions set by your Registered Representative or us. We reserve the right to withdraw either or both riders and any options at any time. When you buy either rider, you must provide us with the names and date of birth of the Owner, any joint Owner, Annuitant and Beneficiary. We then determine who the "Relevant Covered Life" and other "Covered Lives" will be when establishing the Withdrawal Percent. - A Covered Life must be a living person. If you choose the Joint/Spousal Option, we reserve the right to (a) prohibit non-natural entities from being designated as an Owner, (b) prohibit anyone other than your Spouse from being a joint Owner; and (c) impose other designation restrictions from time to time. - For the Single Life Option, the Covered Life is most often the same as the Contract Owner and joint Owner (which could be two different people). In the Joint/Spousal Option, the Covered Life is most often the Contract Owner, and his or her Spouse is the joint Owner or Beneficiary. - The Relevant Covered Life will be one factor used to establish your Withdrawal Percent. When the Single Life Option is chosen, we use the older Covered Life as the Relevant Covered Life; and when the Joint/Spousal Option is chosen, we use the younger Covered Life as the Relevant Covered Life. The maximum age of any Contract Owner or Annuitant when electing either rider is 80. These age restrictions also apply to the Beneficiary when the Joint/Spousal Option is chosen. DOES ELECTING EITHER RIDER FORFEIT YOUR ABILITY TO BUY OTHER RIDERS? Yes. If you elect either rider, you may not elect any rider other than MAV Plus (MAV only in applicable states). HOW IS THE CHARGE FOR EITHER RIDER CALCULATED? The fee for the riders is based on your then current Payment Base (not your Contract Value) as of each Contract Anniversary. This charge will automatically be deducted from your Contract Value on your Contract Anniversary AFTER your Anniversary Value and Payment Base have been computed and prior to all other financial transactions. In the event of a full Surrender, a prorated charge will be deducted from your Surrender Value. The charge for the riders will be withdrawn from each Sub-Account and the Fixed Accumulation Feature in the same proportion that the value of each Sub-Account bears to the total Contract Value. Except as otherwise provided below, we will continue to deduct this charge until we begin to make Annuity Payouts. The rider charge may limit access to the Fixed Accumulation Feature in certain states. APP D-12 ------------------------------------------------------------------------------- We reserve the right to increase the charge for either or both riders (and any option) up to the maximum fees described in the Synopsis at any time 12 months after either riders' effective date. The fee increase will only apply if you are eligible for future automatic Payment Base and/or Withdrawal Percent increases. Any future fee increase will be based on the charge that we are then currently charging other customers who have not previously elected such rider. If we cease sales of either or both riders, we will predetermine the rider charge on a non-discriminatory basis. Fee increases will not apply if (a) the age of the Relevant Covered Life is 80 or older; (b) you notify us in writing of your election to permanently waive automatic Payment Base and Withdrawal Percent increases; or (c) we convert your benefits based on our Minimum Amount rules defined in your Contract. This fee may not be the same as the fee that we charge new purchasers or the fee we set before we cease offering either or both riders (or options). Subject to the foregoing limitation, we also reserve the right to charge a different fee for either rider (or options) to any new Contract Owners as a result of a change of Covered Life. Unless exempt, we will automatically deduct rider fees, as they may be increased from time to time. DOES THE PAYMENT BASE CHANGE UNDER EITHER RIDER? Yes, your initial Payment Base equals your initial Premium Payment except in regard to a company sponsored-exchange program. Your Payment Base will fluctuate based on: - automatic Payment Base increases; and - subsequent Premium Payments; and - partial Surrenders (including partial Surrenders taken prior to the Lifetime Income Eligibility Date or if the amount of the partial Surrender exceeds either your Threshold or Lifetime Benefit Payment amount). - Automatic Payment Base Increase: Your automatic annual Payment Base increase varies depending on whether you choose The Hartford's Lifetime Income Builder Selects or The Hartford's Lifetime Income Builder Portfolios. The following table describes how these options operate:
THE HARTFORD'S LIFETIME INCOME BUILDER SELECTS THE HARTFORD'S LIFETIME INCOME BUILDER PORTFOLIOS ------------------------------------------------------------------------------------------------------------------------------------ New Payment Base [(current Anniversary Value (prior to the rider charge The higher of current Contract Value or Payment Base being taken) divided by your prior Payment Base)] multiplied by your prior Payment Base Annual Payment Base 0% - 10% Unlimited increase limits
We will determine if you are eligible for annual automatic Payment Base increases on each Contract Anniversary. Automatic Payment Base increases will cease upon the earliest of: - your Annuity Commencement Date; - the Contract Anniversary immediately following the Relevant Covered Life's attained age of 80; or - You waive your right to receive automatic Payment Base increases. Your Payment Base can never be less than $0 or more than $5 million. Any activities that would otherwise increase the Payment Base above this ceiling will not be included for any benefits under either rider. See Examples 16 and 17 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I. - Subsequent Premium Payments increase your Payment Base on a dollar-for-dollar basis. See Examples 10 and 11 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I. - Partial Surrenders may trigger a recalculation of the Payment Base depending on (a) whether the partial Surrender takes place prior to the Lifetime Income Eligibility Date, and (b) if the cumulative amount of all partial Surrenders during any Contract Year exceeds the applicable limits as discussed below: A. If cumulative partial Surrenders taken during any Contract Year and prior to the Lifetime Income Eligibility Date, are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Payment Base on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to the Lifetime Income Eligibility Date are greater than the Threshold (subject to rounding), then we will reduce the Payment Base on a (i) dollar-for-dollar basis up to the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. APP D-13 ------------------------------------------------------------------------------- B. If cumulative partial Surrenders taken after the Lifetime Income Eligibility Date are equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will not reduce the Payment Base. C. For any partial Surrender that causes cumulative partial Surrenders after the Lifetime Income Eligibility Date to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Payment Base on a proportionate basis for the amount in excess of the Lifetime Benefit Payment. See Examples 3-9 and 12-15 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I - Covered Life changes may also trigger a recalculation of your Payment Base, Lifetime Benefit Payment, Guaranteed Minimum Death Benefit and rider fees. See "WHAT HAPPENS IF YOU CHANGE OWNERSHIP?" below. - Option Conversion. We reserve the right to offer a one-time only conversion from The Hartford's Lifetime Income Builder Selects to The Hartford's Lifetime Income Builder Portfolios, or vice versa, on or after the first Contract Anniversary after the rider has been in effect and prior to the Relevant Covered Life's reaching attained age 81. Your then current Payment Base will be your new Payment Base for the purposes of the converted rider. This conversion will go into effect on the next following Contract Anniversary. A conversion notice must be received by us in good order between 30 days prior to, or within 15 days after, a Contract Anniversary. This privilege may be withdrawn at our sole discretion at any time without prior notice. The rider fee and any associated restrictions will be based on the rider then in effect. You may rescind your election within 15 days after making your election. Upon rescission; however, your Payment Base will be reset at the LOWER of the then applicable Payment Base or the Contract Value at the time of rescission. RESCISSION OF A CONVERSION OPTION MAY THEREFORE RESULT IN A PERMANENT REDUCTION OF BENEFITS. Once rescinded, this privilege will be terminated. - Partial Surrenders taken during any Contract Year that cumulatively exceed the Annual Withdrawal Amount but do not exceed the Lifetime Benefit Payment will be free of any applicable CDSC. IS EITHER RIDER DESIGNED TO PAY YOU WITHDRAWAL BENEFITS FOR YOUR LIFETIME? Yes. However, withdrawals taken prior to the Lifetime Income Eligibility Date are not guaranteed to be available throughout your lifetime. Such withdrawals will reduce (and may even eliminate) the Payment Base otherwise available to establish Lifetime Benefit Payments and Guaranteed Minimum Death Benefits. As shown in the following table, the Withdrawal Percent for all partial Surrenders taken BEFORE the Lifetime Income Eligibility Date will be 5% (Single Life Option) or 4.5% (Joint/Spousal Option). In contrast, the Withdrawal Percent for partial Surrenders taken AFTER the Lifetime Income Eligibility Date will be based on the chronological age of the Relevant Covered Life at the time of the first withdrawal as shown below:
WITHDRAWAL PERCENT SINGLE LIFE JOINT/SPOUSAL RELEVANT COVERED LIFE ATTAINED AGE OPTION OPTION -------------------------------------------------------------------------------- [LESS THAN]59 1/2 - 64 5.0% 4.5% 65 - 69 5.5% 5.0% 70 - 74 6.0% 5.5% 75 - 79 6.5% 6.0% 80+ 7.0% 6.5%
Your Withdrawal Percentage will increase according to this schedule if: - You are entitled to an automatic Payment Base increase during the Contract Year when the Relevant Covered Life's birthday coincides with a new age band; and - You have not waived your obligation to pay potential rider fee increases. Your new Withdrawal Percent will take effect on either of the following dates depending on whether a partial Surrender was ever taken: - If a partial Surrender HAS NOT been taken, your new Withdrawal Percent will be effective on the next birthday that brought the Relevant Covered Life into a new Withdrawal Percent age band; or - If a partial Surrender HAS been taken, then your new Withdrawal Percent will be effective as of the Contract Anniversary when the next automatic Payment Base increase occurs after the birthday that brought you into a new Withdrawal Percent age band (and not that birthday). APP D-14 ------------------------------------------------------------------------------- See "WHAT HAPPENS IF YOU CHANGE OWNERSHIP?" for a description of circumstances when your Withdrawal Percent may change based on a permissible Covered Life change. See Examples 1-3 and 20 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I. IS EITHER RIDER DESIGNED TO PAY YOU DEATH BENEFITS? Yes. This Guaranteed Minimum Death Benefit guarantees that we will pay a Death Benefit equal to the greater of Premium Payments adjusted for partial Surrenders or Contract Value as of the date we receive due proof of death of the Contract Owner(s) or Annuitant. Termination of either rider will result in the rescission of the Guaranteed Minimum Death Benefit and result in your Beneficiary receiving the Contract Value as of the date we receive due proof of death. For Joint/Spousal election of either rider, no Death Benefit will be available when a Relevant Covered Life is the Beneficiary and the Beneficiary dies. Partial Surrenders will affect the Guaranteed Minimum Death Benefit as follows: A. If cumulative partial Surrenders taken prior to the Lifetime Income Eligibility Date are equal to, or less than, the Threshold (subject to rounding), then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. Alternatively, if cumulative partial Surrenders taken prior to the Lifetime Income Eligibility Date are greater than the Threshold (subject to rounding), then we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Threshold, and (ii) proportionate basis for the amount in excess of the Threshold. B. If cumulative partial Surrenders after the Lifetime Income Eligibility Date are (i) equal to or less than the Lifetime Benefit Payment (subject to rounding), or (ii) exceed the Lifetime Benefit Payment only as a result of enrollment in our Automatic Income Program to satisfy RMD; then the cumulative partial Surrender will reduce the Guaranteed Minimum Death Benefit on a dollar-for-dollar basis. C. For any partial Surrender that causes cumulative partial Surrenders after the Lifetime Income Eligibility Date to exceed the Lifetime Benefit Payment and the RMD exception in (B) does not apply, we will reduce the Guaranteed Minimum Death Benefit on a (i) dollar-for-dollar basis up to the amount of the Lifetime Benefit Payment, and (ii) proportionate basis for the amount in excess of the Lifetime Benefit Payment. Please refer to the section labeled "CAN YOUR SPOUSE CONTINUE YOUR LIFETIME WITHDRAWAL FEATURE" for more information on the continuation of the Lifetime Benefit Payments by your Spouse. DOES EITHER RIDER REPLACE THE STANDARD DEATH BENEFIT? YES, IT PERMANENTLY REPLACES THE STANDARD DEATH BENEFIT. The Guaranteed Minimum Death Benefit will be reset to equal Contract Value when there is a Covered Life change that exceeds the permissible age limitation under either rider. This may also occur for the Single Life Option when the spouse elects Spousal Contract continuation and the new Covered Life exceeds the age limit. CAN YOU REVOKE THIS RIDER? No. However, a Company-sponsored exchange of this rider will not be considered to be a revocation by you of either rider. WHAT EFFECT DOES PARTIAL OR FULL SURRENDERS HAVE ON YOUR BENEFITS UNDER THIS RIDER? Please refer to "DOES THE BENEFIT AMOUNT/PAYMENT BASE CHANGE UNDER EITHER RIDER?" for the effect of partial Surrenders on your Payment Base, Guaranteed Minimum Death Benefit and Lifetime Benefit Payments. You may make a full Surrender of your entire Contract at any time. However, you will receive your Contract Value with any applicable charges deducted and not the Payment Base or any Lifetime Benefit Payment that you would have received under either rider. If your Contract Value on any Contract Anniversary is ever reduced below the minimum amount (as defined in your Contract -- generally, the greater of $500 or one Lifetime Benefit Payment) as a result of investment performance or if on any Valuation Day a partial Surrender is taken that reduces your Contract Value below the minimum amount, then the following will occur: - We will no longer accept subsequent Premium Payments; and - You will be required to either make a full Surrender or promptly transfer your remaining Contract Value to an approved Sub-Account(s) and/or Programs (failure to do so after a reasonable amount of time being deemed as acquiescence to our reallocation of these sums to the Money Market Sub-Account); and - Lifetime Benefit Payments will continue; and - Your Guaranteed Minimum Death Benefit will continue to be reduced by Lifetime Benefit Payments until reduced to zero at which time your Death Benefit shall be equal to your Contract Value; and - All other privileges under either rider will terminate and you will no longer be charged a rider fee or Annual Maintenance Fee; and APP D-15 ------------------------------------------------------------------------------- - If any amount greater than a Lifetime Benefit Payment is requested, the Contract will be liquidated, the rider will terminate and the Guaranteed Minimum Death Benefit will be lost. See Examples 21 and 22 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I. WHAT HAPPENS IF YOU CHANGE OWNERSHIP? Inasmuch as this rider is affected by changes to the Covered Life, only these types of changes are discussed below. We reserve the right to approve all Covered Life changes. Certain approved changes in the designation of the Covered Life may cause a recalculation of the benefits. Covered Life changes also allow us, in our discretion, to impose investment restrictions, as described below. Any Covered Life change made within the first 6 months from the Contract Issue date will have no impact on the Payment Base or Guaranteed Minimum Death Benefit as long as each succeeding Covered Life is less than the maximum age limitation of the applicable rider at the time of the change. The Withdrawal Percent and Lifetime Benefit Payment will thereafter change based on the age of the new relevant Covered Life. After the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and partial Surrenders have not yet been taken, in the event that you and your Spouse become legally divorced, you may add a new Spouse to the Contract. Provided that the age limitation of the rider is not exceeded, the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will then recalculate your Withdrawal Percent based on the age of the younger Covered Life as of the date of the change. The charge for this rider will remain the same. Alternatively, if after the first 6 months from the Contract Issue date, if you elected the Joint/Spousal Option and Surrenders have been taken, in the event that you and your Spouse become legally divorced, you may only remove your ex-Spouse from the Contract whereupon the Payment Base and Guaranteed Minimum Death Benefit will remain the same. We will then recalculate your Withdrawal Percent based on the age of the remaining Covered Life as of the date of the change. The charge for this rider will remain the same. You may not convert your Joint/Spousal Option election to a Single Life Option. In addition, after the first six months following the Contract issue date, if any Covered Life change takes place that is not due to a divorce, then: A. If the older Covered Life after the change is equal to or less than the maximum age limitation of the rider at the time of the change, then we will revoke the Lifetime Withdrawal Feature of either rider and continue the Guaranteed Minimum Death Benefit only. The charge for the rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter. B. If the older Covered Life after the change exceeds the maximum age limitation of either rider at the time of the change, or we no longer offer either rider, then the rider will terminate. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. If you elected the Single Life Option and any Covered Life changes after the first 6 months from Contract Issue date, then: A. If we no longer offer such rider, we will continue the Guaranteed Minimum Death Benefit after resetting this benefit to the lower of the then applicable Guaranteed Minimum Death Benefit or Contract Value on the effective date of the Covered Life change; whereupon the Lifetime Withdrawal Feature will terminate. The charge for this rider then in effect will be assessed on the revocation date and will no longer be assessed thereafter; or B. If we offer such rider, then we will use the attained age of the older Covered Life as of the date of the Covered Life change to reset the Withdrawal Percent. The Payment Base will be recalculated to be the lesser of the Contract Value or the Payment Base effective on the date of the change. The Guaranteed Minimum Death Benefit will be recalculated to be the lesser of the Contract Value or the Guaranteed Minimum Death Benefit effective on the date of the change; or C. If we offer such rider and the older Covered Life after the change exceeds the maximum age limitation of this rider at the time of the change; the rider will be terminated and removed from the Contract. The Guaranteed Minimum Death Benefit will then be equal to the Contract Value. If such rider is no longer available for sale, we will determine the issue age limitation of the rider on a non-discriminatory basis. The following tables illustrate only some of the various changes and the resulting outcomes associated with deaths of the Contract Owner(s) or Annuitant before and after the Annuity Commencement Date. APP D-16 ------------------------------------------------------------------------------- SINGLE LIFE OPTION ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving The Annuitant is living or Joint Contract Owner receives non-spousal Contract Owner deceased the Death Benefit and this rider terminates Contract Owner There is a surviving spousal The Annuitant is living or Joint Contract Owner receives Contract Owner deceased the Death Benefit and this rider can continue under Spousal Contract continuation Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Designated Owner deceased Beneficiary receives the Death Benefit Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates. Estate Owner or Beneficiary deceased receives the Death Benefit Annuitant Contract Owner is living There is no Contingent Contract continues, no Death Annuitant and the Contract Benefit is paid, and this rider Owner becomes the Contingent continues Annuitant Annuitant Contract Owner is living There is no Contingent Rider terminates and Contract Annuitant and the Contract Owner receives the Death Owner waives their right to Benefit become the Contingent Annuitant Annuitant Contract Owner is Living Contingent Annuitant is Living Contingent Annuitant becomes the Annuitant and the Contract and this rider continues
JOINT/SPOUSAL ELECTION: IF THE DECEASED IS . . . AND . . . AND . . . THEN THE . . . Contract Owner There is a surviving Contract The Annuitant is living or The surviving Contract Owner Owner deceased continues the Contract and rider; we will increase the Contract Value to the Death Benefit value Contract Owner There is no surviving Contract The Spouse is the sole primary Follow Spousal Contract Owner beneficiary continuation rules for joint life elections Contract Owner There is no surviving Contract The Annuitant is living or Rider terminates and Contract Owner or Beneficiary deceased Owner's estate receives the Death Benefit Annuitant The Contract Owner is living There is a Contingent Annuitant The Rider continues; upon the death of the last surviving Covered Life, the rider will terminate.
CAN YOUR SPOUSE CONTINUE YOUR LIFETIME WITHDRAWAL FEATURE? - SINGLE LIFE OPTION: If a Covered Life dies and the sole Beneficiary is the deceased Covered Life's Spouse at the time of death, such Spouse may continue the Contract. If the Spouse elects to continue the Contract and such rider, we will continue the rider with respect to all Lifetime Withdrawal Benefits at the charge that is currently being assessed for new sales at the time of continuation. We will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater. The Covered Life will be re-determined on the date of Spousal Contract continuation. If the new Covered Life is less than age 81 at the time of the Spousal Contract continuation, and such rider (or a similar rider, as we determine) is still available for sale, the Payment Base and the Guaranteed Minimum Death Benefit will be set equal to the Contract Value, the Withdrawal Percent will be recalculated based on the age of the older remaining Covered Life on the APP D-17 ------------------------------------------------------------------------------- effective date of the Spousal Contract continuation. If the new Covered Life is 81 or older at the time of the Spousal Contract continuation, the rider will terminate and the Guaranteed Minimum Death Benefit will be equal to the Contract Value. If we are no longer offering such rider at the time of Spousal Contract continuation, we will revoke the Lifetime Withdrawal Feature, the Guaranteed Minimum Death Benefit will be set equal to the Contract Value and the rider charge will no longer be assessed. - JOINT/SPOUSAL OPTION: Either rider is designed to facilitate the continuation of your rights under the rider by your Spouse through the inclusion of a Joint/Spousal Option. If a Covered Life dies and the Spouse elects to continue the Contract, we will increase the Contract Value to the Guaranteed Minimum Death Benefit, if greater and we will continue the rider with respect to all benefits at the current rider charge. The benefits will be reset as follows: - The Payment Base will be equal to the greater of Contract Value or the Payment Base on the Spousal Contract continuation date; - The Guaranteed Minimum Death Benefit will be equal to the Contract Value on the Spousal Contract continuation date; - The Withdrawal Percent will remain at the current percentage if partial Surrenders have commenced; otherwise the Withdrawal Percent will be based on the attained age of the remaining Covered Life on the Spousal Contract continuation date; and - The Lifetime Benefit Payment will be recalculated. The remaining Covered Life can not name a new owner on the Contract. Any new Beneficiary that is added to the Contract will not be taken into consideration as a Covered Life. Either rider will terminate upon the death of the remaining Covered Life. See Examples 18 and 19 under The Hartford's Lifetime Income Builder Selects and The Hartford's Lifetime Income Builder Portfolios in Appendix I. WHAT HAPPENS IF YOU ANNUITIZE YOUR CONTRACT? If you elect to annuitize your Contract prior to reaching the Annuity Commencement Date, you may only annuitize your Contract Value and will not be able to elect any of the annuitization options allowed under this rider. If your Contract reaches the Annuity Commencement Date, the Contract must be annuitized unless we agree to extend the Annuity Commencement Date, in our sole discretion. In this circumstance, the Contract may be annuitized under our standard annuitization rules or, alternatively, under the rules applicable when the Contract Value is below our Minimum Amount rule then in effect. If your Contract Value is reduced below our Minimum Amount rule (as defined in your Contract), then in effect, your Annuity Commencement Date will be attained and we will no longer accept subsequent Premium Payments. We will then issue you a payout annuity. You may elect the frequency of your payments from those offered by us at such time, but will not be less frequently than annually. - SINGLE LIFE OPTION: If you have elected the Single Life Option, we will issue you a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the Covered Life determined at Annuity Commencement Date. We treat the Covered Life as the Annuitant for this payout option. If there is more than one Covered Life, then the lifetime portion will be based on both Covered Lives. The Covered Lives will be the Annuitant and joint Annuitant for this payout option. The lifetime portion will terminate on the first death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit under this rider. If the older Annuitant is age 59 1/2 or younger, we will automatically defer the date the payments begin until the anniversary after the older Annuitant attains age 59 1/2 and is eligible to receive payments in a fixed dollar amount until the later of the death of any Annuitant or a minimum number of years. If the Annuitant and joint Annuitant are alive and the older Annuitant is age 59 1/2 or older, you will receive payments in a fixed dollar amount until the later of the death of any Annuitant or a period certain. The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of any Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of the Withdrawal Percent or the applicable Threshold. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of any Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. APP D-18 ------------------------------------------------------------------------------- This option may not be available if the Contract is issued to qualify under Code Sections 401, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. - JOINT/SPOUSAL OPTION: If you have elected the Joint/Spousal Option and both Spouses are alive, we will issue you a Fixed Joint & Survivor Lifetime and Period Certain Payout. If only one Spouse is alive, we will issue a Fixed Lifetime and Period Certain Payout. The lifetime portion will be based on the surviving Covered Life. The Covered Lives will be the Annuitant and Joint Annuitant for this payout option. The lifetime benefit will terminate on the last death of the two. The minimum amount paid to you under this Annuity Option will at least equal the remaining Guaranteed Minimum Death Benefit. If the younger Annuitant is alive and age 59 1/2 or younger, we will automatically defer the date that payments begin until the anniversary after the younger Annuitant attains age 59 1/2 and is eligible to receive payments in a fixed dollar amount until the death of the last surviving Annuitant or a period certain. If the Annuitant is alive and the younger Annuitant is age 59 1/2 or older, you will receive payments in a fixed dollar amount until the later of the death of the last surviving Annuitant or a minimum number of years. The period certain over which payments will be made is equal to the Guaranteed Minimum Death Benefit divided by the product of the Payment Base multiplied by the Withdrawal Percent on the Annuity Commencement Date. Payments will be made over the greater of the period certain, or until the death of the last Surviving Annuitant, in the frequency that you elect. The annual amount that will be paid to you will be equal to the Payment Base on the Annuity Commencement Date multiplied by the greater of the Withdrawal Percent or the applicable Threshold. Therefore, the higher your then remaining Guaranteed Minimum Death Benefit is at the time of annuitization, the longer the time period you will be entitled to receive annuitization payments. The frequencies will be among those offered by us at that time but will be no less frequently than annually. If, at the death of the last surviving Annuitant, payments have been made for less than the period certain, the remaining scheduled period certain payments will be made to the Beneficiary. A lump sum option is not available. These options may not be available if the Contract is issued to qualify under Code Sections 401, 408, or 457. For such Contracts, this option will be available only if the Period Certain Payout is less than the life expectancy of the Annuitant at the time the option becomes effective. Such life expectancy will be computed under the mortality table then in use by us. ARE THERE RESTRICTIONS ON HOW YOU MUST INVEST? Yes, as described in the following table: Lifetime Income Builder We reserve the right to limit the Funds into which you may allocate your Contract Value. We may Selects prohibit investment in certain Funds or require you to allocate your Contract Value only to certain Funds or in accordance with one of a number of model portfolios or Programs. Lifetime Income Builder Your Contract Value must be invested in one or more Programs and in an approved model portfolio, Portfolios Funds or other investment vehicles established from time to time. Permissible portfolios, Funds, Programs or other investment vehicles are described in your application and other communications. Not all model portfolios or Programs are available through all Financial Intermediaries. We may, in our sole discretion, add, replace or alter Funds, Programs and model portfolios from time to time. You will be provided with advance notification of any investment restriction changes. Changes may be made on a prospective basis with respect to any additional Premium Payments received. While you may switch from model portfolio to model portfolio, you can not pick and choose Funds within any model portfolios nor may you specify which Funds should be redeemed to satisfy the Lifetime Withdrawal Feature. You may provide written investment instructions to invest Contract Value in a manner that violates these investment restrictions. Any such action will; however, result in the termination of your rights under either rider.
Investments within model portfolios will fluctuate in value and may be worth more or less than your original investment. We are not responsible for lost investment opportunities associated with the implementation of these investment restrictions. Please refer to each Fund's investment objectives, policies and restrictions and the risks of investing in each Fund as described in this prospectus and the prospectus for each Fund. If your Lifetime Withdrawal Feature is revoked due to failure to comply with the investment restrictions, you will have a one time opportunity to reinstate the Lifetime Withdrawal Feature on your rider. There is a 15 calendar day reinstatement period that will begin from the date your lifetime withdrawal feature is revoked. During the reinstatement period, if you make a subsequent Premium Payment, take a partial Surrender or make a Covered Life change, your opportunity to reinstate will be terminated. APP D-19 ------------------------------------------------------------------------------- Upon reinstatement of your Lifetime Withdrawal Feature under either rider, your Payment Base will be reset at the lower of the Payment Base prior to the revocation and Contract Value as of the date of the reinstatement. Your Withdrawal Percentage will be set equal to the Withdrawal Percentage prior to the Lifetime Withdrawal Feature revocation; unless, if within the reinstatement period you reach a new age band and no partial Surrenders have been taken, then the Withdrawal Percentage will be set equal to the appropriate percentage based on the attained age of the Relevant Covered Life. Your Lifetime Benefit Payment will be recalculated based on the Lifetime Withdrawal Feature values as of the date of the reinstatement. We will deduct a prorated rider charge on your Contract Anniversary following the reinstatement for the time period between the reinstatement date and your first Contract Anniversary following the reinstatement. ARE THERE RESTRICTIONS ON THE AMOUNT OF SUBSEQUENT PREMIUM PAYMENTS? Yes. We reserve the right to require our approval on all subsequent Premium Payments received after the first twelve months. We may not accept any subsequent Premium Payment which brings the total of such cumulative subsequent Premium Payments in excess of $100,000 without prior approval. Following your Annuity Commencement Date, we will no longer accept subsequent Premium Payments. These restrictions are not currently enforced. CAN WE AGGREGATE CONTRACTS? Yes. For purposes of determining the Payment Base and Premium Payment limits, we reserve the right to treat as one all deferred variable annuity Contracts issued by us where you have elected any optional withdrawal benefit rider. If we elect to aggregate Contracts, we will change the period over which we measure Surrenders against future Lifetime Benefit Payments. We will treat the effective date of our aggregation election until the end of the applicable calendar year as a Contract Year for the purposes of the Lifetime Benefit Payment limit. A pro-rata rider fee will be taken at the end of that calendar year. After the first calendar year following aggregation, the Lifetime Benefit Payment limits will be aggregated and will thereafter be set on a calendar year (i.e., January 1 Contract Anniversary) basis. The rider fee then in effect will be taken at the end of each new Contract Anniversary. OTHER INFORMATION This rider may not be appropriate for all investors. Several factors, among others, should be considered: - The benefits under this rider cannot be directly or indirectly assigned, collateralized, pledged or securitized in any way. Any such actions will invalidate the rider and allow us to terminate the rider. - YOUR ANNUAL LIFETIME BENEFIT PAYMENTS MAY FLUCTUATE BASED ON CHANGES IN THE PAYMENT BASE AND CONTRACT VALUE. THE PAYMENT BASE IS SENSITIVE TO PARTIAL SURRENDERS IN EXCESS OF THE THEN CURRENT MAXIMUM LIFETIME BENEFIT PAYMENT OR THRESHOLD. IT IS THEREFORE POSSIBLE THAT SURRENDERS AND SUBSEQUENT PREMIUM PAYMENTS WITHIN THE SAME CONTRACT YEAR, WHETHER OR NOT EQUAL TO ONE ANOTHER, CAN RESULT IN LOWER LIFETIME BENEFIT PAYMENTS. - Annuitizing your Contract, whether voluntary or not, will impact and possibly eliminate these "lifetime" benefits. First, you may no longer invest additional Premium Payments. Second, the Death Benefit will immediately terminate. Third, any Guaranteed Minimum Withdrawal Benefit guarantees you elect may end. In cases where you are required to annuitize, you will forfeit automatic Payment Base increases (if applicable) and lifetime annuitization payments may equal (or possibly exceed) Lifetime Benefit Payments. However, where you elect to annuitize before a required Annuity Commencement Date, lifetime annuitization payments might be less than the income guaranteed by your Guaranteed Minimum Withdrawal Benefit. - If you had elected the conversion option from The Hartford's Lifetime Income Builder Selects to The Hartford's Lifetime Income Builder Portfolios, or vice versa, and subsequently rescinded that election, your Payment Base will be set to the lower of the Payment Base or the Contract Value on the date of the rescission and therefore your old Payment Base will not be restored. The Death Benefit will also be set to the lower of the Guaranteed Minimum Death Benefit and the Contract Value on the date of the rescission. - Even though either rider is designed to provide living benefits, you should not assume that you will necessarily receive payments for life if you have violated any of the terms of this rider. - While there is no minimum age for electing either rider, withdrawals taken prior to the Lifetime Income Eligibility Date will reduce, or can even eliminate guaranteed Lifetime Benefit Payments. PAYMENTS TAKEN PRIOR TO THE LIFETIME INCOME ELIGIBILITY DATE ARE NOT GUARANTEED TO LAST FOR A LIFETIME. Either rider may not be suitable if a Covered Life is under attained age 59 1/2. - The determination of the Relevant Covered Life is established by the Company and is critical to the determination of many important benefits such as the Withdrawal Percent used to set Lifetime Benefit Payments. Applicants should confirm this determination and be sure they fully appreciate its importance before investing. - We may terminate either or both riders post-election based on your violation of benefit rules and may otherwise withdraw such rider (or any option) for new sales at any time. In the event that either rider (or any option) is terminated by us, your Lifetime APP D-20 ------------------------------------------------------------------------------- Benefit Payments will cease; your Payment Base, including any automatic Payment Base increases will be eliminated and the Guaranteed Minimum Death Benefit will then be equal to the Contract Value, and you will not be allowed to elect any other optional benefit rider. - Unless otherwise provided, you may select either rider only at the time of sale and once you do so, you may not add any other optional withdrawal benefits during the time you own this Contract. If you elect either rider you will not be eligible to elect optional riders other than MAV or MAV Plus. - When the Single Life Option is chosen, Spouses may find continuation of either rider to be unavailable or unattractive after the death of the Contract Owner. Continuation of the benefits available in either optional rider is dependent upon its availability at the time of death of the first Covered Life and will be subject to then prevailing charges. - The Joint/Spousal Option provides that if you and your Spouse are no longer married for any reason other than death, the removal and replacement of your Spouse will constitute a Covered Life change. This can result in the resetting of all benefits under this rider. - Certain Covered Life changes may result in a reduction, recalculation or forfeiture of benefits. - Annuity pay-out options available subsequent to the Annuity Commencement Date may not necessarily provide a stream of income for your lifetime and may be less than Lifetime Benefit Payments. - The fee for either rider may increase any time after 12 months from either rider's effective date if and when automatic Payment Base increases take place. There are no assurances as to the fee we will be charging at the time of each Payment Base increase. This is subject to the maximum fee disclosed in the Synopsis. - Because these benefits are bundled and interdependent upon one another, there is a risk that you may ultimately pay for benefits that you may never get to use. - The purchase of an optional withdrawal benefit feature may not be appropriate for contracts owned by certain types of non-natural entities, including Charitable Trusts. Because many non-natural entities are required to make certain periodic distributions and those amounts may be different than the withdrawal amounts permitted by the optional withdrawal benefit feature, you may wish to consult with your tax advisor to help determine the appropriateness of this benefit. ------------------------------------------------------------------------------- To obtain a Statement of Additional Information, please complete the form below and mail to: The Hartford Attn: U.S. Wealth Management P.O. Box 5085 Hartford, Connecticut 06102-5085 Please send a Statement of Additional Information for Series I of The Director M Plus variable annuity to me at the following address: ---------------------------------------------------------------- Name ---------------------------------------------------------------- Address ---------------------------------------------------------------- City/State Zip Code PART B STATEMENT OF ADDITIONAL INFORMATION HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SEPARATE ACCOUNT THREE THE DIRECTOR M PLUS This Statement of Additional Information is not a prospectus. The information contained in this document should be read in conjunction with the Prospectus. To obtain a Prospectus, send a written request to Hartford Life and Annuity Insurance Company, Attn: Investment Product Services, P.O. Box 5085, Hartford, CT 06102-5085. Date of Prospectus: May 1, 2008 Date of Statement of Additional Information: May 1, 2008 TABLE OF CONTENTS GENERAL INFORMATION 2 Safekeeping of Assets 2 Experts 2 Non-Participating 2 Misstatement of Age or Sex 2 Principal Underwriter 2 Additional Payments 2 PERFORMANCE RELATED INFORMATION 5 Total Return for all Sub-Accounts 5 Yield for Sub-Accounts 5 Money Market Sub-Accounts 6 Additional Materials 6 Performance Comparisons 6 ACCUMULATION UNIT VALUES 7 FINANCIAL STATEMENTS SA-1
2 ------------------------------------------------------------------------------- GENERAL INFORMATION SAFEKEEPING OF ASSETS We hold title to the assets of the Separate Account. The assets are kept physically segregated and are held separate and apart from our general corporate assets. Records are maintained of all purchases and redemptions of the underlying fund shares held in each of the Sub-Accounts. EXPERTS The statutory basis balance sheets of Hartford Life and Annuity Insurance Company (the "Company") as of December 31, 2007 and 2006, and the related statutory basis statements of operations, changes in capital and surplus, and cash flows for each of the three years in the period ended December 31, 2007 have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report dated March 27, 2008 and the statements of assets and liabilities of Hartford Life and Annuity Insurance Company Separate Account Three (the "Account") as of December 31, 2007, and the related statements of operations and changes in net assets for the respective stated periods then ended have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report dated February 20, 2008, which reports are both included in this Statement of Additional Information. Such financial statements are included in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing. The principal business address of Deloitte & Touche LLP is City Place, 32nd Floor, 185 Asylum Street, Hartford, Connecticut 06103-3402. NON-PARTICIPATING The Contract is non-participating and we pay no dividends. MISSTATEMENT OF AGE OR SEX If an Annuitant's age or sex was misstated on the Contract, any Contract payments or benefits will be determined using the correct age and sex. If we have overpaid Annuity Payouts, an adjustment, including interest on the amount of the overpayment, will be made to the next Annuity Payout or Payouts. If we have underpaid due to a misstatement of age or sex, we will credit the next Annuity Payout with the amount we underpaid and credit interest. PRINCIPAL UNDERWRITER The Contracts, which are offered continuously, are distributed by Hartford Securities Distribution Company, Inc. ("HSD"). HSD serves as Principal Underwriter for the securities issued with respect to the Separate Account. HSD is registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934 as a Broker-Dealer and is a member of the National Association of Securities Dealers, Inc. HSD is an affiliate of ours. Both HSD and Hartford are ultimately controlled by The Hartford Financial Services Group, Inc. The principal business address of HSD is the same as ours. We currently pay HSD underwriting commissions for its role as Principal Underwriter of all variable annuities associated with this Separate Account. For the past three years, the aggregate dollar amount of underwriting commissions paid to HSD in its role as Principal Underwriter has been: 2007: $171,529,772; 2006: $171,201,478; and 2005: $95,929,429. ADDITIONAL PAYMENTS As stated in the prospectus, we (or our affiliates) pay Additional Payments to Financial Intermediaries. In addition to the Financial Intermediaries listed in the prospectus with whom we have an ongoing contractual arrangement to make Additional Payments, listed below are all Financial Intermediaries that received Additional Payments in 2007 of items such as sponsorship of meetings, education seminars, and travel and entertainment, whether or not an ongoing contractual relationship exists. 1st Discount Brokerage, Inc., AIM Distributors, Inc., A.P.P.S. Financial Group, Inc., Abacus Investments, Inc., ABN AMRO, Inc., Advantage Capital Corporation, Advisory Group Equity Services Ltd., AFA Financial Group LLC, AFS Brokerage, Inc., AIG Equity Sales Corp., AIG Financial Advisors Inc., AIG Retirement Advisors, Inc., AIG SunAmerica, Inc., Alexander Investment Services Co., Allegheny Investments, Ltd., Allen & Company LLC, Allen & Company of Florida, Inc., Allen Douglas Securities, Inc., Alliance Bank, AllianceBerstein Investments, Inc., AMCORE Investment Services, Inc., American Classic Securities Inc., American Diversified Financial Group LLC, American Funds & Trusts Inc., American Funds Distributors, Inc., American General Securities, Inc., American Investors Company, American Portfolios Financial Services, Inc., Ameriprise Financial, Inc., Ameritas Investment Corp., AMTrust Investment Services, Inc., AMVest Securities, Inc., Anderson & Strudwick, Inc., Andrew Garrett, Inc., Anthony Financial Management LLC, Arizona State Savings & Credit Union, Arvest Asset Management, Askar Corp., Asset Management Securities Corp., Associated Financial Services, Inc., Associated Investment Services, Inc., Associated Securities Corp., Atlantic Coast Securities Corp., AUL Equity Sales Corp., AXA Advisors LLC, AYRE Investments, Inc., B.C. Ziegler and Company, Banc of America Investment Services, Inc., 3 ------------------------------------------------------------------------------- BancNorth Investment Group, Inc., Bancorpsouth Investment Services, Inc., BancWest Investment Services, Inc., Bank Insurance & Securities Association, Bank Iowa, Bank of the West, Bankers & Investors Co., Banknorth, N.A., Bannon Ohanesian & Lecours, Inc., Banorte Securities International, Ltd., Bates Securities, Inc., BB&T Investment Services, Inc., BBVA Investments Inc., BCG Securities, Inc., Beaconsfield Financial Services, Inc., Bedrock Capital Management, Inc., Bernard Herold & Co., Inc., Berthel Fisher & Company Financial Services, Inc., BI Investments LLC, Bodell Overcash Anderson & Co., Inc., Boone County National Bank, BOSC, Inc., Brecek & Young Advisors, Inc., Brighton Securities Corp., Broker Dealer Financial Services Corp., Brokers International Financial, Brokers International Financial Services LLC, Brooke Securities, Inc., Brookstreet Securities Corporation, Brown Advisory Securities LLC, Brown Lisle Cummings, Inc., Bruce A. Lefavi Securities, Inc., Buckman Buckman & Reid, Inc., Butler Freeman Tally Financial Group LLC, Butler Wick & Co., Inc., Cadaret Grant & Co., Inc., Calton & Associates, Inc., Cambridge Investment Research, Inc., Cambridge Legacy Securities LLC, Cantella & Co., Inc., Cantella & Company, Capital Analysts, Inc., Capital Brokerage Corp., Capital Choice Financial Services, Capital City Bank, Capital Concepts Investment Corp., Capital Financial Services, Inc., Capital Growth Securities LLC, Capital Investment Group, Inc., Capital Investment Services, Inc., Capital Management Securities, Inc., Capital One Bank, Capital One Investments LLC, Capital Securities of America, Inc., Capital Select I Corp., Capitol Securities Management, Inc., Carey Thomas Hoover, & Breault, Inc., Carolinas Investment Consulting LLC, CBIZ Financial Solutions, Inc., CCF Investments, Inc., CCO Investment Services Corp., Cebert Wealth Management Group, Inc., Centaurus Financial, Inc., Centennial Securities Company LLC, Central Bank, Century Securities Associates, Inc., CFD Investments, Inc., CFG Financial Associates, Inc., Charter One Financial, Inc., Chase Investments Services, Corp., Chemical Bank & Trust Co., Chemical Bank West, Chicago Investment Group LLC, CIG Securities, Citicorp Financial Services Corporation, Citigroup Global Markets Inc., Citizens Bank, Citizens Financial Services FSB, Citizens Investment Services Corp., Citizens National Bank, City Bank, City Securities Corporation, Clearing Services of America, Inc., Coburn & Meredith, Inc., Colonial Brokerage, Inc., Comerica Securities, Commerce Brokerage Services, Inc., Commerce Capital Markets, Inc., Commonwealth Financial Network, Commonwealth Investment Services, Inc., Community Bank, Community Bankers Securities LLC, Community Investment Services, Inc., Community National Bank, Compak Securities, Inc., Compass Brokerage, Inc., Comprehensive Asset Management Servicing, Inc., Contemporary Financial Solutions, Coordinated Capital Securities, Inc., Cornerstone Financial Services, Inc., Country Club Financial Services, Inc., Countrywide Investment Services, Inc., Crews & Associates, Inc., Cri Securities LLC, Crowell, Weedon & Co., Crown Capital Securities LLP, CUE Financial Group, Inc., Cuna Brokerage Services, Inc., CUSO Financial Services LP, Cutter & Company, Inc., CW Securities LLC, D.A. Davidson & Co., Daiwa Securities America Inc., Davenport & Company LLC, David A. Noyes & Company, Delta Equity Services Corporation, Delta Trust Investments, Inc., Dempsey Financial Network, Inc., Deutsche Bank Securities Inc., DFC Investor Services, Diversified Securities, Inc., Dominion Investor Services, Inc., Dorn & Co., Inc., Dortch Securities & Investments, Inc., Dougherty & Company LLC, Duerr Financial Corporation, Eagle One Investments LLC, Economy Securities, Inc., EDI Financial, Inc., Edward Jones, Effingham State Bank, EK Riley Investments LLC, Emergent Financial Group, Inc., Emerson Equity LLC, Empire Financial Group, Inc., Empire Securities Corp., Ensemble Financial Services, Inc., EPlanning Securities, Inc., Equable Securities Corp., Equitas America LLC, Equity Services, Inc., Essex Financial Services, Inc., Essex National Securities, Inc., Essex Securities LLC, Excel Securities & Associates, Inc., Fairport Capital, Inc., Farmers National Bank, Feltl & Company, Fenwick Securities, Inc., Ferris, Baker, Watts, Inc., FFP Securities, Inc., Fidelity Bank, Fidelity Brokerage Services LLC, Fidelity Federal Bank & Trust, Fiducial Investments Advisors, Inc., Fifth Third Securities, Inc., Financial Design, Inc., Financial Network Investment Corp., Financial Planning Consultants, Inc., Financial Security Management, Inc., Financial Telesis, Inc., Financial West Group, Fintegra LLC, First Allied Securities, Inc., First American Bank, First Bank, First Bank & Trust, First Brokerage America, First Brokerage America LLC, First Busy Securities, Inc., First Citizens Bank, First Citizens Financial Plus, Inc., First Citizens Investor Services, Inc., First Citizens National Bank, First Coast Financial Advisors LLC, First Colonial Group Inc., First Community Bank, N.A., First Dallas Securities Inc., First Federal Bank, First Fidelity Securities, First Financial Equity Corp., First Global Securities, Inc., First Heartland Capital, Inc., First Independent Financial Services, Inc., First MidAmerica Investment Corp., First Montauk Securities Corp., First National Bank, First National Investment Services Company LLC, First Northern Bank, First Place Bank, First Security Bank, First Southeast Investor Services, Inc., First Southwest Company, First St.Louis Securities, Inc., First Tennessee Brokerage, Inc., First Wall Street Corp., First Western Securities, Inc., FirstMerit Securities, Inc., Fiserv Brokerage Services, Inc., Fiserv, Inc., Florida Investment Advisers, FNB Brokerage Services, Inc., FNIC FID Div., Focused Investments, Folger Nolan Fleming Douglas Inc., Foothill Securities, Inc., Foresters Equity Services, Inc., Fortune Financial Services, Inc., Founders Financial Securities LLC, Fox & Company Investments Inc., Franklin Templeton Financial Services Corp., Frost Brokerage Services, Inc., FSC Securities Corp., FSIC, Fulcrum Securities, Inc., G & W Equity Sales, Inc., GBS Financial Corp., Geneos Wealth Management, Inc., Genworth Financial Securities Corp., GIA Financial Group LLC, Girard Securities Inc., Glencrest Insurance Services, Global Brokerage Services, Inc., GMS Group LLC, Gold Coast Securities, Inc., Granite Securities LLC, Grant Bettingen, Inc., Great American Advisors, Inc., Great American Investors, Inc., Great Lakes Capital Financial Service Inc., Great Northern Financial Services, Gregory J. Schwartz & Co., Inc., Gunnallen Financial, Inc., GWN Securities, Inc., H&R Block Financial Advisors, Inc., H. Beck, Inc., H.D.Vest Investment Services., HAAS Financial Products, Inc., Hagar Financial Corporation, Hancock Bank, Hancock Investment Services, Inc., Harbor Financial Services LLC, Harbour Investments, Inc., Harger and Company, Inc., Harold Dance Investments, Harris Investor Services, Inc., Hartford Equity Sales Company Inc., Hartford Investment Financial Services LLC, Harvest Capital LLC, Hawthorne Securities Corporation, Hazard & Siegel, Inc., HBW Securities LLC, Heartland Bank, Heartland Investment Associates, Inc., Hefren-Tillotson, Inc., Heim Young & Associates, Inc., Heritage Bank, Hibernia National Bank, Home Savings Bank 4 ------------------------------------------------------------------------------- Hornor Townsend & Kent, Inc., Horwitz & Associates, Inc., HSBC Bank International, HSBC Securities (USA) Inc., Huntington Securities Corp., Huntington Investment Co., Huntington National Bank, Huntleigh Securities Corporation, IBC Bank, IBC Investments, IBN Financial Services, Inc., ICBA Financial Services Corporation, IFC Holdings, IFG Network Securities, Inc., IFMG Securities, Inc., IMS Securities, Inc., Independent Bank, Independent Financial Group LLC, Independent Financial Securities, Inc., INFINEX Investments, Inc., ING Financial Advisers LLC, ING Financial Partners, Inc., Innovative Solutions Insurance Services, Intercarolina Financial Services, Inc., Interlink Securities Corp., International Assets Advisory LLC, International Research Securities, Inc., Intersecurities, Inc., Intrust Brokerage Inc., Invesmart Securities LLC, Invest Financial Corporation, Investacorp, Inc., Investment Centers Of America, Inc., Investment Management Service, Inc., Investment Planners, Inc., Investment Professionals Inc., Investment Security Corporation, Investors Capital Corp., Investors Security Company, Inc., Iowa State Bank, Iron Street Securities, Inc., Ironstone Securities, Inc., J.B. Hanauer & Co., J.P. Morgan Securities, Inc., J.P. Turner & Company LLC, J.W. Cole Financial, Inc., Jack V. Butterfield Investment Company, James I. Black & Company, Janney Montgomery Scott LLC, Jefferson Pilot Securities Corporation, Jesup & Lamont Securities Corp., Joseph Stevens & Co., Inc., K.W. Brown Investments, Kalos Capital, Inc., Kaplan & Co., Securities Inc., KCD Financial, Inc., Key Investment Services LLC, Kinecta Financial & Insurance Services LLC, KMS Financial Services, Inc., Kovack Securities Inc., Lara, Shull & May, Ltd., Lasalle Financial Services, Inc., Lasalle St Securities LLC, Legacy Asset Securities, Inc., Legacy Financial Services, Inc., Legend Equities Corporation, Legg Mason Investor Services LLC, Leigh Baldwin & Co., LLC, Leonard & Company, Lesko Securities Inc., Lexington Investment Company, Inc., Liberty Group LLC, Lifemark Securities Corp., Lincoln Financial Advisors Corporation, Lincoln Investment Planning, Inc., Linsco/Private Ledger/Bank Div., Long Island Financial Group, Inc., Lord Abbett Distributor LLC, LPL Financial Corporation, M Holdings Securities, Inc., M&I Brokerage Services, Inc., M&T Securities, Inc., M. Griffith Investment Services, Inc., M.L. Stern & Co., LLC, Main Street Securities LLC, Manarin Securities Corporation, Marketing One Securities, Marquette Capital Partners, Inc., MBM Securities, Inc., McGinn, Smith & Co., Inc., McGrath Financial & Retirement Services, Inc., Means Investment Co., Inc., Medallion Investment Services, Inc., Merrill Lynch, Pierce, Fenner & Smith, Inc., Merrimac Corporate Securities, Inc., Merrimack Valley Investment, Inc., Mesirow Financial, Inc., Metlife Securities Inc., MFS Fund Distributors, Inc., Mid Atlantic Capital Corporation, MidAmerica Financial Services, Inc., Milestone Financial Services, Inc., Milkie/Ferguson Investments, Inc., MML Investors Services, Inc., Maloney Securities Co., Inc., Money Concepts Capital Corp., Money Management Advisory, Inc., Moors & Cabot, Inc., Morgan Keegan & Company, Inc., Morgan Stanley & Co., Inc., Morris Group, Inc., MSCS Financial Services LLC, Multi-Financial Securities Corp., Multiple Financial Services, Inc., Mutual Funds Associates Inc., Mutual Of Omaha Investor Services, Inc., Mutual Securities, Inc., Mutual Services Corp., MWA Financial Services Inc., NAST, NatCity Investments, Inc., National Advisers Trust Company FSB, National Financial Services LLC, National Investor Service Corporation, National Planning Corporation, National Securities Corporation, Nations Financial Group, Inc., NAVA, Navy Federal Brokerage Services LLC, Navy Federal Credit Union, NBC Securities, Inc., Neidiger Tucker Bruner, Inc., Nelson Securities Inc., New England Securities, NewAlliance Investments, Inc., Newbridge Securities Corporation, Next Financial Group, Inc., NFB Investment Services Corp., NFP Securities, Inc., North Ridge Securities Corp., Northeast Securities, Inc., Northern Trust Securities, Inc., Northwestern Mutual Investment Services LLC, Nutmeg Securities, Ltd., O Bee Credit Union, Oak Tree Securities, Inc., Oberlin Financial Corporation, OFG Financial Services, Inc., Ogilvie Security Advisors Corporation, Ohio National Equities, Inc., Ohio Savings Securities, Inc., Olde Economie Financial Consultants, Ltd., Omega Securities, Inc., Omni Brokerage, Inc., ONE Investment Services, Inc., OneAmerica Securities, Inc., Online Brokerage Services, Oppenheimer & Co. Inc., Orange County Teachers Federal Credit Union, P & A Financial Securities, Inc., Pacific Financial Associates, Inc., Pacific West Securities, Inc., Packerland Brokerage Services, Inc., Park Avenue Securities LLC, Partners Investment Network, Inc., Partnervest Securities, Inc., Paulson Investment Company Inc., Paychex Securities Corporation, Penn Plaza Brokerage, Ltd., Pension Planners Securities, Inc., Pension Financial Services, Inc., Peoples Bank, Peoples Securities, Inc., Perryman Securities, Inc., Pershing LLC, PFIC Securities Corp., Planmember Securities Corp., Planned Investment Co., Inc., PMK Securities & Research Inc., PNC Investments LLC, Pointe Capital, Inc., Pratt, Kutzke & Associates LLP, Preferred Financial Group, Premier Credit Union, Prime Capital Services, Inc., Primesolutions Securities, Inc., Primevest Financial Services, Inc., Princor Financial, Service Corp., Private Consulting Group, Inc., ProEquities, Inc., Professional Asset Management, Inc., Prospera Financial Services, Inc., Protected Investors of America, Provident Bank, PTS Brokerage LLC, Purshe Kaplan Sterling Investments, Putnam Retail Management Limited Partnership, Pyramid Funds, Corp., QA3 Financial Corp., Quest Capital Strategies, Inc., Quest Securities, Inc., Questar Capital Corporation, R. Seelaus & Company Inc., R.M. Stark & Co., Inc., Raymond James & Associates, Inc., Raymond James FID Division, Raymond James Financial Services, Inc., RBC Centura Securities, Inc., RBC Dain Rauscher Inc., Regal Securities, Inc., Reliance Securities LLC, Resource Horizons Group LLC, Rhodes Securities, Inc., Rice Pontes Capital, Inc., Ridgeway & Conger, Inc., River City Bank, Riverstone Wealth Management, Inc., RNR Securities LLC, Robert B. Ausdal & Co., Inc., Robert W. Baird & Co. Inc., Robinson & Robinson, Inc., Rogan & Associates, Inc., Rogan, Rosenberg & Associates, Inc., Royal Alliance Associates, Inc., Royal Securities Company, Rydex Distributors, Inc., S.C. Parker & Co., Inc., S.G. Long & Company, Safe Credit Union, Sage, Rutty & Co., Inc., Sammons Securities Company LLC, San Mateo Credit Union, Sanders Morris Harris Group Inc., Saxony Securities, Inc., SCF Securities, Inc., Scott & Stringfellow, Inc., Seacoast Investor Services Inc., Securian Financial Services, Inc., Securities America, Inc., Securities Service Network, Inc., SEI Financial Services, Inc., Sentinel Securities, Inc., Sentra Securities Corp., Shepard & Vrbanac Sec., Inc., Shields & Company, SIG Brokerage, L.P., Sigma Financial Corporation, Signal Securities, Inc., Signator Investors Inc., Signature Bank, Signature Financial Group, Inc., SII Investments, Inc., Sisk Investment Services, Inc., Smith Hayes Financial Services Corp., Sorrento Pacific Financial LLC, Source Capital Group, Inc., South Valley Wealth Management, Southeast Investments, N.C., Inc., Southwest 5 ------------------------------------------------------------------------------- Securities, Inc., Spectrum Capital, Inc., Spelman & Co., Inc., Spina Financial, Stanford Group Company, Stephen A. Kohn & Associates, Ltd., Stephens, Inc., Sterling Savings Bank, Sterne Agee & Leach, Inc., Steven L. Falk & Assoc., Inc., Stifel Nicolaus & Co., Inc., Strand Atkinson Williams & York, Inc., Strategic Alliance Corp., Stuart Securities Corp., Summark Financial Services, Summit Bank, Summit Brokerage Services Inc., Summit Equities, Inc., Sunset Financial Services, Inc., SunStreet Securities LLC, SunTrust Investment Services, Inc., SWBC Investment Services LLC, SWS Financial Services, Symetra Investment Services Inc., Synergy Investment Group LLC, Synovus Securities, Inc., T.J. Raney & Sons, Inc., T.S. Phillips Investments, Inc., TD Ameritrade, Inc., Teckmeyer Financial Services LLC, TFS Securities, Inc., The Concord Equity Group LLC, The Huntington Investment Company, The O.N. Equity Sales Company, Thoroughbred Financial Services LLC, Thrasher & Company, Inc., Thrivent Investment Management Inc., Thurston Springer Miller, Herd & Titak, Inc., TimeCapital Securities Corp., Touchstone Financial Group LLC, Tower Square Securities, Inc., Traderight Securities, Inc., Transamerica Financial Advisors, Inc., Triad Advisors, Inc., Trustfirst, Trustmark Securities, Inc., Trustmont Financial Group, Inc., U.S. Bancorp Investments, Inc., UBOC Investment Services, Inc., UBS Financial Services, Inc., UBS International, Inc., UCB Investment Services, Inc., UMB Financial Services, Inc., Unified Financial Securities, Inc., Union Capital Company, UnionBanc Investment Services, UnionBanc Investment Services LLC, United Bank, United Brokerage Services, Inc., United Community Bank, United Financial Group, Ltd., United Global Securities, Inc., United Heritage Financial Group, United Planners' Financial Services of America A Limited Partner, United Securities Alliance, Inc., Univest Investments, Inc., USA Financial Securities, Corp., USLIFE Equity Sales, UVEST Financial Services Group, Inc., Valmark Securities, Inc., Van Kampen Funds, Inc., Vanderbilt Securities LLC, VBC Securities LLC, Venture Bank, Veritrust Financial LLC, VFinance Investments, Inc., Vision Investment Services, Inc., Vorpahl Wing Securities, VSR Financial Services, Inc., W. R. Taylor & Company LLC, Wachovia Securities LSG, Wachovia Securities LLC, Wadsworth Investment Co., Inc., Wall Street Financial Group, Inc., Wallstreet Electronica, Inc., Wamu Investments, Inc., Wasserman & Associates, Inc., Waterstone Financial Group, Inc., Waveland Capital Partners LLC, Wayne Hummer Investments LLC, Webster Bank, Webster Investment Services, Inc., Wedbush Morgan Securities, Inc., Weiss Capital Securities, Inc., Weitzel Financial Services, Inc., Wells Fargo Investments LLC, Wells Fargo Securities LLC, Wellstone Securities LLC, Wesbanco Securities, Inc., Wescom Financial Services, Western International Securities, Inc., Westminster Financial Securities, Inc., WFB Wealth Management Group, WFG Investments, Inc., WFP Securities, Whitney Securities LLC, Wiley Bros.-Aintree Capital LLC, William C. Burnside & Company, Inc., Wilmington Brokerage Services Company, Woodbury Financial Services, Inc., Woodlands Securities, Corp., Woodmen Financial Services, Inc., Woodstock Financial Group, Inc., Workman Securities, Corp., World Choice Securities, Inc., World Financial Group, Inc., World Group Securities, Inc., Worth Financial Group, Inc., WRP Investments, Inc., Wunderlich Securities, Inc., XCU Capital Corp., Inc., Zions Direct, Inc., Zions Investment Securities, Inc. PERFORMANCE RELATED INFORMATION The Separate Account may advertise certain performance-related information concerning the Sub-Accounts. Performance information about a Sub-Account is based on the Sub-Account's past performance only and is no indication of future performance. TOTAL RETURN FOR ALL SUB-ACCOUNTS When a Sub-Account advertises its standardized total return, it will usually be calculated from the later of the date of the inception of the Sub-Account or Separate Account for one, five and ten year periods or some other relevant periods if the Sub-Account has not been in existence for at least ten years. Total return is measured by comparing the value of an investment in the Sub-Account at the beginning of the relevant period to the value of the investment at the end of the period. To calculate standardized total return, we use a hypothetical initial premium payment of $1,000.00 and deduct for the Total Annual Fund Operating Expenses, any Sales Charge, Separate Account Annual Expenses without any optional charge deductions and the Annual Maintenance Fee. The formula we use to calculate standardized total return is P(1+T) TO THE POWER OF n = ERV. In this calculation, "P" represents a hypothetical initial premium payment of $1,000.00, "T" represents the average annual total return, "n" represents the number of years and "ERV" represents the redeemable value at the end of the period. In addition to the standardized total return, the Sub-Account may advertise a non-standardized total return. These figures will usually be calculated from the later of the date of inception of the underlying fund or Separate Account for one, five and ten year periods or other relevant periods. Non-standardized total return is measured in the same manner as the standardized total return described above, except that the sales charge, if applicable, and the Annual Maintenance Fee are not deducted. Therefore, non-standardized total return for a Sub-Account is higher than standardized total return for a Sub-Account. YIELD FOR SUB-ACCOUNTS If applicable, the Sub-Accounts may advertise yield in addition to total return. At any time in the future, yields may be higher or lower than past yields and past performance is no indication of future performance. 6 ------------------------------------------------------------------------------- The standardized yield will be computed for periods beginning with the inception of the Sub-Account in the following manner. The net investment income per Accumulation Unit earned during a one-month period is divided by the Accumulation Unit Value on the last day of the period. The formula we use to calculate yield is: YIELD = 2[(a - b/cd +1) TO THE POWER OF 6 - 1]. In this calculation, "a" represents the net investment income earned during the period by the underlying fund, "b" represents the expenses accrued for the period, "c" represents the average daily number of Accumulation Units outstanding during the period and "d" represents the maximum offering price per Accumulation Unit on the last day of the period. MONEY MARKET SUB-ACCOUNTS At any time in the future, current and effective yields may be higher or lower than past yields and past performance is no indication of future performance. Current yield of a money market fund Sub-Account is calculated for a seven-day period or the "base period" without taking into consideration any realized or unrealized gains or losses on shares of the underlying fund. The first step in determining yield is to compute the base period return. We take a hypothetical account with a balance of one Accumulation Unit of the Sub-Account and calculates the net change in its value from the beginning of the base period to the end of the base period. We then subtract an amount equal to the total deductions for the Contract and then divides that number by the value of the account at the beginning of the base period. The result is the base period return or "BPR". Once the base period return is calculated, we then multiply it by 365/7 to compute the current yield. Current yield is calculated to the nearest hundredth of one percent. The formula for this calculation is YIELD = BPR x (365/7), where BPR = (A - B)/C. "A" is equal to the net change in value of a hypothetical account with a balance of one Accumulation Unit of the Sub-Account from the beginning of the base period to the end of the base period. "B" is equal to the amount that Hartford deducts for mortality and expense risk charge, any applicable administrative charge and the Annual Maintenance Fee. "C" represents the value of the Sub-Account at the beginning of the base period. Effective yield is also calculated using the base period return. The effective yield is calculated by adding 1 to the base period return and raising that result to a power equal to 365 divided by 7 and subtracting 1 from the result. The calculation we use is: EFFECTIVE YIELD = [(BASE PERIOD RETURN + 1) TO THE POWER OF 365/7] - 1. ADDITIONAL MATERIALS We may provide information on various topics to Contract Owners and prospective Contract Owners in advertising, sales literature or other materials. These topics may include the relationship between sectors of the economy and the economy as a whole and its effect on various securities markets, investment strategies and techniques (such as value investing, dollar cost averaging and asset allocation), the advantages and disadvantages of investing in tax-deferred and taxable instruments, customer profiles and hypothetical purchase scenarios, financial management and tax and retirement planning, and other investment alternatives, including comparisons between the Contracts and the characteristics of and market for any alternatives. PERFORMANCE COMPARISONS Each Sub-Account may from time to time include in advertisements the ranking of its performance figures compared with performance figures of other annuity contract's sub-accounts with the same investment objectives which are created by Lipper Analytical Services, Morningstar, Inc. or other recognized ranking services. 7 ------------------------------------------------------------------------------- ACCUMULATION UNIT VALUES There are several classes of Accumulation Unit Values under the Contract depending on the number of optional benefits you select. There are two tables below reflecting the Accumulation Unit Values for Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company. The tables show all classes of Accumulation Unit Values corresponding to all combinations of optional benefits. Tables showing only the highest and lowest possible Accumulation Unit Value appear in the prospectus, which assumes you select either no optional benefits or all optional benefits. HARTFORD LIFE INSURANCE COMPANY
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS BALANCED WEALTH STRATEGY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $11.910 $10.638 $9.737 of period Accumulation Unit Value at end of $12.337 $11.910 $10.638 period Number of Accumulation Units 384 99 32 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.866 $10.621 $9.734 of period Accumulation Unit Value at end of $12.268 $11.866 $10.621 period Number of Accumulation Units 40 38 10 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $11.844 $10.612 $9.732 of period Accumulation Unit Value at end of $12.233 $11.844 $10.612 period Number of Accumulation Units 92 14 4 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.801 $10.594 $9.729 of period Accumulation Unit Value at end of $12.164 $11.801 $10.594 period Number of Accumulation Units 355 209 93 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $11.801 $10.594 $9.729 of period Accumulation Unit Value at end of $12.164 $11.801 $10.594 period Number of Accumulation Units 355 209 93 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $11.736 $10.567 $9.724 of period Accumulation Unit Value at end of $12.060 $11.736 $10.567 period Number of Accumulation Units 46 42 7 outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $13.507 $11.962 $10.000 of period Accumulation Unit Value at end of $14.910 $13.507 $11.962 period Number of Accumulation Units 14 5 2 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $13.462 $11.946 $10.000 of period Accumulation Unit Value at end of $14.831 $13.462 $11.946 period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $13.439 $11.938 $10.000 of period Accumulation Unit Value at end of $14.791 $13.439 $11.938 period Number of Accumulation Units 10 2 -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $13.395 $11.922 $10.000 of period Accumulation Unit Value at end of $14.713 $13.395 $11.922 period Number of Accumulation Units 22 26 9 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $13.395 $11.922 $10.000 of period Accumulation Unit Value at end of $14.713 $13.395 $11.922 period Number of Accumulation Units 22 26 9 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $13.328 $11.899 $10.000 of period Accumulation Unit Value at end of $14.596 $13.328 $11.899 period Number of Accumulation Units 5 4 -- outstanding at end of period (in thousands)
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $10.365 -- -- (a) of period Accumulation Unit Value at end of $10.517 -- -- period Number of Accumulation Units 8 -- -- outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $10.362 -- -- (a) of period Accumulation Unit Value at end of $10.511 -- -- period Number of Accumulation Units 1 -- -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $10.360 -- -- (a) of period Accumulation Unit Value at end of $10.508 -- -- period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $10.357 -- -- (a) of period Accumulation Unit Value at end of $10.502 -- -- period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $10.357 -- -- (a) of period Accumulation Unit Value at end of $10.502 -- -- period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $10.353 -- -- (a) of period Accumulation Unit Value at end of $10.493 -- -- period Number of Accumulation Units 1 -- -- outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $14.678 $11.038 $9.315 of period Accumulation Unit Value at end of $15.252 $14.678 $11.038 period Number of Accumulation Units 1,202 751 142 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $14.624 $11.020 $9.312 of period Accumulation Unit Value at end of $15.165 $14.624 $11.020 period Number of Accumulation Units 207 187 75 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $14.597 $11.011 $9.310 of period Accumulation Unit Value at end of $15.122 $14.597 $11.011 period Number of Accumulation Units 306 130 18 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $14.544 $10.992 $9.307 of period Accumulation Unit Value at end of $15.037 $14.544 $10.992 period Number of Accumulation Units 1,278 1,036 530 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $14.544 $10.992 $9.307 of period Accumulation Unit Value at end of $15.037 $14.544 $10.992 period Number of Accumulation Units 1,278 1,036 530 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $14.464 $10.964 $9.302 of period Accumulation Unit Value at end of $14.910 $14.464 $10.964 period Number of Accumulation Units 121 117 82 outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $11.853 $10.546 $9.413 of period Accumulation Unit Value at end of $11.843 $11.853 $10.546 period Number of Accumulation Units 198 91 16 outstanding at end of period (in thousands)
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.809 $10.528 $9.409 of period Accumulation Unit Value at end of $11.776 $11.809 $10.528 period Number of Accumulation Units 12 14 12 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $11.787 $10.520 $9.408 of period Accumulation Unit Value at end of $11.742 $11.787 $10.520 period Number of Accumulation Units 49 31 1 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.744 $10.502 $9.405 of period Accumulation Unit Value at end of $11.676 $11.744 $10.502 period Number of Accumulation Units 172 76 25 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $11.744 $10.502 $9.405 of period Accumulation Unit Value at end of $11.676 $11.744 $10.502 period Number of Accumulation Units 172 76 25 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $11.680 $10.476 $9.400 of period Accumulation Unit Value at end of $11.577 $11.680 $10.476 period Number of Accumulation Units 5 3 2 outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.259 $10.293 $9.626 of period Accumulation Unit Value at end of $11.562 $12.259 $10.293 period Number of Accumulation Units 686 386 97 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $12.214 $10.275 $9.623 of period Accumulation Unit Value at end of $11.497 $12.214 $10.275 period Number of Accumulation Units 116 97 47 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $12.192 $10.267 $9.621 of period Accumulation Unit Value at end of $11.464 $12.192 $10.267 period Number of Accumulation Units 149 75 9 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $12.147 $10.250 $9.618 of period Accumulation Unit Value at end of $11.400 $12.147 $10.250 period Number of Accumulation Units 724 570 329 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $12.147 $10.250 $9.618 of period Accumulation Unit Value at end of $11.400 $12.147 $10.250 period Number of Accumulation Units 724 570 329 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $12.081 $10.224 $9.613 of period Accumulation Unit Value at end of $11.303 $12.081 $10.224 period Number of Accumulation Units 67 61 42 outstanding at end of period (in thousands) FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.414 $11.320 $9.562 of period Accumulation Unit Value at end of $14.331 $12.414 $11.320 period Number of Accumulation Units 2,886 1,381 190 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $12.369 $11.301 $9.559 of period Accumulation Unit Value at end of $14.250 $12.369 $11.301 period Number of Accumulation Units 427 350 80 outstanding at end of period (in thousands)
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.346 $11.292 $9.557 Accumulation Unit Value at end of period $14.209 $12.346 $11.292 Number of Accumulation Units outstanding at end of period (in thousands) 403 203 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.301 $11.273 $9.554 Accumulation Unit Value at end of period $14.129 $12.301 $11.273 Number of Accumulation Units outstanding at end of period (in thousands) 2,482 1,920 731 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.301 $11.273 $9.554 Accumulation Unit Value at end of period $14.129 $12.301 $11.273 Number of Accumulation Units outstanding at end of period (in thousands) 2,482 1,920 731 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.233 $11.245 $9.549 Accumulation Unit Value at end of period $14.009 $12.233 $11.245 Number of Accumulation Units outstanding at end of period (in thousands) 218 181 66 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.642 -- -- (a) Accumulation Unit Value at end of period $9.548 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.639 -- -- (a) Accumulation Unit Value at end of period $9.543 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.637 -- -- (a) Accumulation Unit Value at end of period $9.540 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.635 -- -- (a) Accumulation Unit Value at end of period $9.535 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.635 -- -- (a) Accumulation Unit Value at end of period $9.535 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.630 -- -- (a) Accumulation Unit Value at end of period $9.527 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP EQUITY-INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.249 $10.378 $9.543 Accumulation Unit Value at end of period $12.208 $12.249 $10.378 Number of Accumulation Units outstanding at end of period (in thousands) 803 422 91 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.204 $10.361 $9.540 Accumulation Unit Value at end of period $12.139 $12.204 $10.361 Number of Accumulation Units outstanding at end of period (in thousands) 127 109 59 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.181 $10.352 $9.538 Accumulation Unit Value at end of period $12.104 $12.181 $10.352 Number of Accumulation Units outstanding at end of period (in thousands) 140 79 18 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.137 $10.335 $9.535 Accumulation Unit Value at end of period $12.036 $12.137 $10.335 Number of Accumulation Units outstanding at end of period (in thousands) 749 574 331
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.137 $10.335 $9.535 Accumulation Unit Value at end of period $12.036 $12.137 $10.335 Number of Accumulation Units outstanding at end of period (in thousands) 749 574 331 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.070 $10.309 $9.530 Accumulation Unit Value at end of period $11.934 $12.070 $10.309 Number of Accumulation Units outstanding at end of period (in thousands) 85 84 42 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.145 $10.627 $9.553 Accumulation Unit Value at end of period $13.892 $11.145 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) 176 109 15 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.104 $10.609 $9.550 Accumulation Unit Value at end of period $13.814 $11.104 $10.609 Number of Accumulation Units outstanding at end of period (in thousands) 29 21 8 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.084 $10.600 $9.548 Accumulation Unit Value at end of period $13.775 $11.084 $10.600 Number of Accumulation Units outstanding at end of period (in thousands) 54 34 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.043 $10.582 $9.545 Accumulation Unit Value at end of period $13.697 $11.043 $10.582 Number of Accumulation Units outstanding at end of period (in thousands) 146 128 58 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.043 $10.582 $9.545 Accumulation Unit Value at end of period $13.697 $11.043 $10.582 Number of Accumulation Units outstanding at end of period (in thousands) 146 128 58 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.983 $10.556 $9.540 Accumulation Unit Value at end of period $13.581 $10.983 $10.556 Number of Accumulation Units outstanding at end of period (in thousands) 24 18 7 FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.362 $11.176 $9.318 Accumulation Unit Value at end of period $14.032 $12.362 $11.176 Number of Accumulation Units outstanding at end of period (in thousands) 643 399 54 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.317 $11.157 $9.314 Accumulation Unit Value at end of period $13.953 $12.317 $11.157 Number of Accumulation Units outstanding at end of period (in thousands) 94 84 24 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.294 $11.148 $9.313 Accumulation Unit Value at end of period $13.913 $12.294 $11.148 Number of Accumulation Units outstanding at end of period (in thousands) 111 87 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.249 $11.129 $9.310 Accumulation Unit Value at end of period $13.834 $12.249 $11.129 Number of Accumulation Units outstanding at end of period (in thousands) 1,037 926 348 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.249 $11.129 $9.310 Accumulation Unit Value at end of period $13.834 $12.249 $11.129 Number of Accumulation Units outstanding at end of period (in thousands) 1,037 926 348 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.182 $11.101 $9.305 Accumulation Unit Value at end of period $13.717 $12.182 $11.101 Number of Accumulation Units outstanding at end of period (in thousands) 51 46 30
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.874 $10.401 $8.953 Accumulation Unit Value at end of period $12.322 $11.874 $10.401 Number of Accumulation Units outstanding at end of period (in thousands) 40 11 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.831 $10.384 $8.950 Accumulation Unit Value at end of period $12.252 $11.831 $10.384 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.809 $10.375 $8.948 Accumulation Unit Value at end of period $12.217 $11.809 $10.375 Number of Accumulation Units outstanding at end of period (in thousands) 12 5 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.766 $10.358 $8.945 Accumulation Unit Value at end of period $12.148 $11.766 $10.358 Number of Accumulation Units outstanding at end of period (in thousands) 44 35 13 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.766 $10.358 $8.945 Accumulation Unit Value at end of period $12.148 $11.766 $10.358 Number of Accumulation Units outstanding at end of period (in thousands) 44 35 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.701 $10.332 $8.940 Accumulation Unit Value at end of period $12.045 $11.701 $10.332 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 1 HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.119 $4.699 $4.355 Accumulation Unit Value at end of period $5.372 $5.119 $4.699 Number of Accumulation Units outstanding at end of period (in thousands) 682 468 254 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.074 $4.667 $4.331 Accumulation Unit Value at end of period $5.314 $5.074 $4.667 Number of Accumulation Units outstanding at end of period (in thousands) 53 52 39 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.180 $1.087 $1.009 Accumulation Unit Value at end of period $1.235 $1.180 $1.087 Number of Accumulation Units outstanding at end of period (in thousands) 269 225 33 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.170 $1.079 $1.003 Accumulation Unit Value at end of period $1.222 $1.170 $1.079 Number of Accumulation Units outstanding at end of period (in thousands) 1,805 1,541 589 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.170 $1.079 $1.003 Accumulation Unit Value at end of period $1.222 $1.170 $1.079 Number of Accumulation Units outstanding at end of period (in thousands) 1,805 1,541 589 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.169 $1.082 $1.008 Accumulation Unit Value at end of period $1.217 $1.169 $1.082 Number of Accumulation Units outstanding at end of period (in thousands) 284 285 44 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.393 $1.259 $1.157 Accumulation Unit Value at end of period $1.485 $1.393 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 22,274 14,696 2,914
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.381 $1.250 $1.151 Accumulation Unit Value at end of period $1.469 $1.381 $1.250 Number of Accumulation Units outstanding at end of period (in thousands) 4,240 3,752 1,645 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.870 $10.758 $9.910 Accumulation Unit Value at end of period $12.618 $11.870 $10.758 Number of Accumulation Units outstanding at end of period (in thousands) 496 320 35 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.247 $1.133 $1.045 Accumulation Unit Value at end of period $1.323 $1.247 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 26,273 24,124 12,450 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.247 $1.133 $1.045 Accumulation Unit Value at end of period $1.323 $1.247 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 26,273 24,124 12,450 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.052 $0.972 Accumulation Unit Value at end of period $1.222 $1.155 $1.052 Number of Accumulation Units outstanding at end of period (in thousands) 2,878 2,553 1,677 HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.819 $3.224 $3.001 Accumulation Unit Value at end of period $4.069 $3.819 $3.224 Number of Accumulation Units outstanding at end of period (in thousands) 7,933 3,708 745 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.786 $3.202 $2.984 Accumulation Unit Value at end of period $4.025 $3.786 $3.202 Number of Accumulation Units outstanding at end of period (in thousands) 979 840 413 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.526 $1.292 $1.205 Accumulation Unit Value at end of period $1.621 $1.526 $1.292 Number of Accumulation Units outstanding at end of period (in thousands) 2,993 1,530 228 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.513 $1.284 $1.199 Accumulation Unit Value at end of period $1.604 $1.513 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 15,627 11,857 5,079 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.513 $1.284 $1.199 Accumulation Unit Value at end of period $1.604 $1.513 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 15,627 11,857 5,079 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.512 $1.287 $1.204 Accumulation Unit Value at end of period $1.598 $1.512 $1.287 Number of Accumulation Units outstanding at end of period (in thousands) 1,526 1,369 305 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.418 $1.193 $1.147 Accumulation Unit Value at end of period $1.492 $1.418 $1.193 Number of Accumulation Units outstanding at end of period (in thousands) 640 345 76 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.409 $1.188 $1.143 Accumulation Unit Value at end of period $1.480 $1.409 $1.188 Number of Accumulation Units outstanding at end of period (in thousands) 63 41 31 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.405 $1.185 $1.142 Accumulation Unit Value at end of period $1.474 $1.405 $1.185 Number of Accumulation Units outstanding at end of period (in thousands) 122 87 52
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.396 $1.180 $1.138 Accumulation Unit Value at end of period $1.462 $1.396 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 745 496 294 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.396 $1.180 $1.138 Accumulation Unit Value at end of period $1.462 $1.396 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 745 496 294 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.392 $1.180 $1.141 Accumulation Unit Value at end of period $1.453 $1.392 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 29 24 24 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.058 $0.937 Accumulation Unit Value at end of period $1.294 $1.143 $1.058 Number of Accumulation Units outstanding at end of period (in thousands) 143 17 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.133 $1.051 $0.932 Accumulation Unit Value at end of period $1.281 $1.133 $1.051 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.125 $1.045 $0.927 Accumulation Unit Value at end of period $1.271 $1.125 $1.045 Number of Accumulation Units outstanding at end of period (in thousands) 12 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.115 $1.038 $0.922 Accumulation Unit Value at end of period $1.257 $1.115 $1.038 Number of Accumulation Units outstanding at end of period (in thousands) 78 50 38 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.115 $1.038 $0.922 Accumulation Unit Value at end of period $1.257 $1.115 $1.038 Number of Accumulation Units outstanding at end of period (in thousands) 78 50 38 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.114 $1.040 $0.926 Accumulation Unit Value at end of period $1.253 $1.114 $1.040 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD GLOBAL ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.987 $1.855 $1.723 Accumulation Unit Value at end of period $2.279 $1.987 $1.855 Number of Accumulation Units outstanding at end of period (in thousands) 147 80 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.969 $1.842 $1.714 Accumulation Unit Value at end of period $2.255 $1.969 $1.842 Number of Accumulation Units outstanding at end of period (in thousands) 49 20 14 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.280 $1.199 $1.116 Accumulation Unit Value at end of period $1.464 $1.280 $1.199 Number of Accumulation Units outstanding at end of period (in thousands) 62 33 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.269 $1.191 $1.110 Accumulation Unit Value at end of period $1.449 $1.269 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 625 478 150 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.269 $1.191 $1.110 Accumulation Unit Value at end of period $1.449 $1.269 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 625 478 150
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.268 $1.194 $1.115 Accumulation Unit Value at end of period $1.444 $1.268 $1.194 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD GLOBAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.064 $1.837 $1.628 Accumulation Unit Value at end of period $2.539 $2.064 $1.837 Number of Accumulation Units outstanding at end of period (in thousands) 183 71 27 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.045 $1.824 $1.619 Accumulation Unit Value at end of period $2.512 $2.045 $1.824 Number of Accumulation Units outstanding at end of period (in thousands) 17 12 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.576 $10.336 $9.180 Accumulation Unit Value at end of period $14.203 $11.576 $10.336 Number of Accumulation Units outstanding at end of period (in thousands) 12 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.002 $1.791 $1.593 Accumulation Unit Value at end of period $2.451 $2.002 $1.791 Number of Accumulation Units outstanding at end of period (in thousands) 360 314 150 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.002 $1.791 $1.593 Accumulation Unit Value at end of period $2.451 $2.002 $1.791 Number of Accumulation Units outstanding at end of period (in thousands) 360 314 150 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.249 $1.113 Accumulation Unit Value at end of period $1.699 $1.391 $1.249 Number of Accumulation Units outstanding at end of period (in thousands) 117 109 57 HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.314 $1.277 $1.135 Accumulation Unit Value at end of period $1.510 $1.314 $1.277 Number of Accumulation Units outstanding at end of period (in thousands) 677 394 86 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.303 $1.268 $1.129 Accumulation Unit Value at end of period $1.494 $1.303 $1.268 Number of Accumulation Units outstanding at end of period (in thousands) 96 65 92 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.297 $1.264 $1.126 Accumulation Unit Value at end of period $1.486 $1.297 $1.264 Number of Accumulation Units outstanding at end of period (in thousands) 281 236 34 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.286 $1.255 $1.119 Accumulation Unit Value at end of period $1.470 $1.286 $1.255 Number of Accumulation Units outstanding at end of period (in thousands) 1,246 1,053 564 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.286 $1.255 $1.119 Accumulation Unit Value at end of period $1.470 $1.286 $1.255 Number of Accumulation Units outstanding at end of period (in thousands) 1,246 1,053 564 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.285 $1.258 $1.125 Accumulation Unit Value at end of period $1.465 $1.285 $1.258 Number of Accumulation Units outstanding at end of period (in thousands) 35 28 19
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.579 $1.432 $1.148 Accumulation Unit Value at end of period $2.014 $1.579 $1.432 Number of Accumulation Units outstanding at end of period (in thousands) 2,148 1,296 136 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.565 $1.422 $1.142 Accumulation Unit Value at end of period $1.993 $1.565 $1.422 Number of Accumulation Units outstanding at end of period (in thousands) 316 272 189 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.063 $14.611 $11.742 Accumulation Unit Value at end of period $20.435 $16.063 $14.611 Number of Accumulation Units outstanding at end of period (in thousands) 74 46 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.544 $1.408 $1.133 Accumulation Unit Value at end of period $1.961 $1.544 $1.408 Number of Accumulation Units outstanding at end of period (in thousands) 3,291 2,588 1,067 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.544 $1.408 $1.133 Accumulation Unit Value at end of period $1.961 $1.544 $1.408 Number of Accumulation Units outstanding at end of period (in thousands) 3,291 2,588 1,067 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.585 $1.449 $1.168 Accumulation Unit Value at end of period $2.006 $1.585 $1.449 Number of Accumulation Units outstanding at end of period (in thousands) 506 395 75 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.270 $1.220 Accumulation Unit Value at end of period $1.406 $1.390 $1.270 Number of Accumulation Units outstanding at end of period (in thousands) 1,866 832 222 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.378 $1.262 $1.214 Accumulation Unit Value at end of period $1.391 $1.378 $1.262 Number of Accumulation Units outstanding at end of period (in thousands) 160 129 58 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.836 $10.851 $10.443 Accumulation Unit Value at end of period $11.937 $11.836 $10.851 Number of Accumulation Units outstanding at end of period (in thousands) 38 13 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.348 $1.239 $1.194 Accumulation Unit Value at end of period $1.357 $1.348 $1.239 Number of Accumulation Units outstanding at end of period (in thousands) 2,661 1,710 694 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.239 $1.194 Accumulation Unit Value at end of period $1.357 $1.348 $1.239 Number of Accumulation Units outstanding at end of period (in thousands) 2,661 1,710 694 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.242 $1.199 Accumulation Unit Value at end of period $1.353 $1.348 $1.242 Number of Accumulation Units outstanding at end of period (in thousands) 254 218 105 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.272 $4.640 $4.321 Accumulation Unit Value at end of period $5.458 $5.272 $4.640 Number of Accumulation Units outstanding at end of period (in thousands) 134 65 20
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.225 $4.608 $4.297 Accumulation Unit Value at end of period $5.399 $5.225 $4.608 Number of Accumulation Units outstanding at end of period (in thousands) 16 14 10 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.145 $1.011 $0.943 Accumulation Unit Value at end of period $1.182 $1.145 $1.011 Number of Accumulation Units outstanding at end of period (in thousands) 92 78 37 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.135 $1.004 $0.938 Accumulation Unit Value at end of period $1.169 $1.135 $1.004 Number of Accumulation Units outstanding at end of period (in thousands) 741 608 402 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.135 $1.004 $0.938 Accumulation Unit Value at end of period $1.169 $1.135 $1.004 Number of Accumulation Units outstanding at end of period (in thousands) 741 608 402 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.134 $1.006 $0.942 Accumulation Unit Value at end of period $1.165 $1.134 $1.006 Number of Accumulation Units outstanding at end of period (in thousands) 96 103 79 HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.616 $1.324 $1.153 Accumulation Unit Value at end of period $1.971 $1.616 $1.324 Number of Accumulation Units outstanding at end of period (in thousands) 2,080 1,032 277 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.602 $1.315 $1.147 Accumulation Unit Value at end of period $1.950 $1.602 $1.315 Number of Accumulation Units outstanding at end of period (in thousands) 383 308 166 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.591 $1.307 $1.141 Accumulation Unit Value at end of period $1.935 $1.591 $1.307 Number of Accumulation Units outstanding at end of period (in thousands) 611 288 48 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.577 $1.298 $1.135 Accumulation Unit Value at end of period $1.914 $1.577 $1.298 Number of Accumulation Units outstanding at end of period (in thousands) 3,352 2,261 891 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.298 $1.135 Accumulation Unit Value at end of period $1.914 $1.577 $1.298 Number of Accumulation Units outstanding at end of period (in thousands) 3,352 2,261 891 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.301 $1.140 Accumulation Unit Value at end of period $1.907 $1.577 $1.301 Number of Accumulation Units outstanding at end of period (in thousands) 216 271 68 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.053 $1.761 Accumulation Unit Value at end of period $3.154 $2.515 $2.053 Number of Accumulation Units outstanding at end of period (in thousands) 2,854 2,023 385 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.493 $2.039 $1.752 Accumulation Unit Value at end of period $3.120 $2.493 $2.039 Number of Accumulation Units outstanding at end of period (in thousands) 517 488 221 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.387 $1.136 $0.976 Accumulation Unit Value at end of period $1.734 $1.387 $1.136 Number of Accumulation Units outstanding at end of period (in thousands) 1,078 699 84
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.375 $1.128 $0.971 Accumulation Unit Value at end of period $1.716 $1.375 $1.128 Number of Accumulation Units outstanding at end of period (in thousands) 5,382 5,163 2,732 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.128 $0.971 Accumulation Unit Value at end of period $1.716 $1.375 $1.128 Number of Accumulation Units outstanding at end of period (in thousands) 5,382 5,163 2,732 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.131 $0.975 Accumulation Unit Value at end of period $1.710 $1.375 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 593 596 463 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.247 $1.765 $1.498 Accumulation Unit Value at end of period $2.411 $2.247 $1.765 Number of Accumulation Units outstanding at end of period (in thousands) 784 355 46 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.227 $1.753 $1.490 Accumulation Unit Value at end of period $2.385 $2.227 $1.753 Number of Accumulation Units outstanding at end of period (in thousands) 107 90 19 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $2.212 $1.743 $1.482 Accumulation Unit Value at end of period $2.366 $2.212 $1.743 Number of Accumulation Units outstanding at end of period (in thousands) 227 92 29 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.193 $1.731 $1.474 Accumulation Unit Value at end of period $2.341 $2.193 $1.731 Number of Accumulation Units outstanding at end of period (in thousands) 785 585 209 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.193 $1.731 $1.474 Accumulation Unit Value at end of period $2.341 $2.193 $1.731 Number of Accumulation Units outstanding at end of period (in thousands) 785 585 209 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.192 $1.736 $1.481 Accumulation Unit Value at end of period $2.333 $2.192 $1.736 Number of Accumulation Units outstanding at end of period (in thousands) 28 30 12 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.526 -- -- (a) Accumulation Unit Value at end of period $9.804 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.523 -- -- (a) Accumulation Unit Value at end of period $9.799 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.522 -- -- (a) Accumulation Unit Value at end of period $9.796 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.519 -- -- (a) Accumulation Unit Value at end of period $9.791 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.519 -- -- (a) Accumulation Unit Value at end of period $9.791 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.515 -- -- (a) Accumulation Unit Value at end of period $9.783 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MIDCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.510 -- -- (a) Accumulation Unit Value at end of period $9.785 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.507 -- -- (a) Accumulation Unit Value at end of period $9.780 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.506 -- -- (a) Accumulation Unit Value at end of period $9.777 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.503 -- -- (a) Accumulation Unit Value at end of period $9.772 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.503 -- -- (a) Accumulation Unit Value at end of period $9.772 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.499 -- -- (a) Accumulation Unit Value at end of period $9.764 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MONEY MARKET HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.948 $1.891 $1.871 Accumulation Unit Value at end of period $2.012 $1.948 $1.891 Number of Accumulation Units outstanding at end of period (in thousands) 4,639 2,397 901 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.931 $1.878 $1.861 Accumulation Unit Value at end of period $1.991 $1.931 $1.878 Number of Accumulation Units outstanding at end of period (in thousands) 314 343 95 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.041 $1.014 $1.005 Accumulation Unit Value at end of period $1.072 $1.041 $1.014 Number of Accumulation Units outstanding at end of period (in thousands) 1,967 703 418 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.088 $1.061 $1.054 Accumulation Unit Value at end of period $1.118 $1.088 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 5,333 2,428 1,390 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.088 $1.061 $1.054 Accumulation Unit Value at end of period $1.118 $1.088 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 5,333 2,428 1,390 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.016 $0.994 $0.989 Accumulation Unit Value at end of period $1.041 $1.016 $0.994 Number of Accumulation Units outstanding at end of period (in thousands) 945 414 179
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.903 $2.818 $2.811 Accumulation Unit Value at end of period $2.954 $2.903 $2.818 Number of Accumulation Units outstanding at end of period (in thousands) 125 76 9 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.878 $2.799 $2.795 Accumulation Unit Value at end of period $2.922 $2.878 $2.799 Number of Accumulation Units outstanding at end of period (in thousands) 9 8 3 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.315 $1.280 $1.279 Accumulation Unit Value at end of period $1.334 $1.315 $1.280 Number of Accumulation Units outstanding at end of period (in thousands) 30 35 12 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.303 $1.271 $1.272 Accumulation Unit Value at end of period $1.319 $1.303 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 307 247 135 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.271 $1.272 Accumulation Unit Value at end of period $1.319 $1.303 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 307 247 135 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.275 $1.278 Accumulation Unit Value at end of period $1.315 $1.303 $1.275 Number of Accumulation Units outstanding at end of period (in thousands) 28 28 39 HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.463 -- Accumulation Unit Value at end of period $2.828 $2.515 -- Number of Accumulation Units outstanding at end of period (in thousands) 891 44 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.493 $2.444 -- Accumulation Unit Value at end of period $2.797 $2.493 -- Number of Accumulation Units outstanding at end of period (in thousands) 52 27 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.748 $1.714 -- Accumulation Unit Value at end of period $1.959 $1.748 -- Number of Accumulation Units outstanding at end of period (in thousands) 269 5 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.733 $1.701 -- Accumulation Unit Value at end of period $1.938 $1.733 -- Number of Accumulation Units outstanding at end of period (in thousands) 697 58 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.733 $1.701 -- Accumulation Unit Value at end of period $1.938 $1.733 -- Number of Accumulation Units outstanding at end of period (in thousands) 697 58 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.368 -- Accumulation Unit Value at end of period $1.551 $1.391 -- Number of Accumulation Units outstanding at end of period (in thousands) 22 -- -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.403 $1.334 $1.140 Accumulation Unit Value at end of period $1.356 $1.403 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 1,345 833 300
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.391 $1.325 $1.133 Accumulation Unit Value at end of period $1.341 $1.391 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 145 150 58 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.059 $13.410 $11.474 Accumulation Unit Value at end of period $13.541 $14.059 $13.410 Number of Accumulation Units outstanding at end of period (in thousands) 33 37 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.373 $1.312 $1.124 Accumulation Unit Value at end of period $1.320 $1.373 $1.312 Number of Accumulation Units outstanding at end of period (in thousands) 1,625 1,417 1,101 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.373 $1.312 $1.124 Accumulation Unit Value at end of period $1.320 $1.373 $1.312 Number of Accumulation Units outstanding at end of period (in thousands) 1,625 1,417 1,101 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.409 $1.350 $1.159 Accumulation Unit Value at end of period $1.350 $1.409 $1.350 Number of Accumulation Units outstanding at end of period (in thousands) 155 99 91 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.324 -- -- (a) Accumulation Unit Value at end of period $9.109 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.322 -- -- (a) Accumulation Unit Value at end of period $9.104 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.320 -- -- (a) Accumulation Unit Value at end of period $9.101 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.318 -- -- (a) Accumulation Unit Value at end of period $9.096 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.318 -- -- (a) Accumulation Unit Value at end of period $9.096 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.314 -- -- (a) Accumulation Unit Value at end of period $9.088 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD STOCK HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $6.573 $5.825 $5.211 Accumulation Unit Value at end of period $6.850 $6.573 $5.825 Number of Accumulation Units outstanding at end of period (in thousands) 286 169 51 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $6.515 $5.785 $5.183 Accumulation Unit Value at end of period $6.776 $6.515 $5.785 Number of Accumulation Units outstanding at end of period (in thousands) 98 82 60 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.100 $0.978 $0.877 Accumulation Unit Value at end of period $1.143 $1.100 $0.978 Number of Accumulation Units outstanding at end of period (in thousands) 365 276 151
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.090 $0.971 $0.872 Accumulation Unit Value at end of period $1.131 $1.090 $0.971 Number of Accumulation Units outstanding at end of period (in thousands) 1,927 1,773 646 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.971 $0.872 Accumulation Unit Value at end of period $1.131 $1.090 $0.971 Number of Accumulation Units outstanding at end of period (in thousands) 1,927 1,773 646 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.974 $0.876 Accumulation Unit Value at end of period $1.127 $1.090 $0.974 Number of Accumulation Units outstanding at end of period (in thousands) 130 102 47 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.174 $3.077 $3.066 Accumulation Unit Value at end of period $3.269 $3.174 $3.077 Number of Accumulation Units outstanding at end of period (in thousands) 12,395 6,762 1,443 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.146 $3.056 $3.049 Accumulation Unit Value at end of period $3.234 $3.146 $3.056 Number of Accumulation Units outstanding at end of period (in thousands) 1,952 1,609 766 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.445 $13.075 $13.053 Accumulation Unit Value at end of period $13.808 $13.445 $13.075 Number of Accumulation Units outstanding at end of period (in thousands) 437 223 35 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.407 $1.371 $1.370 Accumulation Unit Value at end of period $1.442 $1.407 $1.371 Number of Accumulation Units outstanding at end of period (in thousands) 27,554 21,004 10,572 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.407 $1.371 $1.370 Accumulation Unit Value at end of period $1.442 $1.407 $1.371 Number of Accumulation Units outstanding at end of period (in thousands) 27,554 21,004 10,572 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.489 $1.456 $1.458 Accumulation Unit Value at end of period $1.522 $1.489 $1.456 Number of Accumulation Units outstanding at end of period (in thousands) 2,013 1,586 834 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.105 $1.080 $1.081 Accumulation Unit Value at end of period $1.135 $1.105 $1.080 Number of Accumulation Units outstanding at end of period (in thousands) 18,579 9,068 1,727 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.095 $1.072 $1.075 Accumulation Unit Value at end of period $1.123 $1.095 $1.072 Number of Accumulation Units outstanding at end of period (in thousands) 2,346 1,747 690 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.091 $1.069 $1.072 Accumulation Unit Value at end of period $1.117 $1.091 $1.069 Number of Accumulation Units outstanding at end of period (in thousands) 3,285 1,438 143 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.081 $1.061 $1.066 Accumulation Unit Value at end of period $1.105 $1.081 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 18,961 13,122 6,010 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.061 $1.066 Accumulation Unit Value at end of period $1.105 $1.081 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 18,961 13,122 6,010
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.064 $1.071 Accumulation Unit Value at end of period $1.101 $1.081 $1.064 Number of Accumulation Units outstanding at end of period (in thousands) 1,610 1,268 693 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.337 $1.115 $1.037 Accumulation Unit Value at end of period $1.433 $1.337 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) 2,425 167 81 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.325 $1.107 $1.031 Accumulation Unit Value at end of period $1.418 $1.325 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 101 27 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.316 $1.101 $1.026 Accumulation Unit Value at end of period $1.407 $1.316 $1.101 Number of Accumulation Units outstanding at end of period (in thousands) 527 33 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.304 $1.093 $1.020 Accumulation Unit Value at end of period $1.392 $1.304 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 2,342 789 421 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.093 $1.020 Accumulation Unit Value at end of period $1.392 $1.304 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 2,342 789 421 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.096 $1.025 Accumulation Unit Value at end of period $1.387 $1.304 $1.096 Number of Accumulation Units outstanding at end of period (in thousands) 154 126 3 HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.622 $1.385 $1.237 Accumulation Unit Value at end of period $1.496 $1.622 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 910 480 135 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.608 $1.375 $1.230 Accumulation Unit Value at end of period $1.480 $1.608 $1.375 Number of Accumulation Units outstanding at end of period (in thousands) 171 159 92 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $18.244 $15.622 $13.976 Accumulation Unit Value at end of period $16.774 $18.244 $15.622 Number of Accumulation Units outstanding at end of period (in thousands) 27 6 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.587 $1.362 $1.220 Accumulation Unit Value at end of period $1.456 $1.587 $1.362 Number of Accumulation Units outstanding at end of period (in thousands) 2,848 1,769 650 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.587 $1.362 $1.220 Accumulation Unit Value at end of period $1.456 $1.587 $1.362 Number of Accumulation Units outstanding at end of period (in thousands) 2,848 1,769 650 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.628 $1.401 $1.258 Accumulation Unit Value at end of period $1.490 $1.628 $1.401 Number of Accumulation Units outstanding at end of period (in thousands) 334 289 167
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.889 $10.538 $9.508 Accumulation Unit Value at end of period $12.486 $11.889 $10.538 Number of Accumulation Units outstanding at end of period (in thousands) 91 51 10 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.845 $10.520 $9.505 Accumulation Unit Value at end of period $12.416 $11.845 $10.520 Number of Accumulation Units outstanding at end of period (in thousands) 13 15 6 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.823 $10.511 $9.503 Accumulation Unit Value at end of period $12.381 $11.823 $10.511 Number of Accumulation Units outstanding at end of period (in thousands) 25 13 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.780 $10.493 $9.500 Accumulation Unit Value at end of period $12.311 $11.780 $10.493 Number of Accumulation Units outstanding at end of period (in thousands) 53 46 24 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.780 $10.493 $9.500 Accumulation Unit Value at end of period $12.311 $11.780 $10.493 Number of Accumulation Units outstanding at end of period (in thousands) 53 46 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.715 $10.467 $9.495 Accumulation Unit Value at end of period $12.206 $11.715 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) 13 13 4 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.511 $10.211 $9.642 Accumulation Unit Value at end of period $11.687 $11.511 $10.211 Number of Accumulation Units outstanding at end of period (in thousands) 47 34 9 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.469 $10.194 $9.638 Accumulation Unit Value at end of period $11.620 $11.469 $10.194 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.448 $10.185 $9.637 Accumulation Unit Value at end of period $11.588 $11.448 $10.185 Number of Accumulation Units outstanding at end of period (in thousands) 9 6 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.406 $10.168 $9.633 Accumulation Unit Value at end of period $11.522 $11.406 $10.168 Number of Accumulation Units outstanding at end of period (in thousands) 142 85 33 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.406 $10.168 $9.633 Accumulation Unit Value at end of period $11.522 $11.406 $10.168 Number of Accumulation Units outstanding at end of period (in thousands) 142 85 33 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.343 $10.142 $9.628 Accumulation Unit Value at end of period $11.424 $11.343 $10.142 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.702 $9.946 $9.561 Accumulation Unit Value at end of period $11.183 $10.702 $9.946 Number of Accumulation Units outstanding at end of period (in thousands) 283 114 10
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.662 $9.930 $9.557 Accumulation Unit Value at end of period $11.120 $10.662 $9.930 Number of Accumulation Units outstanding at end of period (in thousands) 23 12 8 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.643 $9.921 $9.556 Accumulation Unit Value at end of period $11.088 $10.643 $9.921 Number of Accumulation Units outstanding at end of period (in thousands) 61 12 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.604 $9.905 $9.552 Accumulation Unit Value at end of period $11.026 $10.604 $9.905 Number of Accumulation Units outstanding at end of period (in thousands) 395 211 52 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.604 $9.905 $9.552 Accumulation Unit Value at end of period $11.026 $10.604 $9.905 Number of Accumulation Units outstanding at end of period (in thousands) 395 211 52 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.545 $9.880 $9.547 Accumulation Unit Value at end of period $10.932 $10.545 $9.880 Number of Accumulation Units outstanding at end of period (in thousands) 32 26 16 LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.770 $10.198 $9.583 Accumulation Unit Value at end of period $11.982 $11.770 $10.198 Number of Accumulation Units outstanding at end of period (in thousands) 1,421 600 30 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.727 $10.181 $9.580 Accumulation Unit Value at end of period $11.914 $11.727 $10.181 Number of Accumulation Units outstanding at end of period (in thousands) 146 124 47 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.705 $10.173 $9.578 Accumulation Unit Value at end of period $11.880 $11.705 $10.173 Number of Accumulation Units outstanding at end of period (in thousands) 253 149 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.662 $10.156 $9.575 Accumulation Unit Value at end of period $11.813 $11.662 $10.156 Number of Accumulation Units outstanding at end of period (in thousands) 898 651 166 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.662 $10.156 $9.575 Accumulation Unit Value at end of period $11.813 $11.662 $10.156 Number of Accumulation Units outstanding at end of period (in thousands) 898 651 166 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.598 $10.130 $9.570 Accumulation Unit Value at end of period $11.713 $11.598 $10.130 Number of Accumulation Units outstanding at end of period (in thousands) 79 95 9 LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.758 $10.581 $10.000 Accumulation Unit Value at end of period $12.807 $11.758 $10.581 Number of Accumulation Units outstanding at end of period (in thousands) 43 28 9 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.719 $10.567 $10.000 Accumulation Unit Value at end of period $12.739 $11.719 $10.567 Number of Accumulation Units outstanding at end of period (in thousands) 13 12 8 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.700 $10.560 $10.000 Accumulation Unit Value at end of period $12.705 $11.700 $10.560 Number of Accumulation Units outstanding at end of period (in thousands) 15 3 --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.661 $10.546 $10.000 Accumulation Unit Value at end of period $12.637 $11.661 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 22 16 5 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.661 $10.546 $10.000 Accumulation Unit Value at end of period $12.637 $11.661 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 22 16 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.603 $10.525 $10.000 Accumulation Unit Value at end of period $12.537 $11.603 $10.525 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.159 $10.530 $9.696 Accumulation Unit Value at end of period $12.504 $11.159 $10.530 Number of Accumulation Units outstanding at end of period (in thousands) 539 254 44 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.118 $10.512 $9.693 Accumulation Unit Value at end of period $12.433 $11.118 $10.512 Number of Accumulation Units outstanding at end of period (in thousands) 76 68 39 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.097 $10.504 $9.691 Accumulation Unit Value at end of period $12.398 $11.097 $10.504 Number of Accumulation Units outstanding at end of period (in thousands) 105 57 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.057 $10.486 $9.688 Accumulation Unit Value at end of period $12.328 $11.057 $10.486 Number of Accumulation Units outstanding at end of period (in thousands) 512 401 190 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.057 $10.486 $9.688 Accumulation Unit Value at end of period $12.328 $11.057 $10.486 Number of Accumulation Units outstanding at end of period (in thousands) 512 401 190 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.996 $10.460 $9.683 Accumulation Unit Value at end of period $12.223 $10.996 $10.460 Number of Accumulation Units outstanding at end of period (in thousands) 52 44 20 OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.219 $11.445 $9.607 Accumulation Unit Value at end of period $13.801 $13.219 $11.445 Number of Accumulation Units outstanding at end of period (in thousands) 1,829 771 42 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.171 $11.426 $9.604 Accumulation Unit Value at end of period $13.723 $13.171 $11.426 Number of Accumulation Units outstanding at end of period (in thousands) 207 173 44 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.147 $11.417 $9.602 Accumulation Unit Value at end of period $13.684 $13.147 $11.417 Number of Accumulation Units outstanding at end of period (in thousands) 274 159 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.098 $11.397 $9.599 Accumulation Unit Value at end of period $13.606 $13.098 $11.397 Number of Accumulation Units outstanding at end of period (in thousands) 1,106 927 219 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.098 $11.397 $9.599 Accumulation Unit Value at end of period $13.606 $13.098 $11.397 Number of Accumulation Units outstanding at end of period (in thousands) 1,106 927 219
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.026 $11.369 $9.594 Accumulation Unit Value at end of period $13.491 $13.026 $11.369 Number of Accumulation Units outstanding at end of period (in thousands) 118 90 18 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.757 $10.410 $9.592 Accumulation Unit Value at end of period $12.051 $11.757 $10.410 Number of Accumulation Units outstanding at end of period (in thousands) 79 56 9 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.714 $10.393 $9.589 Accumulation Unit Value at end of period $11.982 $11.714 $10.393 Number of Accumulation Units outstanding at end of period (in thousands) 9 6 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.692 $10.384 $9.587 Accumulation Unit Value at end of period $11.948 $11.692 $10.384 Number of Accumulation Units outstanding at end of period (in thousands) 47 21 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.649 $10.366 $9.584 Accumulation Unit Value at end of period $11.881 $11.649 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 267 188 54 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.649 $10.366 $9.584 Accumulation Unit Value at end of period $11.881 $11.649 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 267 188 54 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.585 $10.340 $9.579 Accumulation Unit Value at end of period $11.780 $11.585 $10.340 Number of Accumulation Units outstanding at end of period (in thousands) 31 32 12 OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.292 $10.893 $9.300 Accumulation Unit Value at end of period $11.929 $12.292 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 767 425 69 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.247 $10.875 $9.297 Accumulation Unit Value at end of period $11.861 $12.247 $10.875 Number of Accumulation Units outstanding at end of period (in thousands) 135 111 38 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.224 $10.866 $9.295 Accumulation Unit Value at end of period $11.827 $12.224 $10.866 Number of Accumulation Units outstanding at end of period (in thousands) 158 84 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.179 $10.848 $9.292 Accumulation Unit Value at end of period $11.760 $12.179 $10.848 Number of Accumulation Units outstanding at end of period (in thousands) 841 670 253 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.179 $10.848 $9.292 Accumulation Unit Value at end of period $11.760 $12.179 $10.848 Number of Accumulation Units outstanding at end of period (in thousands) 841 670 253 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.113 $10.821 $9.287 Accumulation Unit Value at end of period $11.661 $12.113 $10.821 Number of Accumulation Units outstanding at end of period (in thousands) 68 57 34
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.168 $11.049 $9.483 Accumulation Unit Value at end of period $11.654 $11.168 $11.049 Number of Accumulation Units outstanding at end of period (in thousands) 29 15 4 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.127 $11.031 $9.480 Accumulation Unit Value at end of period $11.588 $11.127 $11.031 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.106 $11.022 $9.478 Accumulation Unit Value at end of period $11.555 $11.106 $11.022 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.065 $11.003 $9.475 Accumulation Unit Value at end of period $11.490 $11.065 $11.003 Number of Accumulation Units outstanding at end of period (in thousands) 23 21 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.065 $11.003 $9.475 Accumulation Unit Value at end of period $11.490 $11.065 $11.003 Number of Accumulation Units outstanding at end of period (in thousands) 23 21 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.005 $10.975 $9.470 Accumulation Unit Value at end of period $11.392 $11.005 $10.975 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 2 PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $17.671 $16.893 $16.626 Accumulation Unit Value at end of period $18.109 $17.671 $16.893 Number of Accumulation Units outstanding at end of period (in thousands) 228 114 15 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.802 $13.221 $13.029 Accumulation Unit Value at end of period $14.116 $13.802 $13.221 Number of Accumulation Units outstanding at end of period (in thousands) 16 11 10 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.060 $13.481 $13.295 Accumulation Unit Value at end of period $14.366 $14.060 $13.481 Number of Accumulation Units outstanding at end of period (in thousands) 45 5 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $17.285 $16.607 $16.399 Accumulation Unit Value at end of period $17.625 $17.285 $16.607 Number of Accumulation Units outstanding at end of period (in thousands) 121 105 28 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.285 $16.607 $16.399 Accumulation Unit Value at end of period $17.625 $17.285 $16.607 Number of Accumulation Units outstanding at end of period (in thousands) 121 105 28 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.716 $13.218 $13.078 Accumulation Unit Value at end of period $13.944 $13.716 $13.218 Number of Accumulation Units outstanding at end of period (in thousands) 59 14 9 PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $36.452 $32.820 $30.837 Accumulation Unit Value at end of period $36.928 $36.452 $32.820 Number of Accumulation Units outstanding at end of period (in thousands) 7 4 --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.004 $9.927 $9.340 Accumulation Unit Value at end of period $11.125 $11.004 $9.927 Number of Accumulation Units outstanding at end of period (in thousands) 6 4 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.462 $10.351 $9.744 Accumulation Unit Value at end of period $11.576 $11.462 $10.351 Number of Accumulation Units outstanding at end of period (in thousands) 6 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $35.656 $32.264 $30.415 Accumulation Unit Value at end of period $35.941 $35.656 $32.264 Number of Accumulation Units outstanding at end of period (in thousands) 13 12 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $35.656 $32.264 $30.415 Accumulation Unit Value at end of period $35.941 $35.656 $32.264 Number of Accumulation Units outstanding at end of period (in thousands) 13 12 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.181 $10.148 $9.585 Accumulation Unit Value at end of period $11.237 $11.181 $10.148 Number of Accumulation Units outstanding at end of period (in thousands) 10 10 5 PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $57.815 $50.684 $47.143 Accumulation Unit Value at end of period $53.461 $57.815 $50.684 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.034 $12.327 $11.482 Accumulation Unit Value at end of period $12.951 $14.034 $12.327 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.454 $10.950 $10.206 Accumulation Unit Value at end of period $11.481 $12.454 $10.950 Number of Accumulation Units outstanding at end of period (in thousands) 18 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $56.552 $49.825 $46.499 Accumulation Unit Value at end of period $52.033 $56.552 $49.825 Number of Accumulation Units outstanding at end of period (in thousands) 9 8 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $56.552 $49.825 $46.499 Accumulation Unit Value at end of period $52.033 $56.552 $49.825 Number of Accumulation Units outstanding at end of period (in thousands) 9 8 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.149 $10.736 $10.039 Accumulation Unit Value at end of period $11.145 $12.149 $10.736 Number of Accumulation Units outstanding at end of period (in thousands) 13 10 1 PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.003 $19.096 $16.749 Accumulation Unit Value at end of period $25.598 $24.003 $19.096 Number of Accumulation Units outstanding at end of period (in thousands) 375 241 53 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.328 $8.233 $7.231 Accumulation Unit Value at end of period $10.992 $10.328 $8.233 Number of Accumulation Units outstanding at end of period (in thousands) 177 161 79 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.875 $10.274 $9.029 Accumulation Unit Value at end of period $13.690 $12.875 $10.274 Number of Accumulation Units outstanding at end of period (in thousands) 158 106 15
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $23.478 $18.773 $16.520 Accumulation Unit Value at end of period $24.914 $23.478 $18.773 Number of Accumulation Units outstanding at end of period (in thousands) 371 350 205 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $23.478 $18.773 $16.520 Accumulation Unit Value at end of period $24.914 $23.478 $18.773 Number of Accumulation Units outstanding at end of period (in thousands) 371 350 205 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.560 $10.073 $8.882 Accumulation Unit Value at end of period $13.288 $12.560 $10.073 Number of Accumulation Units outstanding at end of period (in thousands) 81 75 51 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.864 -- -- (a) Accumulation Unit Value at end of period $9.748 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.861 -- -- (a) Accumulation Unit Value at end of period $9.743 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.860 -- -- (a) Accumulation Unit Value at end of period $9.740 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.857 -- -- (a) Accumulation Unit Value at end of period $9.735 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.857 -- -- (a) Accumulation Unit Value at end of period $9.735 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.853 -- -- (a) Accumulation Unit Value at end of period $9.726 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INVESTORS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.876 $9.700 $8.601 Accumulation Unit Value at end of period $10.150 $10.876 $9.700 Number of Accumulation Units outstanding at end of period (in thousands) 341 25 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $7.509 $6.711 $5.958 Accumulation Unit Value at end of period $6.994 $7.509 $6.711 Number of Accumulation Units outstanding at end of period (in thousands) 19 6 5 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $8.087 $7.235 $6.428 Accumulation Unit Value at end of period $7.525 $8.087 $7.235 Number of Accumulation Units outstanding at end of period (in thousands) 109 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.638 $9.535 $8.483 Accumulation Unit Value at end of period $9.879 $10.638 $9.535 Number of Accumulation Units outstanding at end of period (in thousands) 201 26 4 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.638 $9.535 $8.483 Accumulation Unit Value at end of period $9.879 $10.638 $9.535 Number of Accumulation Units outstanding at end of period (in thousands) 201 26 4
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $7.890 $7.093 $6.323 Accumulation Unit Value at end of period $7.304 $7.890 $7.093 Number of Accumulation Units outstanding at end of period (in thousands) 26 21 10 PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $21.580 $18.901 $17.431 Accumulation Unit Value at end of period $20.199 $21.580 $18.901 Number of Accumulation Units outstanding at end of period (in thousands) 48 17 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $19.821 $17.395 $16.064 Accumulation Unit Value at end of period $18.516 $19.821 $17.395 Number of Accumulation Units outstanding at end of period (in thousands) 35 32 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.321 $14.338 $13.249 Accumulation Unit Value at end of period $15.231 $16.321 $14.338 Number of Accumulation Units outstanding at end of period (in thousands) 12 13 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $21.108 $18.581 $17.193 Accumulation Unit Value at end of period $19.659 $21.108 $18.581 Number of Accumulation Units outstanding at end of period (in thousands) 71 57 5 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.108 $18.581 $17.193 Accumulation Unit Value at end of period $19.659 $21.108 $18.581 Number of Accumulation Units outstanding at end of period (in thousands) 71 57 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.921 $14.057 $13.033 Accumulation Unit Value at end of period $14.784 $15.921 $14.057 Number of Accumulation Units outstanding at end of period (in thousands) 17 15 11 PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $26.199 $22.697 $19.908 Accumulation Unit Value at end of period $22.504 $26.199 $22.697 Number of Accumulation Units outstanding at end of period (in thousands) 242 149 20 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $24.301 $21.094 $18.527 Accumulation Unit Value at end of period $20.832 $24.301 $21.094 Number of Accumulation Units outstanding at end of period (in thousands) 54 43 14 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $23.195 $20.154 $17.713 Accumulation Unit Value at end of period $19.863 $23.195 $20.154 Number of Accumulation Units outstanding at end of period (in thousands) 66 45 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $25.627 $22.312 $19.636 Accumulation Unit Value at end of period $21.902 $25.627 $22.312 Number of Accumulation Units outstanding at end of period (in thousands) 284 251 99 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $25.627 $22.312 $19.636 Accumulation Unit Value at end of period $21.902 $25.627 $22.312 Number of Accumulation Units outstanding at end of period (in thousands) 284 251 99 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $22.627 $19.760 $17.424 Accumulation Unit Value at end of period $19.281 $22.627 $19.760 Number of Accumulation Units outstanding at end of period (in thousands) 50 44 23
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.365 $12.134 $11.639 Accumulation Unit Value at end of period $13.278 $13.365 $12.134 Number of Accumulation Units outstanding at end of period (in thousands) 27 8 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.090 $12.818 $12.311 Accumulation Unit Value at end of period $13.971 $14.090 $12.818 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.801 $11.657 $11.203 Accumulation Unit Value at end of period $12.680 $12.801 $11.657 Number of Accumulation Units outstanding at end of period (in thousands) 31 16 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.073 $11.929 $11.480 Accumulation Unit Value at end of period $12.924 $13.073 $11.929 Number of Accumulation Units outstanding at end of period (in thousands) 23 17 8 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.073 $11.929 $11.480 Accumulation Unit Value at end of period $12.924 $13.073 $11.929 Number of Accumulation Units outstanding at end of period (in thousands) 23 17 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.487 $11.428 $11.020 Accumulation Unit Value at end of period $12.307 $12.487 $11.428 Number of Accumulation Units outstanding at end of period (in thousands) 12 9 2 PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $15.980 $15.398 $13.196 Accumulation Unit Value at end of period $16.325 $15.980 $15.398 Number of Accumulation Units outstanding at end of period (in thousands) 2 4 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.621 $5.428 $4.658 Accumulation Unit Value at end of period $5.732 $5.621 $5.428 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $6.601 $6.379 $5.478 Accumulation Unit Value at end of period $6.723 $6.601 $6.379 Number of Accumulation Units outstanding at end of period (in thousands) 4 1 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $15.631 $15.137 $13.016 Accumulation Unit Value at end of period $15.889 $15.631 $15.137 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.631 $15.137 $13.016 Accumulation Unit Value at end of period $15.889 $15.631 $15.137 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.439 $6.255 $5.389 Accumulation Unit Value at end of period $6.526 $6.439 $6.255 Number of Accumulation Units outstanding at end of period (in thousands) 23 24 17 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $53.906 $51.952 $46.089 Accumulation Unit Value at end of period $55.979 $53.906 $51.952 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.458 $5.271 $4.682 Accumulation Unit Value at end of period $5.657 $5.458 $5.271 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $6.760 $6.535 $5.809 Accumulation Unit Value at end of period $6.999 $6.760 $6.535 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $52.728 $51.072 $45.459 Accumulation Unit Value at end of period $54.483 $52.728 $51.072 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $52.728 $51.072 $45.459 Accumulation Unit Value at end of period $54.483 $52.728 $51.072 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.595 $6.407 $5.714 Accumulation Unit Value at end of period $6.794 $6.595 $6.407 Number of Accumulation Units outstanding at end of period (in thousands) 16 20 9 VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.270 $12.052 $9.032 Accumulation Unit Value at end of period $22.490 $16.270 $12.052 Number of Accumulation Units outstanding at end of period (in thousands) 168 75 13 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.210 $12.032 $9.029 Accumulation Unit Value at end of period $22.363 $16.210 $12.032 Number of Accumulation Units outstanding at end of period (in thousands) 18 10 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.180 $12.022 $9.027 Accumulation Unit Value at end of period $22.299 $16.180 $12.022 Number of Accumulation Units outstanding at end of period (in thousands) 39 20 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.121 $12.002 $9.024 Accumulation Unit Value at end of period $22.173 $16.121 $12.002 Number of Accumulation Units outstanding at end of period (in thousands) 224 152 25 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.121 $12.002 $9.024 Accumulation Unit Value at end of period $22.173 $16.121 $12.002 Number of Accumulation Units outstanding at end of period (in thousands) 224 152 25 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.032 $11.972 $9.020 Accumulation Unit Value at end of period $21.986 $16.032 $11.972 Number of Accumulation Units outstanding at end of period (in thousands) 16 16 6 VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.601 $11.732 $9.494 Accumulation Unit Value at end of period $15.205 $12.601 $11.732 Number of Accumulation Units outstanding at end of period (in thousands) 96 29 6 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.554 $11.712 $9.491 Accumulation Unit Value at end of period $15.119 $12.554 $11.712 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.531 $11.703 $9.489 Accumulation Unit Value at end of period $15.076 $12.531 $11.703 Number of Accumulation Units outstanding at end of period (in thousands) 16 12 2
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.485 $11.683 $9.486 Accumulation Unit Value at end of period $14.991 $12.485 $11.683 Number of Accumulation Units outstanding at end of period (in thousands) 61 54 28 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.485 $11.683 $9.486 Accumulation Unit Value at end of period $14.991 $12.485 $11.683 Number of Accumulation Units outstanding at end of period (in thousands) 61 54 28 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.417 $11.654 $9.481 Accumulation Unit Value at end of period $14.864 $12.417 $11.654 Number of Accumulation Units outstanding at end of period (in thousands) 4 2 -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.952 $10.911 $9.630 Accumulation Unit Value at end of period $13.734 $12.952 $10.911 Number of Accumulation Units outstanding at end of period (in thousands) 69 31 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.905 $10.893 $9.627 Accumulation Unit Value at end of period $13.656 $12.905 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 29 25 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.881 $10.884 $9.625 Accumulation Unit Value at end of period $13.617 $12.881 $10.884 Number of Accumulation Units outstanding at end of period (in thousands) 10 4 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.834 $10.865 $9.622 Accumulation Unit Value at end of period $13.540 $12.834 $10.865 Number of Accumulation Units outstanding at end of period (in thousands) 89 62 11 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.834 $10.865 $9.622 Accumulation Unit Value at end of period $13.540 $12.834 $10.865 Number of Accumulation Units outstanding at end of period (in thousands) 89 62 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.763 $10.838 $9.617 Accumulation Unit Value at end of period $13.425 $12.763 $10.838 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 2 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.920 $14.816 $14.064 Accumulation Unit Value at end of period $16.264 $16.920 $14.816 Number of Accumulation Units outstanding at end of period (in thousands) 466 298 65 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.797 $14.737 $14.008 Accumulation Unit Value at end of period $16.113 $16.797 $14.737 Number of Accumulation Units outstanding at end of period (in thousands) 88 74 34 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.735 $14.698 $13.980 Accumulation Unit Value at end of period $16.038 $16.735 $14.698 Number of Accumulation Units outstanding at end of period (in thousands) 105 77 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.613 $14.620 $13.924 Accumulation Unit Value at end of period $15.889 $16.613 $14.620 Number of Accumulation Units outstanding at end of period (in thousands) 748 614 347 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.613 $14.620 $13.924 Accumulation Unit Value at end of period $15.889 $16.613 $14.620 Number of Accumulation Units outstanding at end of period (in thousands) 748 614 347
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.447 $14.517 $13.854 Accumulation Unit Value at end of period $15.683 $16.447 $14.517 Number of Accumulation Units outstanding at end of period (in thousands) 70 64 46 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.971 $14.870 $13.596 Accumulation Unit Value at end of period $17.123 $16.971 $14.870 Number of Accumulation Units outstanding at end of period (in thousands) 270 67 13 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.772 $14.724 $13.481 Accumulation Unit Value at end of period $16.888 $16.772 $14.724 Number of Accumulation Units outstanding at end of period (in thousands) 64 56 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.710 $14.685 $13.454 Accumulation Unit Value at end of period $16.809 $16.710 $14.685 Number of Accumulation Units outstanding at end of period (in thousands) 43 30 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.563 $14.585 $13.380 Accumulation Unit Value at end of period $16.628 $16.563 $14.585 Number of Accumulation Units outstanding at end of period (in thousands) 246 202 104 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.563 $14.585 $13.380 Accumulation Unit Value at end of period $16.628 $16.563 $14.585 Number of Accumulation Units outstanding at end of period (in thousands) 246 202 104 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.380 $14.467 $13.299 Accumulation Unit Value at end of period $16.395 $16.380 $14.467 Number of Accumulation Units outstanding at end of period (in thousands) 20 7 5
(a) Inception date November 12, 2007. HARTFORD LIFE AND ANNUITY INSURANCE COMPANY
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 --------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS BALANCED WEALTH STRATEGY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $11.910 $10.638 $9.737 of period Accumulation Unit Value at end of $12.337 $11.910 $10.638 period Number of Accumulation Units 1,977 838 136 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.866 $10.621 $9.734 of period Accumulation Unit Value at end of $12.268 $11.866 $10.621 period Number of Accumulation Units 289 231 104 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $11.844 $10.612 $9.732 of period Accumulation Unit Value at end of $12.233 $11.844 $10.612 period Number of Accumulation Units 294 129 5 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.801 $10.594 $9.729 of period Accumulation Unit Value at end of $12.164 $11.801 $10.594 period Number of Accumulation Units 1,907 1,080 384 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning $11.801 $10.594 $9.729 of period Accumulation Unit Value at end of $12.164 $11.801 $10.594 period Number of Accumulation Units 1,907 1,080 384 outstanding at end of period (in thousands)
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.736 $10.567 $9.724 Accumulation Unit Value at end of period $12.060 $11.736 $10.567 Number of Accumulation Units outstanding at end of period (in thousands) 78 51 6 ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.507 $11.962 $10.000 Accumulation Unit Value at end of period $14.910 $13.507 $11.962 Number of Accumulation Units outstanding at end of period (in thousands) 128 48 6 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.462 $11.946 $10.000 Accumulation Unit Value at end of period $14.831 $13.462 $11.946 Number of Accumulation Units outstanding at end of period (in thousands) 14 11 2 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.439 $11.938 $10.000 Accumulation Unit Value at end of period $14.791 $13.439 $11.938 Number of Accumulation Units outstanding at end of period (in thousands) 21 10 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.395 $11.922 $10.000 Accumulation Unit Value at end of period $14.713 $13.395 $11.922 Number of Accumulation Units outstanding at end of period (in thousands) 142 70 11 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.395 $11.922 $10.000 Accumulation Unit Value at end of period $14.713 $13.395 $11.922 Number of Accumulation Units outstanding at end of period (in thousands) 142 70 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.328 $11.899 $10.000 Accumulation Unit Value at end of period $14.596 $13.328 $11.899 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 1 ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.365 -- -- (a) Accumulation Unit Value at end of period $10.517 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 35 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.362 -- -- (a) Accumulation Unit Value at end of period $10.511 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.360 -- -- (a) Accumulation Unit Value at end of period $10.508 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 49 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.357 -- -- (a) Accumulation Unit Value at end of period $10.502 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 35 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.357 -- -- (a) Accumulation Unit Value at end of period $10.502 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 35 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.353 -- -- (a) Accumulation Unit Value at end of period $10.493 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $14.678 $11.038 $9.315 Accumulation Unit Value at end of period $15.252 $14.678 $11.038 Number of Accumulation Units outstanding at end of period (in thousands) 5,796 3,145 706
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.624 $11.020 $9.312 Accumulation Unit Value at end of period $15.165 $14.624 $11.020 Number of Accumulation Units outstanding at end of period (in thousands) 986 874 410 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.597 $11.011 $9.310 Accumulation Unit Value at end of period $15.122 $14.597 $11.011 Number of Accumulation Units outstanding at end of period (in thousands) 723 562 82 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.544 $10.992 $9.307 Accumulation Unit Value at end of period $15.037 $14.544 $10.992 Number of Accumulation Units outstanding at end of period (in thousands) 4,488 3,836 1,938 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.544 $10.992 $9.307 Accumulation Unit Value at end of period $15.037 $14.544 $10.992 Number of Accumulation Units outstanding at end of period (in thousands) 4,488 3,836 1,938 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.464 $10.964 $9.302 Accumulation Unit Value at end of period $14.910 $14.464 $10.964 Number of Accumulation Units outstanding at end of period (in thousands) 525 539 220 ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.853 $10.546 $9.413 Accumulation Unit Value at end of period $11.843 $11.853 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 878 369 83 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.809 $10.528 $9.409 Accumulation Unit Value at end of period $11.776 $11.809 $10.528 Number of Accumulation Units outstanding at end of period (in thousands) 84 61 21 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.787 $10.520 $9.408 Accumulation Unit Value at end of period $11.742 $11.787 $10.520 Number of Accumulation Units outstanding at end of period (in thousands) 111 58 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.744 $10.502 $9.405 Accumulation Unit Value at end of period $11.676 $11.744 $10.502 Number of Accumulation Units outstanding at end of period (in thousands) 582 367 170 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.744 $10.502 $9.405 Accumulation Unit Value at end of period $11.676 $11.744 $10.502 Number of Accumulation Units outstanding at end of period (in thousands) 582 367 170 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.680 $10.476 $9.400 Accumulation Unit Value at end of period $11.577 $11.680 $10.476 Number of Accumulation Units outstanding at end of period (in thousands) 96 65 34 ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.259 $10.293 $9.626 Accumulation Unit Value at end of period $11.562 $12.259 $10.293 Number of Accumulation Units outstanding at end of period (in thousands) 2,773 1,530 395 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.214 $10.275 $9.623 Accumulation Unit Value at end of period $11.497 $12.214 $10.275 Number of Accumulation Units outstanding at end of period (in thousands) 524 461 234 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.192 $10.267 $9.621 Accumulation Unit Value at end of period $11.464 $12.192 $10.267 Number of Accumulation Units outstanding at end of period (in thousands) 335 235 52
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.147 $10.250 $9.618 Accumulation Unit Value at end of period $11.400 $12.147 $10.250 Number of Accumulation Units outstanding at end of period (in thousands) 2,150 1,811 885 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.147 $10.250 $9.618 Accumulation Unit Value at end of period $11.400 $12.147 $10.250 Number of Accumulation Units outstanding at end of period (in thousands) 2,150 1,811 885 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.081 $10.224 $9.613 Accumulation Unit Value at end of period $11.303 $12.081 $10.224 Number of Accumulation Units outstanding at end of period (in thousands) 286 239 119 FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.414 $11.320 $9.562 Accumulation Unit Value at end of period $14.331 $12.414 $11.320 Number of Accumulation Units outstanding at end of period (in thousands) 11,162 5,354 748 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.369 $11.301 $9.559 Accumulation Unit Value at end of period $14.250 $12.369 $11.301 Number of Accumulation Units outstanding at end of period (in thousands) 1,467 1,186 468 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.346 $11.292 $9.557 Accumulation Unit Value at end of period $14.209 $12.346 $11.292 Number of Accumulation Units outstanding at end of period (in thousands) 1,401 779 87 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.301 $11.273 $9.554 Accumulation Unit Value at end of period $14.129 $12.301 $11.273 Number of Accumulation Units outstanding at end of period (in thousands) 7,943 6,032 2,199 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.301 $11.273 $9.554 Accumulation Unit Value at end of period $14.129 $12.301 $11.273 Number of Accumulation Units outstanding at end of period (in thousands) 7,943 6,032 2,199 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.233 $11.245 $9.549 Accumulation Unit Value at end of period $14.009 $12.233 $11.245 Number of Accumulation Units outstanding at end of period (in thousands) 549 512 300 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.642 -- -- (a) Accumulation Unit Value at end of period $9.548 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 4 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.639 -- -- (a) Accumulation Unit Value at end of period $9.543 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.637 -- -- (a) Accumulation Unit Value at end of period $9.540 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.635 -- -- (a) Accumulation Unit Value at end of period $9.535 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.635 -- -- (a) Accumulation Unit Value at end of period $9.535 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 2 -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.630 -- -- (a) Accumulation Unit Value at end of period $9.527 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP EQUITY-INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.249 $10.378 $9.543 Accumulation Unit Value at end of period $12.208 $12.249 $10.378 Number of Accumulation Units outstanding at end of period (in thousands) 2,463 1,476 397 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.204 $10.361 $9.540 Accumulation Unit Value at end of period $12.139 $12.204 $10.361 Number of Accumulation Units outstanding at end of period (in thousands) 524 480 247 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.181 $10.352 $9.538 Accumulation Unit Value at end of period $12.104 $12.181 $10.352 Number of Accumulation Units outstanding at end of period (in thousands) 391 234 72 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.137 $10.335 $9.535 Accumulation Unit Value at end of period $12.036 $12.137 $10.335 Number of Accumulation Units outstanding at end of period (in thousands) 2,055 1,785 897 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.137 $10.335 $9.535 Accumulation Unit Value at end of period $12.036 $12.137 $10.335 Number of Accumulation Units outstanding at end of period (in thousands) 2,055 1,785 897 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.070 $10.309 $9.530 Accumulation Unit Value at end of period $11.934 $12.070 $10.309 Number of Accumulation Units outstanding at end of period (in thousands) 292 276 112 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.145 $10.627 $9.553 Accumulation Unit Value at end of period $13.892 $11.145 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) 1,140 547 70 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.104 $10.609 $9.550 Accumulation Unit Value at end of period $13.814 $11.104 $10.609 Number of Accumulation Units outstanding at end of period (in thousands) 157 115 34 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.084 $10.600 $9.548 Accumulation Unit Value at end of period $13.775 $11.084 $10.600 Number of Accumulation Units outstanding at end of period (in thousands) 404 85 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.043 $10.582 $9.545 Accumulation Unit Value at end of period $13.697 $11.043 $10.582 Number of Accumulation Units outstanding at end of period (in thousands) 748 556 171 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.043 $10.582 $9.545 Accumulation Unit Value at end of period $13.697 $11.043 $10.582 Number of Accumulation Units outstanding at end of period (in thousands) 748 556 171 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.983 $10.556 $9.540 Accumulation Unit Value at end of period $13.581 $10.983 $10.556 Number of Accumulation Units outstanding at end of period (in thousands) 333 81 27
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.362 $11.176 $9.318 Accumulation Unit Value at end of period $14.032 $12.362 $11.176 Number of Accumulation Units outstanding at end of period (in thousands) 2,559 1,641 413 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.317 $11.157 $9.314 Accumulation Unit Value at end of period $13.953 $12.317 $11.157 Number of Accumulation Units outstanding at end of period (in thousands) 369 332 124 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.294 $11.148 $9.313 Accumulation Unit Value at end of period $13.913 $12.294 $11.148 Number of Accumulation Units outstanding at end of period (in thousands) 392 309 45 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.249 $11.129 $9.310 Accumulation Unit Value at end of period $13.834 $12.249 $11.129 Number of Accumulation Units outstanding at end of period (in thousands) 2,197 1,850 700 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.249 $11.129 $9.310 Accumulation Unit Value at end of period $13.834 $12.249 $11.129 Number of Accumulation Units outstanding at end of period (in thousands) 2,197 1,850 700 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.182 $11.101 $9.305 Accumulation Unit Value at end of period $13.717 $12.182 $11.101 Number of Accumulation Units outstanding at end of period (in thousands) 268 516 319 FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.874 $10.401 $8.953 Accumulation Unit Value at end of period $12.322 $11.874 $10.401 Number of Accumulation Units outstanding at end of period (in thousands) 310 65 16 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.831 $10.384 $8.950 Accumulation Unit Value at end of period $12.252 $11.831 $10.384 Number of Accumulation Units outstanding at end of period (in thousands) 24 17 9 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.809 $10.375 $8.948 Accumulation Unit Value at end of period $12.217 $11.809 $10.375 Number of Accumulation Units outstanding at end of period (in thousands) 89 16 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.766 $10.358 $8.945 Accumulation Unit Value at end of period $12.148 $11.766 $10.358 Number of Accumulation Units outstanding at end of period (in thousands) 369 281 158 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.766 $10.358 $8.945 Accumulation Unit Value at end of period $12.148 $11.766 $10.358 Number of Accumulation Units outstanding at end of period (in thousands) 369 281 158 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.701 $10.332 $8.940 Accumulation Unit Value at end of period $12.045 $11.701 $10.332 Number of Accumulation Units outstanding at end of period (in thousands) 69 12 3 HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.119 $4.699 $4.355 Accumulation Unit Value at end of period $5.372 $5.119 $4.699 Number of Accumulation Units outstanding at end of period (in thousands) 1,621 1,207 380
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.074 $4.667 $4.331 Accumulation Unit Value at end of period $5.314 $5.074 $4.667 Number of Accumulation Units outstanding at end of period (in thousands) 222 206 109 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.180 $1.087 $1.009 Accumulation Unit Value at end of period $1.235 $1.180 $1.087 Number of Accumulation Units outstanding at end of period (in thousands) 851 676 126 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.170 $1.079 $1.003 Accumulation Unit Value at end of period $1.222 $1.170 $1.079 Number of Accumulation Units outstanding at end of period (in thousands) 7,748 5,626 3,125 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.170 $1.079 $1.003 Accumulation Unit Value at end of period $1.222 $1.170 $1.079 Number of Accumulation Units outstanding at end of period (in thousands) 7,748 5,626 3,125 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.169 $1.082 $1.008 Accumulation Unit Value at end of period $1.217 $1.169 $1.082 Number of Accumulation Units outstanding at end of period (in thousands) 719 611 334 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.393 $1.259 $1.157 Accumulation Unit Value at end of period $1.485 $1.393 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 81,084 55,296 12,076 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.381 $1.250 $1.151 Accumulation Unit Value at end of period $1.469 $1.381 $1.250 Number of Accumulation Units outstanding at end of period (in thousands) 18,130 16,884 7,910 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.870 $10.758 $9.910 Accumulation Unit Value at end of period $12.618 $11.870 $10.758 Number of Accumulation Units outstanding at end of period (in thousands) 1,208 861 158 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.247 $1.133 $1.045 Accumulation Unit Value at end of period $1.323 $1.247 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 77,374 69,351 31,148 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.247 $1.133 $1.045 Accumulation Unit Value at end of period $1.323 $1.247 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 77,374 69,351 31,148 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.052 $0.972 Accumulation Unit Value at end of period $1.222 $1.155 $1.052 Number of Accumulation Units outstanding at end of period (in thousands) 11,291 10,039 4,391 HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.819 $3.224 $3.001 Accumulation Unit Value at end of period $4.069 $3.819 $3.224 Number of Accumulation Units outstanding at end of period (in thousands) 30,091 13,978 2,160 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.786 $3.202 $2.984 Accumulation Unit Value at end of period $4.025 $3.786 $3.202 Number of Accumulation Units outstanding at end of period (in thousands) 2,961 2,315 1,003 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.526 $1.292 $1.205 Accumulation Unit Value at end of period $1.621 $1.526 $1.292 Number of Accumulation Units outstanding at end of period (in thousands) 10,488 6,480 1,009
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.513 $1.284 $1.199 Accumulation Unit Value at end of period $1.604 $1.513 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 46,380 33,300 11,903 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.513 $1.284 $1.199 Accumulation Unit Value at end of period $1.604 $1.513 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 46,380 33,300 11,903 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.512 $1.287 $1.204 Accumulation Unit Value at end of period $1.598 $1.512 $1.287 Number of Accumulation Units outstanding at end of period (in thousands) 3,791 3,881 2,508 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.418 $1.193 $1.147 Accumulation Unit Value at end of period $1.492 $1.418 $1.193 Number of Accumulation Units outstanding at end of period (in thousands) 2,725 1,573 381 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.409 $1.188 $1.143 Accumulation Unit Value at end of period $1.480 $1.409 $1.188 Number of Accumulation Units outstanding at end of period (in thousands) 499 409 160 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.405 $1.185 $1.142 Accumulation Unit Value at end of period $1.474 $1.405 $1.185 Number of Accumulation Units outstanding at end of period (in thousands) 515 374 54 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.396 $1.180 $1.138 Accumulation Unit Value at end of period $1.462 $1.396 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 2,420 1,971 843 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.396 $1.180 $1.138 Accumulation Unit Value at end of period $1.462 $1.396 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 2,420 1,971 843 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.392 $1.180 $1.141 Accumulation Unit Value at end of period $1.453 $1.392 $1.180 Number of Accumulation Units outstanding at end of period (in thousands) 455 409 76 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.058 $0.937 Accumulation Unit Value at end of period $1.294 $1.143 $1.058 Number of Accumulation Units outstanding at end of period (in thousands) 607 257 143 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.133 $1.051 $0.932 Accumulation Unit Value at end of period $1.281 $1.133 $1.051 Number of Accumulation Units outstanding at end of period (in thousands) 77 45 17 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.125 $1.045 $0.927 Accumulation Unit Value at end of period $1.271 $1.125 $1.045 Number of Accumulation Units outstanding at end of period (in thousands) 92 33 38 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.115 $1.038 $0.922 Accumulation Unit Value at end of period $1.257 $1.115 $1.038 Number of Accumulation Units outstanding at end of period (in thousands) 547 227 42 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.115 $1.038 $0.922 Accumulation Unit Value at end of period $1.257 $1.115 $1.038 Number of Accumulation Units outstanding at end of period (in thousands) 547 227 42
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.114 $1.040 $0.926 Accumulation Unit Value at end of period $1.253 $1.114 $1.040 Number of Accumulation Units outstanding at end of period (in thousands) 163 99 95 HARTFORD GLOBAL ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.987 $1.855 $1.723 Accumulation Unit Value at end of period $2.279 $1.987 $1.855 Number of Accumulation Units outstanding at end of period (in thousands) 955 359 185 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.969 $1.842 $1.714 Accumulation Unit Value at end of period $2.255 $1.969 $1.842 Number of Accumulation Units outstanding at end of period (in thousands) 143 140 30 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.280 $1.199 $1.116 Accumulation Unit Value at end of period $1.464 $1.280 $1.199 Number of Accumulation Units outstanding at end of period (in thousands) 192 53 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.269 $1.191 $1.110 Accumulation Unit Value at end of period $1.449 $1.269 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 1,609 982 594 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.269 $1.191 $1.110 Accumulation Unit Value at end of period $1.449 $1.269 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 1,609 982 594 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.268 $1.194 $1.115 Accumulation Unit Value at end of period $1.444 $1.268 $1.194 Number of Accumulation Units outstanding at end of period (in thousands) 107 78 19 HARTFORD GLOBAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.064 $1.837 $1.628 Accumulation Unit Value at end of period $2.539 $2.064 $1.837 Number of Accumulation Units outstanding at end of period (in thousands) 2,183 1,154 292 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.045 $1.824 $1.619 Accumulation Unit Value at end of period $2.512 $2.045 $1.824 Number of Accumulation Units outstanding at end of period (in thousands) 162 108 69 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.576 $10.336 $9.180 Accumulation Unit Value at end of period $14.203 $11.576 $10.336 Number of Accumulation Units outstanding at end of period (in thousands) 238 42 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.002 $1.791 $1.593 Accumulation Unit Value at end of period $2.451 $2.002 $1.791 Number of Accumulation Units outstanding at end of period (in thousands) 2,175 1,442 568 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.002 $1.791 $1.593 Accumulation Unit Value at end of period $2.451 $2.002 $1.791 Number of Accumulation Units outstanding at end of period (in thousands) 2,175 1,442 568 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.391 $1.249 $1.113 Accumulation Unit Value at end of period $1.699 $1.391 $1.249 Number of Accumulation Units outstanding at end of period (in thousands) 1,436 379 84
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.314 $1.277 $1.135 Accumulation Unit Value at end of period $1.510 $1.314 $1.277 Number of Accumulation Units outstanding at end of period (in thousands) 4,802 2,764 992 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.303 $1.268 $1.129 Accumulation Unit Value at end of period $1.494 $1.303 $1.268 Number of Accumulation Units outstanding at end of period (in thousands) 642 565 335 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.297 $1.264 $1.126 Accumulation Unit Value at end of period $1.486 $1.297 $1.264 Number of Accumulation Units outstanding at end of period (in thousands) 779 334 125 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.286 $1.255 $1.119 Accumulation Unit Value at end of period $1.470 $1.286 $1.255 Number of Accumulation Units outstanding at end of period (in thousands) 3,223 3,395 1,850 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.286 $1.255 $1.119 Accumulation Unit Value at end of period $1.470 $1.286 $1.255 Number of Accumulation Units outstanding at end of period (in thousands) 3,223 3,395 1,850 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.285 $1.258 $1.125 Accumulation Unit Value at end of period $1.465 $1.285 $1.258 Number of Accumulation Units outstanding at end of period (in thousands) 280 191 86 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.579 $1.432 $1.148 Accumulation Unit Value at end of period $2.014 $1.579 $1.432 Number of Accumulation Units outstanding at end of period (in thousands) 16,275 6,715 1,702 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.565 $1.422 $1.142 Accumulation Unit Value at end of period $1.993 $1.565 $1.422 Number of Accumulation Units outstanding at end of period (in thousands) 1,952 1,064 235 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.063 $14.611 $11.742 Accumulation Unit Value at end of period $20.435 $16.063 $14.611 Number of Accumulation Units outstanding at end of period (in thousands) 424 83 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.544 $1.408 $1.133 Accumulation Unit Value at end of period $1.961 $1.544 $1.408 Number of Accumulation Units outstanding at end of period (in thousands) 18,737 12,160 3,838 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.544 $1.408 $1.133 Accumulation Unit Value at end of period $1.961 $1.544 $1.408 Number of Accumulation Units outstanding at end of period (in thousands) 18,737 12,160 3,838 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.585 $1.449 $1.168 Accumulation Unit Value at end of period $2.006 $1.585 $1.449 Number of Accumulation Units outstanding at end of period (in thousands) 3,271 1,160 1,327 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.270 $1.220 Accumulation Unit Value at end of period $1.406 $1.390 $1.270 Number of Accumulation Units outstanding at end of period (in thousands) 7,498 3,969 846
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.378 $1.262 $1.214 Accumulation Unit Value at end of period $1.391 $1.378 $1.262 Number of Accumulation Units outstanding at end of period (in thousands) 1,284 1,179 526 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.836 $10.851 $10.443 Accumulation Unit Value at end of period $11.937 $11.836 $10.851 Number of Accumulation Units outstanding at end of period (in thousands) 181 50 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.348 $1.239 $1.194 Accumulation Unit Value at end of period $1.357 $1.348 $1.239 Number of Accumulation Units outstanding at end of period (in thousands) 5,229 3,815 1,710 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.239 $1.194 Accumulation Unit Value at end of period $1.357 $1.348 $1.239 Number of Accumulation Units outstanding at end of period (in thousands) 5,229 3,815 1,710 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.348 $1.242 $1.199 Accumulation Unit Value at end of period $1.353 $1.348 $1.242 Number of Accumulation Units outstanding at end of period (in thousands) 764 1,347 204 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $5.272 $4.640 $4.321 Accumulation Unit Value at end of period $5.458 $5.272 $4.640 Number of Accumulation Units outstanding at end of period (in thousands) 1,315 670 99 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.225 $4.608 $4.297 Accumulation Unit Value at end of period $5.399 $5.225 $4.608 Number of Accumulation Units outstanding at end of period (in thousands) 122 86 21 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.145 $1.011 $0.943 Accumulation Unit Value at end of period $1.182 $1.145 $1.011 Number of Accumulation Units outstanding at end of period (in thousands) 948 521 498 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.135 $1.004 $0.938 Accumulation Unit Value at end of period $1.169 $1.135 $1.004 Number of Accumulation Units outstanding at end of period (in thousands) 4,604 3,765 2,169 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.135 $1.004 $0.938 Accumulation Unit Value at end of period $1.169 $1.135 $1.004 Number of Accumulation Units outstanding at end of period (in thousands) 4,604 3,765 2,169 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.134 $1.006 $0.942 Accumulation Unit Value at end of period $1.165 $1.134 $1.006 Number of Accumulation Units outstanding at end of period (in thousands) 705 702 590 HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.616 $1.324 $1.153 Accumulation Unit Value at end of period $1.971 $1.616 $1.324 Number of Accumulation Units outstanding at end of period (in thousands) 10,566 5,022 1,245 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.602 $1.315 $1.147 Accumulation Unit Value at end of period $1.950 $1.602 $1.315 Number of Accumulation Units outstanding at end of period (in thousands) 1,420 1,184 495 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.591 $1.307 $1.141 Accumulation Unit Value at end of period $1.935 $1.591 $1.307 Number of Accumulation Units outstanding at end of period (in thousands) 2,336 1,738 304
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.577 $1.298 $1.135 Accumulation Unit Value at end of period $1.914 $1.577 $1.298 Number of Accumulation Units outstanding at end of period (in thousands) 7,914 6,056 2,914 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.298 $1.135 Accumulation Unit Value at end of period $1.914 $1.577 $1.298 Number of Accumulation Units outstanding at end of period (in thousands) 7,914 6,056 2,914 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.577 $1.301 $1.140 Accumulation Unit Value at end of period $1.907 $1.577 $1.301 Number of Accumulation Units outstanding at end of period (in thousands) 1,339 981 421 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.053 $1.761 Accumulation Unit Value at end of period $3.154 $2.515 $2.053 Number of Accumulation Units outstanding at end of period (in thousands) 12,333 7,858 1,782 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.493 $2.039 $1.752 Accumulation Unit Value at end of period $3.120 $2.493 $2.039 Number of Accumulation Units outstanding at end of period (in thousands) 2,330 2,290 1,098 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.387 $1.136 $0.976 Accumulation Unit Value at end of period $1.734 $1.387 $1.136 Number of Accumulation Units outstanding at end of period (in thousands) 4,734 2,682 341 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.375 $1.128 $0.971 Accumulation Unit Value at end of period $1.716 $1.375 $1.128 Number of Accumulation Units outstanding at end of period (in thousands) 18,823 17,069 8,142 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.128 $0.971 Accumulation Unit Value at end of period $1.716 $1.375 $1.128 Number of Accumulation Units outstanding at end of period (in thousands) 18,823 17,069 8,142 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.375 $1.131 $0.975 Accumulation Unit Value at end of period $1.710 $1.375 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 3,526 2,516 1,049 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.247 $1.765 $1.498 Accumulation Unit Value at end of period $2.411 $2.247 $1.765 Number of Accumulation Units outstanding at end of period (in thousands) 5,127 2,648 526 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.227 $1.753 $1.490 Accumulation Unit Value at end of period $2.385 $2.227 $1.753 Number of Accumulation Units outstanding at end of period (in thousands) 650 622 212 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $2.212 $1.743 $1.482 Accumulation Unit Value at end of period $2.366 $2.212 $1.743 Number of Accumulation Units outstanding at end of period (in thousands) 1,068 1,001 87 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.193 $1.731 $1.474 Accumulation Unit Value at end of period $2.341 $2.193 $1.731 Number of Accumulation Units outstanding at end of period (in thousands) 5,734 5,533 2,095 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.193 $1.731 $1.474 Accumulation Unit Value at end of period $2.341 $2.193 $1.731 Number of Accumulation Units outstanding at end of period (in thousands) 5,734 5,533 2,095
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.192 $1.736 $1.481 Accumulation Unit Value at end of period $2.333 $2.192 $1.736 Number of Accumulation Units outstanding at end of period (in thousands) 915 955 170 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.526 -- -- (a) Accumulation Unit Value at end of period $9.804 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.523 -- -- (a) Accumulation Unit Value at end of period $9.799 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.522 -- -- (a) Accumulation Unit Value at end of period $9.796 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.519 -- -- (a) Accumulation Unit Value at end of period $9.791 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.519 -- -- (a) Accumulation Unit Value at end of period $9.791 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.515 -- -- (a) Accumulation Unit Value at end of period $9.783 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MIDCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.510 -- -- (a) Accumulation Unit Value at end of period $9.785 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.507 -- -- (a) Accumulation Unit Value at end of period $9.780 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.506 -- -- (a) Accumulation Unit Value at end of period $9.777 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.503 -- -- (a) Accumulation Unit Value at end of period $9.772 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.503 -- -- (a) Accumulation Unit Value at end of period $9.772 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.499 -- -- (a) Accumulation Unit Value at end of period $9.764 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD MONEY MARKET HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.948 $1.891 $1.871 Accumulation Unit Value at end of period $2.012 $1.948 $1.891 Number of Accumulation Units outstanding at end of period (in thousands) 13,113 6,472 2,184 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.931 $1.878 $1.861 Accumulation Unit Value at end of period $1.991 $1.931 $1.878 Number of Accumulation Units outstanding at end of period (in thousands) 1,356 896 605 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.041 $1.014 $1.005 Accumulation Unit Value at end of period $1.072 $1.041 $1.014 Number of Accumulation Units outstanding at end of period (in thousands) 4,138 2,832 647 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.088 $1.061 $1.054 Accumulation Unit Value at end of period $1.118 $1.088 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 19,843 7,990 4,651 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.088 $1.061 $1.054 Accumulation Unit Value at end of period $1.118 $1.088 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 19,843 7,990 4,651 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.016 $0.994 $0.989 Accumulation Unit Value at end of period $1.041 $1.016 $0.994 Number of Accumulation Units outstanding at end of period (in thousands) 1,595 828 626 HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.903 $2.818 $2.811 Accumulation Unit Value at end of period $2.954 $2.903 $2.818 Number of Accumulation Units outstanding at end of period (in thousands) 1,290 664 112 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.878 $2.799 $2.795 Accumulation Unit Value at end of period $2.922 $2.878 $2.799 Number of Accumulation Units outstanding at end of period (in thousands) 168 172 93 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.315 $1.280 $1.279 Accumulation Unit Value at end of period $1.334 $1.315 $1.280 Number of Accumulation Units outstanding at end of period (in thousands) 344 227 12 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.303 $1.271 $1.272 Accumulation Unit Value at end of period $1.319 $1.303 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 1,942 1,766 1,026 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.271 $1.272 Accumulation Unit Value at end of period $1.319 $1.303 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 1,942 1,766 1,026 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.303 $1.275 $1.278 Accumulation Unit Value at end of period $1.315 $1.303 $1.275 Number of Accumulation Units outstanding at end of period (in thousands) 60 68 17 HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.515 $2.463 -- Accumulation Unit Value at end of period $2.828 $2.515 -- Number of Accumulation Units outstanding at end of period (in thousands) 3,981 401 --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.493 $2.444 -- Accumulation Unit Value at end of period $2.797 $2.493 -- Number of Accumulation Units outstanding at end of period (in thousands) 278 21 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.748 $1.714 -- Accumulation Unit Value at end of period $1.959 $1.748 -- Number of Accumulation Units outstanding at end of period (in thousands) 1,150 148 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.733 $1.701 -- Accumulation Unit Value at end of period $1.938 $1.733 -- Number of Accumulation Units outstanding at end of period (in thousands) 4,769 848 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.733 $1.701 -- Accumulation Unit Value at end of period $1.938 $1.733 -- Number of Accumulation Units outstanding at end of period (in thousands) 4,769 848 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.716 $1.687 -- Accumulation Unit Value at end of period $1.913 $1.716 -- Number of Accumulation Units outstanding at end of period (in thousands) 1,185 410 -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.403 $1.334 $1.140 Accumulation Unit Value at end of period $1.356 $1.403 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 5,427 4,123 1,786 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.391 $1.325 $1.133 Accumulation Unit Value at end of period $1.341 $1.391 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 1,373 1,386 1,050 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.059 $13.410 $11.474 Accumulation Unit Value at end of period $13.541 $14.059 $13.410 Number of Accumulation Units outstanding at end of period (in thousands) 97 60 12 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.373 $1.312 $1.124 Accumulation Unit Value at end of period $1.320 $1.373 $1.312 Number of Accumulation Units outstanding at end of period (in thousands) 6,677 8,881 7,405 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.373 $1.312 $1.124 Accumulation Unit Value at end of period $1.320 $1.373 $1.312 Number of Accumulation Units outstanding at end of period (in thousands) 6,677 8,881 7,405 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.409 $1.350 $1.159 Accumulation Unit Value at end of period $1.350 $1.409 $1.350 Number of Accumulation Units outstanding at end of period (in thousands) 851 1,413 1,255 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.324 -- -- (a) Accumulation Unit Value at end of period $9.109 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.322 -- -- (a) Accumulation Unit Value at end of period $9.104 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.320 -- -- (a) Accumulation Unit Value at end of period $9.101 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.318 -- -- (a) Accumulation Unit Value at end of period $9.096 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.318 -- -- (a) Accumulation Unit Value at end of period $9.096 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.314 -- -- (a) Accumulation Unit Value at end of period $9.088 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD STOCK HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $6.573 $5.825 $5.211 Accumulation Unit Value at end of period $6.850 $6.573 $5.825 Number of Accumulation Units outstanding at end of period (in thousands) 1,388 941 269 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $6.515 $5.785 $5.183 Accumulation Unit Value at end of period $6.776 $6.515 $5.785 Number of Accumulation Units outstanding at end of period (in thousands) 214 217 100 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.100 $0.978 $0.877 Accumulation Unit Value at end of period $1.143 $1.100 $0.978 Number of Accumulation Units outstanding at end of period (in thousands) 857 675 98 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.090 $0.971 $0.872 Accumulation Unit Value at end of period $1.131 $1.090 $0.971 Number of Accumulation Units outstanding at end of period (in thousands) 7,939 6,544 3,903 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.971 $0.872 Accumulation Unit Value at end of period $1.131 $1.090 $0.971 Number of Accumulation Units outstanding at end of period (in thousands) 7,939 6,544 3,903 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.090 $0.974 $0.876 Accumulation Unit Value at end of period $1.127 $1.090 $0.974 Number of Accumulation Units outstanding at end of period (in thousands) 820 977 653 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $3.174 $3.077 $3.066 Accumulation Unit Value at end of period $3.269 $3.174 $3.077 Number of Accumulation Units outstanding at end of period (in thousands) 42,451 22,682 5,008 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.146 $3.056 $3.049 Accumulation Unit Value at end of period $3.234 $3.146 $3.056 Number of Accumulation Units outstanding at end of period (in thousands) 7,967 6,528 3,209 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.445 $13.075 $13.053 Accumulation Unit Value at end of period $13.808 $13.445 $13.075 Number of Accumulation Units outstanding at end of period (in thousands) 1,232 607 134 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.407 $1.371 $1.370 Accumulation Unit Value at end of period $1.442 $1.407 $1.371 Number of Accumulation Units outstanding at end of period (in thousands) 74,435 58,269 27,613 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.407 $1.371 $1.370 Accumulation Unit Value at end of period $1.442 $1.407 $1.371 Number of Accumulation Units outstanding at end of period (in thousands) 74,435 58,269 27,613
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.489 $1.456 $1.458 Accumulation Unit Value at end of period $1.522 $1.489 $1.456 Number of Accumulation Units outstanding at end of period (in thousands) 5,935 4,694 3,152 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.105 $1.080 $1.081 Accumulation Unit Value at end of period $1.135 $1.105 $1.080 Number of Accumulation Units outstanding at end of period (in thousands) 60,999 29,837 6,100 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.095 $1.072 $1.075 Accumulation Unit Value at end of period $1.123 $1.095 $1.072 Number of Accumulation Units outstanding at end of period (in thousands) 11,647 9,090 4,210 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.091 $1.069 $1.072 Accumulation Unit Value at end of period $1.117 $1.091 $1.069 Number of Accumulation Units outstanding at end of period (in thousands) 9,134 3,660 640 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.081 $1.061 $1.066 Accumulation Unit Value at end of period $1.105 $1.081 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 45,368 31,551 13,440 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.061 $1.066 Accumulation Unit Value at end of period $1.105 $1.081 $1.061 Number of Accumulation Units outstanding at end of period (in thousands) 45,368 31,551 13,440 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.081 $1.064 $1.071 Accumulation Unit Value at end of period $1.101 $1.081 $1.064 Number of Accumulation Units outstanding at end of period (in thousands) 5,303 3,695 1,449 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.337 $1.115 $1.037 Accumulation Unit Value at end of period $1.433 $1.337 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) 10,834 2,201 343 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.325 $1.107 $1.031 Accumulation Unit Value at end of period $1.418 $1.325 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 678 202 46 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.316 $1.101 $1.026 Accumulation Unit Value at end of period $1.407 $1.316 $1.101 Number of Accumulation Units outstanding at end of period (in thousands) 1,873 1,131 206 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.304 $1.093 $1.020 Accumulation Unit Value at end of period $1.392 $1.304 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 5,451 2,300 400 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.093 $1.020 Accumulation Unit Value at end of period $1.392 $1.304 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 5,451 2,300 400 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.304 $1.096 $1.025 Accumulation Unit Value at end of period $1.387 $1.304 $1.096 Number of Accumulation Units outstanding at end of period (in thousands) 1,039 709 139
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.622 $1.385 $1.237 Accumulation Unit Value at end of period $1.496 $1.622 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 11,440 5,721 1,006 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.608 $1.375 $1.230 Accumulation Unit Value at end of period $1.480 $1.608 $1.375 Number of Accumulation Units outstanding at end of period (in thousands) 1,254 1,196 225 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $18.244 $15.622 $13.976 Accumulation Unit Value at end of period $16.774 $18.244 $15.622 Number of Accumulation Units outstanding at end of period (in thousands) 90 95 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.587 $1.362 $1.220 Accumulation Unit Value at end of period $1.456 $1.587 $1.362 Number of Accumulation Units outstanding at end of period (in thousands) 11,091 10,536 2,829 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.587 $1.362 $1.220 Accumulation Unit Value at end of period $1.456 $1.587 $1.362 Number of Accumulation Units outstanding at end of period (in thousands) 11,091 10,536 2,829 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.628 $1.401 $1.258 Accumulation Unit Value at end of period $1.490 $1.628 $1.401 Number of Accumulation Units outstanding at end of period (in thousands) 442 1,341 336 LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.889 $10.538 $9.508 Accumulation Unit Value at end of period $12.486 $11.889 $10.538 Number of Accumulation Units outstanding at end of period (in thousands) 414 292 57 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.845 $10.520 $9.505 Accumulation Unit Value at end of period $12.416 $11.845 $10.520 Number of Accumulation Units outstanding at end of period (in thousands) 83 51 66 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.823 $10.511 $9.503 Accumulation Unit Value at end of period $12.381 $11.823 $10.511 Number of Accumulation Units outstanding at end of period (in thousands) 81 74 12 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.780 $10.493 $9.500 Accumulation Unit Value at end of period $12.311 $11.780 $10.493 Number of Accumulation Units outstanding at end of period (in thousands) 266 225 415 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.780 $10.493 $9.500 Accumulation Unit Value at end of period $12.311 $11.780 $10.493 Number of Accumulation Units outstanding at end of period (in thousands) 266 225 415 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.715 $10.467 $9.495 Accumulation Unit Value at end of period $12.206 $11.715 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) 58 41 14 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.511 $10.211 $9.642 Accumulation Unit Value at end of period $11.687 $11.511 $10.211 Number of Accumulation Units outstanding at end of period (in thousands) 175 92 32
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.469 $10.194 $9.638 Accumulation Unit Value at end of period $11.620 $11.469 $10.194 Number of Accumulation Units outstanding at end of period (in thousands) 35 22 15 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.448 $10.185 $9.637 Accumulation Unit Value at end of period $11.588 $11.448 $10.185 Number of Accumulation Units outstanding at end of period (in thousands) 26 12 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.406 $10.168 $9.633 Accumulation Unit Value at end of period $11.522 $11.406 $10.168 Number of Accumulation Units outstanding at end of period (in thousands) 168 112 92 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.406 $10.168 $9.633 Accumulation Unit Value at end of period $11.522 $11.406 $10.168 Number of Accumulation Units outstanding at end of period (in thousands) 168 112 92 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.343 $10.142 $9.628 Accumulation Unit Value at end of period $11.424 $11.343 $10.142 Number of Accumulation Units outstanding at end of period (in thousands) 25 22 9 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.702 $9.946 $9.561 Accumulation Unit Value at end of period $11.183 $10.702 $9.946 Number of Accumulation Units outstanding at end of period (in thousands) 1,224 528 82 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.662 $9.930 $9.557 Accumulation Unit Value at end of period $11.120 $10.662 $9.930 Number of Accumulation Units outstanding at end of period (in thousands) 143 119 74 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.643 $9.921 $9.556 Accumulation Unit Value at end of period $11.088 $10.643 $9.921 Number of Accumulation Units outstanding at end of period (in thousands) 220 65 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.604 $9.905 $9.552 Accumulation Unit Value at end of period $11.026 $10.604 $9.905 Number of Accumulation Units outstanding at end of period (in thousands) 944 552 170 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.604 $9.905 $9.552 Accumulation Unit Value at end of period $11.026 $10.604 $9.905 Number of Accumulation Units outstanding at end of period (in thousands) 944 552 170 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.545 $9.880 $9.547 Accumulation Unit Value at end of period $10.932 $10.545 $9.880 Number of Accumulation Units outstanding at end of period (in thousands) 53 28 10 LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.770 $10.198 $9.583 Accumulation Unit Value at end of period $11.982 $11.770 $10.198 Number of Accumulation Units outstanding at end of period (in thousands) 5,787 2,448 183 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.727 $10.181 $9.580 Accumulation Unit Value at end of period $11.914 $11.727 $10.181 Number of Accumulation Units outstanding at end of period (in thousands) 481 349 140 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.705 $10.173 $9.578 Accumulation Unit Value at end of period $11.880 $11.705 $10.173 Number of Accumulation Units outstanding at end of period (in thousands) 863 571 51
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.662 $10.156 $9.575 Accumulation Unit Value at end of period $11.813 $11.662 $10.156 Number of Accumulation Units outstanding at end of period (in thousands) 2,959 2,056 550 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.662 $10.156 $9.575 Accumulation Unit Value at end of period $11.813 $11.662 $10.156 Number of Accumulation Units outstanding at end of period (in thousands) 2,959 2,056 550 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.598 $10.130 $9.570 Accumulation Unit Value at end of period $11.713 $11.598 $10.130 Number of Accumulation Units outstanding at end of period (in thousands) 205 179 68 LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.758 $10.581 $10.000 Accumulation Unit Value at end of period $12.807 $11.758 $10.581 Number of Accumulation Units outstanding at end of period (in thousands) 151 79 16 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.719 $10.567 $10.000 Accumulation Unit Value at end of period $12.739 $11.719 $10.567 Number of Accumulation Units outstanding at end of period (in thousands) 40 34 17 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.700 $10.560 $10.000 Accumulation Unit Value at end of period $12.705 $11.700 $10.560 Number of Accumulation Units outstanding at end of period (in thousands) 31 16 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.661 $10.546 $10.000 Accumulation Unit Value at end of period $12.637 $11.661 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 129 118 63 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.661 $10.546 $10.000 Accumulation Unit Value at end of period $12.637 $11.661 $10.546 Number of Accumulation Units outstanding at end of period (in thousands) 129 118 63 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.603 $10.525 $10.000 Accumulation Unit Value at end of period $12.537 $11.603 $10.525 Number of Accumulation Units outstanding at end of period (in thousands) 12 17 5 OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.159 $10.530 $9.696 Accumulation Unit Value at end of period $12.504 $11.159 $10.530 Number of Accumulation Units outstanding at end of period (in thousands) 2,064 973 216 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.118 $10.512 $9.693 Accumulation Unit Value at end of period $12.433 $11.118 $10.512 Number of Accumulation Units outstanding at end of period (in thousands) 328 283 134 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.097 $10.504 $9.691 Accumulation Unit Value at end of period $12.398 $11.097 $10.504 Number of Accumulation Units outstanding at end of period (in thousands) 254 151 30 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.057 $10.486 $9.688 Accumulation Unit Value at end of period $12.328 $11.057 $10.486 Number of Accumulation Units outstanding at end of period (in thousands) 1,409 1,133 542 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.057 $10.486 $9.688 Accumulation Unit Value at end of period $12.328 $11.057 $10.486 Number of Accumulation Units outstanding at end of period (in thousands) 1,409 1,133 542
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.996 $10.460 $9.683 Accumulation Unit Value at end of period $12.223 $10.996 $10.460 Number of Accumulation Units outstanding at end of period (in thousands) 220 186 104 OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.219 $11.445 $9.607 Accumulation Unit Value at end of period $13.801 $13.219 $11.445 Number of Accumulation Units outstanding at end of period (in thousands) 6,504 3,030 344 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.171 $11.426 $9.604 Accumulation Unit Value at end of period $13.723 $13.171 $11.426 Number of Accumulation Units outstanding at end of period (in thousands) 635 500 198 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.147 $11.417 $9.602 Accumulation Unit Value at end of period $13.684 $13.147 $11.417 Number of Accumulation Units outstanding at end of period (in thousands) 874 497 50 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.098 $11.397 $9.599 Accumulation Unit Value at end of period $13.606 $13.098 $11.397 Number of Accumulation Units outstanding at end of period (in thousands) 4,104 2,945 833 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.098 $11.397 $9.599 Accumulation Unit Value at end of period $13.606 $13.098 $11.397 Number of Accumulation Units outstanding at end of period (in thousands) 4,104 2,945 833 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.026 $11.369 $9.594 Accumulation Unit Value at end of period $13.491 $13.026 $11.369 Number of Accumulation Units outstanding at end of period (in thousands) 274 207 97 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.757 $10.410 $9.592 Accumulation Unit Value at end of period $12.051 $11.757 $10.410 Number of Accumulation Units outstanding at end of period (in thousands) 439 202 35 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.714 $10.393 $9.589 Accumulation Unit Value at end of period $11.982 $11.714 $10.393 Number of Accumulation Units outstanding at end of period (in thousands) 43 35 12 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.692 $10.384 $9.587 Accumulation Unit Value at end of period $11.948 $11.692 $10.384 Number of Accumulation Units outstanding at end of period (in thousands) 47 33 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.649 $10.366 $9.584 Accumulation Unit Value at end of period $11.881 $11.649 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 211 210 95 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.649 $10.366 $9.584 Accumulation Unit Value at end of period $11.881 $11.649 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 211 210 95 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.585 $10.340 $9.579 Accumulation Unit Value at end of period $11.780 $11.585 $10.340 Number of Accumulation Units outstanding at end of period (in thousands) 40 27 14
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.292 $10.893 $9.300 Accumulation Unit Value at end of period $11.929 $12.292 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 3,542 2,022 320 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.247 $10.875 $9.297 Accumulation Unit Value at end of period $11.861 $12.247 $10.875 Number of Accumulation Units outstanding at end of period (in thousands) 588 522 180 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.224 $10.866 $9.295 Accumulation Unit Value at end of period $11.827 $12.224 $10.866 Number of Accumulation Units outstanding at end of period (in thousands) 473 313 39 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.179 $10.848 $9.292 Accumulation Unit Value at end of period $11.760 $12.179 $10.848 Number of Accumulation Units outstanding at end of period (in thousands) 2,792 2,402 793 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.179 $10.848 $9.292 Accumulation Unit Value at end of period $11.760 $12.179 $10.848 Number of Accumulation Units outstanding at end of period (in thousands) 2,792 2,402 793 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.113 $10.821 $9.287 Accumulation Unit Value at end of period $11.661 $12.113 $10.821 Number of Accumulation Units outstanding at end of period (in thousands) 325 264 85 OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.168 $11.049 $9.483 Accumulation Unit Value at end of period $11.654 $11.168 $11.049 Number of Accumulation Units outstanding at end of period (in thousands) 91 49 5 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.127 $11.031 $9.480 Accumulation Unit Value at end of period $11.588 $11.127 $11.031 Number of Accumulation Units outstanding at end of period (in thousands) 29 23 8 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.106 $11.022 $9.478 Accumulation Unit Value at end of period $11.555 $11.106 $11.022 Number of Accumulation Units outstanding at end of period (in thousands) 15 6 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.065 $11.003 $9.475 Accumulation Unit Value at end of period $11.490 $11.065 $11.003 Number of Accumulation Units outstanding at end of period (in thousands) 62 48 19 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.065 $11.003 $9.475 Accumulation Unit Value at end of period $11.490 $11.065 $11.003 Number of Accumulation Units outstanding at end of period (in thousands) 62 48 19 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.005 $10.975 $9.470 Accumulation Unit Value at end of period $11.392 $11.005 $10.975 Number of Accumulation Units outstanding at end of period (in thousands) 12 8 2 PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $17.671 $16.893 $16.626 Accumulation Unit Value at end of period $18.109 $17.671 $16.893 Number of Accumulation Units outstanding at end of period (in thousands) 917 366 90
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.802 $13.221 $13.029 Accumulation Unit Value at end of period $14.116 $13.802 $13.221 Number of Accumulation Units outstanding at end of period (in thousands) 121 100 36 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.060 $13.481 $13.295 Accumulation Unit Value at end of period $14.366 $14.060 $13.481 Number of Accumulation Units outstanding at end of period (in thousands) 167 49 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $17.285 $16.607 $16.399 Accumulation Unit Value at end of period $17.625 $17.285 $16.607 Number of Accumulation Units outstanding at end of period (in thousands) 528 342 147 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.285 $16.607 $16.399 Accumulation Unit Value at end of period $17.625 $17.285 $16.607 Number of Accumulation Units outstanding at end of period (in thousands) 528 342 147 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.716 $13.218 $13.078 Accumulation Unit Value at end of period $13.944 $13.716 $13.218 Number of Accumulation Units outstanding at end of period (in thousands) 22 17 14 PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $36.452 $32.820 $30.837 Accumulation Unit Value at end of period $36.928 $36.452 $32.820 Number of Accumulation Units outstanding at end of period (in thousands) 164 85 18 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.004 $9.927 $9.340 Accumulation Unit Value at end of period $11.125 $11.004 $9.927 Number of Accumulation Units outstanding at end of period (in thousands) 43 24 2 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.462 $10.351 $9.744 Accumulation Unit Value at end of period $11.576 $11.462 $10.351 Number of Accumulation Units outstanding at end of period (in thousands) 36 11 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $35.656 $32.264 $30.415 Accumulation Unit Value at end of period $35.941 $35.656 $32.264 Number of Accumulation Units outstanding at end of period (in thousands) 66 50 14 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $35.656 $32.264 $30.415 Accumulation Unit Value at end of period $35.941 $35.656 $32.264 Number of Accumulation Units outstanding at end of period (in thousands) 66 50 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.181 $10.148 $9.585 Accumulation Unit Value at end of period $11.237 $11.181 $10.148 Number of Accumulation Units outstanding at end of period (in thousands) 45 55 32 PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $57.815 $50.684 $47.143 Accumulation Unit Value at end of period $53.461 $57.815 $50.684 Number of Accumulation Units outstanding at end of period (in thousands) 37 18 4 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.034 $12.327 $11.482 Accumulation Unit Value at end of period $12.951 $14.034 $12.327 Number of Accumulation Units outstanding at end of period (in thousands) 21 19 6 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.454 $10.950 $10.206 Accumulation Unit Value at end of period $11.481 $12.454 $10.950 Number of Accumulation Units outstanding at end of period (in thousands) 37 17 2
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $56.552 $49.825 $46.499 Accumulation Unit Value at end of period $52.033 $56.552 $49.825 Number of Accumulation Units outstanding at end of period (in thousands) 27 22 10 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $56.552 $49.825 $46.499 Accumulation Unit Value at end of period $52.033 $56.552 $49.825 Number of Accumulation Units outstanding at end of period (in thousands) 27 22 10 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.149 $10.736 $10.039 Accumulation Unit Value at end of period $11.145 $12.149 $10.736 Number of Accumulation Units outstanding at end of period (in thousands) 21 22 14 PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.003 $19.096 $16.749 Accumulation Unit Value at end of period $25.598 $24.003 $19.096 Number of Accumulation Units outstanding at end of period (in thousands) 1,496 970 222 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.328 $8.233 $7.231 Accumulation Unit Value at end of period $10.992 $10.328 $8.233 Number of Accumulation Units outstanding at end of period (in thousands) 692 658 324 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.875 $10.274 $9.029 Accumulation Unit Value at end of period $13.690 $12.875 $10.274 Number of Accumulation Units outstanding at end of period (in thousands) 468 337 49 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $23.478 $18.773 $16.520 Accumulation Unit Value at end of period $24.914 $23.478 $18.773 Number of Accumulation Units outstanding at end of period (in thousands) 1,317 1,177 552 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $23.478 $18.773 $16.520 Accumulation Unit Value at end of period $24.914 $23.478 $18.773 Number of Accumulation Units outstanding at end of period (in thousands) 1,317 1,177 552 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.560 $10.073 $8.882 Accumulation Unit Value at end of period $13.288 $12.560 $10.073 Number of Accumulation Units outstanding at end of period (in thousands) 322 283 140 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.864 -- -- (a) Accumulation Unit Value at end of period $9.748 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.861 -- -- (a) Accumulation Unit Value at end of period $9.743 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.860 -- -- (a) Accumulation Unit Value at end of period $9.740 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 8 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.857 -- -- (a) Accumulation Unit Value at end of period $9.735 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.857 -- -- (a) Accumulation Unit Value at end of period $9.735 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 1 -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.853 -- -- (a) Accumulation Unit Value at end of period $9.726 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INVESTORS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.876 $9.700 $8.601 Accumulation Unit Value at end of period $10.150 $10.876 $9.700 Number of Accumulation Units outstanding at end of period (in thousands) 1,194 207 14 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $7.509 $6.711 $5.958 Accumulation Unit Value at end of period $6.994 $7.509 $6.711 Number of Accumulation Units outstanding at end of period (in thousands) 139 47 11 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $8.087 $7.235 $6.428 Accumulation Unit Value at end of period $7.525 $8.087 $7.235 Number of Accumulation Units outstanding at end of period (in thousands) 153 6 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.638 $9.535 $8.483 Accumulation Unit Value at end of period $9.879 $10.638 $9.535 Number of Accumulation Units outstanding at end of period (in thousands) 525 105 24 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.638 $9.535 $8.483 Accumulation Unit Value at end of period $9.879 $10.638 $9.535 Number of Accumulation Units outstanding at end of period (in thousands) 525 105 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $7.890 $7.093 $6.323 Accumulation Unit Value at end of period $7.304 $7.890 $7.093 Number of Accumulation Units outstanding at end of period (in thousands) 75 17 14 PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $21.580 $18.901 $17.431 Accumulation Unit Value at end of period $20.199 $21.580 $18.901 Number of Accumulation Units outstanding at end of period (in thousands) 157 101 27 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $19.821 $17.395 $16.064 Accumulation Unit Value at end of period $18.516 $19.821 $17.395 Number of Accumulation Units outstanding at end of period (in thousands) 44 40 8 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.321 $14.338 $13.249 Accumulation Unit Value at end of period $15.231 $16.321 $14.338 Number of Accumulation Units outstanding at end of period (in thousands) 41 18 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $21.108 $18.581 $17.193 Accumulation Unit Value at end of period $19.659 $21.108 $18.581 Number of Accumulation Units outstanding at end of period (in thousands) 169 166 106 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.108 $18.581 $17.193 Accumulation Unit Value at end of period $19.659 $21.108 $18.581 Number of Accumulation Units outstanding at end of period (in thousands) 169 166 106 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.921 $14.057 $13.033 Accumulation Unit Value at end of period $14.784 $15.921 $14.057 Number of Accumulation Units outstanding at end of period (in thousands) 25 19 16
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $26.199 $22.697 $19.908 Accumulation Unit Value at end of period $22.504 $26.199 $22.697 Number of Accumulation Units outstanding at end of period (in thousands) 1,189 721 138 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $24.301 $21.094 $18.527 Accumulation Unit Value at end of period $20.832 $24.301 $21.094 Number of Accumulation Units outstanding at end of period (in thousands) 226 206 86 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $23.195 $20.154 $17.713 Accumulation Unit Value at end of period $19.863 $23.195 $20.154 Number of Accumulation Units outstanding at end of period (in thousands) 187 144 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $25.627 $22.312 $19.636 Accumulation Unit Value at end of period $21.902 $25.627 $22.312 Number of Accumulation Units outstanding at end of period (in thousands) 1,059 1,003 450 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $25.627 $22.312 $19.636 Accumulation Unit Value at end of period $21.902 $25.627 $22.312 Number of Accumulation Units outstanding at end of period (in thousands) 1,059 1,003 450 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $22.627 $19.760 $17.424 Accumulation Unit Value at end of period $19.281 $22.627 $19.760 Number of Accumulation Units outstanding at end of period (in thousands) 162 187 67 PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.365 $12.134 $11.639 Accumulation Unit Value at end of period $13.278 $13.365 $12.134 Number of Accumulation Units outstanding at end of period (in thousands) 515 210 41 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.090 $12.818 $12.311 Accumulation Unit Value at end of period $13.971 $14.090 $12.818 Number of Accumulation Units outstanding at end of period (in thousands) 152 66 11 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.801 $11.657 $11.203 Accumulation Unit Value at end of period $12.680 $12.801 $11.657 Number of Accumulation Units outstanding at end of period (in thousands) 50 24 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.073 $11.929 $11.480 Accumulation Unit Value at end of period $12.924 $13.073 $11.929 Number of Accumulation Units outstanding at end of period (in thousands) 480 320 56 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.073 $11.929 $11.480 Accumulation Unit Value at end of period $12.924 $13.073 $11.929 Number of Accumulation Units outstanding at end of period (in thousands) 480 320 56 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.487 $11.428 $11.020 Accumulation Unit Value at end of period $12.307 $12.487 $11.428 Number of Accumulation Units outstanding at end of period (in thousands) 61 73 10 PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $15.980 $15.398 $13.196 Accumulation Unit Value at end of period $16.325 $15.980 $15.398 Number of Accumulation Units outstanding at end of period (in thousands) 38 26 8
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.621 $5.428 $4.658 Accumulation Unit Value at end of period $5.732 $5.621 $5.428 Number of Accumulation Units outstanding at end of period (in thousands) 33 34 9 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $6.601 $6.379 $5.478 Accumulation Unit Value at end of period $6.723 $6.601 $6.379 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $15.631 $15.137 $13.016 Accumulation Unit Value at end of period $15.889 $15.631 $15.137 Number of Accumulation Units outstanding at end of period (in thousands) 16 17 7 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $15.631 $15.137 $13.016 Accumulation Unit Value at end of period $15.889 $15.631 $15.137 Number of Accumulation Units outstanding at end of period (in thousands) 16 17 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.439 $6.255 $5.389 Accumulation Unit Value at end of period $6.526 $6.439 $6.255 Number of Accumulation Units outstanding at end of period (in thousands) 16 12 13 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $53.906 $51.952 $46.089 Accumulation Unit Value at end of period $55.979 $53.906 $51.952 Number of Accumulation Units outstanding at end of period (in thousands) 7 6 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.458 $5.271 $4.682 Accumulation Unit Value at end of period $5.657 $5.458 $5.271 Number of Accumulation Units outstanding at end of period (in thousands) 33 34 3 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $6.760 $6.535 $5.809 Accumulation Unit Value at end of period $6.999 $6.760 $6.535 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $52.728 $51.072 $45.459 Accumulation Unit Value at end of period $54.483 $52.728 $51.072 Number of Accumulation Units outstanding at end of period (in thousands) 14 13 7 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $52.728 $51.072 $45.459 Accumulation Unit Value at end of period $54.483 $52.728 $51.072 Number of Accumulation Units outstanding at end of period (in thousands) 14 13 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.595 $6.407 $5.714 Accumulation Unit Value at end of period $6.794 $6.595 $6.407 Number of Accumulation Units outstanding at end of period (in thousands) 14 15 17 VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.270 $12.052 $9.032 Accumulation Unit Value at end of period $22.490 $16.270 $12.052 Number of Accumulation Units outstanding at end of period (in thousands) 859 360 110 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.210 $12.032 $9.029 Accumulation Unit Value at end of period $22.363 $16.210 $12.032 Number of Accumulation Units outstanding at end of period (in thousands) 152 90 10 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.180 $12.022 $9.027 Accumulation Unit Value at end of period $22.299 $16.180 $12.022 Number of Accumulation Units outstanding at end of period (in thousands) 317 195 14
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.121 $12.002 $9.024 Accumulation Unit Value at end of period $22.173 $16.121 $12.002 Number of Accumulation Units outstanding at end of period (in thousands) 818 581 162 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.121 $12.002 $9.024 Accumulation Unit Value at end of period $22.173 $16.121 $12.002 Number of Accumulation Units outstanding at end of period (in thousands) 818 581 162 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.032 $11.972 $9.020 Accumulation Unit Value at end of period $21.986 $16.032 $11.972 Number of Accumulation Units outstanding at end of period (in thousands) 183 123 82 VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.601 $11.732 $9.494 Accumulation Unit Value at end of period $15.205 $12.601 $11.732 Number of Accumulation Units outstanding at end of period (in thousands) 400 135 21 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.554 $11.712 $9.491 Accumulation Unit Value at end of period $15.119 $12.554 $11.712 Number of Accumulation Units outstanding at end of period (in thousands) 44 37 13 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.531 $11.703 $9.489 Accumulation Unit Value at end of period $15.076 $12.531 $11.703 Number of Accumulation Units outstanding at end of period (in thousands) 276 48 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.485 $11.683 $9.486 Accumulation Unit Value at end of period $14.991 $12.485 $11.683 Number of Accumulation Units outstanding at end of period (in thousands) 249 172 72 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.485 $11.683 $9.486 Accumulation Unit Value at end of period $14.991 $12.485 $11.683 Number of Accumulation Units outstanding at end of period (in thousands) 249 172 72 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.417 $11.654 $9.481 Accumulation Unit Value at end of period $14.864 $12.417 $11.654 Number of Accumulation Units outstanding at end of period (in thousands) 147 67 14 VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.952 $10.911 $9.630 Accumulation Unit Value at end of period $13.734 $12.952 $10.911 Number of Accumulation Units outstanding at end of period (in thousands) 325 126 38 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.905 $10.893 $9.627 Accumulation Unit Value at end of period $13.656 $12.905 $10.893 Number of Accumulation Units outstanding at end of period (in thousands) 62 37 7 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.881 $10.884 $9.625 Accumulation Unit Value at end of period $13.617 $12.881 $10.884 Number of Accumulation Units outstanding at end of period (in thousands) 100 71 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.834 $10.865 $9.622 Accumulation Unit Value at end of period $13.540 $12.834 $10.865 Number of Accumulation Units outstanding at end of period (in thousands) 218 144 61 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.834 $10.865 $9.622 Accumulation Unit Value at end of period $13.540 $12.834 $10.865 Number of Accumulation Units outstanding at end of period (in thousands) 218 144 61
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.763 $10.838 $9.617 Accumulation Unit Value at end of period $13.425 $12.763 $10.838 Number of Accumulation Units outstanding at end of period (in thousands) 44 129 32 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.920 $14.816 $14.064 Accumulation Unit Value at end of period $16.264 $16.920 $14.816 Number of Accumulation Units outstanding at end of period (in thousands) 1,751 1,167 329 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.797 $14.737 $14.008 Accumulation Unit Value at end of period $16.113 $16.797 $14.737 Number of Accumulation Units outstanding at end of period (in thousands) 404 373 208 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.735 $14.698 $13.980 Accumulation Unit Value at end of period $16.038 $16.735 $14.698 Number of Accumulation Units outstanding at end of period (in thousands) 283 185 32 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.613 $14.620 $13.924 Accumulation Unit Value at end of period $15.889 $16.613 $14.620 Number of Accumulation Units outstanding at end of period (in thousands) 1,800 1,614 899 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.613 $14.620 $13.924 Accumulation Unit Value at end of period $15.889 $16.613 $14.620 Number of Accumulation Units outstanding at end of period (in thousands) 1,800 1,614 899 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.447 $14.517 $13.854 Accumulation Unit Value at end of period $15.683 $16.447 $14.517 Number of Accumulation Units outstanding at end of period (in thousands) 196 171 93 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.971 $14.870 $13.596 Accumulation Unit Value at end of period $17.123 $16.971 $14.870 Number of Accumulation Units outstanding at end of period (in thousands) 956 405 91 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.772 $14.724 $13.481 Accumulation Unit Value at end of period $16.888 $16.772 $14.724 Number of Accumulation Units outstanding at end of period (in thousands) 124 106 36 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.710 $14.685 $13.454 Accumulation Unit Value at end of period $16.809 $16.710 $14.685 Number of Accumulation Units outstanding at end of period (in thousands) 142 57 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.563 $14.585 $13.380 Accumulation Unit Value at end of period $16.628 $16.563 $14.585 Number of Accumulation Units outstanding at end of period (in thousands) 772 617 204 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.563 $14.585 $13.380 Accumulation Unit Value at end of period $16.628 $16.563 $14.585 Number of Accumulation Units outstanding at end of period (in thousands) 772 617 204 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.380 $14.467 $13.299 Accumulation Unit Value at end of period $16.395 $16.380 $14.467 Number of Accumulation Units outstanding at end of period (in thousands) 64 57 23
(a) Inception date November 12, 2007. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM THE CONTRACT OWNERS OF HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SEPARATE ACCOUNT THREE AND THE BOARD OF DIRECTORS OF HARTFORD LIFE AND ANNUITY INSURANCE COMPANY ------------------------------------------------------------------------------- We have audited the accompanying statements of assets and liabilities of each of the individual Sub-Accounts disclosed in Note 1 which comprise the Hartford Life and Annuity Insurance Company Separate Account Three (the "Account"), as of December 31, 2007, and the related statements of operations and changes in net assets for the respective stated periods then ended. These financial statements are the responsibility of the Account's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Account is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Account's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of investments owned as of December 31, 2007, by correspondence with the mutual fund companies; where replies were not received from the mutual fund companies, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of each of the individual Sub-Accounts constituting Hartford Life and Annuity Insurance Company Separate Account Three as of December 31, 2007, the results of their operations and the changes in their net assets for the respective stated periods then ended, in conformity with accounting principles generally accepted in the United States of America. /s/ Deloitte & Touche LLP Hartford, Connecticut February 20, 2008 SA-1 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class 1 -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 8,564,598 594,681 ============== ============ Cost: Class 1 -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $105,749,023 $7,970,730 ============== ============ Market Value: Class 1 -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $111,082,831 $8,759,657 Due from Hartford Life and Annuity Insurance Company 602,546 63,662 Receivable from fund shares sold -- -- Other assets -- -- -------------- ------------ Total Assets 111,685,377 8,823,319 -------------- ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- Payable for fund shares purchased 602,546 63,662 Other liabilities -- -- -------------- ------------ Total Liabilities 602,546 63,662 -------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $111,082,831 $8,759,657 ============== ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-2 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN VP INTERNATIONAL VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ---------------------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class 1 -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 15,016,715 2,301,378 10,344,843 67,066 ============== ============= ============== ============ Cost: Class 1 -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $328,706,505 $41,377,905 $142,450,055 $1,695,307 ============== ============= ============== ============ Market Value: Class 1 -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $373,615,867 $39,192,458 $142,655,382 $1,658,536 Due from Hartford Life and Annuity Insurance Company 788,353 44,878 410,348 107,510 Receivable from fund shares sold -- -- -- -- Other assets 4 -- 2 -- -------------- ------------- -------------- ------------ Total Assets 374,404,224 39,237,336 143,065,732 1,766,046 -------------- ------------- -------------- ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- -- Payable for fund shares purchased 788,353 44,878 410,348 107,510 Other liabilities -- -- -- -- -------------- ------------- -------------- ------------ Total Liabilities 788,353 44,878 410,348 107,510 -------------- ------------- -------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $373,615,871 $39,192,458 $142,655,384 $1,658,536 ============== ============= ============== ============ AMERICAN FUNDS AMERICAN FUNDS GLOBAL GROWTH AMERICAN FUNDS GROWTH-INCOME FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class 1 -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 3,466,242 7,563,609 10,818,115 Class X -- -- -- Class Y -- -- -- Other -- -- -- ============= ============== ============== Cost: Class 1 -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 $53,357,525 $345,857,766 $345,734,656 Class X -- -- -- Class Y -- -- -- Other -- -- -- ============= ============== ============== Market Value: Class 1 -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 $86,656,044 $504,644,016 $457,173,528 Class X -- -- -- Class Y -- -- -- Other -- -- -- Due from Hartford Life and Annuity Insurance Company 3,536 -- -- Receivable from fund shares sold -- 94,696 231,239 Other assets -- 3 2 ------------- -------------- -------------- Total Assets 86,659,580 504,738,715 457,404,769 ------------- -------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 94,696 231,239 Payable for fund shares purchased 3,536 -- -- Other liabilities 1 -- -- ------------- -------------- -------------- Total Liabilities 3,537 94,696 231,239 ------------- -------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $86,656,043 $504,644,019 $457,173,530 ============= ============== ==============
(a) From inception September 20, 2007 to December 31, 2007. SA-3 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL AMERICAN FUNDS CAPITALIZATION INTERNATIONAL FUND FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 8,421,253 2,429,859 Class X -- -- Class Y -- -- Other -- -- ============== ============= Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 $127,988,597 $36,739,160 Class X -- -- Class Y -- -- Other -- -- ============== ============= Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 $208,173,364 $65,484,692 Class X -- -- Class Y -- -- Other -- -- Due from Hartford Life and Annuity Insurance Company -- -- Receivable from fund shares sold 16,760 29,974 Other assets -- -- -------------- ------------- Total Assets 208,190,124 65,514,666 -------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 16,760 29,974 Payable for fund shares purchased -- -- Other liabilities 1 -- -------------- ------------- Total Liabilities 16,761 29,974 -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $208,173,363 $65,484,692 ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-4 -------------------------------------------------------------------------------
FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP EQUITY-INCOME GROWTH CONTRAFUND MID CAP SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 6,218,729 1,562,021 25,265,907 4,570,040 ============== ============= ============== ============== Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $157,740,422 $56,767,723 $780,880,515 $151,845,373 ============== ============= ============== ============== Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $146,575,445 $69,744,248 $693,801,805 $162,830,521 Due from Hartford Life and Annuity Insurance Company 312,903 -- 2,388,654 499,295 Receivable from fund shares sold -- 572,700 -- -- Other assets -- -- -- 2 -------------- ------------- -------------- -------------- Total Assets 146,888,348 70,316,948 696,190,459 163,329,818 -------------- ------------- -------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 572,701 -- -- Payable for fund shares purchased 312,903 -- 2,388,654 499,295 Other liabilities 1 -- -- -- -------------- ------------- -------------- -------------- Total Liabilities 312,904 572,701 2,388,654 499,295 -------------- ------------- -------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $146,575,444 $69,744,247 $693,801,805 $162,830,523 ============== ============= ============== ============== FIDELITY VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FIDELITY VIP APPRECIATION CAP GROWTH VALUE STRATEGIES PORTFOLIO SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- 11,416 2,544,381 Class X -- -- -- Class Y -- -- -- Other 1,363,948 -- -- ============= ========== ============= Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- $109,999 $43,883,130 Class X -- -- -- Class Y -- -- -- Other $17,888,516 -- -- ============= ========== ============= Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- $102,512 $58,291,766 Class X -- -- -- Class Y -- -- -- Other $17,213,019 -- -- Due from Hartford Life and Annuity Insurance Company 16,140 21,501 -- Receivable from fund shares sold -- -- 48,049 Other assets -- -- -- ------------- ---------- ------------- Total Assets 17,229,159 124,013 58,339,815 ------------- ---------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- 48,049 Payable for fund shares purchased 16,140 21,501 -- Other liabilities -- -- -- ------------- ---------- ------------- Total Liabilities 16,140 21,501 48,049 ------------- ---------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $17,213,019 $102,512 $58,291,766 ============= ========== =============
(a) From inception September 20, 2007 to December 31, 2007. SA-5 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
FRANKLIN STRATEGIC FRANKLIN MUTUAL INCOME SECURITIES SHARES SECURITIES FUND FUND SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 9,318,380 -- Class II -- -- Class 2 -- 8,919,387 Class X -- -- Class Y -- -- Other -- -- ============== ============== Cost: Class I -- -- Class 1 $109,969,802 -- Class II -- -- Class 2 -- $129,031,907 Class X -- -- Class Y -- -- Other -- -- ============== ============== Market Value: Class I -- -- Class 1 $119,088,892 -- Class II -- -- Class 2 -- $180,082,419 Class X -- -- Class Y -- -- Other -- -- Due from Hartford Life and Annuity Insurance Company -- -- Receivable from fund shares sold 56,597 135,308 Other assets -- -- -------------- -------------- Total Assets 119,145,489 180,217,727 -------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 56,597 135,308 Payable for fund shares purchased -- -- Other liabilities -- -- -------------- -------------- Total Liabilities 56,597 135,308 -------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $119,088,892 $180,082,419 ============== ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-6 -------------------------------------------------------------------------------
HARTFORD TEMPLETON HARTFORD LARGECAP DEVELOPING MARKETS TEMPLETON GROWTH ADVISERS GROWTH SECURITIES FUND SECURITIES FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 2,551,750 -- -- -- Class II -- -- -- -- Class 2 -- 4,060,103 -- -- Class X -- -- -- -- Class Y -- -- -- -- Other -- -- 2,432,526 4,921 ============= ============= ============= ========= Cost: Class I -- -- -- -- Class 1 $20,909,085 -- -- -- Class II -- -- -- -- Class 2 -- $45,567,102 -- -- Class X -- -- -- -- Class Y -- -- -- -- Other -- -- $55,801,999 $98,105 ============= ============= ============= ========= Market Value: Class I -- -- -- -- Class 1 $41,261,799 -- -- -- Class II -- -- -- -- Class 2 -- $62,687,989 -- -- Class X -- -- -- -- Class Y -- -- -- -- Other -- -- $51,021,521 $97,329 Due from Hartford Life and Annuity Insurance Company -- -- 27,224 -- Receivable from fund shares sold 58,512 80,072 -- 12 Other assets -- -- -- -- ------------- ------------- ------------- --------- Total Assets 41,320,311 62,768,061 51,048,745 97,341 ------------- ------------- ------------- --------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 58,512 80,072 -- 12 Payable for fund shares purchased -- -- 27,224 -- Other liabilities -- -- 10 -- ------------- ------------- ------------- --------- Total Liabilities 58,512 80,072 27,234 12 ------------- ------------- ------------- --------- NET ASSETS: For Variable Annuity Contract Liabilities $41,261,799 $62,687,989 $51,021,511 $97,329 ============= ============= ============= ========= HARTFORD HARTFORD HARTFORD TOTAL DIVIDEND AND FUNDAMENTAL RETURN BOND GROWTH GROWTH HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (B) ----------------------------- ------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 56,737,217 24,765,975 361,077 ============== ============== ============ Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $648,305,628 $564,795,148 $3,834,398 ============== ============== ============ Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $632,383,428 $553,444,814 $4,006,844 Due from Hartford Life and Annuity Insurance Company 830,728 2,009,871 5,902 Receivable from fund shares sold -- -- -- Other assets 22 -- -- -------------- -------------- ------------ Total Assets 633,214,178 555,454,685 4,012,746 -------------- -------------- ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- Payable for fund shares purchased 830,728 2,009,871 5,902 Other liabilities -- 1 -- -------------- -------------- ------------ Total Liabilities 830,728 2,009,872 5,902 -------------- -------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $632,383,450 $553,444,813 $4,006,844 ============== ============== ============
(a) From inception September 20, 2007 to December 31, 2007. (b) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. SA-7 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD GLOBAL ADVISERS GLOBAL GROWTH HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (C) -------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 900,622 1,318,887 ============= ============= Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $11,712,117 $27,896,576 ============= ============= Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $12,257,246 $29,568,717 Due from Hartford Life and Annuity Insurance Company 41,670 60,909 Receivable from fund shares sold -- -- Other assets 1 1 ------------- ------------- Total Assets 12,298,917 29,629,627 ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- Payable for fund shares purchased 41,670 60,909 Other liabilities -- -- ------------- ------------- Total Liabilities 41,670 60,909 ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $12,257,247 $29,568,718 ============= =============
(c) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-8 -------------------------------------------------------------------------------
HARTFORD DISCIPLINED HARTFORD GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HARTFORD HIGH HLS FUND HLS FUND HLS FUND YIELD HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 36,838,272 2,653,631 5,200,504 5,204,494 ============== ============= ============== ============= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $490,157,118 $33,430,011 $169,262,235 $49,983,186 ============== ============= ============== ============= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $554,416,870 $35,540,635 $170,336,783 $46,138,552 Due from Hartford Life and Annuity Insurance Company 151,218 749,077 1,135,606 69,973 Receivable from fund shares sold -- -- -- -- Other assets -- -- 5 -- -------------- ------------- -------------- ------------- Total Assets 554,568,088 36,289,712 171,472,394 46,208,525 -------------- ------------- -------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- -- Payable for fund shares purchased 151,218 749,077 1,135,606 69,973 Other liabilities 24 -- -- 1 -------------- ------------- -------------- ------------- Total Liabilities 151,242 749,077 1,135,606 69,974 -------------- ------------- -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $554,416,846 $35,540,635 $170,336,788 $46,138,551 ============== ============= ============== ============= HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL HARTFORD INDEX GROWTH SMALL COMPANY HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT -------------------------- -------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 902,527 7,350,383 3,697,438 ============= ============== ============= Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $29,351,257 $102,629,694 $60,290,881 ============= ============== ============= Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $28,465,768 $106,347,609 $55,725,350 Due from Hartford Life and Annuity Insurance Company -- -- 83,168 Receivable from fund shares sold 3,752 429,933 -- Other assets 5 1 2 ------------- -------------- ------------- Total Assets 28,469,525 106,777,543 55,808,520 ------------- -------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 3,752 429,933 -- Payable for fund shares purchased -- -- 83,168 Other liabilities -- -- -- ------------- -------------- ------------- Total Liabilities 3,752 429,933 83,168 ------------- -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $28,465,773 $106,347,610 $55,725,352 ============= ============== =============
(d) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-9 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD INTERNATIONAL OPPORTUNITIES HARTFORD MID CAP HLS FUND GROWTH HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 11,450,939 19,474 ============== ========== Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $169,466,074 $207,334 ============== ========== Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $178,869,274 $198,514 Due from Hartford Life and Annuity Insurance Company -- 17,193 Receivable from fund shares sold 436,910 -- Other assets -- -- -------------- ---------- Total Assets 179,306,184 215,707 -------------- ---------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 436,910 -- Payable for fund shares purchased -- 17,193 Other liabilities 12 -- -------------- ---------- Total Liabilities 436,922 17,193 -------------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $178,869,262 $198,514 ============== ==========
(a) From inception September 20, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-10 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD SMALL HARTFORD SMALL MONEY MARKET SECURITIES CAP VALUE COMPANY HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 147,108,651 1,357,821 9,852 2,639,538 ============== ============= ========== ============= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $147,108,651 $15,198,943 $108,546 $53,085,061 ============== ============= ========== ============= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $147,108,653 $14,351,528 $105,348 $49,140,743 Due from Hartford Life and Annuity Insurance Company 103,870 9,053 1,277 395,109 Receivable from fund shares sold -- -- -- -- Other assets 105 -- -- -- -------------- ------------- ---------- ------------- Total Assets 147,212,628 14,360,581 106,625 49,535,852 -------------- ------------- ---------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- -- Payable for fund shares purchased 103,870 9,053 1,277 395,109 Other liabilities -- 1 -- 4 -------------- ------------- ---------- ------------- Total Liabilities 103,870 9,054 1,277 395,113 -------------- ------------- ---------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $147,108,758 $14,351,527 $105,348 $49,140,739 ============== ============= ========== ============= HARTFORD HARTFORD U.S. SMALLCAP GOVERNMENT GROWTH HARTFORD STOCK SECURITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 2,317,160 1,246,466 27,309,681 ============= ============= ============== Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $49,008,585 $61,644,526 $301,480,433 ============= ============= ============== Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $43,347,811 $58,724,309 $304,522,054 Due from Hartford Life and Annuity Insurance Company 676,586 -- 2,970,635 Receivable from fund shares sold -- 202,646 -- Other assets 2 2 -- ------------- ------------- -------------- Total Assets 44,024,399 58,926,957 307,492,689 ------------- ------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 202,646 -- Payable for fund shares purchased 676,586 -- 2,970,635 Other liabilities -- -- 28 ------------- ------------- -------------- Total Liabilities 676,586 202,646 2,970,663 ------------- ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $43,347,813 $58,724,311 $304,522,026 ============= ============= ==============
(a) From inception September 20, 2007 to December 31, 2007. SA-11 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD VALUE HARTFORD VALUE OPPORTUNITIES HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 4,842,739 4,232,581 ============= ============= Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $61,803,455 $80,892,942 ============= ============= Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $62,144,971 $65,275,711 Due from Hartford Life and Annuity Insurance Company 760,288 -- Receivable from fund shares sold -- 800,714 Other assets -- 1 ------------- ------------- Total Assets 62,905,259 66,076,426 ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 800,714 Payable for fund shares purchased 760,288 -- Other liabilities 5 -- ------------- ------------- Total Liabilities 760,293 800,714 ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $62,144,966 $65,275,712 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-12 -------------------------------------------------------------------------------
HARTFORD LORD ABBETT LORD ABBETT EQUITY INCOME LORD ABBETT ALL AMERICA'S VALUE BOND DEBENTURE HLS FUND VALUE PORTFOLIO PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (E) --------------------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 2,772,056 2,331,388 2,184,021 6,280,794 ============= ============= ============= ============= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $37,319,417 $36,748,178 $32,708,250 $75,884,785 ============= ============= ============= ============= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $39,640,206 $39,260,565 $32,301,667 $73,924,939 Due from Hartford Life and Annuity Insurance Company 13,919 32,928 30,277 275,311 Receivable from fund shares sold -- -- -- -- Other assets -- -- -- 1 ------------- ------------- ------------- ------------- Total Assets 39,654,125 39,293,493 32,331,944 74,200,251 ------------- ------------- ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- -- Payable for fund shares purchased 13,919 32,928 30,277 275,311 Other liabilities 1 -- -- -- ------------- ------------- ------------- ------------- Total Liabilities 13,920 32,928 30,277 275,311 ------------- ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $39,640,205 $39,260,565 $32,301,667 $73,924,940 ============= ============= ============= ============= LORD ABBETT LORD ABBETT GROWTH AND LARGE CAP MFS CORE INCOME PORTFOLIO CORE FUND EQUITY SERIES SUB-ACCOUNT SUB-ACCOUNT (F) SUB-ACCOUNT (G) ----------------------------- ------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 11,184,910 1,231,412 529,090 ============== ============= ============ Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $325,673,496 $14,304,905 $8,116,789 ============== ============= ============ Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $312,170,846 $15,872,902 $9,089,774 Due from Hartford Life and Annuity Insurance Company 1,383,528 21,112 -- Receivable from fund shares sold -- -- 1,374 Other assets -- -- -- -------------- ------------- ------------ Total Assets 313,554,374 15,894,014 9,091,148 -------------- ------------- ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- 1,374 Payable for fund shares purchased 1,383,528 21,112 -- Other liabilities 1 -- -- -------------- ------------- ------------ Total Liabilities 1,383,529 21,112 1,374 -------------- ------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $312,170,845 $15,872,902 $9,089,774 ============== ============= ============
(e) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. (f) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (g) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-13 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
MFS INVESTORS MFS EMERGING GROWTH STOCK GROWTH SERIES SERIES SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 457,925 656,533 ============= ============ Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $9,722,909 $6,469,174 ============= ============ Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $11,452,704 $7,760,220 Due from Hartford Life and Annuity Insurance Company -- -- Receivable from fund shares sold 2,814 2,103 Other assets -- -- ------------- ------------ Total Assets 11,455,518 7,762,323 ------------- ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company 2,814 2,103 Payable for fund shares purchased -- -- Other liabilities -- -- ------------- ------------ Total Liabilities 2,814 2,103 ------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $11,452,704 $7,760,220 ============= ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-14 -------------------------------------------------------------------------------
MFS INVESTORS MFS TOTAL EQUITY AND CORE PLUS TRUST SERIES RETURN SERIES INCOME FIXED INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- 11,598,589 Class 1 -- -- -- -- Class II -- -- 1,828,451 -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 983,668 10,251,104 -- -- ============ ============ ============ ============ Cost: Class I -- -- -- $130,559,649 Class 1 -- -- -- -- Class II -- -- $21,737,510 -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $17,237,118 $193,124,973 -- -- ============ ============ ============ ============ Market Value: Class I -- -- -- $134,311,664 Class 1 -- -- -- -- Class II -- -- $26,951,375 -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $23,135,876 $222,243,936 -- -- Due from Hartford Life and Annuity Insurance Company -- -- -- -- Receivable from fund shares sold 2,514 73,037 1,435 24,710 Other assets -- -- -- -- ------------ ------------ ------------ ------------ Total Assets 23,138,390 222,316,973 26,952,810 134,336,374 ------------ ------------ ------------ ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company 2,514 73,037 1,435 24,710 Payable for fund shares purchased -- -- -- -- Other liabilities -- 1 -- 1 ------------ ------------ ------------ ------------ Total Liabilities 2,514 73,038 1,435 24,711 ------------ ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $23,135,876 $222,243,935 $26,951,375 $134,311,663 ============ ============ ============ ============ EMERGING EMERGING MARKETS DEBT MARKETS EQUITY HIGH YIELD SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------ ASSETS: Investments: Number of Shares: Class I 1,339,503 1,221,669 1,805,778 Class 1 -- -- -- Class II -- 3,723,754 -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- ============ ============ ============ Cost: Class I $10,772,757 $14,665,372 $28,873,719 Class 1 -- -- -- Class II -- 70,227,236 -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- ============ ============ ============ Market Value: Class I $11,425,962 $29,649,899 $23,258,425 Class 1 -- -- -- Class II -- 90,301,035 -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- Due from Hartford Life and Annuity Insurance Company 11,602 -- -- Receivable from fund shares sold -- 430,254 36,274 Other assets -- -- -- ------------ ------------ ------------ Total Assets 11,437,564 120,381,188 23,294,699 ------------ ------------ ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 430,254 36,274 Payable for fund shares purchased 11,602 -- -- Other liabilities -- -- -- ------------ ------------ ------------ Total Liabilities 11,602 430,254 36,274 ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $11,425,962 $119,950,934 $23,258,425 ============ ============ ============
SA-15 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
MID CAP U.S. MID GROWTH CAP VALUE SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- 4,026,369 Class 1 -- -- Class II 2,408,668 1,346,184 Class 2 -- -- Class X -- -- Class Y -- -- Other -- -- ============= ============== Cost: Class I -- $59,019,831 Class 1 -- -- Class II $31,487,328 26,217,808 Class 2 -- -- Class X -- -- Class Y -- -- Other -- -- ============= ============== Market Value: Class I -- $76,943,920 Class 1 -- -- Class II $34,925,683 25,631,343 Class 2 -- -- Class X -- -- Class Y -- -- Other -- -- Due from Hartford Life and Annuity Insurance Company 161,342 -- Receivable from fund shares sold -- 77,962 Other assets -- -- ------------- -------------- Total Assets 35,087,025 102,653,225 ------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 77,962 Payable for fund shares purchased 161,342 -- Other liabilities -- -- ------------- -------------- Total Liabilities 161,342 77,962 ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $34,925,683 $102,575,263 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-16 -------------------------------------------------------------------------------
CAPITAL DEVELOPING FOCUS GROWTH BALANCED GROWTH OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X 5,338,587 2,192,351 973,688 1,068,381 Class Y 1,655,847 1,563,528 815,363 356,735 Other -- -- -- -- ============== ============= ============= ============= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X $75,364,194 $26,580,345 $10,317,654 $15,806,191 Class Y 33,425,086 22,818,009 10,386,219 7,645,224 Other -- -- -- -- ============== ============= ============= ============= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X $113,071,276 $35,954,561 $14,673,484 $34,391,201 Class Y 34,723,122 25,563,678 12,059,213 11,297,799 Other -- -- -- -- Due from Hartford Life and Annuity Insurance Company -- -- 45,458 -- Receivable from fund shares sold 77,223 41,407 -- 63,337 Other assets 1 1 -- -- -------------- ------------- ------------- ------------- Total Assets 147,871,622 61,559,647 26,778,155 45,752,337 -------------- ------------- ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 77,223 41,407 -- 63,337 Payable for fund shares purchased -- -- 45,458 -- Other liabilities -- -- -- -- -------------- ------------- ------------- ------------- Total Liabilities 77,223 41,407 45,458 63,337 -------------- ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $147,794,399 $61,518,240 $26,732,697 $45,689,000 ============== ============= ============= ============= FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X 2,962,096 7,224,468 2,475,373 Class Y 3,166,777 2,467,477 537,432 Other -- -- -- ============= ============== ============= Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X $29,366,294 $95,415,876 $28,198,208 Class Y 23,142,947 36,085,679 7,835,638 Other -- -- -- ============= ============== ============= Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X $21,090,123 $134,664,079 $46,388,498 Class Y 22,484,119 45,919,743 9,980,109 Other -- -- -- Due from Hartford Life and Annuity Insurance Company -- -- -- Receivable from fund shares sold 508 131,832 75,008 Other assets -- -- -- ------------- -------------- ------------- Total Assets 43,574,750 180,715,654 56,443,615 ------------- -------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 508 131,832 75,008 Payable for fund shares purchased -- -- -- Other liabilities 1 1 -- ------------- -------------- ------------- Total Liabilities 509 131,833 75,008 ------------- -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $43,574,241 $180,583,821 $56,368,607 ============= ============== =============
SA-17 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
GROWTH MONEY MARKET SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X 858,333 34,291,094 Class Y 1,222,070 79,907,235 Other -- -- ============= ============== Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X $10,540,820 $34,291,094 Class Y 18,845,228 79,907,235 Other -- -- ============= ============== Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X $19,046,424 $34,291,094 Class Y 26,714,457 79,907,235 Other -- -- Due from Hartford Life and Annuity Insurance Company -- -- Receivable from fund shares sold 8,232 405,350 Other assets -- -- ------------- -------------- Total Assets 45,769,113 114,603,679 ------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 8,232 405,350 Payable for fund shares purchased -- -- Other liabilities 1 -- ------------- -------------- Total Liabilities 8,233 405,350 ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $45,760,880 $114,198,329 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-18 -------------------------------------------------------------------------------
EQUALLY WEIGHTED SMALL COMPANY UTILITIES S&P 500 GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- 987,351 2,168,830 Class 2 -- -- -- -- Class X 1,471,955 2,603,648 -- -- Class Y 579,822 3,637,834 -- -- Other -- -- -- -- ============== ============== ============= ============= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- $16,231,381 $30,719,429 Class 2 -- -- -- -- Class X $18,273,434 $33,044,050 -- -- Class Y 11,789,067 76,077,431 -- -- Other -- -- -- -- ============== ============== ============= ============= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- $16,715,855 $39,234,127 Class 2 -- -- -- -- Class X $43,820,097 $66,054,549 -- -- Class Y 17,249,712 91,236,868 -- -- Other -- -- -- -- Due from Hartford Life and Annuity Insurance Company -- -- 3,058 -- Receivable from fund shares sold 30,986 36,497 -- 7,802 Other assets -- -- -- -- -------------- -------------- ------------- ------------- Total Assets 61,100,795 157,327,914 16,718,913 39,241,929 -------------- -------------- ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 30,986 36,497 -- 7,802 Payable for fund shares purchased -- -- 3,058 -- Other liabilities -- 1 -- -- -------------- -------------- ------------- ------------- Total Liabilities 30,986 36,498 3,058 7,802 -------------- -------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $61,069,809 $157,291,416 $16,715,855 $39,234,127 ============== ============== ============= ============= OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL GLOBAL SECURITIES MIDCAP FUND APPRECIATION FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 110,362 2,410,204 10,417,579 ============ ============== ============== Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $5,568,850 $98,297,893 $361,615,519 ============ ============== ============== Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $5,873,457 $112,749,320 $377,845,581 Due from Hartford Life and Annuity Insurance Company 18,054 424,007 1,661,307 Receivable from fund shares sold -- -- -- Other assets -- 3 -- ------------ -------------- -------------- Total Assets 5,891,511 113,173,330 379,506,888 ------------ -------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- Payable for fund shares purchased 18,054 424,006 1,661,307 Other liabilities -- -- 5 ------------ -------------- -------------- Total Liabilities 18,054 424,006 1,661,312 ------------ -------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $5,873,457 $112,749,324 $377,845,576 ============ ============== ==============
SA-19 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER MAIN STREET MAIN STREET FUND SMALL CAP FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 784,803 9,981,432 ============= ============== Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $18,339,667 $181,192,190 ============= ============== Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $19,918,293 $179,965,217 Due from Hartford Life and Annuity Insurance Company 27,772 354,884 Receivable from fund shares sold -- -- Other assets -- 1 ------------- -------------- Total Assets 19,946,065 180,320,102 ------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- Payable for fund shares purchased 27,772 354,884 Other liabilities -- -- ------------- -------------- Total Liabilities 27,772 354,884 ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $19,918,293 $179,965,218 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-20 -------------------------------------------------------------------------------
PUTNAM VT PUTNAM INTERNATIONAL DIVERSIFIED PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND INCOME ASSET ALLOCATION AND INCOME INCOME FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 7,957,779 1,073,000 487,815 14,447 ============= ============= ============= ========== Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $68,473,155 $17,267,971 $12,795,467 $239,543 ============= ============= ============= ========== Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $69,232,678 $18,176,611 $11,278,271 $238,086 Due from Hartford Life and Annuity Insurance Company 413,103 22,665 -- 12,616 Receivable from fund shares sold -- -- 7,140 -- Other assets -- -- -- -- ------------- ------------- ------------- ---------- Total Assets 69,645,781 18,199,276 11,285,411 250,702 ------------- ------------- ------------- ---------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- 7,140 -- Payable for fund shares purchased 413,103 22,665 -- 12,616 Other liabilities -- -- -- -- ------------- ------------- ------------- ---------- Total Liabilities 413,103 22,665 7,140 12,616 ------------- ------------- ------------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $69,232,678 $18,176,611 $11,278,271 $238,086 ============= ============= ============= ========== PUTNAM INTERNATIONAL PUTNAM PUTNAM EQUITY INVESTORS NEW VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 9,507,773 4,059,466 1,762,788 ============== ============= ============= Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $168,880,539 $47,930,042 $29,942,882 ============== ============= ============= Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $180,267,368 $46,846,234 $27,534,749 Due from Hartford Life and Annuity Insurance Company 250,964 1,217,884 69,297 Receivable from fund shares sold -- -- -- Other assets -- -- -- -------------- ------------- ------------- Total Assets 180,518,332 48,064,118 27,604,046 -------------- ------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- -- Payable for fund shares purchased 250,964 1,217,884 69,297 Other liabilities 2 -- -- -------------- ------------- ------------- Total Liabilities 250,966 1,217,884 69,297 -------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $180,267,366 $46,846,234 $27,534,749 ============== ============= =============
(a) From inception September 20, 2007 to December 31, 2007. SA-21 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
PUTNAM THE PUTNAM SMALL GEORGE PUTNAM CAP VALUE FUND OF BOSTON SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other 6,588,339 2,606,421 ============== ============= Cost: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $149,874,039 $30,191,852 ============== ============= Market Value: Class I -- -- Class 1 -- -- Class II -- -- Class 2 -- -- Class X -- -- Class Y -- -- Other $123,531,351 $28,644,569 Due from Hartford Life and Annuity Insurance Company 63,957 2,246 Receivable from fund shares sold -- -- Other assets 2 -- -------------- ------------- Total Assets 123,595,310 28,646,815 -------------- ------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- Payable for fund shares purchased 63,957 2,246 Other liabilities -- -- -------------- ------------- Total Liabilities 63,957 2,246 -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $123,531,353 $28,644,569 ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-22 -------------------------------------------------------------------------------
PUTNAM GROWTH AND PUTNAM VISTA VOYAGER ENTERPRISE INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- 369,143 1,229,644 Class 1 -- -- -- -- Class II -- -- 303,282 10,063,193 Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 209,781 95,117 -- -- ============ ============ ============= ============== Cost: Class I -- -- $7,628,023 $18,932,727 Class 1 -- -- -- -- Class II -- -- 5,123,313 187,975,014 Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $3,047,563 $2,708,299 -- -- ============ ============ ============= ============== Market Value: Class I -- -- $6,448,937 $26,265,206 Class 1 -- -- -- -- Class II -- -- 5,298,334 214,446,639 Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $3,201,258 $3,018,074 -- -- Due from Hartford Life and Annuity Insurance Company 587,598 -- -- 343,782 Receivable from fund shares sold -- 12,776 9,937 -- Other assets -- -- -- -- ------------ ------------ ------------- -------------- Total Assets 3,788,856 3,030,850 11,757,208 241,055,627 ------------ ------------ ------------- -------------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 12,776 9,937 -- Payable for fund shares purchased 587,598 -- -- 343,782 Other liabilities -- -- -- -- ------------ ------------ ------------- -------------- Total Liabilities 587,598 12,776 9,937 343,782 ------------ ------------ ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $3,201,258 $3,018,074 $11,747,271 $240,711,845 ============ ============ ============= ============== STRATEGIC AGGRESSIVE COMSTOCK GROWTH GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II 19,797,718 131,320 237,169 Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- ============== ============ ============ Cost: Class I -- -- -- Class 1 -- -- -- Class II $260,809,863 $3,154,389 $1,151,852 Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- ============== ============ ============ Market Value: Class I -- -- -- Class 1 -- -- -- Class II $273,208,506 $4,371,628 $1,356,606 Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other -- -- -- Due from Hartford Life and Annuity Insurance Company 161,470 -- -- Receivable from fund shares sold -- 428 448 Other assets -- -- -- -------------- ------------ ------------ Total Assets 273,369,976 4,372,056 1,357,054 -------------- ------------ ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 428 448 Payable for fund shares purchased 161,470 -- -- Other liabilities -- -- -- -------------- ------------ ------------ Total Liabilities 161,470 428 448 -------------- ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $273,208,506 $4,371,628 $1,356,606 ============== ============ ============
SA-23 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO ADVANTAGE VT GOVERNMENT ASSET ALLOCATION PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- Class 1 -- -- Class II 3,744,502 -- Class 2 -- -- Class X -- -- Class Y -- -- Other -- 44,597 ============= ========== Cost: Class I -- -- Class 1 -- -- Class II $34,779,766 -- Class 2 -- -- Class X -- -- Class Y -- -- Other -- $590,823 ============= ========== Market Value: Class I -- -- Class 1 -- -- Class II $35,610,215 -- Class 2 -- -- Class X -- -- Class Y -- -- Other -- $652,903 Due from Hartford Life and Annuity Insurance Company -- -- Receivable from fund shares sold 61,271 469 Other assets -- -- ------------- ---------- Total Assets 35,671,486 653,372 ------------- ---------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company 61,271 469 Payable for fund shares purchased -- -- Other liabilities -- -- ------------- ---------- Total Liabilities 61,271 469 ------------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $35,610,215 $652,903 ============= ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-24 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT TOTAL RETURN EQUITY INCOME C&B LARGE CAP LARGE COMPANY BOND FUND FUND VALUE FUND CORE FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 78,044 21,044 144,699 2,893 ========== ========== ============ ========= Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $765,842 $357,207 $1,507,001 $48,022 ========== ========== ============ ========= Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $775,752 $394,359 $1,590,246 $46,166 Due from Hartford Life and Annuity Insurance Company 9 -- 13,239 -- Receivable from fund shares sold -- 23 -- 3 Other assets 9 -- -- -- ---------- ---------- ------------ --------- Total Assets 775,770 394,382 1,603,485 46,169 ---------- ---------- ------------ --------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 23 -- 3 Payable for fund shares purchased 9 -- 13,239 -- Other liabilities -- -- -- -- ---------- ---------- ------------ --------- Total Liabilities 9 23 13,239 3 ---------- ---------- ------------ --------- NET ASSETS: For Variable Annuity Contract Liabilities $775,761 $394,359 $1,590,246 $46,166 ========== ========== ============ ========= WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT INTERNATIONAL LARGE COMPANY MONEY MARKET CORE FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other 22,865 493,920 869,459 ========== ============ ============ Cost: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $202,419 $4,579,674 $869,459 ========== ============ ============ Market Value: Class I -- -- -- Class 1 -- -- -- Class II -- -- -- Class 2 -- -- -- Class X -- -- -- Class Y -- -- -- Other $236,883 $5,097,254 $869,459 Due from Hartford Life and Annuity Insurance Company 11,988 7,342 -- Receivable from fund shares sold -- -- 1,150,286 Other assets -- -- 2 ---------- ------------ ------------ Total Assets 248,871 5,104,596 2,019,747 ---------- ------------ ------------ LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- -- 1,150,286 Payable for fund shares purchased 11,988 7,342 -- Other liabilities -- -- -- ---------- ------------ ------------ Total Liabilities 11,988 7,342 1,150,286 ---------- ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $236,883 $5,097,254 $869,461 ========== ============ ============
SA-25 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO ADVANTAGE VT WELLS FARGO ADVANTAGE VT WELLS FARGO SMALL CAP ADVANTAGE VT SMALL/MID CAP ADVANTAGE VT GROWTH FUND DISCOVERY FUND VALUE FUND OPPORTUNITY FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other 337,573 15,483 22,818 36,213 ============ ========== ========== ========== Cost: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $3,111,037 $257,961 $301,729 $874,096 ============ ========== ========== ========== Market Value: Class I -- -- -- -- Class 1 -- -- -- -- Class II -- -- -- -- Class 2 -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Other $3,271,086 $311,361 $252,822 $797,769 Due from Hartford Life and Annuity Insurance Company 5,293 -- -- -- Receivable from fund shares sold -- 14 11 31 Other assets -- -- -- -- ------------ ---------- ---------- ---------- Total Assets 3,276,379 311,375 252,833 797,800 ------------ ---------- ---------- ---------- LIABILITIES: Due to Hartford Life and Annuity Insurance Company -- 14 11 31 Payable for fund shares purchased 5,293 -- -- -- Other liabilities 1 -- -- -- ------------ ---------- ---------- ---------- Total Liabilities 5,294 14 11 31 ------------ ---------- ---------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $3,271,085 $311,361 $252,822 $797,769 ============ ========== ========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-26 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-27 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY --------------------------------------------------------------------------------------------------------------------------------- DEFERRED ANNUITY CONTRACTS IN THE ACCUMULATION PERIOD (BY SUB-ACCOUNT): AllianceBernstein VP Balanced Wealth Strategy Portfolio -- Class B 9,005,086 $12.043388 to $12.638593 $111,082,831 AllianceBernstein VP Global Research Growth Portfolio -- Class B 587,786 14.595740 to 15.251626 8,759,657 AllianceBernstein VP International Value Portfolio -- Class B 24,501,801 10.203042 to 15.623839 373,237,340 AllianceBernstein VP Small/Mid Cap Value Portfolio -- Class B 3,293,589 11.560375 to 12.131787 38,981,650 AllianceBernstein VP Value Portfolio -- Class B 12,313,803 11.286935 to 11.844777 142,348,576 AllianceBernstein VPS International Growth Portfolio -- Class B 157,776 10.502108 to 10.541737 1,658,536 American Funds Global Growth Fund -- Class 2 6,494,278 1.889019 to 17.985042 86,626,514 American Funds Growth Fund -- Class 2 43,188,755 1.546007 to 16.007709 504,494,375 American Funds Growth-Income Fund -- Class 2 33,090,069 1.385135 to 14.739170 457,021,922 American Funds International Fund -- Class 2 14,653,070 2.097855 to 19.459913 208,114,100 American Funds Global Small Capitalization Fund -- Class 2 3,363,920 2.472943 to 25.430467 65,484,692 Fidelity VIP Equity-Income -- Class SRV2 12,001,652 11.916841 to 12.505825 146,501,961 Fidelity VIP Growth -- Class SRV2 5,026,049 13.561428 to 14.231633 69,706,517 Fidelity VIP Contrafund -- Class SRV2 48,314,374 13.989471 to 14.680736 693,439,581 Fidelity VIP Mid Cap -- Class SRV2 11,574,134 13.697774 to 14.374716 162,398,299 Fidelity VIP Value Strategies -- Class SRV2 1,400,730 12.028191 to 12.622679 17,213,019 Fidelity VIP Dynamic Capital Appreciation Portfolio -- Class 2 10,732 9.535023 to 9.571139 102,512 Franklin Small-Mid Cap Growth Securities Fund -- Class 2 6,282,881 1.291354 to 14.871642 58,287,167 Franklin Strategic Income Securities Fund -- Class 1 7,898,206 1.494425 to 16.301738 119,078,594 Franklin Mutual Shares Securities Fund -- Class 2 10,723,297 1.528406 to 17.873570 180,006,576 Templeton Developing Markets Securities Fund -- Class 1 1,594,007 3.416340 to 29.724964 41,261,799 Templeton Growth Securities Fund -- Class 2 4,182,301 1.522683 to 16.124366 62,671,962 Hartford Advisers HLS Fund -- Class IA 32,695,784 1.215681 to 5.518244 50,978,655 Hartford LargeCap Growth HLS Fund -- Class IA 9,923 9.794897 to 9.819592 97,329 Hartford Total Return Bond HLS Fund -- Class IA 340,349,333 1.436363 to 13.808135 631,789,863 Hartford Dividend and Growth HLS Fund -- Class IA 271,469,869 1.596005 to 4.179487 553,217,578 Hartford Fundamental Growth HLS Fund -- Class IA 3,089,456 1.252075 to 1.359522 4,006,844 Hartford Global Advisers HLS Fund -- Class IA 7,351,333 1.443701 to 11.362948 12,257,247 Hartford Global Growth HLS Fund -- Class IA 12,371,657 1.698782 to 14.203088 29,568,718 Hartford Disciplined Equity HLS Fund -- Class IA 399,914,329 1.221724 to 12.618494 553,991,293 Hartford Growth HLS Fund -- Class IA 23,412,290 1.464573 to 1.576049 35,535,145 Hartford Growth Opportunities HLS Fund -- Class IA 80,654,887 1.948859 to 20.434681 170,336,788 Hartford High Yield HLS Fund -- Class IA 31,831,396 1.352034 to 11.936834 46,131,862 Hartford Index HLS Fund -- Class IA 17,888,953 1.143306 to 5.606271 28,465,773 Hartford International Growth HLS Fund -- Class IA 53,439,731 1.907291 to 11.912146 106,341,409 Hartford International Small Company HLS Fund -- Class IA 23,094,487 2.332801 to 10.174677 55,690,059 Hartford International Opportunities HLS Fund -- Class IA 88,976,179 1.710094 to 12.227564 178,761,948
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-28 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY --------------------------------------------------------------------------------------------------------------------------------- Hartford Mid Cap Growth HLS Fund -- Class IA 20,272 $9.771745 to $9.808732 $198,514 Hartford Money Market HLS Fund -- Class IA 113,138,301 1.038826 to 2.067045 147,098,443 Hartford Mortgage Securities HLS Fund -- Class IA 8,612,314 1.312991 to 3.034214 14,305,526 Hartford Small Cap Value HLS Fund -- Class IA 11,554 9.095988 to 9.130446 105,348 Hartford Small Company HLS Fund -- Class IA 23,605,363 1.546238 to 2.904548 48,933,910 Hartford SmallCap Growth HLS Fund -- Class IA 31,094,786 1.311438 to 13.540773 43,288,794 Hartford Stock HLS Fund -- Class IA 41,328,999 1.113667 to 7.036465 58,724,311 Hartford U.S. Government Securities HLS Fund -- Class IA 267,793,076 1.098120 to 1.184437 304,224,651 Hartford Value HLS Fund -- Class IA 43,232,949 1.386464 to 1.505403 62,130,831 Hartford Value Opportunities HLS Fund -- Class IA 42,749,902 1.447249 to 16.773721 65,275,712 Hartford Equity Income HLS Fund -- Class IA 26,304,703 1.450037 to 1.541964 39,635,990 Lord Abbett All Value Portfolio -- Class VC 3,122,344 12.188854 to 12.791256 39,255,607 Lord Abbett America's Value Portfolio -- Class VC 2,731,366 11.424297 to 11.971920 32,294,128 Lord Abbett Bond Debenture Fund -- Class VC 6,583,454 10.916673 to 11.456197 73,921,452 Lord Abbett Growth and Income Portfolio -- Class VC 25,942,407 11.696028 to 12.274113 312,100,890 Lord Abbett Large Cap Core Fund -- Class VC 1,232,783 12.520156 to 13.100410 15,872,902 MFS Core Equity Series -- Class INIT 1,150,059 1.216627 to 10.433334 9,089,506 MFS Emerging Growth Series -- Class INIT 1,646,922 1.363595 to 10.254739 11,452,410 MFS Investors Growth Stock Series -- Class INIT 1,028,826 1.159127 to 9.316867 7,760,220 MFS Investors Trust Series -- Class INIT 2,233,510 1.331219 to 10.748457 23,135,876 MFS Total Return Series -- Class INIT 15,723,628 1.329842 to 14.851084 222,206,384 Equity and Income -- Class II 1,808,654 14.482570 to 15.230246 26,951,375 Core Plus Fixed Income -- Class I 10,035,224 1.239946 to 14.601703 134,242,841 Emerging Markets Debt -- Class I 589,272 1.784655 to 23.376960 11,425,962 Emerging Markets Equity -- Class I 1,028,689 3.579275 to 31.733290 29,643,816 Emerging Markets Equity -- Class II 4,031,600 13.517536 to 23.038258 90,301,035 High Yield -- Class I 2,100,853 1.391435 to 11.743825 23,254,035 Mid Cap Growth -- Class II 2,294,628 14.842715 to 15.576117 34,925,683 U.S. Mid Cap Value -- Class I 4,351,308 1.554834 to 21.228770 76,902,357 U.S. Mid Cap Value -- Class II 1,860,051 13.406446 to 14.068913 25,631,343 Focus Growth -- Class X 7,253,916 1.333634 to 34.400937 112,755,168 Focus Growth -- Class Y 4,146,445 8.036551 to 8.547613 34,721,996 Balanced Growth -- Class X 3,312,629 1.356218 to 26.142135 35,788,154 Balanced Growth -- Class Y 1,787,016 13.762785 to 14.637810 25,562,553 Capital Opportunities -- Class X 1,396,202 1.508588 to 14.309407 14,665,340 Capital Opportunities -- Class Y 2,269,201 5.111479 to 5.436497 12,059,213 Developing Growth -- Class X 1,731,629 1.925822 to 40.660810 34,280,472 Developing Growth -- Class Y 1,010,482 10.806114 to 11.493181 11,297,799 Flexible Income -- Class X 2,197,455 1.397865 to 14.845269 20,984,421 Flexible Income -- Class Y 1,921,239 11.282737 to 12.000085 22,484,118 Dividend Growth -- Class X 9,093,409 1.226769 to 30.498692 134,110,537 Dividend Growth -- Class Y 3,600,639 12.275072 to 13.055590 45,918,713 Global Equity -- Class X 3,336,636 1.696135 to 25.914544 46,253,768 Global Equity -- Class Y 815,141 11.805397 to 12.555943 9,980,109 Growth -- Class X 1,427,488 1.376764 to 24.554060 18,984,227 Growth -- Class Y 3,163,075 8.205665 to 8.727445 26,714,456
SA-29 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY --------------------------------------------------------------------------------------------------------------------------------- Money Market -- Class X 3,018,784 $1.072322 to $13.835207 $34,226,307 Money Market -- Class Y 7,582,801 10.215179 to 10.864720 79,907,235 Utilities -- Class X 2,027,972 1.879656 to 37.850885 43,684,132 Utilities -- Class Y 1,442,316 11.449522 to 12.177150 17,249,712 Equally Weighted S&P 500 -- Class X 4,003,731 1.491161 to 36.694511 65,859,992 Equally Weighted S&P 500 -- Class Y 5,788,884 15.263891 to 16.234315 91,236,869 Small Company Growth -- Class II 1,221,869 13.404473 to 13.969089 16,715,855 Global Franchise -- Class II 2,074,434 18.455152 to 19.407659 39,234,127 Oppenheimer Midcap Fund -- Class SRV 503,937 11.376060 to 11.938399 5,873,457 Oppenheimer Capital Appreciation Fund -- Class SRV 9,006,654 12.205811 to 12.809096 112,642,957 Oppenheimer Global Securities Fund -- Class SRV 27,305,261 10.304583 to 14.137670 377,640,436 Oppenheimer Main Street Fund -- Class SRV 1,651,874 11.763316 to 12.344736 19,918,293 Oppenheimer Main Street Small Cap Fund -- Class SRV 15,083,178 11.644211 to 12.219796 179,862,063 Putnam Diversified Income -- Class IB 3,970,822 13.809063 to 18.865269 69,232,678 Putnam Global Asset Allocation -- Class IB 739,114 11.125158 to 38.469378 18,176,611 Putnam Growth and Income -- Class IB 386,630 11.144502 to 55.693138 11,278,271 Putnam VT International Growth and Income Fund -- Class IB 24,414 9.734619 to 9.771491 238,086 Putnam International Equity -- Class IB 9,294,934 10.270794 to 26.666709 180,152,729 Putnam Investors -- Class IB 5,022,254 6.842189 to 10.573923 46,830,608 Putnam New Value -- Class IB 1,375,768 14.754219 to 21.041934 27,534,749 Putnam Small Cap Value -- Class IB 5,598,150 19.242065 to 23.443202 123,469,422 Putnam The George Putnam Fund of Boston -- Class IB 2,141,873 12.282903 to 14.135785 28,639,703 Putnam Vista -- Class IB 298,658 5.606900 to 17.006719 3,201,258 Putnam Voyager -- Class IB 207,480 5.533992 to 58.316205 3,018,074 Enterprise -- Class I 846,343 1.166429 to 9.935661 6,438,909 Enterprise -- Class II 805,065 6.329218 to 6.731727 5,298,334 Growth and Income -- Class I 2,534,190 1.461243 to 16.726355 26,221,620 Growth and Income -- Class II 12,694,550 16.242615 to 17.327605 214,399,289 Comstock -- Class II 16,965,658 15.537611 to 16.457983 273,147,822 Strategic Growth -- Class II 292,213 14.590661 to 15.344436 4,371,628 Aggressive Growth Portfolio -- Class II 97,948 13.551542 to 14.122344 1,356,606 Government Portfolio -- Class II 3,315,291 10.536728 to 10.975127 35,610,215 Wells Fargo Advantage VT Asset Allocation Fund 480,911 1.340980 to 1.417654 652,903 Wells Fargo Advantage VT Total Return Bond Fund 638,429 1.189547 to 1.257584 775,761 Wells Fargo Advantage VT Equity Income Fund 286,176 1.363417 to 1.441381 394,359 Wells Fargo Advantage VT C&B Large Cap Value Fund 1,244,507 1.236794 to 1.305124 1,590,246 Wells Fargo Advantage VT Large Company Core Fund 42,322 1.083419 to 1.143314 46,166 Wells Fargo Advantage VT International Core Fund 151,635 1.546543 to 1.631868 236,883 Wells Fargo Advantage VT Large Company Growth Fund 4,563,201 1.086651 to 1.148817 5,097,254 Wells Fargo Advantage VT Money Market Fund 838,624 1.015616 to 1.071732 869,461 Wells Fargo Advantage VT Small Cap Growth Fund 2,101,324 1.512039 to 1.598511 3,271,085 Wells Fargo Advantage VT Discovery Fund 20,419 14.952864 to 15.443882 311,361 Wells Fargo Advantage VT Small/Mid Cap Value Fund 18,794 13.173244 to 13.605746 252,822 Wells Fargo Advantage VT Opportunity Fund 63,191 12.463044 to 12.707062 797,769
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-30 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY --------------------------------------------------------------------------------------------------------------------------------- DEFERRED ANNUITY CONTRACTS IN THE ANNUITY PERIOD (BY SUB-ACCOUNT): AllianceBernstein VP International Value Portfolio -- Class B 24,380 $15.251701 to $15.623839 $378,531 AllianceBernstein VP Small/Mid Cap Value Portfolio -- Class B 17,405 11.994853 to 12.131787 210,808 AllianceBernstein VP Value Portfolio -- Class B 25,997 11.562496 to 11.844777 306,808 American Funds Global Growth Fund -- Class 2 1,642 17.985042 to 17.985042 29,529 American Funds Growth Fund -- Class 2 11,775 11.067960 to 16.007709 149,644 American Funds Growth-Income Fund -- Class 2 10,382 14.312389 to 14.739170 151,608 American Funds International Fund -- Class 2 3,739 13.433973 to 19.459913 59,263 Fidelity VIP Equity-Income -- Class SRV2 5,944 12.207771 to 12.364681 73,483 Fidelity VIP Growth -- Class SRV2 2,681 14.071015 to 14.071015 37,730 Fidelity VIP Contrafund -- Class SRV2 24,755 14.515095 to 14.680736 362,224 Fidelity VIP Mid Cap -- Class SRV2 30,073 14.212488 to 14.374716 432,224 Franklin Small-Mid Cap Growth Securities Fund -- Class 2 525 8.487515 to 14.871642 4,599 Franklin Strategic Income Securities Fund -- Class 1 632 16.301738 to 16.301738 10,298 Franklin Mutual Shares Securities Fund -- Class 2 4,275 17.617223 to 17.873570 75,843 Templeton Growth Securities Fund -- Class 2 994 16.124366 to 16.124366 16,027 Hartford Advisers HLS Fund -- Class IA 34,077 1.257619 to 1.257619 42,856 Hartford Total Return Bond HLS Fund -- Class IA 378,578 1.564006 to 3.269488 593,587 Hartford Dividend and Growth HLS Fund -- Class IA 129,995 1.748028 to 1.748028 227,235 Hartford Disciplined Equity HLS Fund -- Class IA 338,440 1.255550 to 1.485253 425,553 Hartford Growth HLS Fund -- Class IA 3,543 1.549411 to 1.549411 5,490 Hartford High Yield HLS Fund -- Class IA 4,805 1.390217 to 1.405961 6,689 Hartford International Growth HLS Fund -- Class IA 3,053 2.030997 to 2.030997 6,201 Hartford International Small Company HLS Fund Class IA 14,207 2.484107 to 2.484107 35,293 Hartford International Opportunities HLS Fund -- Class IA 61,774 1.732516 to 3.154074 107,314 Hartford Money Market HLS Fund -- Class IA 8,202 1.185768 to 2.012297 10,315 Hartford Mortgage Securities HLS Fund -- Class IA 33,043 1.392150 to 1.392150 46,001 Hartford Small Company HLS Fund -- Class IA 113,297 1.778842 to 1.827464 206,829 Hartford SmallCap Growth HLS Fund -- Class IA 41,880 1.390728 to 1.414586 59,019 Hartford U.S. Government Securities HLS Fund -- Class IA 255,435 1.135132 to 1.164462 297,375 Hartford Value HLS Fund -- Class IA 9,569 1.477075 to 1.477075 14,135 Hartford Equity Income HLS Fund -- Class IA 2,772 1.520541 to 1.520541 4,215 Lord Abbett All Value Portfolio -- Class VC 392 12.646901 to 12.646901 4,958 Lord Abbett America's Value Portfolio -- Class VC 637 11.836825 to 11.836825 7,539 Lord Abbett Bond Debenture Fund -- Class VC 308 11.326886 to 11.326886 3,488 Lord Abbett Growth and Income Portfolio -- Class VC 5,764 12.135566 to 12.135566 69,955 MFS Core Equity Series -- Class INIT 26 10.433334 to 10.433334 268 MFS Emerging Growth Series -- Class INIT 29 10.254739 to 10.254739 294 MFS Total Return Series -- Class INIT 2,533 14.812565 to 14.851084 37,551 Core Plus Fixed Income -- Class I 4,842 13.944482 to 14.601703 68,822 Emerging Markets Equity -- Class I 192 31.733290 to 31.733290 6,083 High Yield -- Class I 374 11.743825 to 11.743825 4,390
SA-31 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY --------------------------------------------------------------------------------------------------------------------------------- U.S. Mid Cap Value -- Class I 2,533 $15.289466 to $19.598934 $41,563 Focus Growth -- Class X 9,189 34.400937 to 34.400937 316,108 Focus Growth -- Class Y 132 8.547613 to 8.547613 1,127 Balanced Growth -- Class X 6,366 26.142135 to 26.142135 166,408 Balanced Growth -- Class Y 77 14.637810 to 14.637810 1,125 Capital Opportunities -- Class X 569 14.309407 to 14.309407 8,144 Developing Growth -- Class X 2,723 40.660810 to 40.660810 110,729 Flexible Income -- Class X 7,120 14.845269 to 14.845269 105,702 Dividend Growth -- Class X 18,150 30.498692 to 30.498692 553,542 Dividend Growth -- Class Y 79 13.055590 to 13.055590 1,029 Global Equity -- Class X 5,199 25.914544 to 25.914544 134,730 Growth -- Class X 2,533 24.554060 to 24.554060 62,197 Money Market -- Class X 4,683 13.835207 to 13.835207 64,788 Utilities -- Class X 3,592 37.850885 to 37.850885 135,965 Equally Weighted S&P 500 -- Class X 5,302 36.694511 to 36.694511 194,555 Oppenheimer Capital Appreciation Fund -- Class SRV 8,399 12.664534 to 12.664534 106,367 Oppenheimer Global Securities Fund -- Class SRV 14,579 13.978128 to 14.137670 205,140 Oppenheimer Main Street Small Cap Fund -- Class SRV 8,539 11.928542 to 12.081858 103,155 Putnam International Equity -- Class IB 4,371 25.598241 to 26.230023 114,637 Putnam Investors -- Class IB 1,502 10.400750 to 10.400750 15,626 Putnam Small Cap Value -- Class IB 2,686 23.059278 to 23.059278 61,931 Putnam The George Putnam Fund of Boston -- Class IB 358 13.606177 to 13.606177 4,866 Enterprise -- Class I 1,034 9.697231 to 9.697231 10,028 Growth and Income -- Class I 2,643 16.489414 to 16.489414 43,586 Growth and Income -- Class II 2,733 17.327605 to 17.327605 47,350 Comstock -- Class II 3,688 16.264048 to 16.457983 60,684
# Rounded unit values THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-32 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-33 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,738,695 $8,580 ------------- ----------- EXPENSES: Mortality and Expense Risk and Administrative charges (1,336,595) (102,971) ------------- ----------- Net investment income (loss) 402,100 (94,391) ------------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (2,976) 9,663 Net realized gain on distributions 1,280,525 214,093 Net unrealized appreciation (depreciation) of investments during the year 287,536 444,013 ------------- ----------- Net gain (loss) on investments 1,565,085 667,769 ------------- ----------- Net increase (decrease) in net assets resulting from operations $1,967,185 $573,378 ============= ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-34 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN VP INTERNATIONAL VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $3,296,117 $235,670 $1,486,570 $914 ------------- ------------- -------------- --------- EXPENSES: Mortality and Expense Risk and Administrative charges (5,242,888) (560,206) (2,068,622) (1,307) ------------- ------------- -------------- --------- Net investment income (loss) (1,946,771) (324,536) (582,052) (393) ------------- ------------- -------------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 142,243 (436,610) (17,907) (1,283) Net realized gain on distributions 12,354,334 2,204,203 3,395,552 33,177 Net unrealized appreciation (depreciation) of investments during the year (1,897,215) (3,350,592) (11,939,265) (36,771) ------------- ------------- -------------- --------- Net gain (loss) on investments 10,599,362 (1,582,999) (8,561,620) (4,877) ------------- ------------- -------------- --------- Net increase (decrease) in net assets resulting from operations $8,652,591 $(1,907,535) $(9,143,672) $(5,270) ============= ============= ============== ========= AMERICAN FUNDS AMERICAN FUNDS GLOBAL GROWTH AMERICAN FUNDS GROWTH-INCOME FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $2,271,257 $3,936,462 $7,180,318 ------------- -------------- -------------- EXPENSES: Mortality and Expense Risk and Administrative charges (1,591,457) (10,016,400) (9,366,566) ------------- -------------- -------------- Net investment income (loss) 679,800 (6,079,938) (2,186,248) ------------- -------------- -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,655,353 15,292,272 16,342,076 Net realized gain on distributions 3,448,716 35,677,987 16,171,874 Net unrealized appreciation (depreciation) of investments during the year 3,349,933 5,744,139 (14,081,754) ------------- -------------- -------------- Net gain (loss) on investments 9,454,002 56,714,398 18,432,196 ------------- -------------- -------------- Net increase (decrease) in net assets resulting from operations $10,133,802 $50,634,460 $16,245,948 ============= ============== ==============
(a) From inception September 20, 2007 to December 31, 2007. SA-35 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL AMERICAN FUNDS CAPITALIZATION INTERNATIONAL FUND FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $2,957,624 $1,912,168 ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (3,860,039) (1,277,799) ------------- ------------- Net investment income (loss) (902,415) 634,369 ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,039,998 1,696,605 Net realized gain on distributions 9,660,024 5,105,790 Net unrealized appreciation (depreciation) of investments during the year 21,314,900 4,015,478 ------------- ------------- Net gain (loss) on investments 33,014,922 10,817,873 ------------- ------------- Net increase (decrease) in net assets resulting from operations $32,112,507 $11,452,242 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-36 -------------------------------------------------------------------------------
FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP EQUITY-INCOME GROWTH CONTRAFUND MID CAP SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $2,431,689 $150,732 $4,810,896 $682,301 -------------- ------------- -------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (2,107,057) (819,315) (8,165,750) (2,257,243) -------------- ------------- -------------- ------------- Net investment income (loss) 324,632 (668,583) (3,354,854) (1,574,942) -------------- ------------- -------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 20,573 249,422 (69,615) 224,512 Net realized gain on distributions 12,277,439 44,409 164,030,575 10,819,287 Net unrealized appreciation (depreciation) of investments during the year (14,699,800) 11,380,965 (87,524,889) 6,808,107 -------------- ------------- -------------- ------------- Net gain (loss) on investments (2,401,788) 11,674,796 76,436,071 17,851,906 -------------- ------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations $(2,077,156) $11,006,213 $73,081,217 $16,276,964 ============== ============= ============== ============= FIDELITY VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FIDELITY VIP APPRECIATION CAP GROWTH VALUE STRATEGIES PORTFOLIO SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $73,785 $81 $ -- ----------- -------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (272,091) (111) (1,176,815) ----------- -------- ------------- Net investment income (loss) (198,306) (30) (1,176,815) ----------- -------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (349,118) (4,023) 1,804,270 Net realized gain on distributions 851,596 6,797 4,522,529 Net unrealized appreciation (depreciation) of investments during the year (996,745) (7,487) 291,305 ----------- -------- ------------- Net gain (loss) on investments (494,267) (4,713) 6,618,104 ----------- -------- ------------- Net increase (decrease) in net assets resulting from operations $(692,573) $(4,743) $5,441,289 =========== ======== =============
(a) From inception September 20, 2007 to December 31, 2007. SA-37 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
FRANKLIN STRATEGIC FRANKLIN MUTUAL INCOME SECURITIES SHARES SECURITIES FUND FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $6,189,872 $2,827,099 ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (2,229,114) (3,731,693) ------------- ------------- Net investment income (loss) 3,960,758 (904,594) ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,812 5,671,077 Net realized gain on distributions 339,843 6,921,645 Net unrealized appreciation (depreciation) of investments during the year 233,632 (8,248,672) ------------- ------------- Net gain (loss) on investments 576,287 4,344,050 ------------- ------------- Net increase (decrease) in net assets resulting from operations $4,537,045 $3,439,456 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-38 -------------------------------------------------------------------------------
HARTFORD TEMPLETON HARTFORD LARGECAP DEVELOPING MARKETS TEMPLETON GROWTH ADVISERS GROWTH SECURITIES FUND SECURITIES FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ---------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $953,376 $930,094 $1,127,840 $181 ------------ ------------- ------------- ------ EXPENSES: Mortality and Expense Risk and Administrative charges (744,801) (1,340,502) (746,743) (52) ------------ ------------- ------------- ------ Net investment income (loss) 208,575 (410,408) 381,097 129 ------------ ------------- ------------- ------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,732,942 2,031,236 (18,703) -- Net realized gain on distributions 2,858,930 2,967,648 5,364,113 -- Net unrealized appreciation (depreciation) of investments during the year 3,078,962 (4,101,753) (3,809,020) (776) ------------ ------------- ------------- ------ Net gain (loss) on investments 8,670,834 897,131 1,536,390 (776) ------------ ------------- ------------- ------ Net increase (decrease) in net assets resulting from operations $8,879,409 $486,723 $1,917,487 $(647) ============ ============= ============= ====== HARTFORD HARTFORD HARTFORD TOTAL DIVIDEND AND FUNDAMENTAL RETURN BOND GROWTH GROWTH HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (B) ----------------------------- ------------------------------------------------------------------ INVESTMENT INCOME: Dividends $32,337,461 $9,035,748 $1,211 ------------- -------------- ---------- EXPENSES: Mortality and Expense Risk and Administrative charges (8,139,587) (6,711,001) (44,989) ------------- -------------- ---------- Net investment income (loss) 24,197,874 2,324,747 (43,778) ------------- -------------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 22,249 67,976 (18,485) Net realized gain on distributions -- 40,863,517 224,970 Net unrealized appreciation (depreciation) of investments during the year (7,928,908) (21,311,474) 122,291 ------------- -------------- ---------- Net gain (loss) on investments (7,906,659) 19,620,019 328,776 ------------- -------------- ---------- Net increase (decrease) in net assets resulting from operations $16,291,215 $21,944,766 $284,998 ============= ============== ==========
(a) From inception September 20, 2007 to December 31, 2007. (b) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. SA-39 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD GLOBAL ADVISERS GLOBAL GROWTH HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (C) ------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $97,171 $8,291 ------------ ------------ EXPENSES: Mortality and Expense Risk and Administrative charges (135,230) (288,935) ------------ ------------ Net investment income (loss) (38,059) (280,644) ------------ ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 26,766 9,781 Net realized gain on distributions 783,092 2,705,230 Net unrealized appreciation (depreciation) of investments during the year 482,548 1,055,049 ------------ ------------ Net gain (loss) on investments 1,292,406 3,770,060 ------------ ------------ Net increase (decrease) in net assets resulting from operations $1,254,347 $3,489,416 ============ ============
(c) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-40 -------------------------------------------------------------------------------
HARTFORD DISCIPLINED HARTFORD GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HARTFORD HIGH HLS FUND HLS FUND HLS FUND YIELD HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $5,608,539 $6,181 $202,099 $3,558,426 ------------- ------------ ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (8,412,148) (434,387) (1,811,657) (641,300) ------------- ------------ ------------- ------------- Net investment income (loss) (2,803,609) (428,206) (1,609,558) 2,917,126 ------------- ------------ ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (11,116) 45,299 3,592 1,358 Net realized gain on distributions 1,867,280 2,235,919 24,609,064 -- Net unrealized appreciation (depreciation) of investments during the year 30,900,843 2,225,660 1,945,249 (2,787,024) ------------- ------------ ------------- ------------- Net gain (loss) on investments 32,757,007 4,506,878 26,557,905 (2,785,666) ------------- ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations $29,953,398 $4,078,672 $24,948,347 $131,460 ============= ============ ============= ============= HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL HARTFORD INDEX GROWTH SMALL COMPANY HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT -------------------------- ------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $476,949 $678,657 $947,037 ------------ ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (425,607) (1,162,110) (874,308) ------------ ------------- ------------- Net investment income (loss) 51,342 (483,453) 72,729 ------------ ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 39,444 99,274 14,771 Net realized gain on distributions 1,585,508 16,708,538 8,568,561 Net unrealized appreciation (depreciation) of investments during the year (998,879) (801,199) (5,906,861) ------------ ------------- ------------- Net gain (loss) on investments 626,073 16,006,613 2,676,471 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations $677,415 $15,523,160 $2,749,200 ============ ============= =============
(d) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-41 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD INTERNATIONAL OPPORTUNITIES HARTFORD MID CAP HLS FUND GROWTH HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $1,837,966 $414 ------------- -------- EXPENSES: Mortality and Expense Risk and Administrative charges (2,324,695) (119) ------------- -------- Net investment income (loss) (486,729) 295 ------------- -------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 922,300 1 Net realized gain on distributions 31,451,114 8,218 Net unrealized appreciation (depreciation) of investments during the year 1,350,430 (8,820) ------------- -------- Net gain (loss) on investments 33,723,844 (601) ------------- -------- Net increase (decrease) in net assets resulting from operations $33,237,115 $(306) ============= ========
(a) From inception September 20, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-42 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD SMALL HARTFORD SMALL MONEY MARKET SECURITIES CAP VALUE COMPANY HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $5,123,159 $781,755 $650 $104,908 ------------- ----------- -------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (1,734,557) (208,199) (65) (366,821) ------------- ----------- -------- ------------- Net investment income (loss) 3,388,602 573,556 585 (261,913) ------------- ----------- -------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions -- 1,300 (1,208) 4,071 Net realized gain on distributions -- -- 4,846 5,525,626 Net unrealized appreciation (depreciation) of investments during the year -- (346,826) (3,198) (3,507,282) ------------- ----------- -------- ------------- Net gain (loss) on investments -- (345,526) 440 2,022,415 ------------- ----------- -------- ------------- Net increase (decrease) in net assets resulting from operations $3,388,602 $228,030 $1,025 $1,760,502 ============= =========== ======== ============= HARTFORD HARTFORD U.S. SMALLCAP GOVERNMENT GROWTH HARTFORD STOCK SECURITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- INVESTMENT INCOME: Dividends $130,580 $614,571 $9,104,038 ------------- ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (740,833) (927,129) (3,847,135) ------------- ------------- ------------- Net investment income (loss) (610,253) (312,558) 5,256,903 ------------- ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (9,283) 153,329 7,810 Net realized gain on distributions 3,351,975 8,440,213 -- Net unrealized appreciation (depreciation) of investments during the year (4,220,349) (6,351,332) 1,498,031 ------------- ------------- ------------- Net gain (loss) on investments (877,657) 2,242,210 1,505,841 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations $(1,487,910) $1,929,652 $6,762,744 ============= ============= =============
SA-43 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD VALUE HARTFORD VALUE OPPORTUNITIES HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $719,890 $930,500 ------------- -------------- EXPENSES: Mortality and Expense Risk and Administrative charges (524,433) (1,147,920) ------------- -------------- Net investment income (loss) 195,457 (217,420) ------------- -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 38,567 9,648 Net realized gain on distributions 2,450,487 10,476,334 Net unrealized appreciation (depreciation) of investments during the year (1,177,113) (16,815,590) ------------- -------------- Net gain (loss) on investments 1,311,941 (6,329,608) ------------- -------------- Net increase (decrease) in net assets resulting from operations $1,507,398 $(6,547,028) ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-44 -------------------------------------------------------------------------------
HARTFORD LORD ABBETT EQUITY INCOME LORD ABBETT ALL AMERICA'S VALUE LORD ABBETT HLS FUND VALUE PORTFOLIO PORTFOLIO BOND DEBENTURE FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (E) ------------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $841,214 $197,368 $970,590 $4,420,863 ------------ ------------ ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (473,035) (470,911) (333,019) (838,873) ------------ ------------ ------------- ------------- Net investment income (loss) 368,179 (273,543) 637,571 3,581,990 ------------ ------------ ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (19,069) 49,082 25,737 41,612 Net realized gain on distributions 1,393,309 1,477,477 1,024,036 239,107 Net unrealized appreciation (depreciation) of investments during the year (205,041) 333,404 (1,590,107) (1,490,530) ------------ ------------ ------------- ------------- Net gain (loss) on investments 1,169,199 1,859,963 (540,334) (1,209,811) ------------ ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations $1,537,378 $1,586,420 $97,237 $2,372,179 ============ ============ ============= ============= LORD ABBETT LORD ABBETT GROWTH AND LARGE CAP MFS CORE INCOME PORTFOLIO CORE FUND EQUITY SERIES SUB-ACCOUNT SUB-ACCOUNT (F) SUB-ACCOUNT (G) ----------------------------- ----------------------------------------------------------------------- INVESTMENT INCOME: Dividends $3,830,967 $97,015 $32,680 -------------- ------------ ----------- EXPENSES: Mortality and Expense Risk and Administrative charges (3,613,622) (194,316) (171,135) -------------- ------------ ----------- Net investment income (loss) 217,345 (97,301) (138,455) -------------- ------------ ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 17,633 42,186 303,441 Net realized gain on distributions 21,125,654 546,791 -- Net unrealized appreciation (depreciation) of investments during the year (19,355,986) 644,438 674,262 -------------- ------------ ----------- Net gain (loss) on investments 1,787,301 1,233,415 977,703 -------------- ------------ ----------- Net increase (decrease) in net assets resulting from operations $2,004,646 $1,136,114 $839,248 ============== ============ ===========
(e) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. (f) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (g) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-45 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MFS INVESTORS MFS EMERGING GROWTH STOCK GROWTH SERIES SERIES SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $29,107 ------------ ----------- EXPENSES: Mortality and Expense Risk and Administrative charges (209,538) (160,127) ------------ ----------- Net investment income (loss) (209,538) (131,020) ------------ ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 1,020,466 477,811 Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year 1,120,487 424,270 ------------ ----------- Net gain (loss) on investments 2,140,953 902,081 ------------ ----------- Net increase (decrease) in net assets resulting from operations $1,931,415 $771,061 ============ ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-46 -------------------------------------------------------------------------------
MFS INVESTORS MFS TOTAL EQUITY AND CORE PLUS TRUST SERIES RETURN SERIES INCOME FIXED INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $199,733 $6,130,301 $526,324 $5,057,649 ----------- ------------- ----------- ------------ EXPENSES: Mortality and Expense Risk and Administrative charges (458,678) (4,475,000) (569,077) (2,518,689) ----------- ------------- ----------- ------------ Net investment income (loss) (258,945) 1,655,301 (42,753) 2,538,960 ----------- ------------- ----------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 821,581 3,493,875 400,308 289,044 Net realized gain on distributions 202,583 5,861,296 741,024 -- Net unrealized appreciation (depreciation) of investments during the year 1,104,709 (5,397,380) (671,358) 1,955,449 ----------- ------------- ----------- ------------ Net gain (loss) on investments 2,128,873 3,957,791 469,974 2,244,493 ----------- ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations $1,869,928 $5,613,092 $427,221 $4,783,453 =========== ============= =========== ============ EMERGING EMERGING MARKETS DEBT MARKETS EQUITY HIGH YIELD SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- INVESTMENT INCOME: Dividends $870,901 $337,272 $2,267,680 ------------ ------------ ------------ EXPENSES: Mortality and Expense Risk and Administrative charges (222,167) (1,438,950) (463,147) ------------ ------------ ------------ Net investment income (loss) 648,734 (1,101,678) 1,804,533 ------------ ------------ ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 186,998 1,112,125 (683,659) Net realized gain on distributions 372,113 8,960,596 -- Net unrealized appreciation (depreciation) of investments during the year (686,548) 17,471,777 (574,433) ------------ ------------ ------------ Net gain (loss) on investments (127,437) 27,544,498 (1,258,092) ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations $521,297 $26,442,820 $546,441 ============ ============ ============
SA-47 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MID CAP U.S. MID GROWTH CAP VALUE SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $687,054 ------------ ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (337,594) (1,889,549) ------------ ------------- Net investment income (loss) (337,594) (1,202,495) ------------ ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 47,171 1,484,900 Net realized gain on distributions 974,491 10,885,592 Net unrealized appreciation (depreciation) of investments during the year 3,052,493 (5,355,129) ------------ ------------- Net gain (loss) on investments 4,074,155 7,015,363 ------------ ------------- Net increase (decrease) in net assets resulting from operations $3,736,561 $5,812,868 ============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-48 -------------------------------------------------------------------------------
CAPITAL DEVELOPING FOCUS GROWTH BALANCED GROWTH OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $1,673,386 $ -- $158,624 ------------- ------------- ------------ ------------ EXPENSES: Mortality and Expense Risk and Administrative charges (2,285,265) (1,087,341) (446,220) (703,412) ------------- ------------- ------------ ------------ Net investment income (loss) (2,285,265) 586,045 (446,220) (544,788) ------------- ------------- ------------ ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 7,982,940 2,470,522 893,251 4,593,289 Net realized gain on distributions -- 5,422,819 -- -- Net unrealized appreciation (depreciation) of investments during the year 23,301,711 (6,804,344) 3,939,088 4,745,186 ------------- ------------- ------------ ------------ Net gain (loss) on investments 31,284,651 1,088,997 4,832,339 9,338,475 ------------- ------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations $28,999,386 $1,675,042 $4,386,119 $8,793,687 ============= ============= ============ ============ FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- INVESTMENT INCOME: Dividends $2,793,257 $2,247,329 $368,151 ------------- ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (764,105) (3,113,252) (898,828) ------------- ------------- ------------- Net investment income (loss) 2,029,152 (865,923) (530,677) ------------- ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (1,737,850) 11,151,188 3,017,282 Net realized gain on distributions -- -- 8,327,043 Net unrealized appreciation (depreciation) of investments during the year 678,790 (3,853,602) (2,465,555) ------------- ------------- ------------- Net gain (loss) on investments (1,059,060) 7,297,586 8,878,770 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations $970,092 $6,431,663 $8,348,093 ============= ============= =============
SA-49 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
GROWTH MONEY MARKET SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $5,302,310 ------------ ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (821,199) (2,048,651) ------------ ------------- Net investment income (loss) (821,199) 3,253,659 ------------ ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,894,281 -- Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year 6,299,230 -- ------------ ------------- Net gain (loss) on investments 9,193,511 -- ------------ ------------- Net increase (decrease) in net assets resulting from operations $8,372,312 $3,253,659 ============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-50 -------------------------------------------------------------------------------
EQUALLY WEIGHTED SMALL COMPANY UTILITIES S&P 500 GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,096,773 $2,369,097 $ -- $ -- ------------- -------------- ------------- ------------ EXPENSES: Mortality and Expense Risk and Administrative charges (960,156) (3,089,709) (365,601) (830,587) ------------- -------------- ------------- ------------ Net investment income (loss) 136,617 (720,612) (365,601) (830,587) ------------- -------------- ------------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 6,822,838 9,594,950 163,481 (47,276) Net realized gain on distributions -- 15,950,131 1,519,618 3,690,300 Net unrealized appreciation (depreciation) of investments during the year 3,706,989 (24,144,725) (1,152,745) (3,820) ------------- -------------- ------------- ------------ Net gain (loss) on investments 10,529,827 1,400,356 530,354 3,639,204 ------------- -------------- ------------- ------------ Net increase (decrease) in net assets resulting from operations $10,666,444 $679,744 $164,753 $2,808,617 ============= ============== ============= ============ OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL GLOBAL SECURITIES MIDCAP FUND APPRECIATION FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- ------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $6,918 $2,712,552 ------------- ------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (76,543) (1,397,431) (4,525,006) ------------- ------------- ------------- Net investment income (loss) (76,543) (1,390,513) (1,812,454) ------------- ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 10,956 205,374 (60,918) Net realized gain on distributions -- -- 11,343,947 Net unrealized appreciation (depreciation) of investments during the year 192,667 10,204,389 (1,460,165) ------------- ------------- ------------- Net gain (loss) on investments 203,623 10,409,763 9,822,864 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations $127,080 $9,019,250 $8,010,410 ============= ============= =============
SA-51 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER MAIN STREET MAIN STREET FUND SMALL CAP FUND SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $122,776 $226,287 ----------- -------------- EXPENSES: Mortality and Expense Risk and Administrative charges (288,322) (2,643,299) ----------- -------------- Net investment income (loss) (165,546) (2,417,012) ----------- -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 12,645 71,232 Net realized gain on distributions -- 4,894,006 Net unrealized appreciation (depreciation) of investments during the year 367,253 (10,502,637) ----------- -------------- Net gain (loss) on investments 379,898 (5,537,399) ----------- -------------- Net increase (decrease) in net assets resulting from operations $214,352 $(7,954,411) =========== ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-52 -------------------------------------------------------------------------------
PUTNAM VT PUTNAM INTERNATIONAL DIVERSIFIED PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND INCOME ASSET ALLOCATION AND INCOME INCOME FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,887,553 $60,218 $115,546 $ -- ----------- ---------- ----------- -------- EXPENSES: Mortality and Expense Risk and Administrative charges (729,496) (226,609) (155,814) (137) ----------- ---------- ----------- -------- Net investment income (loss) 1,158,057 (166,391) (40,268) (137) ----------- ---------- ----------- -------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (35,975) 43,595 6,978 10 Net realized gain on distributions -- -- 1,327,718 -- Net unrealized appreciation (depreciation) of investments during the year 173,915 153,853 (2,272,771) (1,457) ----------- ---------- ----------- -------- Net gain (loss) on investments 137,940 197,448 (938,075) (1,447) ----------- ---------- ----------- -------- Net increase (decrease) in net assets resulting from operations $1,295,997 $31,057 $(978,343) $(1,584) =========== ========== =========== ======== PUTNAM INTERNATIONAL PUTNAM PUTNAM EQUITY INVESTORS NEW VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------- INVESTMENT INCOME: Dividends $4,143,750 $28,680 $226,473 ------------- ----------- ----------- EXPENSES: Mortality and Expense Risk and Administrative charges (2,638,071) (277,450) (330,689) ------------- ----------- ----------- Net investment income (loss) 1,505,679 (248,770) (104,216) ------------- ----------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 185,017 (45,353) (23,313) Net realized gain on distributions 17,938,165 -- 1,894,932 Net unrealized appreciation (depreciation) of investments during the year (10,957,248) (1,825,616) (3,804,389) ------------- ----------- ----------- Net gain (loss) on investments 7,165,934 (1,870,969) (1,932,770) ------------- ----------- ----------- Net increase (decrease) in net assets resulting from operations $8,671,613 $(2,119,739) $(2,036,986) ============= =========== ===========
(a) From inception September 20, 2007 to December 31, 2007. SA-53 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
PUTNAM THE PUTNAM SMALL GEORGE PUTNAM CAP VALUE FUND OF BOSTON SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $682,627 $554,692 -------------- ------------- EXPENSES: Mortality and Expense Risk and Administrative charges (2,096,036) (372,496) -------------- ------------- Net investment income (loss) (1,413,409) 182,196 -------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (247,342) 18,166 Net realized gain on distributions 13,652,542 1,925,298 Net unrealized appreciation (depreciation) of investments during the year (32,970,803) (2,549,729) -------------- ------------- Net gain (loss) on investments (19,565,603) (606,265) -------------- ------------- Net increase (decrease) in net assets resulting from operations $(20,979,012) $(424,069) ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-54 -------------------------------------------------------------------------------
PUTNAM GROWTH AND PUTNAM VISTA VOYAGER ENTERPRISE INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $ -- $39,355 $3,126,391 --------- ---------- ------------ -------------- EXPENSES: Mortality and Expense Risk and Administrative charges (37,356) (50,949) (204,798) (4,000,859) --------- ---------- ------------ -------------- Net investment income (loss) (37,356) (50,949) (165,443) (874,468) --------- ---------- ------------ -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 10,134 14,048 (492,896) 4,259,783 Net realized gain on distributions -- -- -- 8,232,350 Net unrealized appreciation (depreciation) of investments during the year 64,486 137,901 1,984,536 (10,601,498) --------- ---------- ------------ -------------- Net gain (loss) on investments 74,620 151,949 1,491,640 1,890,635 --------- ---------- ------------ -------------- Net increase (decrease) in net assets resulting from operations $37,264 $101,000 $1,326,197 $1,016,167 ========= ========== ============ ============== STRATEGIC AGGRESSIVE COMSTOCK GROWTH GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- INVESTMENT INCOME: Dividends $4,221,453 $ -- $ -- -------------- ---------- ---------- EXPENSES: Mortality and Expense Risk and Administrative charges (4,958,277) (90,202) (28,096) -------------- ---------- ---------- Net investment income (loss) (736,824) (90,202) (28,096) -------------- ---------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 1,125,719 157,109 22,500 Net realized gain on distributions 5,861,801 -- 91,242 Net unrealized appreciation (depreciation) of investments during the year (18,764,730) 519,771 110,027 -------------- ---------- ---------- Net gain (loss) on investments (11,777,210) 676,880 223,769 -------------- ---------- ---------- Net increase (decrease) in net assets resulting from operations $(12,514,034) $586,678 $195,673 ============== ========== ==========
SA-55 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO ADVANTAGE VT GOVERNMENT ASSET ALLOCATION PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,426,922 $14,498 ------------ --------- EXPENSES: Mortality and Expense Risk and Administrative charges (667,969) (12,767) ------------ --------- Net investment income (loss) 758,953 1,731 ------------ --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (22,851) 3,065 Net realized gain on distributions -- 10,091 Net unrealized appreciation (depreciation) of investments during the year 800,839 18,474 ------------ --------- Net gain (loss) on investments 777,988 31,630 ------------ --------- Net increase (decrease) in net assets resulting from operations $1,536,941 $33,361 ============ =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-56 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT TOTAL RETURN EQUITY INCOME C&B LARGE CAP LARGE COMPANY BOND FUND FUND VALUE FUND CORE FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $37,966 $6,282 $13,793 $ -- ---------- ---------- ---------- --------- EXPENSES: Mortality and Expense Risk and Administrative charges (14,916) (8,760) (19,252) (654) ---------- ---------- ---------- --------- Net investment income (loss) 23,050 (2,478) (5,459) (654) ---------- ---------- ---------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (1,929) 1,483 1,869 (71) Net realized gain on distributions -- 27,305 -- -- Net unrealized appreciation (depreciation) of investments during the year 11,339 (22,529) (43,531) (2,738) ---------- ---------- ---------- --------- Net gain (loss) on investments 9,410 6,259 (41,662) (2,809) ---------- ---------- ---------- --------- Net increase (decrease) in net assets resulting from operations $32,460 $3,781 $(47,121) $(3,463) ========== ========== ========== ========= WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT INTERNATIONAL LARGE COMPANY MONEY MARKET CORE FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- INVESTMENT INCOME: Dividends $25 $ -- $50,947 --------- ----------- ---------- EXPENSES: Mortality and Expense Risk and Administrative charges (3,879) (82,617) (19,356) --------- ----------- ---------- Net investment income (loss) (3,854) (82,617) 31,591 --------- ----------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 904 48,933 -- Net realized gain on distributions 13,986 -- -- Net unrealized appreciation (depreciation) of investments during the year 8,094 312,515 -- --------- ----------- ---------- Net gain (loss) on investments 22,984 361,448 -- --------- ----------- ---------- Net increase (decrease) in net assets resulting from operations $19,130 $278,831 $31,591 ========= =========== ==========
SA-57 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO ADVANTAGE VT WELLS FARGO ADVANTAGE VT WELLS FARGO SMALL CAP ADVANTAGE VT SMALL/MID CAP ADVANTAGE VT GROWTH FUND DISCOVERY FUND VALUE FUND OPPORTUNITY FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $ -- $50 $2,873 ----------- --------- --------- --------- EXPENSES: Mortality and Expense Risk and Administrative charges (49,394) (3,753) (3,879) (5,911) ----------- --------- --------- --------- Net investment income (loss) (49,394) (3,753) (3,829) (3,038) ----------- --------- --------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 21,791 1,505 78 659 Net realized gain on distributions 460,646 -- 41,592 67,315 Net unrealized appreciation (depreciation) of investments during the year (122,667) 42,028 (45,653) (75,394) ----------- --------- --------- --------- Net gain (loss) on investments 359,770 43,533 (3,983) (7,420) ----------- --------- --------- --------- Net increase (decrease) in net assets resulting from operations $310,376 $39,780 $(7,812) $(10,458) =========== ========= ========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-58 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-59 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $402,100 $(94,391) Net realized gain (loss) on security transactions (2,976) 9,663 Net realized gain on distributions 1,280,525 214,093 Net unrealized appreciation (depreciation) of investments during the year 287,536 444,013 -------------- ------------ Net increase (decrease) in net assets resulting from operations 1,967,185 573,378 -------------- ------------ UNIT TRANSACTIONS: Purchases 45,004,417 3,376,435 Net transfers 14,609,724 1,044,495 Surrenders for benefit payments and fees (3,565,238) (292,047) Net annuity transactions -- -- -------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 56,048,903 4,128,883 -------------- ------------ Net increase (decrease) in net assets 58,016,088 4,702,261 NET ASSETS: Beginning of year 53,066,743 4,057,396 -------------- ------------ End of year $111,082,831 $8,759,657 ============== ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-60 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN VP INTERNATIONAL VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL VALUE PORTFOLIO VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,946,771) $(324,536) $(582,052) $(393) Net realized gain (loss) on security transactions 142,243 (436,610) (17,907) (1,283) Net realized gain on distributions 12,354,334 2,204,203 3,395,552 33,177 Net unrealized appreciation (depreciation) of investments during the year (1,897,215) (3,350,592) (11,939,265) (36,771) ----------- ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 8,652,591 (1,907,535) (9,143,672) (5,270) ----------- ------------- ----------- ------------ UNIT TRANSACTIONS: Purchases 106,499,655 12,911,144 37,940,147 287,643 Net transfers 25,687,762 7,995,770 16,759,958 1,378,085 Surrenders for benefit payments and fees (14,009,375) (1,534,210) (6,111,748) (1,922) Net annuity transactions 61,126 (17,866) 34,204 -- ----------- ------------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions 118,239,168 19,354,838 48,622,561 1,663,806 ----------- ------------- ----------- ------------ Net increase (decrease) in net assets 126,891,759 17,447,303 39,478,889 1,658,536 NET ASSETS: Beginning of year 246,724,112 21,745,155 103,176,495 -- ----------- ------------- ----------- ------------ End of year $373,615,871 $39,192,458 $142,655,384 $1,658,536 =========== ============= =========== ============ AMERICAN FUNDS AMERICAN FUNDS GLOBAL GROWTH AMERICAN FUNDS GROWTH-INCOME FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- OPERATIONS: Net investment income (loss) $679,800 $(6,079,938) $(2,186,248) Net realized gain (loss) on security transactions 2,655,353 15,292,272 16,342,076 Net realized gain on distributions 3,448,716 35,677,987 16,171,874 Net unrealized appreciation (depreciation) of investments during the year 3,349,933 5,744,139 (14,081,754) ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 10,133,802 50,634,460 16,245,948 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 1,396,530 4,462,805 4,481,743 Net transfers 776,045 (9,855,804) (10,984,446) Surrenders for benefit payments and fees (7,423,865) (49,147,186) (50,602,686) Net annuity transactions (19,867) 31,164 71,761 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions (5,271,157) (54,509,021) (57,033,628) ------------ ------------ ------------ Net increase (decrease) in net assets 4,862,645 (3,874,561) (40,787,680) NET ASSETS: Beginning of year 81,793,398 508,518,580 497,961,210 ------------ ------------ ------------ End of year $86,656,043 $504,644,019 $457,173,530 ============ ============ ============
(a) From inception September 20, 2007 to December 31, 2007. SA-61 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL AMERICAN FUNDS CAPITALIZATION INTERNATIONAL FUND FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(902,415) $634,369 Net realized gain (loss) on security transactions 2,039,998 1,696,605 Net realized gain on distributions 9,660,024 5,105,790 Net unrealized appreciation (depreciation) of investments during the year 21,314,900 4,015,478 -------------- ------------- Net increase (decrease) in net assets resulting from operations 32,112,507 11,452,242 -------------- ------------- UNIT TRANSACTIONS: Purchases 3,166,104 662,086 Net transfers 2,028,061 (1,922,144) Surrenders for benefit payments and fees (17,701,229) (6,402,849) Net annuity transactions 25,902 -- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (12,481,162) (7,662,907) -------------- ------------- Net increase (decrease) in net assets 19,631,345 3,789,335 NET ASSETS: Beginning of year 188,542,018 61,695,357 -------------- ------------- End of year $208,173,363 $65,484,692 ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-62 -------------------------------------------------------------------------------
FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP EQUITY-INCOME GROWTH CONTRAFUND MID CAP SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $324,632 $(668,583) $(3,354,854) $(1,574,942) Net realized gain (loss) on security transactions 20,573 249,422 (69,615) 224,512 Net realized gain on distributions 12,277,439 44,409 164,030,575 10,819,287 Net unrealized appreciation (depreciation) of investments during the year (14,699,800) 11,380,965 (87,524,889) 6,808,107 -------------- ------------- -------------- -------------- Net increase (decrease) in net assets resulting from operations (2,077,156) 11,006,213 73,081,217 16,276,964 -------------- ------------- -------------- -------------- UNIT TRANSACTIONS: Purchases 36,897,573 16,771,787 198,857,001 36,557,992 Net transfers 12,854,821 13,305,349 92,876,618 6,779,616 Surrenders for benefit payments and fees (6,149,816) (2,557,987) (23,755,547) (5,749,019) Net annuity transactions 33,549 24,415 82,560 (31,991) -------------- ------------- -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 43,636,127 27,543,564 268,060,632 37,556,598 -------------- ------------- -------------- -------------- Net increase (decrease) in net assets 41,558,971 38,549,777 341,141,849 53,833,562 NET ASSETS: Beginning of year 105,016,473 31,194,470 352,659,956 108,996,961 -------------- ------------- -------------- -------------- End of year $146,575,444 $69,744,247 $693,801,805 $162,830,523 ============== ============= ============== ============== FIDELITY VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FIDELITY VIP APPRECIATION CAP GROWTH VALUE STRATEGIES PORTFOLIO SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(198,306) $(30) $(1,176,815) Net realized gain (loss) on security transactions (349,118) (4,023) 1,804,270 Net realized gain on distributions 851,596 6,797 4,522,529 Net unrealized appreciation (depreciation) of investments during the year (996,745) (7,487) 291,305 ------------- ---------- ------------- Net increase (decrease) in net assets resulting from operations (692,573) (4,743) 5,441,289 ------------- ---------- ------------- UNIT TRANSACTIONS: Purchases 7,210,383 49,000 314,007 Net transfers 4,190,502 58,309 (2,241,054) Surrenders for benefit payments and fees (688,281) (54) (5,306,288) Net annuity transactions -- -- (413) ------------- ---------- ------------- Net increase (decrease) in net assets resulting from unit transactions 10,712,604 107,255 (7,233,748) ------------- ---------- ------------- Net increase (decrease) in net assets 10,020,031 102,512 (1,792,459 NET ASSETS: Beginning of year 7,192,988 -- 60,084,225 ------------- ---------- ------------- End of year $17,213,019 $102,512 $58,291,766 ============= ========== =============
(a) From inception September 20, 2007 to December 31, 2007. SA-63 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
FRANKLIN STRATEGIC FRANKLIN MUTUAL INCOME SECURITIES SHARES SECURITIES FUND FUND SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $3,960,758 $(904,594) Net realized gain (loss) on security transactions 2,812 5,671,077 Net realized gain on distributions 339,843 6,921,645 Net unrealized appreciation (depreciation) of investments during the year 233,632 (8,248,672) -------------- -------------- Net increase (decrease) in net assets resulting from operations 4,537,045 3,439,456 -------------- -------------- UNIT TRANSACTIONS: Purchases 709,549 1,378,620 Net transfers 20,319,724 (344,670) Surrenders for benefit payments and fees (11,242,633) (21,038,821) Net annuity transactions (3,801) 17,912 -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 9,782,839 (19,986,959) -------------- -------------- Net increase (decrease) in net assets 14,319,884 (16,547,503) NET ASSETS: Beginning of year 104,769,008 196,629,922 -------------- -------------- End of year $119,088,892 $180,082,419 ============== ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-64 -------------------------------------------------------------------------------
HARTFORD TEMPLETON HARTFORD LARGECAP DEVELOPING MARKETS TEMPLETON GROWTH ADVISERS GROWTH SECURITIES FUND SECURITIES FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $208,575 $(410,408) $381,097 $129 Net realized gain (loss) on security transactions 2,732,942 2,031,236 (18,703) -- Net realized gain on distributions 2,858,930 2,967,648 5,364,113 -- Net unrealized appreciation (depreciation) of investments during the year 3,078,962 (4,101,753) (3,809,020) (776) ------------- ------------- ------------- --------- Net increase (decrease) in net assets resulting from operations 8,879,409 486,723 1,917,487 (647) ------------- ------------- ------------- --------- UNIT TRANSACTIONS: Purchases 517,583 652,709 10,086,472 40,011 Net transfers (2,010,904) (3,014,657) 3,753,815 57,965 Surrenders for benefit payments and fees (3,259,375) (6,812,039) (2,380,465) -- Net annuity transactions -- (17,262) (3,841) -- ------------- ------------- ------------- --------- Net increase (decrease) in net assets resulting from unit transactions (4,752,696) (9,191,249) 11,455,981 97,976 ------------- ------------- ------------- --------- Net increase (decrease) in net assets 4,126,713 (8,704,526) 13,373,468 97,329 NET ASSETS: Beginning of year 37,135,086 71,392,515 37,648,043 -- ------------- ------------- ------------- --------- End of year $41,261,799 $62,687,989 $51,021,511 $97,329 ============= ============= ============= ========= HARTFORD HARTFORD HARTFORD TOTAL DIVIDEND AND FUNDAMENTAL RETURN BOND GROWTH GROWTH HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (B) ----------------------------- ------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $24,197,874 $2,324,747 $(43,778) Net realized gain (loss) on security transactions 22,249 67,976 (18,485) Net realized gain on distributions -- 40,863,517 224,970 Net unrealized appreciation (depreciation) of investments during the year (7,928,908) (21,311,474) 122,291 -------------- -------------- ------------ Net increase (decrease) in net assets resulting from operations 16,291,215 21,944,766 284,998 -------------- -------------- ------------ UNIT TRANSACTIONS: Purchases 141,827,047 171,943,706 1,200,842 Net transfers 117,168,592 85,891,850 1,078,751 Surrenders for benefit payments and fees (27,531,754) (21,625,157) (312,037) Net annuity transactions 335,315 80,517 -- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 231,799,200 236,290,916 1,967,556 -------------- -------------- ------------ Net increase (decrease) in net assets 248,090,415 258,235,682 2,252,554 NET ASSETS: Beginning of year 384,293,035 295,209,131 1,754,290 -------------- -------------- ------------ End of year $632,383,450 $553,444,813 $4,006,844 ============== ============== ============
(a) From inception September 20, 2007 to December 31, 2007. (b) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. SA-65 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD GLOBAL ADVISERS GLOBAL GROWTH HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (C) -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(38,059) $(280,644) Net realized gain (loss) on security transactions 26,766 9,781 Net realized gain on distributions 783,092 2,705,230 Net unrealized appreciation (depreciation) of investments during the year 482,548 1,055,049 ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,254,347 3,489,416 ------------- ------------- UNIT TRANSACTIONS: Purchases 2,939,414 4,036,821 Net transfers 2,483,767 10,681,990 Surrenders for benefit payments and fees (702,790) (936,897) Net annuity transactions -- -- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 4,720,391 13,781,914 ------------- ------------- Net increase (decrease) in net assets 5,974,738 17,271,330 NET ASSETS: Beginning of year 6,282,509 12,297,388 ------------- ------------- End of year $12,257,247 $29,568,718 ============= =============
(c) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-66 -------------------------------------------------------------------------------
HARTFORD DISCIPLINED HARTFORD GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HARTFORD HIGH HLS FUND HLS FUND HLS FUND YIELD HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(2,803,609) $(428,206) $(1,609,558) $2,917,126 Net realized gain (loss) on security transactions (11,116) 45,299 3,592 1,358 Net realized gain on distributions 1,867,280 2,235,919 24,609,064 -- Net unrealized appreciation (depreciation) of investments during the year 30,900,843 2,225,660 1,945,249 (2,787,024) --------------- ------------- --------------- ------------- Net increase (decrease) in net assets resulting from operations 29,953,398 4,078,672 24,948,347 131,460 --------------- ------------- --------------- ------------- UNIT TRANSACTIONS: Purchases 100,332,014 5,030,566 39,800,851 11,208,708 Net transfers 41,813,900 2,186,018 41,169,228 8,911,362 Surrenders for benefit payments and fees (24,027,291) (1,681,388) (5,713,022) (2,298,134) Net annuity transactions 203,312 (767) -- 317 --------------- ------------- --------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 118,321,935 5,534,429 75,257,057 17,822,253 --------------- ------------- --------------- ------------- Net increase (decrease) in net assets 148,275,333 9,613,101 100,205,404 17,953,713 NET ASSETS: Beginning of year 406,141,513 25,927,534 70,131,384 28,184,838 --------------- ------------- --------------- ------------- End of year $554,416,846 $35,540,635 $170,336,788 $46,138,551 =============== ============= =============== ============= HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL HARTFORD INDEX GROWTH SMALL COMPANY HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $51,342 $(483,453) $72,729 Net realized gain (loss) on security transactions 39,444 99,274 14,771 Net realized gain on distributions 1,585,508 16,708,538 8,568,561 Net unrealized appreciation (depreciation) of investments during the year (998,879) (801,199) (5,906,861) ------------- --------------- ------------- Net increase (decrease) in net assets resulting from operations 677,415 15,523,160 2,749,200 ------------- --------------- ------------- UNIT TRANSACTIONS: Purchases 5,918,100 23,329,710 20,403,005 Net transfers 2,105,893 16,231,067 (2,132,602) Surrenders for benefit payments and fees (817,764) (3,211,617) (2,016,720) Net annuity transactions -- (843) 11,708 ------------- --------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 7,206,229 36,348,317 16,265,391 ------------- --------------- ------------- Net increase (decrease) in net assets 7,883,644 51,871,477 19,014,591 NET ASSETS: Beginning of year 20,582,129 54,476,133 36,710,761 ------------- --------------- ------------- End of year $28,465,773 $106,347,610 $55,725,352 ============= =============== =============
(d) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-67 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD INTERNATIONAL OPPORTUNITIES HARTFORD MID CAP HLS FUND GROWTH HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(486,729) $295 Net realized gain (loss) on security transactions 922,300 1 Net realized gain on distributions 31,451,114 8,218 Net unrealized appreciation (depreciation) of investments during the year 1,350,430 (8,820) -------------- ---------- Net increase (decrease) in net assets resulting from operations 33,237,115 (306) -------------- ---------- UNIT TRANSACTIONS: Purchases 33,829,046 164,466 Net transfers 8,197,656 34,354 Surrenders for benefit payments and fees (6,480,599) -- Net annuity transactions 41,328 -- -------------- ---------- Net increase (decrease) in net assets resulting from unit transactions 35,587,431 198,820 -------------- ---------- Net increase (decrease) in net assets 68,824,546 198,514 NET ASSETS: Beginning of year 110,044,716 -- -------------- ---------- End of year $178,869,262 $198,514 ============== ==========
(a) From inception September 20, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-68 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD SMALL HARTFORD SMALL MONEY MARKET SECURITIES CAP VALUE COMPANY HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $3,388,602 $573,556 $585 $(261,913) Net realized gain (loss) on security transactions -- 1,300 (1,208) 4,071 Net realized gain on distributions -- -- 4,846 5,525,626 Net unrealized appreciation (depreciation) of investments during the year -- (346,826) (3,198) (3,507,282) -------------- ------------- ---------- ------------- Net increase (decrease) in net assets resulting from operations 3,388,602 228,030 1,025 1,760,502 -------------- ------------- ---------- ------------- UNIT TRANSACTIONS: Purchases 83,617,432 2,071,448 37,008 25,107,369 Net transfers 9,331,833 2,149,436 67,315 16,294,876 Surrenders for benefit payments and fees (22,369,369) (958,322) -- (795,572) Net annuity transactions 566 (4,585) -- (6,761) -------------- ------------- ---------- ------------- Net increase (decrease) in net assets resulting from unit transactions 70,580,462 3,257,977 104,323 40,599,912 -------------- ------------- ---------- ------------- Net increase (decrease) in net assets 73,969,064 3,486,007 105,348 42,360,414 NET ASSETS: Beginning of year 73,139,694 10,865,520 -- 6,780,325 -------------- ------------- ---------- ------------- End of year $147,108,758 $14,351,527 $105,348 $49,140,739 ============== ============= ========== ============= HARTFORD HARTFORD U.S. SMALLCAP GOVERNMENT GROWTH HARTFORD STOCK SECURITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(610,253) $(312,558) $5,256,903 Net realized gain (loss) on security transactions (9,283) 153,329 7,810 Net realized gain on distributions 3,351,975 8,440,213 -- Net unrealized appreciation (depreciation) of investments during the year (4,220,349) (6,351,332) 1,498,031 ------------- ------------- -------------- Net increase (decrease) in net assets resulting from operations (1,487,910) 1,929,652 6,762,744 ------------- ------------- -------------- UNIT TRANSACTIONS: Purchases 6,115,619 8,494,754 73,032,582 Net transfers (3,825,133) 2,648,544 69,616,683 Surrenders for benefit payments and fees (2,151,308) (4,277,565) (12,642,282) Net annuity transactions (2,851) -- 150,873 ------------- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 136,327 6,865,733 130,157,856 ------------- ------------- -------------- Net increase (decrease) in net assets (1,351,583) 8,795,385 136,920,600 NET ASSETS: Beginning of year 44,699,396 49,928,926 167,601,426 ------------- ------------- -------------- End of year $43,347,813 $58,724,311 $304,522,026 ============= ============= ==============
(a) From inception September 20, 2007 to December 31, 2007. SA-69 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD VALUE HARTFORD VALUE OPPORTUNITIES HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $195,457 $(217,420) Net realized gain (loss) on security transactions 38,567 9,648 Net realized gain on distributions 2,450,487 10,476,334 Net unrealized appreciation (depreciation) of investments during the year (1,177,113) (16,815,590) ------------- -------------- Net increase (decrease) in net assets resulting from operations 1,507,398 (6,547,028) ------------- -------------- UNIT TRANSACTIONS: Purchases 31,328,476 23,582,783 Net transfers 12,728,916 (4,174,285) Surrenders for benefit payments and fees (1,939,507) (2,435,938) Net annuity transactions 14,359 -- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 42,132,244 16,972,560 ------------- -------------- Net increase (decrease) in net assets 43,639,642 10,425,532 NET ASSETS: Beginning of year 18,505,324 54,850,180 ------------- -------------- End of year $62,144,966 $65,275,712 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-70 -------------------------------------------------------------------------------
HARTFORD LORD ABBETT LORD ABBETT EQUITY INCOME LORD ABBETT ALL AMERICA'S VALUE BOND DEBENTURE HLS FUND VALUE PORTFOLIO PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (E) --------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $368,179 $(273,543) $637,571 $3,581,990 Net realized gain (loss) on security transactions (19,069) 49,082 25,737 41,612 Net realized gain on distributions 1,393,309 1,477,477 1,024,036 239,107 Net unrealized appreciation (depreciation) of investments during the year (205,041) 333,404 (1,590,107) (1,490,530) ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,537,378 1,586,420 97,237 2,372,179 ------------- ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 10,640,243 7,352,574 6,260,517 16,627,932 Net transfers 4,270,993 3,596,592 7,053,334 17,009,173 Surrenders for benefit payments and fees (1,861,080) (1,664,204) (1,270,997) (2,846,040) Net annuity transactions (632) (747) (1,168) (521) ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 13,049,524 9,284,215 12,041,686 30,790,544 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets 14,586,902 10,870,635 12,138,923 33,162,723 NET ASSETS: Beginning of year 25,053,303 28,389,930 20,162,744 40,762,217 ------------- ------------- ------------- ------------- End of year $39,640,205 $39,260,565 $32,301,667 $73,924,940 ============= ============= ============= ============= LORD ABBETT LORD ABBETT GROWTH AND LARGE CAP MFS CORE INCOME PORTFOLIO CORE FUND EQUITY SERIES SUB-ACCOUNT SUB-ACCOUNT (F) SUB-ACCOUNT (G) ----------------------------- -------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $217,345 $(97,301) $(138,455) Net realized gain (loss) on security transactions 17,633 42,186 303,441 Net realized gain on distributions 21,125,654 546,791 -- Net unrealized appreciation (depreciation) of investments during the year (19,355,986) 644,438 674,262 -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 2,004,646 1,136,114 839,248 -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 106,967,995 3,558,768 4,795 Net transfers 52,647,445 860,094 (103,156) Surrenders for benefit payments and fees (11,120,786) (752,679) (1,034,759) Net annuity transactions 70,819 -- (40) -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 148,565,473 3,666,183 (1,133,160) -------------- ------------- ------------- Net increase (decrease) in net assets 150,570,119 4,802,297 (293,912) NET ASSETS: Beginning of year 161,600,726 11,070,605 9,383,686 -------------- ------------- ------------- End of year $312,170,845 $15,872,902 $9,089,774 ============== ============= =============
(e) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. (f) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (g) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-71 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MFS INVESTORS MFS EMERGING GROWTH STOCK GROWTH SERIES SERIES SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(209,538) $(131,020) Net realized gain (loss) on security transactions 1,020,466 477,811 Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year 1,120,487 424,270 ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,931,415 771,061 ------------- ------------- UNIT TRANSACTIONS: Purchases 48,147 26,606 Net transfers (564,840) (645,510) Surrenders for benefit payments and fees (1,075,478) (1,169,229) Net annuity transactions (41) -- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (1,592,212) (1,788,133) ------------- ------------- Net increase (decrease) in net assets 339,203 (1,017,072) NET ASSETS: Beginning of year 11,113,501 8,777,292 ------------- ------------- End of year $11,452,704 $7,760,220 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-72 -------------------------------------------------------------------------------
MFS INVESTORS MFS TOTAL EQUITY AND CORE PLUS TRUST SERIES RETURN SERIES INCOME FIXED INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(258,945) $1,655,301 $(42,753) $2,538,960 Net realized gain (loss) on security transactions 821,581 3,493,875 400,308 289,044 Net realized gain on distributions 202,583 5,861,296 741,024 -- Net unrealized appreciation (depreciation) of investments during the year 1,104,709 (5,397,380) (671,358) 1,955,449 ------------- -------------- ------------- -------------- Net increase (decrease) in net assets resulting from operations 1,869,928 5,613,092 427,221 4,783,453 ------------- -------------- ------------- -------------- UNIT TRANSACTIONS: Purchases 175,108 1,428,317 158,500 363,958 Net transfers (743,601) (342,698) (512,724) 4,942,032 Surrenders for benefit payments and fees (2,125,485) (25,548,759) (2,091,662) (17,284,433) Net annuity transactions -- 20,751 -- 38,784 ------------- -------------- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions (2,693,978) (24,442,389) (2,445,886) (11,939,659) ------------- -------------- ------------- -------------- Net increase (decrease) in net assets (824,050) (18,829,297) (2,018,665) (7,156,206) NET ASSETS: Beginning of year 23,959,926 241,073,232 28,970,040 141,467,869 ------------- -------------- ------------- -------------- End of year $23,135,876 $222,243,935 $26,951,375 $134,311,663 ============= ============== ============= ============== EMERGING EMERGING MARKETS DEBT MARKETS EQUITY HIGH YIELD SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------- OPERATIONS: Net investment income (loss) $648,734 $(1,101,678) $1,804,533 Net realized gain (loss) on security transactions 186,998 1,112,125 (683,659) Net realized gain on distributions 372,113 8,960,596 -- Net unrealized appreciation (depreciation) of investments during the year (686,548) 17,471,777 (574,433) ------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations 521,297 26,442,820 546,441 ------------- -------------- ------------- UNIT TRANSACTIONS: Purchases 32,696 22,053,356 90,007 Net transfers (242,334) 16,206,657 (244,485) Surrenders for benefit payments and fees (1,585,500) (5,608,152) (4,516,954) Net annuity transactions -- (280) 4,405 ------------- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (1,795,138) 32,651,581 (4,667,027) ------------- -------------- ------------- Net increase (decrease) in net assets (1,273,841) 59,094,401 (4,120,586) NET ASSETS: Beginning of year 12,699,803 60,856,533 27,379,011 ------------- -------------- ------------- End of year $11,425,962 $119,950,934 $23,258,425 ============= ============== =============
SA-73 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MID CAP U.S. MID GROWTH CAP VALUE SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(337,594) $(1,202,495) Net realized gain (loss) on security transactions 47,171 1,484,900 Net realized gain on distributions 974,491 10,885,592 Net unrealized appreciation (depreciation) of investments during the year 3,052,493 (5,355,129) ------------- -------------- Net increase (decrease) in net assets resulting from operations 3,736,561 5,812,868 ------------- -------------- UNIT TRANSACTIONS: Purchases 6,348,429 9,678,609 Net transfers 10,620,063 740,064 Surrenders for benefit payments and fees (826,548) (11,438,760) Net annuity transactions -- 22,029 ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 16,141,944 (998,058) ------------- -------------- Net increase (decrease) in net assets 19,878,505 4,814,810 NET ASSETS: Beginning of year 15,047,178 97,760,453 ------------- -------------- End of year $34,925,683 $102,575,263 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-74 -------------------------------------------------------------------------------
CAPITAL DEVELOPING FOCUS GROWTH BALANCED GROWTH OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(2,285,265) $586,045 $(446,220) $(544,788) Net realized gain (loss) on security transactions 7,982,940 2,470,522 893,251 4,593,289 Net realized gain on distributions -- 5,422,819 -- -- Net unrealized appreciation (depreciation) of investments during the year 23,301,711 (6,804,344) 3,939,088 4,745,186 ------------ ------------ ------------ ----------- Net increase (decrease) in net assets resulting from operations 28,999,386 1,675,042 4,386,119 8,793,687 ------------ ------------ ------------ ----------- UNIT TRANSACTIONS: Purchases 313,293 194,455 49,827 65,847 Net transfers (7,619,876) (1,446,999) (2,153,506) 367,599 Surrenders for benefit payments and fees (31,421,198) (13,042,621) (4,570,654) (9,880,818) Net annuity transactions (71,585) (47,890) 3,013 (12,765) ------------ ------------ ------------ ----------- Net increase (decrease) in net assets resulting from unit transactions (38,799,366) (14,343,055) (6,671,320) (9,460,137) ------------ ------------ ------------ ----------- Net increase (decrease) in net assets (9,799,980) (12,668,013) (2,285,201) (666,450) NET ASSETS: Beginning of year 157,594,379 74,186,253 29,017,898 46,355,450 ------------ ------------ ------------ ----------- End of year $147,794,399 $61,518,240 $26,732,697 $45,689,000 ============ ============ ============ =========== FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------ OPERATIONS: Net investment income (loss) $2,029,152 $(865,923) $(530,677) Net realized gain (loss) on security transactions (1,737,850) 11,151,188 3,017,282 Net realized gain on distributions -- -- 8,327,043 Net unrealized appreciation (depreciation) of investments during the year 678,790 (3,853,602) (2,465,555) ----------- ------------ ------------ Net increase (decrease) in net assets resulting from operations 970,092 6,431,663 8,348,093 ----------- ------------ ------------ UNIT TRANSACTIONS: Purchases 99,506 326,174 255,192 Net transfers 919,267 (9,688,643) (1,393,013) Surrenders for benefit payments and fees (7,264,172) (43,958,916) (12,998,754) Net annuity transactions (29,424) (120,937) (20,981) ----------- ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions (6,274,823) (53,442,322) (14,157,556) ----------- ------------ ------------ Net increase (decrease) in net assets (5,304,731) (47,010,659) (5,809,463) NET ASSETS: Beginning of year 48,878,972 227,594,480 62,178,070 ----------- ------------ ------------ End of year $43,574,241 $180,583,821 $56,368,607 =========== ============ ============
SA-75 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
GROWTH MONEY MARKET SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(821,199) $3,253,659 Net realized gain (loss) on security transactions 2,894,281 -- Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year 6,299,230 -- ------------- -------------- Net increase (decrease) in net assets resulting from operations 8,372,312 3,253,659 ------------- -------------- UNIT TRANSACTIONS: Purchases 306,737 988,602 Net transfers (3,260,114) 47,566,571 Surrenders for benefit payments and fees (6,756,470) (50,887,032) Net annuity transactions (150,066) (23,752) ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions (9,859,913) (2,355,611) ------------- -------------- Net increase (decrease) in net assets (1,487,601) 898,048 NET ASSETS: Beginning of year 47,248,481 113,300,281 ------------- -------------- End of year $45,760,880 $114,198,329 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-76 -------------------------------------------------------------------------------
EQUALLY WEIGHTED SMALL COMPANY UTILITIES S&P 500 GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $136,617 $(720,612) $(365,601) $(830,587) Net realized gain (loss) on security transactions 6,822,838 9,594,950 163,481 (47,276) Net realized gain on distributions -- 15,950,131 1,519,618 3,690,300 Net unrealized appreciation (depreciation) of investments during the year 3,706,989 (24,144,725) (1,152,745) (3,820) -------------- -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 10,666,444 679,744 164,753 2,808,617 -------------- -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 132,437 1,165,019 210,196 989,297 Net transfers (815,045) (7,109,784) (805,906) 2,213,385 Surrenders for benefit payments and fees (12,787,485) (28,488,021) (1,016,855) (3,605,611) Net annuity transactions (32,419) (27,635) -- -- -------------- -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (13,502,512) (34,460,421) (1,612,565) (402,929) -------------- -------------- ------------- ------------- Net increase (decrease) in net assets (2,836,068) (33,780,677) (1,447,812) 2,405,688 NET ASSETS: Beginning of year 63,905,877 191,072,093 18,163,667 36,828,439 -------------- -------------- ------------- ------------- End of year $61,069,809 $157,291,416 $16,715,855 $39,234,127 ============== ============== ============= ============= OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL GLOBAL SECURITIES MIDCAP FUND APPRECIATION FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- -------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(76,543) $(1,390,513) $(1,812,454) Net realized gain (loss) on security transactions 10,956 205,374 (60,918) Net realized gain on distributions -- -- 11,343,947 Net unrealized appreciation (depreciation) of investments during the year 192,667 10,204,389 (1,460,165) ------------ -------------- -------------- Net increase (decrease) in net assets resulting from operations 127,080 9,019,250 8,010,410 ------------ -------------- -------------- UNIT TRANSACTIONS: Purchases 2,061,108 33,347,141 129,136,509 Net transfers 306,412 12,160,795 59,100,616 Surrenders for benefit payments and fees (135,285) (4,125,656) (12,897,906) Net annuity transactions -- 31,760 77,351 ------------ -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 2,232,235 41,414,040 175,416,570 ------------ -------------- -------------- Net increase (decrease) in net assets 2,359,315 50,433,290 183,426,980 NET ASSETS: Beginning of year 3,514,142 62,316,034 194,418,596 ------------ -------------- -------------- End of year $5,873,457 $112,749,324 $377,845,576 ============ ============== ==============
SA-77 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER MAIN STREET MAIN STREET FUND SMALL CAP FUND SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(165,546) $(2,417,012) Net realized gain (loss) on security transactions 12,645 71,232 Net realized gain on distributions -- 4,894,006 Net unrealized appreciation (depreciation) of investments during the year 367,253 (10,502,637) ------------- -------------- Net increase (decrease) in net assets resulting from operations 214,352 (7,954,411) ------------- -------------- UNIT TRANSACTIONS: Purchases 10,095,644 52,290,598 Net transfers (1,832,215) 18,006,291 Surrenders for benefit payments and fees (779,698) (7,136,314) Net annuity transactions -- 66,655 ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 7,483,731 63,227,230 ------------- -------------- Net increase (decrease) in net assets 7,698,083 55,272,819 NET ASSETS: Beginning of year 12,220,210 124,692,399 ------------- -------------- End of year $19,918,293 $179,965,218 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-78 -------------------------------------------------------------------------------
PUTNAM VT PUTNAM INTERNATIONAL DIVERSIFIED PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND INCOME ASSET ALLOCATION AND INCOME INCOME FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,158,057 $(166,391) $(40,268) $(137) Net realized gain (loss) on security transactions (35,975) 43,595 6,978 10 Net realized gain on distributions -- -- 1,327,718 -- Net unrealized appreciation (depreciation) of investments during the year 173,915 153,853 (2,272,771) (1,457) ------------- ------------- ------------- ---------- Net increase (decrease) in net assets resulting from operations 1,295,997 31,057 (978,343) (1,584) ------------- ------------- ------------- ---------- UNIT TRANSACTIONS: Purchases 27,283,901 7,083,865 4,006,611 122,671 Net transfers 12,227,423 817,408 546,597 117,165 Surrenders for benefit payments and fees (1,813,264) (765,533) (404,301) (166) Net annuity transactions -- -- -- -- ------------- ------------- ------------- ---------- Net increase (decrease) in net assets resulting from unit transactions 37,698,060 7,135,740 4,148,907 239,670 ------------- ------------- ------------- ---------- Net increase (decrease) in net assets 38,994,057 7,166,797 3,170,564 238,086 NET ASSETS: Beginning of year 30,238,621 11,009,814 8,107,707 -- ------------- ------------- ------------- ---------- End of year $69,232,678 $18,176,611 $11,278,271 $238,086 ============= ============= ============= ========== PUTNAM INTERNATIONAL PUTNAM PUTNAM EQUITY INVESTORS NEW VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,505,679 $(248,770) $(104,216) Net realized gain (loss) on security transactions 185,017 (45,353) (23,313) Net realized gain on distributions 17,938,165 -- 1,894,932 Net unrealized appreciation (depreciation) of investments during the year (10,957,248) (1,825,616) (3,804,389) -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 8,671,613 (2,119,739) (2,036,986) -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 44,022,379 28,832,745 6,632,171 Net transfers 7,424,966 12,880,038 6,373,892 Surrenders for benefit payments and fees (7,252,279) (624,921) (946,900) Net annuity transactions 53,751 15,887 -- -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 44,248,817 41,103,749 12,059,163 -------------- ------------- ------------- Net increase (decrease) in net assets 52,920,430 38,984,010 10,022,177 NET ASSETS: Beginning of year 127,346,936 7,862,224 17,512,572 -------------- ------------- ------------- End of year $180,267,366 $46,846,234 $27,534,749 ============== ============= =============
(a) From inception September 20, 2007 to December 31, 2007. SA-79 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
PUTNAM THE PUTNAM SMALL GEORGE PUTNAM CAP VALUE FUND OF BOSTON SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,413,409) $182,196 Net realized gain (loss) on security transactions (247,342) 18,166 Net realized gain on distributions 13,652,542 1,925,298 Net unrealized appreciation (depreciation) of investments during the year (32,970,803) (2,549,729) -------------- ------------- Net increase (decrease) in net assets resulting from operations (20,979,012) (424,069) -------------- ------------- UNIT TRANSACTIONS: Purchases 32,371,033 13,463,532 Net transfers 9,899,803 (1,451,099) Surrenders for benefit payments and fees (5,733,294) (1,034,312) Net annuity transactions 41,292 (754) -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 36,578,834 10,977,367 -------------- ------------- Net increase (decrease) in net assets 15,599,822 10,553,298 NET ASSETS: Beginning of year 107,931,531 18,091,271 -------------- ------------- End of year $123,531,353 $28,644,569 ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-80 -------------------------------------------------------------------------------
PUTNAM GROWTH AND PUTNAM VISTA VOYAGER ENTERPRISE INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(37,356) $(50,949) $(165,443) $(874,468) Net realized gain (loss) on security transactions 10,134 14,048 (492,896) 4,259,783 Net realized gain on distributions -- -- -- 8,232,350 Net unrealized appreciation (depreciation) of investments during the year 64,486 137,901 1,984,536 (10,601,498) ------------ ------------ ------------- -------------- Net increase (decrease) in net assets resulting from operations 37,264 101,000 1,326,197 1,016,167 ------------ ------------ ------------- -------------- UNIT TRANSACTIONS: Purchases 473,759 670,936 5,973 31,498,235 Net transfers 516,849 (170,595) (702,088) 16,213,247 Surrenders for benefit payments and fees (133,075) (133,537) (2,061,858) (20,458,019) Net annuity transactions -- -- (813) (24,166) ------------ ------------ ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 857,533 366,804 (2,758,786) 27,229,297 ------------ ------------ ------------- -------------- Net increase (decrease) in net assets 894,797 467,804 (1,432,589) 28,245,464 NET ASSETS: Beginning of year 2,306,461 2,550,270 13,179,860 212,466,381 ------------ ------------ ------------- -------------- End of year $3,201,258 $3,018,074 $11,747,271 $240,711,845 ============ ============ ============= ============== STRATEGIC AGGRESSIVE COMSTOCK GROWTH GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(736,824) $(90,202) $(28,096) Net realized gain (loss) on security transactions 1,125,719 157,109 22,500 Net realized gain on distributions 5,861,801 -- 91,242 Net unrealized appreciation (depreciation) of investments during the year (18,764,730) 519,771 110,027 -------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations (12,514,034) 586,678 195,673 -------------- ------------ ------------ UNIT TRANSACTIONS: Purchases 29,616,194 7,938 -- Net transfers 17,720,823 (271,585) (137,526) Surrenders for benefit payments and fees (17,153,826) (339,038) (83,850) Net annuity transactions 24,942 -- -- -------------- ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 30,208,133 (602,685) (221,376) -------------- ------------ ------------ Net increase (decrease) in net assets 17,694,099 (16,007) (25,703) NET ASSETS: Beginning of year 255,514,407 4,387,635 1,382,309 -------------- ------------ ------------ End of year $273,208,506 $4,371,628 $1,356,606 ============== ============ ============
SA-81 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO ADVANTAGE VT GOVERNMENT ASSET ALLOCATION PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $758,953 $1,731 Net realized gain (loss) on security transactions (22,851) 3,065 Net realized gain on distributions -- 10,091 Net unrealized appreciation (depreciation) of investments during the year 800,839 18,474 ------------- ---------- Net increase (decrease) in net assets resulting from operations 1,536,941 33,361 ------------- ---------- UNIT TRANSACTIONS: Purchases 332,865 38,600 Net transfers 7,495,365 (1,985) Surrenders for benefit payments and fees (2,045,810) (20,869) Net annuity transactions -- -- ------------- ---------- Net increase (decrease) in net assets resulting from unit transactions 5,782,420 15,746 ------------- ---------- Net increase (decrease) in net assets 7,319,361 49,107 NET ASSETS: Beginning of year 28,290,854 603,796 ------------- ---------- End of year $35,610,215 $652,903 ============= ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-82 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT TOTAL RETURN EQUITY INCOME C&B LARGE CAP LARGE COMPANY BOND FUND FUND VALUE FUND CORE FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $23,050 $(2,478) $(5,459) $(654) Net realized gain (loss) on security transactions (1,929) 1,483 1,869 (71) Net realized gain on distributions -- 27,305 -- -- Net unrealized appreciation (depreciation) of investments during the year 11,339 (22,529) (43,531) (2,738) ----------- ---------- ------------ --------- Net increase (decrease) in net assets resulting from operations 32,460 3,781 (47,121) (3,463) ----------- ---------- ------------ --------- UNIT TRANSACTIONS: Purchases 110,195 -- 468,761 -- Net transfers (258,316) (9,756) 276,348 45,115 Surrenders for benefit payments and fees (26,231) (17,173) (62,462) (1,415) Net annuity transactions -- -- -- -- ----------- ---------- ------------ --------- Net increase (decrease) in net assets resulting from unit transactions (174,352) (26,929) 682,647 43,700 ----------- ---------- ------------ --------- Net increase (decrease) in net assets (141,892) (23,148) 635,526 40,237 NET ASSETS: Beginning of year 917,653 417,507 954,720 5,929 ----------- ---------- ------------ --------- End of year $775,761 $394,359 $1,590,246 $46,166 =========== ========== ============ ========= WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT INTERNATIONAL LARGE COMPANY MONEY MARKET CORE FUND GROWTH FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(3,854) $(82,617) $31,591 Net realized gain (loss) on security transactions 904 48,933 -- Net realized gain on distributions 13,986 -- -- Net unrealized appreciation (depreciation) of investments during the year 8,094 312,515 -- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 19,130 278,831 31,591 ---------- ------------ ------------- UNIT TRANSACTIONS: Purchases 29,565 812,023 (117,059) Net transfers 14,801 283,622 (854,494) Surrenders for benefit payments and fees (8,145) (229,719) (34,003) Net annuity transactions -- -- -- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 36,221 865,926 (1,005,556) ---------- ------------ ------------- Net increase (decrease) in net assets 55,351 1,144,757 (973,965) NET ASSETS: Beginning of year 181,532 3,952,497 1,843,426 ---------- ------------ ------------- End of year $236,883 $5,097,254 $869,461 ========== ============ =============
SA-83 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO ADVANTAGE VT WELLS FARGO ADVANTAGE VT WELLS FARGO SMALL CAP ADVANTAGE VT SMALL/MID CAP ADVANTAGE VT GROWTH FUND DISCOVERY FUND VALUE FUND OPPORTUNITY FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(49,394) $(3,753) $(3,829) $(3,038) Net realized gain (loss) on security transactions 21,791 1,505 78 659 Net realized gain on distributions 460,646 -- 41,592 67,315 Net unrealized appreciation (depreciation) of investments during the year (122,667) 42,028 (45,653) (75,394) ------------ ---------- ---------- ---------- Net increase (decrease) in net assets resulting from operations 310,376 39,780 (7,812) (10,458) ------------ ---------- ---------- ---------- UNIT TRANSACTIONS: Purchases 705,014 35,000 17,915 399,896 Net transfers 1,627 77,518 40,960 301,743 Surrenders for benefit payments and fees (145,832) (3,199) (3,061) (7,875) Net annuity transactions -- -- -- -- ------------ ---------- ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions 560,809 109,319 55,814 693,764 ------------ ---------- ---------- ---------- Net increase (decrease) in net assets 871,185 149,099 48,002 683,306 NET ASSETS: Beginning of year 2,399,900 162,262 204,820 114,463 ------------ ---------- ---------- ---------- End of year $3,271,085 $311,361 $252,822 $797,769 ============ ========== ========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-84 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-85 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH PORTFOLIO GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(344,096) $(39,481) Net realized gain (loss) on security transactions 26,258 2,802 Net realized gain on distributions -- 35,724 Net unrealized appreciation (depreciation) of investments during the year 4,600,267 297,209 ------------- ------------ Net increase (decrease) in net assets resulting from operations 4,282,429 296,254 ------------- ------------ UNIT TRANSACTIONS: Purchases 30,310,684 2,334,983 Net transfers 5,874,322 613,748 Surrenders for benefit payments and fees (1,474,631) (47,624) Net annuity transactions -- -- ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 34,710,375 2,901,107 ------------- ------------ Net increase (decrease) in net assets 38,992,804 3,197,361 NET ASSETS: Beginning of year 14,073,939 860,035 ------------- ------------ End of year $53,066,743 $4,057,396 ============= ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-86 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN AMERICAN FUNDS VP INTERNATIONAL VP SMALL/MID CAP ALLIANCEBERNSTEIN GLOBAL GROWTH VALUE PORTFOLIO VALUE PORTFOLIO VP VALUE PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(756,051) $(205,368) $(515,862) $(722,836) Net realized gain (loss) on security transactions 80,159 17,858 13,960 625,322 Net realized gain on distributions 2,530,379 914,080 1,774,977 -- Net unrealized appreciation (depreciation) of investments during the year 40,995,331 995,217 11,376,189 12,387,861 -------------- ------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations 42,849,818 1,721,787 12,649,264 12,290,347 -------------- ------------- -------------- ------------- UNIT TRANSACTIONS: Purchases 103,823,626 10,437,170 40,980,274 4,431,613 Net transfers 35,004,247 2,645,312 17,540,303 6,055,659 Surrenders for benefit payments and fees (5,636,689) (556,025) (2,938,199) (5,620,473) Net annuity transactions 204,539 209,918 230,313 (6,778) -------------- ------------- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 133,395,723 12,736,375 55,812,691 4,860,021 -------------- ------------- -------------- ------------- Net increase (decrease) in net assets 176,245,541 14,458,162 68,461,955 17,150,368 NET ASSETS: Beginning of year 70,478,571 7,286,993 34,714,540 64,643,030 -------------- ------------- -------------- ------------- End of year $246,724,112 $21,745,155 $103,176,495 $81,793,398 ============== ============= ============== ============= AMERICAN FUNDS AMERICAN FUNDS GROWTH-INCOME AMERICAN FUNDS GROWTH FUND FUND INTERNATIONAL FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(5,535,303) $(1,569,414) $(323,932) Net realized gain (loss) on security transactions 8,147,605 5,845,267 469,920 Net realized gain on distributions 3,066,834 11,189,190 1,521,769 Net unrealized appreciation (depreciation) of investments during the year 32,973,787 43,182,729 24,147,419 -------------- -------------- -------------- Net increase (decrease) in net assets resulting from operations 38,652,923 58,647,772 25,815,176 -------------- -------------- -------------- UNIT TRANSACTIONS: Purchases 27,912,796 23,564,493 20,309,680 Net transfers 910,255 472,233 16,856,022 Surrenders for benefit payments and fees (34,823,532) (34,565,599) (13,034,961) Net annuity transactions (27,291) (21,364) 8,829 -------------- -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions (6,027,772) (10,550,237) 24,139,570 -------------- -------------- -------------- Net increase (decrease) in net assets 32,625,151 48,097,535 49,954,746 NET ASSETS: Beginning of year 475,893,429 449,863,675 138,587,272 -------------- -------------- -------------- End of year $508,518,580 $497,961,210 $188,542,018 ============== ============== ==============
SA-87 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION FIDELITY VIP FUND EQUITY-INCOME SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(799,897) $920,221 Net realized gain (loss) on security transactions 384,511 13,924 Net realized gain on distributions 2,874,364 9,203,670 Net unrealized appreciation (depreciation) of investments during the year 8,248,000 2,260,706 ------------- -------------- Net increase (decrease) in net assets resulting from operations 10,706,978 12,398,521 ------------- -------------- UNIT TRANSACTIONS: Purchases 4,035,271 41,793,093 Net transfers 3,405,862 17,401,835 Surrenders for benefit payments and fees (3,723,101) (2,840,397) Net annuity transactions -- 6,407 ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 3,718,032 56,360,938 ------------- -------------- Net increase (decrease) in net assets 14,425,010 68,759,459 NET ASSETS: Beginning of year 47,270,347 36,257,014 ------------- -------------- End of year $61,695,357 $105,016,473 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-88 -------------------------------------------------------------------------------
FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP GROWTH CONTRAFUND MID CAP VALUE STRATEGIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(281,566) $(943,686) $(1,169,427) $(76,418) Net realized gain (loss) on security transactions 854 10,739 (60,074) (13,788) Net realized gain on distributions -- 25,887,190 4,849,318 546,556 Net unrealized appreciation (depreciation) of investments during the year 1,349,143 (4,317,429) 2,204,963 195,738 ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from operations 1,068,431 20,636,814 5,824,780 652,088 ------------- -------------- -------------- ------------ UNIT TRANSACTIONS: Purchases 17,014,306 182,245,427 54,313,035 3,536,263 Net transfers 6,224,834 70,263,489 20,735,577 470,221 Surrenders for benefit payments and fees (584,319) (7,503,002) (2,900,124) (197,370) Net annuity transactions 5,545 60,166 107,358 -- ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 22,660,366 245,066,080 72,255,846 3,809,114 ------------- -------------- -------------- ------------ Net increase (decrease) in net assets 23,728,797 265,702,894 78,080,626 4,461,202 NET ASSETS: Beginning of year 7,465,673 86,957,062 30,916,335 2,731,786 ------------- -------------- -------------- ------------ End of year $31,194,470 $352,659,956 $108,996,961 $7,192,988 ============= ============== ============== ============ FRANKLIN SMALL-MID FRANKLIN STRATEGIC FRANKLIN MUTUAL CAP GROWTH INCOME SECURITIES SHARES SECURITIES SECURITIES FUND FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,117,369) $2,802,296 $(1,120,954) Net realized gain (loss) on security transactions 1,284,174 197,985 2,919,976 Net realized gain on distributions -- 618,170 6,050,920 Net unrealized appreciation (depreciation) of investments during the year 3,629,481 2,586,737 19,931,434 ------------- -------------- -------------- Net increase (decrease) in net assets resulting from operations 3,796,286 6,205,188 27,781,376 ------------- -------------- -------------- UNIT TRANSACTIONS: Purchases 4,014,581 3,924,048 6,949,330 Net transfers 519,580 8,302,410 3,409,849 Surrenders for benefit payments and fees (4,094,684) (8,743,382) (15,444,655) Net annuity transactions (414) (4,075) (19,500) ------------- -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 439,063 3,479,001 (5,104,976) ------------- -------------- -------------- Net increase (decrease) in net assets 4,235,349 9,684,189 22,676,400 NET ASSETS: Beginning of year 55,848,876 95,084,819 173,953,522 ------------- -------------- -------------- End of year $60,084,225 $104,769,008 $196,629,922 ============= ============== ==============
SA-89 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
TEMPLETON DEVELOPING MARKETS TEMPLETON GROWTH SECURITIES FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(218,680) $(379,995) Net realized gain (loss) on security transactions 655,410 697,620 Net realized gain on distributions -- 2,425,982 Net unrealized appreciation (depreciation) of investments during the year 7,117,877 9,003,834 ------------- ------------- Net increase (decrease) in net assets resulting from operations 7,554,607 11,747,441 ------------- ------------- UNIT TRANSACTIONS: Purchases 2,550,690 3,546,455 Net transfers 1,173,462 2,064,724 Surrenders for benefit payments and fees (2,782,936) (4,665,188) Net annuity transactions -- (16,208) ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 941,216 929,783 ------------- ------------- Net increase (decrease) in net assets 8,495,823 12,677,224 NET ASSETS: Beginning of year 28,639,263 58,715,291 ------------- ------------- End of year $37,135,086 $71,392,515 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-90 -------------------------------------------------------------------------------
HARTFORD HARTFORD HARTFORD TOTAL DIVIDEND AND ADVISERS RETURN BOND GROWTH HARTFORD FOCUS HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $388,159 $13,231,904 $1,922,881 $(6,699) Net realized gain (loss) on security transactions (6,103) (1,292) 5,199 3,986 Net realized gain on distributions 2,598,519 37,515 18,835,320 100,503 Net unrealized appreciation (depreciation) of investments during the year (328,107) (2,371,905) 11,042,200 36,619 ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from operations 2,652,468 10,896,222 31,805,600 134,409 ------------- -------------- -------------- ------------ UNIT TRANSACTIONS: Purchases 14,662,428 163,545,275 136,850,687 873,369 Net transfers 5,752,970 82,574,876 61,428,175 107,670 Surrenders for benefit payments and fees (1,183,499) (11,587,584) (6,981,151) (82,346) Net annuity transactions 42,050 152,034 122,204 -- ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 19,273,949 234,684,601 191,419,915 898,693 ------------- -------------- -------------- ------------ Net increase (decrease) in net assets 21,926,417 245,580,823 223,225,515 1,033,102 NET ASSETS: Beginning of year 15,721,626 138,712,212 71,983,616 721,188 ------------- -------------- -------------- ------------ End of year $37,648,043 $384,293,035 $295,209,131 $1,754,290 ============= ============== ============== ============ HARTFORD HARTFORD HARTFORD DISCIPLINED GLOBAL ADVISERS GLOBAL LEADERS EQUITY HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $93,765 $(49,610) $(396,317) Net realized gain (loss) on security transactions (2,808) (20,767) 9,276 Net realized gain on distributions 210,417 617,365 -- Net unrealized appreciation (depreciation) of investments during the year 25,651 421,575 31,256,709 ------------ ------------- -------------- Net increase (decrease) in net assets resulting from operations 327,025 968,563 30,869,668 ------------ ------------- -------------- UNIT TRANSACTIONS: Purchases 2,257,019 5,314,443 176,504,008 Net transfers 1,343,295 2,833,988 75,117,386 Surrenders for benefit payments and fees (132,023) (532,678) (11,325,726) Net annuity transactions -- -- 48,593 ------------ ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 3,468,291 7,615,753 240,344,261 ------------ ------------- -------------- Net increase (decrease) in net assets 3,795,316 8,584,316 271,213,929 NET ASSETS: Beginning of year 2,487,193 3,713,072 134,927,584 ------------ ------------- -------------- End of year $6,282,509 $12,297,388 $406,141,513 ============ ============= ==============
SA-91 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HARTFORD GROWTH HARTFORD GROWTH OPPORTUNITIES HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(282,923) $(291,606) Net realized gain (loss) on security transactions (19,255) (70,985) Net realized gain on distributions 1,575,981 6,373,409 Net unrealized appreciation (depreciation) of investments during the year (413,444) (1,029,884) ------------- ------------- Net increase (decrease) in net assets resulting from operations 860,359 4,980,934 ------------- ------------- UNIT TRANSACTIONS: Purchases 10,958,491 39,937,335 Net transfers 3,100,084 8,479,823 Surrenders for benefit payments and fees (826,618) (1,808,637) Net annuity transactions 5,175 -- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 13,237,132 46,608,521 ------------- ------------- Net increase (decrease) in net assets 14,097,491 51,589,455 NET ASSETS: Beginning of year 11,830,043 18,541,929 ------------- ------------- End of year $25,927,534 $70,131,384 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-92 -------------------------------------------------------------------------------
HARTFORD INTERNATIONAL HARTFORD CAPITAL INTERNATIONAL HARTFORD HIGH HARTFORD INDEX APPRECIATION SMALL COMPANY YIELD HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $2,892,100 $75,328 $(134,371) $193,548 Net realized gain (loss) on security transactions 8,671 (42,806) (20,314) (77,967) Net realized gain on distributions -- 1,824,609 3,778,090 3,660,725 Net unrealized appreciation (depreciation) of investments during the year (1,116,821) 27,556 3,623,418 1,302,300 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,783,950 1,884,687 7,246,823 5,078,606 ------------- ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 10,136,451 9,292,178 19,508,205 18,358,301 Net transfers 8,737,355 3,146,357 12,982,099 6,373,318 Surrenders for benefit payments and fees (989,771) (465,728) (1,415,356) (997,850) Net annuity transactions (533) -- (111,337) 20,674 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 17,883,502 11,972,807 30,963,611 23,754,443 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets 19,667,452 13,857,494 38,210,434 28,833,049 NET ASSETS: Beginning of year 8,517,386 6,724,635 16,265,699 7,877,712 ------------- ------------- ------------- ------------- End of year $28,184,838 $20,582,129 $54,476,133 $36,710,761 ============= ============= ============= ============= HARTFORD HARTFORD INTERNATIONAL HARTFORD MORTGAGE OPPORTUNITIES MONEY MARKET SECURITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,095,078 $1,461,780 $786,481 Net realized gain (loss) on security transactions 32,634 -- 5,650 Net realized gain on distributions 7,915,621 -- -- Net unrealized appreciation (depreciation) of investments during the year 5,625,710 -- (509,662) -------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations 14,669,043 1,461,780 282,469 -------------- -------------- ------------- UNIT TRANSACTIONS: Purchases 46,276,174 77,652,879 3,712,018 Net transfers 18,395,971 (18,912,563) 2,861,453 Surrenders for benefit payments and fees (2,753,902) (8,091,920) (499,948) Net annuity transactions 10,167 (826) 48,145 -------------- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 61,928,410 50,647,570 6,121,668 -------------- -------------- ------------- Net increase (decrease) in net assets 76,597,453 52,109,350 6,404,137 NET ASSETS: Beginning of year 33,447,263 21,030,344 4,461,383 -------------- -------------- ------------- End of year $110,044,716 $73,139,694 $10,865,520 ============== ============== =============
SA-93 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HARTFORD HARTFORD SMALL SMALLCAP COMPANY GROWTH HLS FUND HLS FUND SUB-ACCOUNT (A) SUB-ACCOUNT -------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(21,730) $(548,266) Net realized gain (loss) on security transactions 2,028 (183,232) Net realized gain on distributions 989,305 3,329,541 Net unrealized appreciation (depreciation) of investments during the year (437,036) (823,091) ------------ ------------- Net increase (decrease) in net assets resulting from operations 532,567 1,774,952 ------------ ------------- UNIT TRANSACTIONS: Purchases 2,409,255 20,392,409 Net transfers 3,739,119 (4,451,761) Surrenders for benefit payments and fees (73,379) (1,557,043) Net annuity transactions 172,763 (79,701) ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 6,247,758 14,303,904 ------------ ------------- Net increase (decrease) in net assets 6,780,325 16,078,856 NET ASSETS: Beginning of year -- 28,620,540 ------------ ------------- End of year $6,780,325 $44,699,396 ============ =============
(a) From inception, June 1, 2006 to December 31, 2006. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-94 -------------------------------------------------------------------------------
HARTFORD U.S. GOVERNMENT HARTFORD VALUE HARTFORD STOCK SECURITIES HARTFORD VALUE OPPORTUNITIES HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(13,036) $1,837,068 $43,975 $58,660 Net realized gain (loss) on security transactions 15,824 8,019 12,557 13,201 Net realized gain on distributions 2,745,883 -- 222,074 3,656,885 Net unrealized appreciation (depreciation) of investments during the year 2,264,715 1,461,912 1,483,141 758,721 ----------- ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 5,013,386 3,306,999 1,761,747 4,487,467 ----------- ------------- ----------- ------------ UNIT TRANSACTIONS: Purchases 16,337,976 77,922,669 7,048,505 17,837,585 Net transfers 6,068,654 37,937,916 6,968,859 21,410,176 Surrenders for benefit payments and fees (1,868,317) (5,247,382) (654,773) (1,300,132) Net annuity transactions -- 62,920 -- -- ----------- ------------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions 20,538,313 110,676,123 13,362,591 37,947,629 ----------- ------------- ----------- ------------ Net increase (decrease) in net assets 25,551,699 113,983,122 15,124,338 42,435,096 NET ASSETS: Beginning of year 24,377,227 53,618,304 3,380,986 12,415,084 ----------- ------------- ----------- ------------ End of year $49,928,926 $167,601,426 $18,505,324 $54,850,180 =========== ============= =========== ============ HARTFORD LORD ABBETT EQUITY INCOME LORD ABBETT ALL AMERICA'S VALUE HLS FUND VALUE PORTFOLIO PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- OPERATIONS: Net investment income (loss) $225,508 $(232,340) $284,707 Net realized gain (loss) on security transactions 18,234 843,190 4,023 Net realized gain on distributions 31,585 685,901 383,491 Net unrealized appreciation (depreciation) of investments during the year 2,535,618 1,670,332 1,301,948 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 2,810,945 2,967,083 1,974,169 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 7,656,130 15,844,316 4,158,220 Net transfers 7,774,868 (2,771,155) 6,010,924 Surrenders for benefit payments and fees (787,754) (949,287) (700,163) Net annuity transactions 4,263 5,113 7,856 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 14,647,507 12,128,987 9,476,837 ------------ ------------ ------------ Net increase (decrease) in net assets 17,458,452 15,096,070 11,451,006 NET ASSETS: Beginning of year 7,594,851 13,293,860 8,711,738 ------------ ------------ ------------ End of year $25,053,303 $28,389,930 $20,162,744 ============ ============ ============
SA-95 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
LORD ABBETT LORD ABBETT BOND-DEBENTURE GROWTH AND PORTFOLIO INCOME PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,944,692 $616,853 Net realized gain (loss) on security transactions 7,445 11,081 Net realized gain on distributions -- 5,007,851 Net unrealized appreciation (depreciation) of investments during the year 62,938 6,798,395 ------------- -------------- Net increase (decrease) in net assets resulting from operations 2,015,075 12,434,180 ------------- -------------- UNIT TRANSACTIONS: Purchases 16,743,636 88,586,383 Net transfers 11,655,507 34,549,829 Surrenders for benefit payments and fees (1,200,148) (2,992,560) Net annuity transactions 3,683 -- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 27,202,678 120,143,652 ------------- -------------- Net increase (decrease) in net assets 29,217,753 132,577,832 NET ASSETS: Beginning of year 11,544,464 29,022,894 ------------- -------------- End of year $40,762,217 $161,600,726 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-96 -------------------------------------------------------------------------------
LORD ABBETT MFS CAPITAL MFS INVESTORS LARGE-CAP OPPORTUNITIES MFS EMERGING GROWTH STOCK CORE PORTFOLIO SERIES GROWTH SERIES SERIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(40,001) $(126,478) $(206,060) $(164,196) Net realized gain (loss) on security transactions 4,688 15,590 66,184 94,474 Net realized gain on distributions 42,880 -- -- -- Net unrealized appreciation (depreciation) of investments during the year 840,095 1,118,026 751,869 536,142 ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations 847,662 1,007,138 611,993 466,420 ----------- ----------- ----------- ----------- UNIT TRANSACTIONS: Purchases 3,629,936 158,301 549,471 578,700 Net transfers 2,743,864 (136,976) (158,058) (448,753) Surrenders for benefit payments and fees (198,333) (864,874) (699,328) (617,195) Net annuity transactions -- (38) (39) -- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from unit transactions 6,175,467 (843,587) (307,954) (487,248) ----------- ----------- ----------- ----------- Net increase (decrease) in net assets 7,023,129 163,551 304,039 (20,828) NET ASSETS: Beginning of year 4,047,476 9,220,135 10,809,462 8,798,120 ----------- ----------- ----------- ----------- End of year $11,070,605 $9,383,686 $11,113,501 $8,777,292 =========== =========== =========== =========== MFS INVESTORS MFS TOTAL EQUITY AND TRUST SERIES RETURN SERIES INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------- OPERATIONS: Net investment income (loss) $(337,431) $1,066,658 $(239,246) Net realized gain (loss) on security transactions 1,101,341 1,252,894 577,697 Net realized gain on distributions -- 7,307,499 605,111 Net unrealized appreciation (depreciation) of investments during the year 1,741,250 12,351,373 1,882,651 ----------- ------------ ----------- Net increase (decrease) in net assets resulting from operations 2,505,160 21,978,424 2,826,213 ----------- ------------ ----------- UNIT TRANSACTIONS: Purchases 2,260,226 10,358,197 615,682 Net transfers (2,046,869) (1,184,356) 232,509 Surrenders for benefit payments and fees (2,363,522) (18,757,809) (2,256,251) Net annuity transactions -- (4,415) -- ----------- ------------ ----------- Net increase (decrease) in net assets resulting from unit transactions (2,150,165) (9,588,383) (1,408,060) ----------- ------------ ----------- Net increase (decrease) in net assets 354,995 12,390,041 1,418,153 NET ASSETS: Beginning of year 23,604,931 228,683,191 27,551,887 ----------- ------------ ----------- End of year $23,959,926 $241,073,232 $28,970,040 =========== ============ ===========
SA-97 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
CORE PLUS EMERGING FIXED INCOME MARKETS DEBT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $3,301,302 $860,393 Net realized gain (loss) on security transactions 273,573 187,699 Net realized gain on distributions 780,672 236,994 Net unrealized appreciation (depreciation) of investments during the year (1,694,040) (232,588) -------------- ------------- Net increase (decrease) in net assets resulting from operations 2,661,507 1,052,498 -------------- ------------- UNIT TRANSACTIONS: Purchases 3,378,980 641,876 Net transfers 4,014,528 224,051 Surrenders for benefit payments and fees (14,139,349) (1,678,559) Net annuity transactions 18,824 -- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (6,727,017) (812,632) -------------- ------------- Net increase (decrease) in net assets (4,065,510) 239,866 NET ASSETS: Beginning of year 145,533,379 12,459,937 -------------- ------------- End of year $141,467,869 $12,699,803 ============== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-98 -------------------------------------------------------------------------------
EMERGING MID CAP MARKETS EQUITY TECHNOLOGY HIGH YIELD GROWTH SUB-ACCOUNT SUB-ACCOUNT (B) SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(420,178) $(27,495) $1,769,055 $(172,685) Net realized gain (loss) on security transactions 211,136 (430,973) (1,235,858) (79,651) Net realized gain on distributions 1,023,802 -- -- 772,204 Net unrealized appreciation (depreciation) of investments during the year 11,561,439 723,484 1,290,918 84,194 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 12,376,199 265,016 1,824,115 604,062 ------------- ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 20,812,614 3,811 466,342 8,033,433 Net transfers 5,116,386 (4,946,821) (748,979) 1,685,861 Surrenders for benefit payments and fees (3,897,361) (106,521) (4,046,149) (506,079) Net annuity transactions (303) 174 -- -- ------------- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 22,031,336 (5,049,357) (4,328,786) 9,213,215 ------------- ------------- ------------- ------------- Net increase (decrease) in net assets 34,407,535 (4,784,341) (2,504,671) 9,817,277 NET ASSETS: Beginning of year 26,448,998 4,784,341 29,883,682 5,229,901 ------------- ------------- ------------- ------------- End of year $60,856,533 $ -- $27,379,011 $15,047,178 ============= ============= ============= ============= U.S. MID CAP VALUE FOCUS GROWTH BALANCED GROWTH SUB-ACCOUNT SUB-ACCOUNT (C) SUB-ACCOUNT ----------------------------- ----------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,339,278) $(2,622,070) $696,406 Net realized gain (loss) on security transactions 1,604,986 118,246 3,121,173 Net realized gain on distributions 10,591,791 -- 3,883,757 Net unrealized appreciation (depreciation) of investments during the year 4,406,880 (1,092,533) 94,421 ------------- -------------- --------------- Net increase (decrease) in net assets resulting from operations 15,264,379 (3,596,357) 7,795,757 ------------- -------------- --------------- UNIT TRANSACTIONS: Purchases 8,452,303 750,195 1,168,484 Net transfers 2,882,993 (13,556,063) (1,103,199) Surrenders for benefit payments and fees (9,317,967) (34,641,492) (15,295,880) Net annuity transactions (3,445) 54,715 99,131 ------------- -------------- --------------- Net increase (decrease) in net assets resulting from unit transactions 2,013,884 (47,392,645) (15,131,464) ------------- -------------- --------------- Net increase (decrease) in net assets 17,278,263 (50,989,002) (7,335,707) NET ASSETS: Beginning of year 80,482,190 208,583,381 81,521,960 ------------- -------------- --------------- End of year $97,760,453 $157,594,379 $74,186,253 ============= ============== ===============
(b) Fund closed effective April 28, 2006. (c) Formerly American Opportunities. Change effective July 3, 2006. SA-99 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
CAPITAL DEVELOPING OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(513,336) $(765,543) Net realized gain (loss) on security transactions (32,942) 4,144,705 Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year 2,411,725 864,973 ------------- -------------- Net increase (decrease) in net assets resulting from operations 1,865,447 4,244,135 ------------- -------------- UNIT TRANSACTIONS: Purchases 698,474 456,236 Net transfers (2,961,009) (3,470,881) Surrenders for benefit payments and fees (4,978,024) (8,800,916) Net annuity transactions (901) (17,715) ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions (7,241,460) (11,833,276) ------------- -------------- Net increase (decrease) in net assets (5,376,013) (7,589,141) NET ASSETS: Beginning of year 34,393,911 53,944,591 ------------- -------------- End of year $29,017,898 $46,355,450 ============= ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-100 -------------------------------------------------------------------------------
FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $2,422,359 $(607,234) $(480,821) $(812,986) Net realized gain (loss) on security transactions (2,305,772) 6,578,318 3,372,076 1,202,556 Net realized gain on distributions -- -- 4,475,878 -- Net unrealized appreciation (depreciation) of investments during the year 1,847,834 15,424,119 3,994,931 495,744 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 1,964,421 21,395,203 11,362,064 885,314 ------------ ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 588,427 1,662,333 465,898 3,574,436 Net transfers (750,537) (17,282,382) (2,403,703) 828,401 Surrenders for benefit payments and fees (8,242,183) (51,954,081) (11,664,122) (6,586,995) Net annuity transactions 85,184 36,515 90,905 (22,387) ------------ ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions (8,319,109) (67,537,615) (13,511,022) (2,206,545) ------------ ------------ ------------ ------------ Net increase (decrease) in net assets (6,354,688) (46,142,412) (2,148,958) (1,321,231) NET ASSETS: Beginning of year 55,233,660 273,736,892 64,327,028 48,569,712 ------------ ------------ ------------ ------------ End of year $48,878,972 $227,594,480 $62,178,070 $47,248,481 ============ ============ ============ ============ EQUALLY WEIGHTED MONEY MARKET UTILITIES S&P 500 SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------- OPERATIONS: Net investment income (loss) $2,707,624 $320,502 $(1,011,382) Net realized gain (loss) on security transactions -- 6,209,450 11,550,309 Net realized gain on distributions -- -- 10,158,475 Net unrealized appreciation (depreciation) of investments during the year -- 4,408,075 3,645,800 ------------ ------------- ------------ Net increase (decrease) in net assets resulting from operations 2,707,624 10,938,027 24,343,202 ------------ ------------- ------------ UNIT TRANSACTIONS: Purchases 1,651,933 403,173 6,405,290 Net transfers 77,130,893 (2,854,253) (2,924,502) Surrenders for benefit payments and fees (49,350,798) (13,931,684) (30,057,107) Net annuity transactions 35,433 16,456 157,464 ------------ ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 29,467,461 (16,366,308) (26,418,855) ------------ ------------- ------------ Net increase (decrease) in net assets 32,175,085 (5,428,281) (2,075,653) NET ASSETS: Beginning of year 81,125,196 69,334,158 193,147,746 ------------ ------------- ------------ End of year $113,300,281 $63,905,877 $191,072,093 ============ ============= ============
SA-101 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
SMALL COMPANY GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(313,506) $(229,302) Net realized gain (loss) on security transactions 40,754 158,650 Net realized gain on distributions 1,195,488 717,604 Net unrealized appreciation (depreciation) of investments during the year 469,453 4,919,248 ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,392,189 5,566,200 ------------- ------------- UNIT TRANSACTIONS: Purchases 3,706,131 3,371,359 Net transfers 2,318,079 1,939,077 Surrenders for benefit payments and fees (621,215) (1,450,344) Net annuity transactions -- -- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 5,402,995 3,860,092 ------------- ------------- Net increase (decrease) in net assets 6,795,184 9,426,292 NET ASSETS: Beginning of year 11,368,483 27,402,147 ------------- ------------- End of year $18,163,667 $36,828,439 ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-102 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER OPPENHEIMER CAPITAL GLOBAL SECURITIES OPPENHEIMER MIDCAP FUND APPRECIATION FUND FUND MAIN STREET FUND SUB-ACCOUNT (D) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(41,483) $(646,330) $(1,171,929) $(74,756) Net realized gain (loss) on security transactions (10,915) 1,805 3,454 12,556 Net realized gain on distributions -- -- 2,904,681 -- Net unrealized appreciation (depreciation) of investments during the year 61,266 3,504,428 15,605,793 1,087,551 ------------ ------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations 8,868 2,859,903 17,341,999 1,025,351 ------------ ------------- -------------- ------------- UNIT TRANSACTIONS: Purchases 1,718,377 27,487,273 110,750,443 5,426,568 Net transfers 664,619 11,199,918 36,076,518 1,963,884 Surrenders for benefit payments and fees (46,836) (1,815,561) (3,330,854) (353,884) Net annuity transactions -- 48,066 (595) -- ------------ ------------- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 2,336,160 36,919,696 143,495,512 7,036,568 ------------ ------------- -------------- ------------- Net increase (decrease) in net assets 2,345,028 39,779,599 160,837,511 8,061,919 NET ASSETS: Beginning of year 1,169,114 22,536,435 33,581,085 4,158,291 ------------ ------------- -------------- ------------- End of year $3,514,142 $62,316,034 $194,418,596 $12,220,210 ============ ============= ============== ============= OPPENHEIMER PUTNAM MAIN STREET DIVERSIFIED PUTNAM GLOBAL SMALL CAP FUND INCOME ASSET ALLOCATION SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,190,770) $473,240 $26,175 Net realized gain (loss) on security transactions (11,585) 11,720 6,292 Net realized gain on distributions 1,342,275 -- -- Net unrealized appreciation (depreciation) of investments during the year 7,896,615 510,643 695,465 -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 8,036,535 995,603 727,932 -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 59,029,551 15,527,003 5,694,784 Net transfers 29,944,124 5,273,576 1,502,483 Surrenders for benefit payments and fees (2,751,840) (768,444) (151,607) Net annuity transactions 15,161 -- -- -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 86,236,996 20,032,135 7,045,660 -------------- ------------- ------------- Net increase (decrease) in net assets 94,273,531 21,027,738 7,773,592 NET ASSETS: Beginning of year 30,418,868 9,210,883 3,236,222 -------------- ------------- ------------- End of year $124,692,399 $30,238,621 $11,009,814 ============== ============= =============
(d) Formerly Oppenheimer Aggressive Growth Fund. Change effective May 1, 2006. SA-103 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
PUTNAM PUTNAM GROWTH INTERNATIONAL AND INCOME EQUITY SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(20,063) $(975,678) Net realized gain (loss) on security transactions 18,801 37,807 Net realized gain on distributions 85,430 -- Net unrealized appreciation (depreciation) of investments during the year 696,933 19,821,728 ------------ -------------- Net increase (decrease) in net assets resulting from operations 781,101 18,883,857 ------------ -------------- UNIT TRANSACTIONS: Purchases 3,935,788 55,281,319 Net transfers 1,051,657 17,262,762 Surrenders for benefit payments and fees (180,538) (3,175,582) Net annuity transactions -- 12,090 ------------ -------------- Net increase (decrease) in net assets resulting from unit transactions 4,806,907 69,380,589 ------------ -------------- Net increase (decrease) in net assets 5,588,008 88,264,446 NET ASSETS: Beginning of year 2,519,699 39,082,490 ------------ -------------- End of year $8,107,707 $127,346,936 ============ ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-104 -------------------------------------------------------------------------------
PUTNAM THE PUTNAM PUTNAM PUTNAM SMALL GEORGE PUTNAM INVESTORS NEW VALUE CAP VALUE FUND OF BOSTON SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(55,279) $(81,481) $(1,016,080) $15,750 Net realized gain (loss) on security transactions 23,510 2,400 3,680 38,718 Net realized gain on distributions -- 595,888 4,980,803 253,412 Net unrealized appreciation (depreciation) of investments during the year 708,375 1,215,489 5,786,974 945,870 ------------ ------------- -------------- ------------- Net increase (decrease) in net assets resulting from operations 676,606 1,732,296 9,755,377 1,253,750 ------------ ------------- -------------- ------------- UNIT TRANSACTIONS: Purchases 4,252,253 6,531,014 51,975,601 17,041,879 Net transfers 1,903,518 3,334,043 17,278,520 (4,081,489) Surrenders for benefit payments and fees (114,792) (515,965) (2,790,723) (412,275) Net annuity transactions -- (161,242) (115,179) 5,266 ------------ ------------- -------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 6,040,979 9,187,850 66,348,219 12,553,381 ------------ ------------- -------------- ------------- Net increase (decrease) in net assets 6,717,585 10,920,146 76,103,596 13,807,131 NET ASSETS: Beginning of year 1,144,639 6,592,426 31,827,935 4,284,140 ------------ ------------- -------------- ------------- End of year $7,862,224 $17,512,572 $107,931,531 $18,091,271 ============ ============= ============== ============= PUTNAM PUTNAM VISTA VOYAGER ENTERPRISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(29,041) $(32,321) $(182,138) Net realized gain (loss) on security transactions 2,550 17,579 (1,254,327) Net realized gain on distributions -- -- -- Net unrealized appreciation (depreciation) of investments during the year 47,685 125,618 2,089,009 ------------ ------------ ------------- Net increase (decrease) in net assets resulting from operations 21,194 110,876 652,544 ------------ ------------ ------------- UNIT TRANSACTIONS: Purchases 1,331,850 1,349,734 723,156 Net transfers 194,040 (1,951) (1,377,162) Surrenders for benefit payments and fees (104,469) (48,798) (2,360,019) Net annuity transactions -- -- 8,819 ------------ ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 1,421,421 1,298,985 (3,005,206) ------------ ------------ ------------- Net increase (decrease) in net assets 1,442,615 1,409,861 (2,352,662) NET ASSETS: Beginning of year 863,846 1,140,409 15,532,522 ------------ ------------ ------------- End of year $2,306,461 $2,550,270 $13,179,860 ============ ============ =============
SA-105 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
GROWTH AND INCOME COMSTOCK SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(1,521,796) $(1,503,105) Net realized gain (loss) on security transactions 1,174,945 241,539 Net realized gain on distributions 11,362,416 10,585,767 Net unrealized appreciation (depreciation) of investments during the year 13,904,458 18,854,265 -------------- -------------- Net increase (decrease) in net assets resulting from operations 24,920,023 28,178,466 -------------- -------------- UNIT TRANSACTIONS: Purchases 30,604,363 57,474,874 Net transfers 12,486,948 27,031,370 Surrenders for benefit payments and fees (15,079,410) (9,856,217) Net annuity transactions 29,666 11,526 -------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 28,041,567 74,661,553 -------------- -------------- Net increase (decrease) in net assets 52,961,590 102,840,019 NET ASSETS: Beginning of year 159,504,791 152,674,388 -------------- -------------- End of year $212,466,381 $255,514,407 ============== ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-106 -------------------------------------------------------------------------------
WELLS FARGO ADVANTAGE VT STRATEGIC AGGRESSIVE GOVERNMENT ASSET ALLOCATION GROWTH GROWTH PORTFOLIO PORTFOLIO FUND SUB-ACCOUNT (E) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (F) ------------------------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(96,860) $(29,105) $426,998 $999 Net realized gain (loss) on security transactions 44,257 (57,949) 11,000 (378) Net realized gain on distributions -- 100,205 -- 5,358 Net unrealized appreciation (depreciation) of investments during the year 10,593 (42,050) (85,071) 39,421 ------------ ------------ ------------- ----------- Net increase (decrease) in net assets resulting from operations (42,010) (28,899) 352,927 45,400 ------------ ------------ ------------- ----------- UNIT TRANSACTIONS: Purchases 727,835 612,277 5,621,734 128,900 Net transfers (525,447) (236,803) 5,189,669 92,732 Surrenders for benefit payments and fees (359,667) (22,307) (1,413,555) (114,155) Net annuity transactions -- -- -- -- ------------ ------------ ------------- ----------- Net increase (decrease) in net assets resulting from unit transactions (157,279) 353,167 9,397,848 107,477 ------------ ------------ ------------- ----------- Net increase (decrease) in net assets (199,289) 324,268 9,750,775 152,877 NET ASSETS: Beginning of year 4,586,924 1,058,041 18,540,079 450,919 ------------ ------------ ------------- ----------- End of year $4,387,635 $1,382,309 $28,290,854 $603,796 ============ ============ ============= =========== WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT TOTAL RETURN EQUITY INCOME C&B LARGE CAP BOND FUND FUND VALUE FUND SUB-ACCOUNT (G) SUB-ACCOUNT (H) SUB-ACCOUNT (I) ----------------------------- ---------------------------------------------------------------- OPERATIONS: Net investment income (loss) $11,941 $(1,955) $(432) Net realized gain (loss) on security transactions 120 1,408 577 Net realized gain on distributions -- 867 -- Net unrealized appreciation (depreciation) of investments during the year 750 56,351 126,303 ---------- ---------- ---------- Net increase (decrease) in net assets resulting from operations 12,811 56,671 126,448 ---------- ---------- ---------- UNIT TRANSACTIONS: Purchases 708,714 17,134 345,074 Net transfers (38,916) 42,920 119,201 Surrenders for benefit payments and fees (33,735) (11,536) (38,546) Net annuity transactions -- -- -- ---------- ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions 636,063 48,518 425,729 ---------- ---------- ---------- Net increase (decrease) in net assets 648,874 105,189 552,177 NET ASSETS: Beginning of year 268,779 312,318 402,543 ---------- ---------- ---------- End of year $917,653 $417,507 $954,720 ========== ========== ==========
(e) Formerly Emerging Growth. Change effective August 15, 2006. (f) Formerly Wells Fargo Advantage Asset Allocation Fund. Change effective May 1, 2006. (g) Formerly Wells Fargo Advantage Total Return Bond Fund. Change effective May 1, 2006. (h) Formerly Wells Fargo Advantage Equity Income Fund. Change effective May 1, 2006. (i) Formerly Wells Fargo Advantage C&B Large Cap Value Fund. Change effective May 1, 2006. SA-107 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT LARGE COMPANY INTERNATIONAL CORE FUND CORE FUND SUB-ACCOUNT (J) SUB-ACCOUNT (K) ------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(23) $(428) Net realized gain (loss) on security transactions 2 784 Net realized gain on distributions -- 6,220 Net unrealized appreciation (depreciation) of investments during the year 763 20,517 ------- ---------- Net increase (decrease) in net assets resulting from operations 742 27,093 ------- ---------- UNIT TRANSACTIONS: Purchases -- 24,542 Net transfers -- -- Surrenders for benefit payments and fees 1 (18,702) Net annuity transactions -- -- ------- ---------- Net increase (decrease) in net assets resulting from unit transactions 1 5,840 ------- ---------- Net increase (decrease) in net assets 743 32,933 NET ASSETS: Beginning of year 5,186 148,599 ------- ---------- End of year $5,929 $181,532 ======= ==========
(j) Formerly Wells Fargo Advantage Large Company Core Fund. Change effective May 1, 2006. (k) Formerly Wells Fargo Advantage International Core Fund. Change effective May 1, 2006. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-108 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT ADVANTAGE VT LARGE COMPANY MONEY MARKET SMALL CAP GROWTH FUND FUND GROWTH FUND SUB-ACCOUNT (L) SUB-ACCOUNT (M) SUB-ACCOUNT (N) ----------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(48,034) $22,134 $(26,750) Net realized gain (loss) on security transactions 1,829 -- 2,618 Net realized gain on distributions -- -- 38,435 Net unrealized appreciation (depreciation) of investments during the year 160,848 -- 256,025 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 114,643 22,134 270,328 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 1,835,489 335,425 1,153,393 Net transfers 780,180 1,475,270 371,656 Surrenders for benefit payments and fees (116,494) (8,714) (64,340) Net annuity transactions -- -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 2,499,175 1,801,981 1,460,709 ------------ ------------ ------------ Net increase (decrease) in net assets 2,613,818 1,824,115 1,731,037 NET ASSETS: Beginning of year 1,338,679 19,311 668,863 ------------ ------------ ------------ End of year $3,952,497 $1,843,426 $2,399,900 ============ ============ ============ WELLS FARGO WELLS FARGO ADVANTAGE VT WELLS FARGO ADVANTAGE VT SMALL/MID CAP ADVANTAGE VT DISCOVERY FUND VALUE FUND OPPORTUNITY FUND SUB-ACCOUNT (O) SUB-ACCOUNT (P) SUB-ACCOUNT (Q) ----------------------------- ---------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(1,563) $(1,850) $(1,262) Net realized gain (loss) on security transactions (5) 363 105 Net realized gain on distributions -- 19,898 11,268 Net unrealized appreciation (depreciation) of investments during the year 11,273 (3,805) (2,720) ---------- ---------- ---------- Net increase (decrease) in net assets resulting from operations 9,705 14,606 7,391 ---------- ---------- ---------- UNIT TRANSACTIONS: Purchases 135,769 136,828 78,853 Net transfers 15,985 1,016 5,046 Surrenders for benefit payments and fees (882) (1,425) (742) Net annuity transactions -- -- -- ---------- ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions 150,872 136,419 83,157 ---------- ---------- ---------- Net increase (decrease) in net assets 160,577 151,025 90,548 NET ASSETS: Beginning of year 1,685 53,795 23,915 ---------- ---------- ---------- End of year $162,262 $204,820 $114,463 ========== ========== ==========
(l) Formerly Wells Fargo Advantage Large Company Growth Fund. Change effective May 1, 2006. (m) Formerly Wells Fargo Advantage Money Market Fund. Change effective May 1, 2006. (n) Formerly Wells Fargo Advantage Small Cap Growth Fund. Change effective May 1, 2006. (o) Formerly Wells Fargo Advantage Discovery Fund. Change effective May 1, 2006. (p) Formerly Wells Fargo Advantage Multi Cap Value Fund. Change effective May 1, 2006. (q) Formerly Wells Fargo Advantage Opportunity Fund. Change effective May 1, 2006. SA-109 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2007 ------------------------------------------------------------------------------- 1. ORGANIZATION: Separate Account Three ("the Account") is a separate investment account within Hartford Life and Annuity Insurance Company ("the Company") and is registered with the Securities and Exchange Commission (SEC) as a unit investment trust under the Investment Company Act of 1940, as amended. Both the Company and the Account are subject to supervision and regulation by the Department of Insurance of the State of Connecticut and the SEC. The Account invests deposits by variable annuity contract owners of the Company in various mutual funds ("the Funds") as directed by the contract owners. The Account invests in the following sub-accounts (collectively, the "Sub-Accounts"): the AllianceBernstein VP Balanced Wealth Strategy Portfolio, AllianceBernstein VP Global Research Growth Portfolio, AllianceBernstein VP International Value Portfolio, AllianceBernstein VP Small/Mid Cap Value Portfolio, AllianceBernstein VP Value Portfolio, AllianceBernstein VPS International Growth Portfolio, American Funds Global Growth Fund, American Funds Growth Fund, American Funds Growth-Income Fund, American Funds International Fund, American Funds Global Small Capitalization Fund, Fidelity VIP Equity-Income, Fidelity VIP Growth, Fidelity VIP Contrafund, Fidelity VIP Mid Cap, Fidelity VIP Value Strategies, Fidelity VIP Dynamic Capital Appreciation Portfolio, Franklin Small-Mid Cap Growth Securities Fund, Franklin Strategic Income Securities Fund, Franklin Mutual Shares Securities Fund, Templeton Developing Markets Securities Fund, Templeton Growth Securities Fund, Hartford Advisers HLS Fund, Hartford LargeCap Growth HLS Fund, Hartford Total Return Bond HLS Fund, Hartford Dividend and Growth HLS Fund, Hartford Fundamental Growth HLS Fund, Hartford Global Advisers HLS Fund, Hartford Global Growth HLS Fund, Hartford Disciplined Equity HLS Fund, Hartford Growth HLS Fund, Hartford Growth Opportunities HLS Fund, Hartford High Yield HLS Fund, Hartford Index HLS Fund, Hartford International Growth HLS Fund, Hartford International Small Company HLS Fund, Hartford International Opportunities HLS Fund, Hartford Mid Cap Growth HLS Fund, Hartford Money Market HLS Fund, Hartford Mortgage Securities HLS Fund, Hartford Small Cap Value HLS Fund, Hartford Small Company HLS Fund, Hartford SmallCap Growth HLS Fund, Hartford Stock HLS Fund, Hartford U.S. Government Securities HLS Fund, Hartford Value HLS Fund, Hartford Value Opportunities HLS Fund, Hartford Equity Income HLS Fund, Lord Abbett All Value Portfolio, Lord Abbett America's Value Portfolio, Lord Abbett Bond Debenture Fund, Lord Abbett Growth and Income Portfolio, Lord Abbett Large Cap Core Fund, MFS Core Equity Series, MFS Emerging Growth Series, MFS Investors Growth Stock Series, MFS Investors Trust Series, MFS Total Return Series, Equity and Income, Core Plus Fixed Income, Emerging Markets Debt, Emerging Markets Equity, High Yield, Mid Cap Growth, U.S. Mid Cap Value, Focus Growth, Balanced Growth, Capital Opportunities, Developing Growth, Flexible Income, Dividend Growth, Global Equity, Growth, Money Market, Utilities, Equally Weighted S&P 500, Small Company Growth, Global Franchise, Oppenheimer Midcap Fund, Oppenheimer Capital Appreciation Fund, Oppenheimer Global Securities Fund, Oppenheimer Main Street Fund, Oppenheimer Main Street Small Cap Fund, Putnam Diversified Income, Putnam Global Asset Allocation, Putnam Growth and Income, Putnam VT International Growth and Income Fund, Putnam International Equity, Putnam Investors, Putnam New Value, Putnam Small Cap Value, Putnam The George Putnam Fund of Boston, Putnam Vista, Putnam Voyager, Enterprise, Growth and Income, Comstock, Strategic Growth, Aggressive Growth Portfolio, Government Portfolio, Wells Fargo Advantage VT Asset Allocation Fund, Wells Fargo Advantage VT Total Return Bond Fund, Wells Fargo Advantage VT Equity Income Fund, Wells Fargo Advantage VT C&B Large Cap Value Fund, Wells Fargo Advantage VT Large Company Core Fund, Wells Fargo Advantage VT International Core Fund, Wells Fargo Advantage VT Large Company Growth Fund, Wells Fargo Advantage VT Money Market Fund, Wells Fargo Advantage VT Small Cap Growth Fund, Wells Fargo Advantage VT Discovery Fund, Wells Fargo Advantage VT Small/ Mid Cap Value Fund, and Wells Fargo Advantage VT Opportunity Fund. 2. SIGNIFICANT ACCOUNTING POLICIES: The following is a summary of significant accounting policies of the Account, which are in accordance with accounting principles generally accepted in the United States of America: a) SECURITY TRANSACTIONS -- Security transactions are recorded on the trade date (date the order to buy or sell is executed). Realized gains and losses on the sales of securities are computed using the last in first out method. Dividend and net realized gain on distributions income is accrued as of the ex-dividend date. Net realized gain on distributions income represents dividends from the Funds, which are characterized as capital gains under tax regulations. b) SECURITY VALUATION -- The investments in shares of the Funds are valued at the closing net asset value per share SA-110 ------------------------------------------------------------------------------- as determined by the appropriate Fund as of December 31, 2007. c) UNIT TRANSACTIONS -- Unit transactions are executed based on the unit values calculated at the close of the business day. d) FEDERAL INCOME TAXES -- The operations of the Account form a part of, and are taxed with, the total operations of the Company, which is taxed as an insurance company under the Internal Revenue Code. Under current law, no federal income taxes are payable with respect to the operations of the Account. e) USE OF ESTIMATES -- The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of income and expenses during the period. Operating results in the future could vary from the amounts derived from management's estimates. f) MORTALITY RISK -- Net assets allocated to contracts in the annuity period are computed according to the 1983a Individual Annuitant Mortality Table and the Annuity 2000 Table. The Mortality Risk is fully borne by the Company and may result in additional amounts being transferred into the Account by the Company to cover greater longevity of annuitants than expected. Conversely, if amounts allocated exceed amounts required, transfers may be made to the Company. g) RECLASSIFICATIONS -- Certain reclassifications have been made to the December 31, 2006 Statements of Changes in Net Assets to conform to the current year presentation. h) FAIR VALUE MEASUREMENTS -- In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" ("SFAS 157"). This statement defines fair value, establishes a framework for measuring fair value under accounting principles generally accepted in the United States, and enhances disclosures about fair value measurements. The definition focuses on the price that would be received to sell the asset or paid to transfer the liability (an exit price), not the price that would be paid to acquire the asset or received to assume the liability (an entry price). SFAS 157 provides guidance on how to measure fair value when required under existing accounting standards. SFAS 157 is effective for fiscal years beginning after November 15, 2007, with earlier application encouraged only in the initial quarter of an entity's fiscal year. The Account will adopt SFAS 157 on January 1, 2008. Adoption of this statement is not expected to have a material impact on the Account's financial statements. i) ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES, AN INTERPRETATION OF FASB STATEMENT NO. 109 -- In July 2006, the FASB released "Accounting for Uncertainty in Income Taxes" ("FIN 48") to clarify accounting for income taxes recognized in the financial statements in accordance with FASB 109, "Accounting for Income Taxes." FIN 48 is effective for fiscal years beginning after December 15, 2006 and prescribes a comprehensive model for how an entity should recognize, measure, present and disclose in its financial statements uncertain tax positions that the entity has taken or expect to take on a tax return. Upon adoption, as of the first quarter of 2007, FIN 48 did not have an effect on the Account's financial condition. 3. ADMINISTRATION OF THE ACCOUNT AND RELATED CHARGES: Certain amounts are deducted from the contracts, as described below: a) MORTALITY AND EXPENSE RISK AND ADMINISTRATIVE CHARGES -- The Company, as issuer of variable annuity contracts, provides the mortality and expense risk charges and, with respect to the Account, receives a maximum annual fee of 1.60% of the Account's average daily net assets. The Company also provides administrative services and receives a maximum annual fee of 0.20% of the Account's average daily net assets. b) DEDUCTION OF ANNUAL MAINTENANCE FEE -- Annual maintenance fees are charged through termination of units of interest from applicable contract owners' accounts, in accordance with the terms of the contracts. These charges are reflected in surrenders for benefit payments and fees on the accompanying statements of changes in net assets. SA-111 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 ------------------------------------------------------------------------------- 4. PURCHASES AND SALES OF INVESTMENTS: The cost of purchases and proceeds from sales of investments for the year ended December 31, 2007 were as follows:
PURCHASES PROCEEDS SUB-ACCOUNT AT COST FROM SALES -------------------------------------------------------------------------------- AllianceBernstein VP Balanced Wealth Strategy Portfolio $67,979,058 $10,247,637 AllianceBernstein VP Global Research Growth Portfolio 5,424,968 1,176,386 AllianceBernstein VP International Value Portfolio 154,400,666 25,758,907 AllianceBernstein VP Small/Mid Cap Value Portfolio 29,079,038 7,844,651 AllianceBernstein VP Value Portfolio 57,724,874 6,289,979 AllianceBernstein VPS International Growth Portfolio 1,742,769 46,179 American Funds Global Growth Fund 15,894,123 17,037,056 American Funds Growth Fund 63,701,162 88,613,740 American Funds Growth-Income Fund 43,442,466 86,492,054 American Funds International Fund 31,785,186 35,509,240 American Funds Global Small Capitalization Fund 16,428,971 18,351,792 Fidelity VIP Equity-Income 63,329,443 7,092,657 Fidelity VIP Growth 37,250,249 10,331,197 Fidelity VIP Contrafund 444,353,911 15,625,033 Fidelity VIP Mid Cap 61,980,285 15,181,503 Fidelity VIP Value Strategies 20,335,872 8,970,073 Fidelity VIP Dynamic Capital Appreciation Portfolio 316,655 202,633 Franklin Small-Mid Cap Growth Securities Fund 8,480,512 12,368,522 Franklin Strategic Income Securities Fund 33,180,765 19,097,295 Franklin Mutual Shares Securities Fund 21,739,266 35,709,611 Templeton Developing Markets Securities Fund 11,263,602 12,948,956 Templeton Growth Securities Fund 8,748,791 15,383,163 Hartford Advisers HLS Fund 23,003,636 5,803,032 Hartford LargeCap Growth HLS Fund 98,151 46 Hartford Total Return Bond HLS Fund 272,525,305 16,527,437 Hartford Dividend and Growth HLS Fund 293,763,789 14,288,361 Hartford Fundamental Growth HLS Fund 4,561,601 2,412,951 Hartford Global Advisers HLS Fund 7,316,116 1,850,747 Hartford Global Growth HLS Fund 18,814,631 2,607,920 Hartford Disciplined Equity HLS Fund 142,925,193 25,543,939 Hartford Growth HLS Fund 13,306,526 5,964,972 Hartford Growth Opportunities HLS Fund 108,817,882 10,563,873 Hartford High Yield HLS Fund 29,578,327 8,839,152 Hartford Index HLS Fund 14,461,376 5,617,845 Hartford International Growth HLS Fund 61,800,364 9,226,212 Hartford International Small Company HLS Fund 37,411,826 12,505,912 Hartford International Opportunities HLS Fund 88,034,302 21,483,331 Hartford Mid Cap Growth HLS Fund 207,434 101 Hartford Money Market HLS Fund 192,442,748 118,469,521 Hartford Mortgage Securities HLS Fund 6,390,603 2,559,034 Hartford Small Cap Value HLS Fund 117,739 7,985 Hartford Small Company HLS Fund 48,388,372 2,524,741 Hartford SmallCap Growth HLS Fund 13,385,444 10,512,668 Hartford Stock HLS Fund 23,900,972 8,908,665
SA-112 ------------------------------------------------------------------------------- PURCHASES PROCEEDS SUB-ACCOUNT AT COST FROM SALES -------------------------------------------------------------------------------- HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND $143,099,097 $7,683,705 HARTFORD VALUE HLS FUND 51,046,590 6,269,259 HARTFORD VALUE OPPORTUNITIES HLS FUND 44,631,305 17,400,666 HARTFORD EQUITY INCOME HLS FUND 22,287,596 7,476,686 LORD ABBETT ALL VALUE PORTFOLIO 14,718,597 4,231,098 LORD ABBETT AMERICA'S VALUE PORTFOLIO 16,560,017 2,857,005 LORD ABBETT BOND DEBENTURE FUND 43,151,782 8,540,769 LORD ABBETT GROWTH AND INCOME PORTFOLIO 180,919,978 11,012,624 LORD ABBETT LARGE CAP CORE FUND 6,281,180 2,165,510 MFS CORE EQUITY SERIES 740,864 2,012,484 MFS EMERGING GROWTH SERIES 1,870,065 3,671,799 MFS INVESTORS GROWTH STOCK SERIES 619,320 2,538,470 MFS INVESTORS TRUST SERIES 2,154,580 4,904,704 MFS TOTAL RETURN SERIES 22,435,981 39,362,607 EQUITY AND INCOME 3,063,750 4,811,299 CORE PLUS FIXED INCOME 17,297,796 26,698,429 EMERGING MARKETS DEBT 2,544,479 3,318,695 EMERGING MARKETS EQUITY 60,830,430 20,318,804 HIGH YIELD 5,321,123 8,183,277 MID CAP GROWTH 21,765,164 4,987,336 U.S. MID CAP VALUE 33,246,458 24,562,010 FOCUS GROWTH 1,997,221 43,079,449 BALANCED GROWTH 9,316,059 17,649,746 CAPITAL OPPORTUNITIES 943,006 8,060,387 DEVELOPING GROWTH 3,411,404 13,416,114 FLEXIBLE INCOME 6,673,457 10,919,118 DIVIDEND GROWTH 4,027,972 58,332,224 GLOBAL EQUITY 10,052,586 16,413,335 GROWTH 2,111,086 12,791,593 MONEY MARKET 109,570,030 108,671,981 UTILITIES 4,243,829 17,608,763 EQUALLY WEIGHTED S&P 500 25,247,735 44,476,988 SMALL COMPANY GROWTH 3,690,898 4,149,313 GLOBAL FRANCHISE 10,913,603 8,457,082 OPPENHEIMER MIDCAP FUND 3,262,174 1,106,495 OPPENHEIMER CAPITAL APPRECIATION FUND 46,666,579 6,645,224 OPPENHEIMER GLOBAL SECURITIES FUND 193,331,891 8,386,418 OPPENHEIMER MAIN STREET FUND 13,209,653 5,891,585 OPPENHEIMER MAIN STREET SMALL CAP FUND 77,030,558 11,327,960 PUTNAM DIVERSIFIED INCOME 47,498,980 8,642,862 PUTNAM GLOBAL ASSET ALLOCATION 10,342,061 3,373,111 PUTNAM GROWTH AND INCOME 7,379,669 1,944,346 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND 240,108 575 PUTNAM INTERNATIONAL EQUITY 79,090,972 15,400,471 PUTNAM INVESTORS 42,954,327 2,099,350 PUTNAM NEW VALUE 15,953,790 2,104,273 PUTNAM SMALL CAP VALUE 64,806,124 15,991,833 PUTNAM THE GEORGE PUTNAM FUND OF BOSTON 20,362,737 7,277,872 PUTNAM VISTA 1,489,480 669,304 PUTNAM VOYAGER 1,036,554 721,122
SA-113 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
PURCHASES PROCEEDS SUB-ACCOUNT AT COST FROM SALES -------------------------------------------------------------------------------- Enterprise $675,501 $3,599,635 Growth and Income 72,496,104 37,910,821 Comstock 62,786,828 27,457,265 Strategic Growth 122,633 815,513 Aggressive Growth Portfolio 302,377 460,604 Government Portfolio 13,700,713 7,159,324 Wells Fargo Advantage VT Asset Allocation Fund 71,176 43,605 Wells Fargo Advantage VT Total Return Bond Fund 308,960 460,205 Wells Fargo Advantage VT Equity Income Fund 40,375 42,478 Wells Fargo Advantage VT C&B Large Cap Value Fund 779,974 102,788 Wells Fargo Advantage VT Large Company Core Fund 45,115 2,068 Wells Fargo Advantage VT International Core Fund 59,065 12,713 Wells Fargo Advantage VT Large Company Growth Fund 1,483,232 699,939 Wells Fargo Advantage VT Money Market Fund 1,755,700 2,729,601 Wells Fargo Advantage VT Small Cap Growth Fund 1,543,200 571,167 Wells Fargo Advantage VT Discovery Fund 124,270 18,701 Wells Fargo Advantage VT Small/Mid Cap Value Fund 100,718 7,143 Wells Fargo Advantage VT Opportunity Fund 771,012 12,993 ----------------- ----------------- $4,268,442,617 $1,487,219,402 ================= =================
5. CHANGES IN UNITS OUTSTANDING: The changes in units outstanding for the year ended December 31, 2007 were as follows:
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- AllianceBernstein VP Balanced 5,335,943 791,536 4,544,407 Wealth Strategy Portfolio AllianceBernstein VP Global 364,637 77,465 287,172 Research Growth Portfolio AllianceBernstein VP 9,309,595 1,612,260 7,697,335 International Value Portfolio AllianceBernstein VP Small/Mid 2,095,201 620,315 1,474,886 Cap Value Portfolio AllianceBernstein VP Value 4,396,290 481,137 3,915,153 Portfolio AllianceBernstein VPS 162,094 4,318 157,776 International Growth Portfolio American Funds Global Growth 831,436 1,246,585 (415,149 ) Fund American Funds Growth Fund 2,409,791 7,209,661 (4,799,870 ) American Funds Growth-Income 1,562,304 5,694,680 (4,132,376 ) Fund American Funds International 1,493,379 2,502,388 (1,009,009 ) Fund American Funds Global Small 518,154 909,231 (391,077 ) Capitalization Fund Fidelity VIP Equity-Income 3,956,647 530,660 3,425,987 Fidelity VIP Growth 2,999,156 771,428 2,227,728 Fidelity VIP Contrafund 20,992,863 1,067,359 19,925,504 Fidelity VIP Mid Cap 3,866,723 1,089,356 2,777,367 Fidelity VIP Value Strategies 1,490,325 697,378 792,947 Fidelity VIP Dynamic Capital 31,721 20,989 10,732 Appreciation Portfolio Franklin Small-Mid Cap Growth 422,457 1,320,777 (898,320 ) Securities Fund Franklin Strategic Income 1,860,744 1,198,060 662,684 Securities Fund Franklin Mutual Shares 745,982 1,950,435 (1,204,453 ) Securities Fund Templeton Developing Markets 315,499 512,618 (197,119 ) Securities Fund Templeton Growth Securities 332,446 926,588 (594,142 ) Fund Hartford Advisers HLS Fund 11,131,900 3,613,577 7,518,323
SA-114 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Hartford LargeCap Growth HLS Fund 9,923 -- 9,923 Hartford Total Return Bond HLS Fund 130,239,621 8,327,349 121,912,272 Hartford Dividend and Growth HLS Fund 120,091,672 7,281,832 112,809,840 Hartford Fundamental Growth HLS Fund 3,436,306 1,876,798 1,559,508 Hartford Global Advisers HLS Fund 4,087,617 1,142,775 2,944,842 Hartford Global Growth HLS Fund 6,907,601 1,177,162 5,730,439 Hartford Disciplined Equity HLS Fund 104,221,028 17,320,714 86,900,314 Hartford Growth HLS Fund 7,808,693 4,045,236 3,763,457 Hartford Growth Opportunities HLS Fund 42,463,679 5,532,433 36,931,246 Hartford High Yield HLS Fund 17,660,114 5,997,767 11,662,347 Hartford Index HLS Fund 7,566,535 3,849,676 3,716,859 Hartford International Growth HLS Fund 24,815,133 4,933,606 19,881,527 Hartford International Small Company HLS Fund 11,655,670 4,990,137 6,665,533 Hartford International Opportunities HLS Fund 31,174,457 11,769,132 19,405,325 Hartford Mid Cap Growth HLS Fund 20,272 -- 20,272 Hartford Money Market HLS Fund 148,171,001 92,988,641 55,182,360 Hartford Mortgage Securities HLS Fund 3,355,049 1,669,398 1,685,651 Hartford Small Cap Value HLS Fund 12,450 896 11,554 Hartford Small Company HLS Fund 21,128,179 1,211,611 19,916,568 Hartford SmallCap Growth HLS Fund 6,568,769 6,826,037 (257,268) Hartford Stock HLS Fund 9,643,324 6,454,568 3,188,756 Hartford U.S. Government Securities HLS Fund 122,698,637 6,546,815 116,151,822 Hartford Value HLS Fund 33,772,984 4,420,950 29,352,034 Hartford Value Opportunities HLS Fund 19,161,588 9,336,376 9,825,212 Hartford Equity Income HLS Fund 13,676,819 4,941,508 8,735,311 Lord Abbett All Value Portfolio 1,069,148 324,663 744,485 Lord Abbett America's Value Portfolio 1,214,213 221,809 992,404 Lord Abbett Bond Debenture Fund 3,534,719 748,956 2,785,763 Lord Abbett Growth and Income Portfolio 13,104,245 864,582 12,239,663 Lord Abbett Large Cap Core Fund 453,266 159,380 293,886 MFS Core Equity Series 84,502 234,848 (150,346) MFS Emerging Growth Series 275,877 516,046 (240,169) MFS Investors Growth Stock Series 82,261 316,153 (233,892) MFS Investors Trust Series 180,038 446,637 (266,599) MFS Total Return Series 839,282 2,569,876 (1,730,594) Equity and Income 121,966 284,412 (162,446) Core Plus Fixed Income 966,216 2,150,501 (1,184,285) Emerging Markets Debt 61,315 154,744 (93,429) Emerging Markets Equity 2,587,014 934,754 1,652,260 High Yield 285,229 713,109 (427,880) Mid Cap Growth 1,439,220 336,433 1,102,787 U.S. Mid Cap Value 1,519,649 1,580,905 (61,256) Focus Growth 246,469 3,297,870 (3,051,401) Balanced Growth 172,092 990,735 (818,643) Capital Opportunities 163,148 1,056,821 (893,673) Developing Growth 284,950 851,329 (566,379) Flexible Income 343,896 863,939 (520,043) Dividend Growth 146,551 3,618,319 (3,471,768)
SA-115 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Global Equity 130,495 1,156,532 (1,026,037) Growth 262,243 1,239,013 (976,770) Money Market 11,994,788 12,324,983 (330,195) Utilities 272,792 1,125,947 (853,155) Equally Weighted S&P 500 422,507 2,194,487 (1,771,980) Small Company Growth 157,554 274,671 (117,117) Global Franchise 400,592 420,351 (19,759) Oppenheimer Midcap Fund 279,151 90,279 188,872 Oppenheimer Capital Appreciation Fund 3,939,029 513,765 3,425,264 Oppenheimer Global Securities Fund 13,191,731 572,859 12,618,872 Oppenheimer Main Street Fund 1,081,409 470,095 611,314 Oppenheimer Main Street Small Cap Fund 5,782,781 848,388 4,934,393 Putnam Diversified Income 2,655,111 490,414 2,164,697 Putnam Global Asset Allocation 383,673 157,080 226,593 Putnam Growth and Income 182,013 72,898 109,115 Putnam VT International Growth and Income Fund 24,460 46 24,414 Putnam International Equity 2,863,000 824,479 2,038,521 Putnam Investors 4,424,946 203,271 4,221,675 Putnam New Value 640,032 94,607 545,425 Putnam Small Cap Value 1,987,701 613,297 1,374,404 Putnam The George Putnam Fund of Boston 1,309,942 513,605 796,337 Putnam Vista 138,839 47,141 91,698 Putnam Voyager 65,959 50,325 15,634 Enterprise 98,272 451,911 (353,639) Growth and Income 3,634,762 2,335,783 1,298,979 Comstock 3,165,738 1,457,667 1,708,071 Strategic Growth 8,587 51,666 (43,079) Aggressive Growth Portfolio 15,321 32,434 (17,113) Government Portfolio 1,196,356 641,011 555,345 Wells Fargo Advantage VT Asset Allocation Fund 33,873 23,102 10,771 Wells Fargo Advantage VT Total Return Bond Fund 229,125 378,972 (149,847) Wells Fargo Advantage VT Equity Income Fund 5,072 23,938 (18,866) Wells Fargo Advantage VT C&B Large Cap Value Fund 576,475 65,708 510,767 Wells Fargo Advantage VT Large Company Core Fund 38,351 1,273 37,078 Wells Fargo Advantage VT International Core Fund 28,640 5,949 22,691 Wells Fargo Advantage VT Large Company Growth Fund 1,359,564 561,101 798,463 Wells Fargo Advantage VT Money Market Fund 1,668,743 2,663,009 (994,266) Wells Fargo Advantage VT Small Cap Growth Fund 712,182 348,394 363,788 Wells Fargo Advantage VT Discovery Fund 8,705 1,065 7,640 Wells Fargo Advantage VT Small/Mid Cap Value Fund 4,133 235 3,898 Wells Fargo Advantage VT Opportunity Fund 54,252 592 53,660
SA-116 ------------------------------------------------------------------------------- The changes in units outstanding for the year ended December 31, 2006 were as follows:
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- AllianceBernstein VP Balanced Wealth Strategy Portfolio 3,517,185 380,949 3,136,236 AllianceBernstein VP Global Research Growth Portfolio 273,397 44,727 228,670 AllianceBernstein VP International Value Portfolio 11,187,709 750,881 10,436,828 AllianceBernstein VP Small/Mid Cap Value Portfolio 1,336,267 191,656 1,144,611 AllianceBernstein VP Value Portfolio 5,245,787 196,999 5,048,788 American Funds Global Growth Fund 1,213,599 802,279 411,320 American Funds Growth Fund 4,639,904 5,578,729 (938,825) American Funds Growth-Income Fund 3,020,003 4,142,844 (1,122,841) American Funds International Fund 3,839,911 1,756,678 2,083,233 American Funds Global Small Capitalization Fund 917,721 635,420 282,301 Fidelity VIP Equity-Income 5,293,592 208,901 5,084,691 Fidelity VIP Growth 2,135,167 37,261 2,097,906 Fidelity VIP Contrafund 21,305,885 580,791 20,725,094 Fidelity VIP Mid Cap 6,562,559 505,959 6,056,600 Fidelity VIP Value Strategies 442,685 98,179 344,506 Franklin Small-Mid Cap Growth Securities Fund 995,436 1,098,420 (102,984) Franklin Strategic Income Securities Fund 1,885,461 1,656,337 229,124 Franklin Mutual Shares Securities Fund 1,300,384 1,628,828 (328,444) Templeton Developing Markets Securities Fund 462,842 419,669 43,173 Templeton Growth Securities Fund 781,192 674,660 106,532 Hartford Advisers HLS Fund 15,540,430 2,349,574 13,190,856 Hartford Total Return Bond HLS Fund 136,523,360 3,360,874 133,162,486 Hartford Dividend and Growth HLS Fund 113,477,119 3,058,614 110,418,505 Hartford Focus HLS Fund 1,189,627 340,415 849,212 Hartford Global Advisers HLS Fund 3,019,968 538,597 2,481,371 Hartford Global Leaders HLS Fund 5,287,113 971,542 4,315,571 Hartford Disciplined Equity HLS Fund 198,815,008 2,261,396 196,553,612 Hartford Growth HLS Fund 13,434,580 3,030,893 10,403,687 Hartford Growth Opportunities HLS Fund 35,806,629 4,924,581 30,882,048 Hartford High Yield HLS Fund 15,075,597 1,616,425 13,459,172 Hartford Index HLS Fund 10,561,623 2,301,190 8,260,433 Hartford International Capital Appreciation HLS Fund 24,196,809 2,912,450 21,284,359 Hartford International Small Company HLS Fund 13,553,780 1,605,924 11,947,856 Hartford International Opportunities HLS Fund 44,935,361 1,935,300 43,000,061 Hartford Money Market HLS Fund 98,572,679 57,496,559 41,076,120 Hartford Mortgage Securities HLS Fund 5,005,096 1,142,682 3,862,414 Hartford Small Company HLS Fund 4,162,345 360,253 3,802,092 Hartford SmallCap Growth HLS Fund 20,066,323 10,084,869 9,981,454 Hartford Stock HLS Fund 18,198,958 2,977,519 15,221,439 Hartford U.S. Government Securities HLS Fund 105,045,843 2,990,474 102,055,369 Hartford Value HLS Fund 12,892,585 2,039,297 10,853,288 Hartford Value Opportunities HLS Fund 26,588,503 2,574,507 24,013,996 Hartford Equity Income HLS Fund 13,328,142 2,097,165 11,230,977 Lord Abbett All Value Portfolio 2,193,763 1,076,689 1,117,074 Lord Abbett America's Value Portfolio 1,013,835 125,260 888,575 Lord Abbett Bond-Debenture Portfolio 2,869,351 230,515 2,638,836
SA-117 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Lord Abbett Growth and Income Portfolio 11,102,541 239,360 10,863,181 Lord Abbett Large-Cap Core Portfolio 616,556 59,737 556,819 MFS Capital Opportunities Series 68,097 208,610 (140,513) MFS Emerging Growth Series 223,614 275,534 (51,920) MFS Investors Growth Stock Series 145,674 225,667 (79,993) MFS Investors Trust Series 544,208 788,745 (244,537) MFS Total Return Series 1,741,156 2,506,668 (765,512) Equity and Income 212,367 309,682 (97,315) Core Plus Fixed Income 1,345,743 2,047,756 (702,013) Emerging Markets Debt 145,587 167,502 (21,915) Emerging Markets Equity 2,464,823 925,654 1,539,169 High Yield 235,866 627,378 (391,512) Mid Cap Growth 1,043,585 296,980 746,605 U.S. Mid Cap Value 1,282,786 1,137,256 145,530 Focus Growth 387,623 2,976,971 (2,589,348) Balanced Growth 455,737 1,373,230 (917,493) Capital Opportunities 613,119 1,488,289 (875,170) Developing Growth 320,695 800,639 (479,944) Flexible Income 369,028 977,786 (608,758) Dividend Growth 452,059 3,640,386 (3,188,327) Global Equity 273,366 1,149,202 (875,836) Growth 1,160,880 853,188 307,692 Money Market 10,274,158 6,938,662 3,335,496 Utilities 291,843 961,502 (669,659) Equally Weighted S&P 500 1,448,506 2,488,118 (1,039,612) Small Company Growth 569,890 149,684 420,206 Global Franchise 644,584 406,515 238,069 Oppenheimer Midcap Fund/VA 250,667 41,503 209,164 Oppenheimer Capital Appreciation Fund 3,586,694 139,075 3,447,619 Oppenheimer Global Securities Fund 11,980,909 216,314 11,764,595 Oppenheimer Main Street Fund 743,344 102,472 640,872 Oppenheimer Main Street Small Cap Fund 7,790,394 428,383 7,362,011 Putnam Diversified Income 1,426,060 208,339 1,217,721 Putnam Global Asset Allocation 409,596 37,575 372,021 Putnam Growth and Income 211,476 25,353 186,123 Putnam International Equity 4,533,109 252,740 4,280,369 Putnam Investors 776,313 106,897 669,416 Putnam New Value 552,511 83,793 468,718 Putnam Small Cap Value 3,003,329 220,854 2,782,475 Putnam The George Putnam Fund of Boston 1,634,823 638,134 996,689 Putnam Vista 201,805 77,087 124,718 Putnam Voyager 147,097 30,020 117,077 Enterprise 213,278 666,313 (453,035) Growth and Income 3,671,675 1,845,480 1,826,195 Comstock 5,779,570 931,336 4,848,234 Strategic Growth 83,748 100,908 (17,160) Aggressive Growth Portfolio 81,250 56,846 24,404 Government Portfolio 1,221,518 289,361 932,157
SA-118 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Wells Fargo Advantage VT Asset Allocation Fund 187,933 105,511 82,422 Wells Fargo Advantage VT Total Return Bond Fund 648,272 97,227 551,045 Wells Fargo Advantage VT Equity Income Fund 54,126 14,185 39,941 Wells Fargo Advantage VT C&B Large Cap Value Fund 426,890 65,801 361,089 Wells Fargo Advantage VT International Core Fund 18,770 14,886 3,884 Wells Fargo Advantage VT Large Company Growth Fund 2,675,384 195,538 2,479,846 Wells Fargo Advantage VT Money Market Fund 1,964,921 151,604 1,813,317 Wells Fargo Advantage VT Small Cap Growth Fund 1,282,958 130,953 1,152,005 Wells Fargo Advantage VT Discovery Fund 12,684 55 12,629 Wells Fargo Advantage VT Small/Mid Cap Value Fund 10,823 367 10,456 Wells Fargo Advantage VT Opportunity Fund 7,390 66 7,324
SA-119 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 ------------------------------------------------------------------------------- 6. FINANCIAL HIGHLIGHTS: The following is a summary of units, unit fair value, contract owners' equity, expense ratios, investment income ratios, and total return showing the minimum and maximum contract charges for which a series of each Sub-Account has outstanding units.
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VP BALANCED WEALTH STRATEGY PORTFOLIO 2007 Lowest contract charges 635,042 $12.638593 $8,026,033 Highest contract charges 9,006 12.043388 108,460 Remaining contract charges 8,361,038 -- 102,948,338 2006 Lowest contract charges 183,981 12.097214 2,225,681 Highest contract charges 8,787 11.725104 103,034 Remaining contract charges 4,267,911 -- 50,738,028 2005 Lowest contract charges 16,112 10.714409 172,629 Highest contract charges 10,304 10.562816 108,842 Remaining contract charges 1,298,027 -- 13,792,468 ALLIANCEBERNSTEIN VP GLOBAL RESEARCH GROWTH PORTFOLIO 2007 Lowest contract charges 15,787 15.251626 240,770 Highest contract charges 8,255 14.595740 120,488 Remaining contract charges 563,744 -- 8,398,399 2006 Lowest contract charges 4,331 13.699024 59,326 Highest contract charges 2,039 13.327881 27,176 Remaining contract charges 294,244 -- 3,970,894 2005 Lowest contract charges 612 12.029861 7,365 Highest contract charges 1,096 11.898589 13,036 Remaining contract charges 70,236 -- 839,634 ALLIANCEBERNSTEIN VP INTERNATIONAL VALUE PORTFOLIO 2007 Lowest contract charges 601,948 15.623839 9,404,741 Highest contract charges 7,888 10.203042 80,479 Remaining contract charges 23,916,345 -- 364,130,651 2006 Lowest contract charges 230,910 14.909092 3,442,674 Highest contract charges 539,371 14.464028 7,801,471 Remaining contract charges 16,058,565 -- 235,479,967 2005 Lowest contract charges 41,025 11.117122 456,085 Highest contract charges 219,921 10.964475 2,411,322 Remaining contract charges 6,131,072 -- 67,611,164 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ ALLIANCEBERNSTEIN VP BALANCED WEALTH STRATEGY PORTFOLIO 2007 Lowest contract charges 0.74% 2.02% 4.48% Highest contract charges 2.45% 1.97% 2.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.42% 12.91% Highest contract charges 2.45% 0.77% 11.00% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 0.02% 9.88% Highest contract charges 2.39% -- 8.64% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP GLOBAL RESEARCH GROWTH PORTFOLIO 2007 Lowest contract charges 0.74% 0.13% 11.33% Highest contract charges 2.38% 0.12% 9.51% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 13.88% Highest contract charges 2.40% -- 12.01% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 20.30% Highest contract charges 2.37% -- 18.99% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP INTERNATIONAL VALUE PORTFOLIO 2007 Lowest contract charges 0.74% 0.98% 4.79% Highest contract charges 1.83% -- (1.66)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.78% 34.11% Highest contract charges 2.40% 1.23% 31.92% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.03% 19.17% Highest contract charges 2.34% 0.10% 17.87% Remaining contract charges -- -- --
SA-120 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VP SMALL/MID CAP VALUE PORTFOLIO 2007 Lowest contract charges 128,720 $12.131787 $1,561,609 Highest contract charges 6,770 11.560375 78,266 Remaining contract charges 3,175,504 -- 37,552,583 2006 Lowest contract charges 65,776 12.039175 791,919 Highest contract charges 4,909 11.668764 57,286 Remaining contract charges 1,765,422 -- 20,895,950 2005 Lowest contract charges 21,935 10.621426 232,986 Highest contract charges 33,785 10.475556 353,920 Remaining contract charges 635,776 -- 6,700,087 ALLIANCEBERNSTEIN VP VALUE PORTFOLIO 2007 Lowest contract charges 106,065 11.844777 1,256,320 Highest contract charges 825 11.286935 9,309 Remaining contract charges 12,232,910 -- 141,389,755 2006 Lowest contract charges 73,507 12.452476 915,343 Highest contract charges 569 12.069459 6,867 Remaining contract charges 8,350,571 -- 102,254,285 2005 Lowest contract charges 31,649 10.366270 328,087 Highest contract charges 118,588 10.223888 1,212,432 Remaining contract charges 3,225,622 -- 33,174,021 ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO 2007 Lowest contract charges 1,902 10.541737 20,048 Highest contract charges 34,634 10.502108 363,727 Remaining contract charges 121,240 -- 1,274,761 AMERICAN FUNDS GLOBAL GROWTH FUND 2007 Lowest contract charges 187,323 1.889019 353,858 Highest contract charges 146,939 11.926853 1,752,514 Remaining contract charges 6,161,658 -- 84,549,671 2006 Lowest contract charges 188,640 1.666306 314,329 Highest contract charges 144,231 10.658295 1,537,253 Remaining contract charges 6,578,198 -- 79,941,816 2005 Lowest contract charges 199,235 1.401769 279,282 Highest contract charges 129,547 9.083466 1,176,735 Remaining contract charges 6,170,967 -- 63,187,013 2004 Lowest contract charges 168,147 1.244884 209,323 Highest contract charges 82,862 8.172367 677,180 Remaining contract charges 5,667,783 -- 51,924,244 2003 Lowest contract charges 18,849 1.111293 20,947 Highest contract charges 25,084 7.390785 185,390 Remaining contract charges 4,411,315 -- 34,917,811 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ ALLIANCEBERNSTEIN VP SMALL/MID CAP VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 0.67% 0.77% Highest contract charges 2.43% 0.62% (0.93)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.20% 13.35% Highest contract charges 2.43% -- 11.44% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.20% 12.68% Highest contract charges 2.31% -- 11.45% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 1.23% (4.88)% Highest contract charges 2.44% 1.08% (6.48)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.75% 20.13% Highest contract charges 2.44% 1.15% 18.10% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.51% 7.53% Highest contract charges 2.34% 0.19% 6.35% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO 2007 Lowest contract charges 0.21% 0.42% 1.58% Highest contract charges 0.50% -- 1.40% Remaining contract charges -- -- -- AMERICAN FUNDS GLOBAL GROWTH FUND 2007 Lowest contract charges 1.30% 2.66% 13.37% Highest contract charges 2.59% 2.72% 11.90% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.94% 18.87% Highest contract charges 2.60% 0.88% 17.34% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.68% 12.60% Highest contract charges 2.58% 0.63% 11.15% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 0.47% 12.02% Highest contract charges 2.58% 0.48% 10.58% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.30% 0.41% 33.53% Highest contract charges 1.62% 0.09% 29.08% Remaining contract charges -- -- --
SA-121 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- AMERICAN FUNDS GROWTH FUND 2007 Lowest contract charges 965,039 $1.546007 $1,491,957 Highest contract charges 1,469,026 10.406277 15,287,092 Remaining contract charges 40,766,465 -- 487,864,970 2006 Lowest contract charges 1,219,565 1.394084 1,700,177 Highest contract charges 1,527,069 9.506472 14,517,041 Remaining contract charges 45,253,766 -- 492,301,362 2005 Lowest contract charges 1,745,083 1.281399 2,236,147 Highest contract charges 1,369,233 8.852411 12,121,011 Remaining contract charges 45,824,909 -- 461,536,271 2004 Lowest contract charges 1,184,708 1.117260 1,323,627 Highest contract charges 961,708 7.819403 7,519,980 Remaining contract charges 41,829,634 -- 372,627,630 2003 Lowest contract charges 426,080 1.006145 428,698 Highest contract charges 446,466 7.133854 3,185,023 Remaining contract charges 31,199,420 -- 244,162,432 AMERICAN FUNDS GROWTH-INCOME FUND 2007 Lowest contract charges 1,088,077 1.385135 1,507,134 Highest contract charges 702,060 13.858148 9,729,248 Remaining contract charges 31,310,314 -- 445,937,148 2006 Lowest contract charges 1,326,224 1.335895 1,771,694 Highest contract charges 713,707 13.540353 9,663,838 Remaining contract charges 35,192,896 -- 486,525,678 2005 Lowest contract charges 1,737,353 1.174773 2,040,996 Highest contract charges 679,018 12.063035 8,191,019 Remaining contract charges 35,939,297 -- 439,631,660 2004 Lowest contract charges 1,227,457 1.124557 1,380,346 Highest contract charges 427,197 11.698456 4,997,550 Remaining contract charges 34,360,563 -- 405,160,831 2003 Lowest contract charges 477,485 1.032179 492,850 Highest contract charges 315,316 10.878053 3,430,020 Remaining contract charges 26,135,600 -- 285,774,226 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ AMERICAN FUNDS GROWTH FUND 2007 Lowest contract charges 1.30% 0.72% 10.90% Highest contract charges 2.59% 0.77% 9.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.70% 8.79% Highest contract charges 2.60% 0.84% 7.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.76% 14.69% Highest contract charges 2.59% 0.76% 13.21% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 0.24% 11.04% Highest contract charges 2.57% 0.32% 9.61% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.16% 35.04% Highest contract charges 1.62% 0.24% 24.34% Remaining contract charges -- -- -- AMERICAN FUNDS GROWTH-INCOME FUND 2007 Lowest contract charges 1.30% 1.39% 3.69% Highest contract charges 2.59% 1.50% 2.35% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.46% 13.72% Highest contract charges 2.60% 1.61% 12.25% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.44% 4.47% Highest contract charges 2.59% 1.53% 3.12% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 1.12% 8.95% Highest contract charges 2.57% 1.66% 7.54% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 1.38% 30.72% Highest contract charges 1.63% 1.89% 24.33% Remaining contract charges -- -- --
SA-122 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- AMERICAN FUNDS INTERNATIONAL FUND 2007 Lowest contract charges 526,477 $2.116001 $1,114,025 Highest contract charges 621,226 12.631102 7,846,772 Remaining contract charges 13,509,106 -- 199,212,566 2006 Lowest contract charges 634,879 1.786074 1,133,944 Highest contract charges 632,674 10.801046 6,833,536 Remaining contract charges 14,398,265 -- 180,574,538 2005 Lowest contract charges 799,484 1.520816 1,215,868 Highest contract charges 576,023 9.317239 5,366,943 Remaining contract charges 12,207,078 -- 132,004,461 2004 Lowest contract charges 355,702 1.268031 451,041 Highest contract charges 354,898 7.870167 2,793,105 Remaining contract charges 8,711,630 -- 79,739,908 2003 Lowest contract charges 208,459 1.076631 224,434 Highest contract charges 53,994 6.769614 365,518 Remaining contract charges 5,321,839 -- 39,658,250 AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION FUND 2007 Lowest contract charges 91,052 2.472943 225,167 Highest contract charges 106,025 17.261982 1,830,198 Remaining contract charges 3,166,843 -- 63,429,327 2006 Lowest contract charges 85,253 2.063188 175,894 Highest contract charges 121,995 14.590139 1,779,918 Remaining contract charges 3,547,749 -- 59,739,545 2005 Lowest contract charges 38,207 1.684898 64,375 Highest contract charges 111,899 12.070920 1,350,729 Remaining contract charges 3,322,590 -- 45,855,243 2004 Lowest contract charges 44,145 1.361722 60,113 Highest contract charges 57,840 9.883142 571,644 Remaining contract charges 2,726,105 -- 30,763,149 2003 Lowest contract charges 136,573 11.782892 1,609,229 Highest contract charges 14,240 8.391207 119,492 Remaining contract charges 1,649,749 -- 14,927,804 FIDELITY VIP EQUITY-INCOME 2007 Lowest contract charges 231,763 12.505825 2,898,392 Highest contract charges 5,759 11.916841 68,627 Remaining contract charges 11,770,074 -- 143,608,425 2006 Lowest contract charges 170,391 12.441638 2,119,955 Highest contract charges 3,438 12.058974 41,455 Remaining contract charges 8,407,780 -- 102,855,063 2005 Lowest contract charges 30,866 10.452282 322,621 Highest contract charges 2,965 10.304441 30,550 Remaining contract charges 3,463,087 -- 35,903,843 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ AMERICAN FUNDS INTERNATIONAL FUND 2007 Lowest contract charges 1.30% 1.35% 18.47% Highest contract charges 2.59% 1.50% 16.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.52% 17.44% Highest contract charges 2.60% 1.71% 15.93% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.73% 19.94% Highest contract charges 2.58% 1.74% 18.39% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.66% 17.78% Highest contract charges 2.57% 2.60% 16.26% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% 3.10% 33.11% Highest contract charges 1.62% 3.47% 33.99% Remaining contract charges -- -- -- AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION FUND 2007 Lowest contract charges 1.30% 3.01% 19.86% Highest contract charges 2.59% 2.85% 18.31% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.51% 22.45% Highest contract charges 2.60% 0.44% 20.87% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.17% 23.73% Highest contract charges 2.58% 0.94% 22.14% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.28% -- 19.32% Highest contract charges 2.58% -- 17.78% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.39% 0.44% 51.40% Highest contract charges 1.64% 0.08% 46.12% Remaining contract charges -- -- -- FIDELITY VIP EQUITY-INCOME 2007 Lowest contract charges 0.75% 1.80% 0.52% Highest contract charges 2.44% 2.25% (1.18)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.08% 19.03% Highest contract charges 2.45% 2.84% 17.03% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.37% Highest contract charges 2.42% -- 8.14% Remaining contract charges -- -- --
SA-123 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- FIDELITY VIP GROWTH 2007 Lowest contract charges 29,843 $14.231633 $424,721 Highest contract charges 6,471 13.561428 87,750 Remaining contract charges 4,992,416 -- 69,231,776 2006 Lowest contract charges 19,775 11.320706 223,863 Highest contract charges 1,936 10.972432 21,247 Remaining contract charges 2,779,291 -- 30,949,360 2005 Lowest contract charges 4,441 10.702519 47,533 Highest contract charges 1,936 10.551172 20,432 Remaining contract charges 696,719 -- 7,397,708 FIDELITY VIP CONTRAFUND 2007 Lowest contract charges 2,684,604 14.680736 39,411,967 Highest contract charges 29,016 13.989471 405,912 Remaining contract charges 45,625,509 -- 653,983,926 2006 Lowest contract charges 1,308,022 12.609462 16,493,423 Highest contract charges 33,893 12.221659 414,227 Remaining contract charges 27,071,710 -- 335,752,306 2005 Lowest contract charges 285,180 11.401061 3,251,358 Highest contract charges 18,679 11.239872 209,950 Remaining contract charges 7,384,672 -- 83,495,754 FIDELITY VIP MID CAP 2007 Lowest contract charges 424,890 14.374716 6,107,673 Highest contract charges 10,895 13.697774 149,237 Remaining contract charges 11,168,422 -- 156,573,613 2006 Lowest contract charges 281,385 12.556903 3,533,324 Highest contract charges 5,705 12.170682 69,429 Remaining contract charges 8,539,750 -- 105,394,208 2005 Lowest contract charges 90,564 11.255439 1,019,337 Highest contract charges 4,189 11.096304 46,478 Remaining contract charges 2,675,487 -- 29,850,520 FIDELITY VIP VALUE STRATEGIES 2007 Lowest contract charges 26,469 12.622679 334,115 Highest contract charges 2,373 12.028191 28,547 Remaining contract charges 1,371,888 -- 16,850,357 2006 Lowest contract charges 10,196 12.061412 122,970 Highest contract charges 2,374 11.690429 27,751 Remaining contract charges 595,213 -- 7,042,267 2005 Lowest contract charges 3,237 10.475321 33,906 Highest contract charges 1,979 10.327175 20,439 Remaining contract charges 258,061 -- 2,677,441 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO 2007 Lowest contract charges 355 9.571139 3,397 Highest contract charges 1,596 9.535023 15,217 Remaining contract charges 8,781 -- 83,898 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ FIDELITY VIP GROWTH 2007 Lowest contract charges 0.75% 0.21% 25.71% Highest contract charges 2.41% 0.23% 23.60% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.08% 5.78% Highest contract charges 2.45% 0.16% 3.99% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 11.87% Highest contract charges 2.42% -- 10.61% Remaining contract charges -- -- -- FIDELITY VIP CONTRAFUND 2007 Lowest contract charges 0.75% 1.00% 16.43% Highest contract charges 2.44% 0.76% 14.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.28% 10.60% Highest contract charges 2.45% 1.04% 8.74% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 19.05% Highest contract charges 2.40% -- 17.72% Remaining contract charges -- -- -- FIDELITY VIP MID CAP 2007 Lowest contract charges 0.75% 0.49% 14.48% Highest contract charges 2.44% 0.62% 12.55% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.11% 11.56% Highest contract charges 2.47% 0.12% 9.68% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 20.62% Highest contract charges 2.41% -- 19.27% Remaining contract charges -- -- -- FIDELITY VIP VALUE STRATEGIES 2007 Lowest contract charges 0.75% 0.48% 4.65% Highest contract charges 2.44% 0.59% 2.89% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.13% 15.14% Highest contract charges 2.45% 0.31% 13.20% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 16.84% Highest contract charges 2.42% -- 15.52% Remaining contract charges -- -- -- FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO 2007 Lowest contract charges 0.18% 0.24% (0.85)% Highest contract charges 0.55% 0.52% (1.03)% Remaining contract charges -- -- --
SA-124 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- FRANKLIN SMALL-MID CAP GROWTH SECURITIES FUND 2007 Lowest contract charges 219,822 $1.302551 $286,329 Highest contract charges 134,729 7.980030 1,075,144 Remaining contract charges 5,928,855 -- 56,930,293 2006 Lowest contract charges 407,531 1.186237 483,431 Highest contract charges 151,000 7.362563 1,111,743 Remaining contract charges 6,623,194 -- 58,489,051 2005 Lowest contract charges 600,907 1.105640 664,387 Highest contract charges 129,054 6.952213 897,212 Remaining contract charges 6,554,748 -- 54,287,277 2004 Lowest contract charges 314,240 1.068933 335,901 Highest contract charges 85,472 6.809347 582,006 Remaining contract charges 6,243,069 -- 50,917,790 2003 Lowest contract charges 95,725 0.971452 92,992 Highest contract charges 68,641 6.269322 430,335 Remaining contract charges 4,930,443 -- 35,544,806 FRANKLIN STRATEGIC INCOME SECURITIES FUND 2007 Lowest contract charges 146,290 1.494425 218,619 Highest contract charges 225,867 14.647354 3,308,356 Remaining contract charges 7,526,681 -- 115,561,917 2006 Lowest contract charges 141,715 1.425577 202,028 Highest contract charges 192,953 14.155259 2,731,305 Remaining contract charges 6,901,486 -- 101,835,675 2005 Lowest contract charges 160,836 1.331024 214,077 Highest contract charges 156,212 13.389254 2,091,564 Remaining contract charges 6,689,982 -- 92,779,178 2004 Lowest contract charges 97,713 1.325500 129,518 Highest contract charges 87,320 13.508186 1,179,531 Remaining contract charges 5,538,524 -- 77,172,647 2003 Lowest contract charges 326,464 13.368091 4,364,199 Highest contract charges 40,472 12.601986 510,028 Remaining contract charges 3,063,647 -- 39,282,747 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ FRANKLIN SMALL-MID CAP GROWTH SECURITIES FUND 2007 Lowest contract charges 1.30% -- 9.81% Highest contract charges 2.59% -- 8.39% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% -- 7.29% Highest contract charges 2.60% -- 5.90% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% -- 3.43% Highest contract charges 2.59% -- 2.10% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% -- 10.04% Highest contract charges 2.57% -- 8.61% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 35.48% Highest contract charges 1.62% -- 30.99% Remaining contract charges -- -- -- FRANKLIN STRATEGIC INCOME SECURITIES FUND 2007 Lowest contract charges 1.30% 5.45% 4.83% Highest contract charges 2.59% 5.31% 3.48% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 5.81% 7.10% Highest contract charges 2.60% 4.96% 5.72% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 4.57% 0.42% Highest contract charges 2.59% 4.53% (0.88)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 4.17% 8.59% Highest contract charges 2.56% 2.29% 7.19% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 2.63% 18.68% Highest contract charges 1.60% 0.13% 8.65% Remaining contract charges -- -- --
SA-125 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- FRANKLIN MUTUAL SHARES SECURITIES FUND 2007 Lowest contract charges 220,670 $1.528406 $337,273 Highest contract charges 279,388 16.564137 4,627,827 Remaining contract charges 10,227,514 -- 175,117,319 2006 Lowest contract charges 300,430 1.496340 449,545 Highest contract charges 286,357 16.428819 4,704,505 Remaining contract charges 11,345,238 -- 191,475,872 2005 Lowest contract charges 317,568 1.280557 406,664 Highest contract charges 261,129 14.243479 3,719,389 Remaining contract charges 11,681,772 -- 169,827,469 2004 Lowest contract charges 238,827 1.173480 280,259 Highest contract charges 174,975 13.223137 2,313,716 Remaining contract charges 10,858,987 -- 145,834,221 2003 Lowest contract charges 107,854 1.055500 113,840 Highest contract charges 158,853 12.049362 1,914,073 Remaining contract charges 7,976,625 -- 97,317,549 TEMPLETON DEVELOPING MARKETS SECURITIES FUND 2007 Lowest contract charges 70,994 3.416340 242,540 Highest contract charges 53,870 25.990444 1,400,099 Remaining contract charges 1,469,143 -- 39,619,160 2006 Lowest contract charges 47,574 2.681166 127,563 Highest contract charges 54,027 20.664228 1,116,428 Remaining contract charges 1,689,525 -- 35,891,095 2005 Lowest contract charges 47,487 2.114912 100,431 Highest contract charges 45,705 16.513159 754,739 Remaining contract charges 1,654,761 -- 27,784,093 2004 Lowest contract charges 27,359 1.677055 45,882 Highest contract charges 22,441 13.265566 297,695 Remaining contract charges 1,274,152 -- 17,017,223 2003 Lowest contract charges 150,240 10.480643 1,574,610 Highest contract charges 5,191 10.906370 56,613 Remaining contract charges 608,747 -- 6,597,380 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ FRANKLIN MUTUAL SHARES SECURITIES FUND 2007 Lowest contract charges 1.30% 1.40% 2.14% Highest contract charges 2.59% 1.41% 0.82% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.54% 16.85% Highest contract charges 2.60% 1.32% 15.34% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.87% 9.13% Highest contract charges 2.59% 0.87% 7.72% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.78% 11.18% Highest contract charges 2.57% 0.57% 9.74% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.30% 1.01% 23.53% Highest contract charges 1.63% 0.16% 19.24% Remaining contract charges -- -- -- TEMPLETON DEVELOPING MARKETS SECURITIES FUND 2007 Lowest contract charges 1.29% 1.74% 27.42% Highest contract charges 2.59% 2.53% 25.78% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.24% 26.77% Highest contract charges 2.60% 1.28% 25.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.38% 26.11% Highest contract charges 2.58% 1.31% 24.48% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 3.17% 23.22% Highest contract charges 2.57% 0.78% 21.63% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.39% 0.79% 51.60% Highest contract charges 1.60% -- 44.19% Remaining contract charges -- -- --
SA-126 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- TEMPLETON GROWTH SECURITIES FUND 2007 Lowest contract charges 70,048 $1.522683 $106,661 Highest contract charges 147,178 14.466570 2,129,154 Remaining contract charges 3,966,069 -- 60,452,174 2006 Lowest contract charges 75,250 1.507218 113,413 Highest contract charges 152,503 14.507161 2,212,392 Remaining contract charges 4,549,684 -- 69,066,710 2005 Lowest contract charges 49,436 1.253557 61,970 Highest contract charges 142,256 12.223467 1,738,859 Remaining contract charges 4,479,213 -- 56,914,462 2004 Lowest contract charges 20,693 1.166563 24,140 Highest contract charges 71,355 11.523966 822,290 Remaining contract charges 3,629,184 -- 43,226,341 2003 Lowest contract charges 20,232 1.018575 20,607 Highest contract charges 44,570 10.193782 454,340 Remaining contract charges 2,383,449 -- 24,825,655 HARTFORD ADVISERS HLS FUND 2007 Lowest contract charges 709,812 1.282397 910,261 Highest contract charges 33,093 1.215681 40,230 Remaining contract charges 31,986,956 -- 50,071,020 2006 Lowest contract charges 467,737 1.211634 566,725 Highest contract charges 48,030 1.168295 56,114 Remaining contract charges 24,695,771 -- 37,025,204 2005 Lowest contract charges 273,427 1.102727 301,515 Highest contract charges 124,508 1.081514 134,657 Remaining contract charges 11,622,747 -- 15,285,454 HARTFORD LARGECAP GROWTH HLS FUND 2007 Lowest contract charges 138 9.819592 1,352 Highest contract charges 2,077 9.794897 20,342 Remaining contract charges 7,708 -- 75,635 HARTFORD TOTAL RETURN BOND HLS FUND 2007 Lowest contract charges 16,311,614 1.594851 26,014,594 Highest contract charges 146,741 1.519717 223,005 Remaining contract charges 324,269,556 -- 606,145,851 2006 Lowest contract charges 7,356,213 1.535168 11,293,022 Highest contract charges 156,245 1.487922 232,480 Remaining contract charges 211,303,181 -- 372,767,533 2005 Lowest contract charges 2,516,563 1.475829 3,714,017 Highest contract charges 65,510 1.454940 95,313 Remaining contract charges 83,071,080 -- 134,902,882 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ TEMPLETON GROWTH SECURITIES FUND 2007 Lowest contract charges 1.30% 1.34% 1.03% Highest contract charges 2.59% 1.32% (0.28)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.23% 20.24% Highest contract charges 2.60% 1.37% 18.68% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.24% 7.46% Highest contract charges 2.58% 1.05% 6.07% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.17% 14.53% Highest contract charges 2.57% 1.07% 13.05% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.26% -- 30.43% Highest contract charges 1.63% 0.02% 30.14% Remaining contract charges -- -- -- HARTFORD ADVISERS HLS FUND 2007 Lowest contract charges 0.75% 2.58% 5.84% Highest contract charges 2.45% 2.37% 4.06% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.89% 9.88% Highest contract charges 2.45% 1.57% 8.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 5.92% 8.52% Highest contract charges 2.38% 5.14% 7.29% Remaining contract charges -- -- -- HARTFORD LARGECAP GROWTH HLS FUND 2007 Lowest contract charges 0.29% 3.05% 3.00% Highest contract charges 0.44% 0.82% 2.88% Remaining contract charges -- -- -- HARTFORD TOTAL RETURN BOND HLS FUND 2007 Lowest contract charges 0.75% 7.37% 3.89% Highest contract charges 2.44% 5.10% 2.14% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 7.01% 4.02% Highest contract charges 2.45% 6.30% 2.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 15.72% 0.94% Highest contract charges 2.37% 15.26% (0.20)% Remaining contract charges -- -- --
SA-127 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD DIVIDEND AND GROWTH HLS FUND 2007 Lowest contract charges 20,730,363 $1.782505 $36,951,976 Highest contract charges 95,014 1.596005 151,644 Remaining contract charges 250,774,487 -- 516,341,193 2006 Lowest contract charges 9,400,152 1.658967 15,594,542 Highest contract charges 28,548 1.510859 43,131 Remaining contract charges 149,361,324 -- 279,571,458 2005 Lowest contract charges 2,445,544 1.388704 3,396,137 Highest contract charges 11,814 1.286401 15,197 Remaining contract charges 45,914,161 -- 68,572,282 HARTFORD FUNDAMENTAL GROWTH HLS FUND 2007 Lowest contract charges 42,408 1.359522 57,655 Highest contract charges 35,901 1.252275 44,958 Remaining contract charges 3,011,147 -- 3,904,231 2006 Lowest contract charges 11,544 1.189811 13,736 Highest contract charges 99,152 1.114489 110,504 Remaining contract charges 1,419,252 -- 1,630,050 2005 Lowest contract charges 2,751 1.092528 3,005 Highest contract charges 95,134 1.040393 98,977 Remaining contract charges 582,851 -- 619,206 HARTFORD GLOBAL ADVISERS HLS FUND 2007 Lowest contract charges 802,517 1.506901 1,209,314 Highest contract charges 107,425 1.443701 155,089 Remaining contract charges 6,441,391 -- 10,892,844 2006 Lowest contract charges 548,603 1.302216 714,399 Highest contract charges 78,063 1.268352 99,011 Remaining contract charges 3,779,825 -- 5,469,099 2005 Lowest contract charges 314,518 1.205504 379,152 Highest contract charges 18,988 1.193690 22,666 Remaining contract charges 1,591,614 -- 2,085,375 HARTFORD GLOBAL GROWTH HLS FUND 2007 Lowest contract charges 715,029 1.780206 1,272,898 Highest contract charges 5,255 12.139377 63,788 Remaining contract charges 11,651,373 -- 28,232,032 2006 Lowest contract charges 391,521 1.434316 561,564 Highest contract charges 378,871 1.391475 527,189 Remaining contract charges 5,870,826 -- 11,208,635 2005 Lowest contract charges 177,361 1.266039 224,545 Highest contract charges 84,055 1.248662 104,956 Remaining contract charges 2,064,231 -- 3,383,571 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD DIVIDEND AND GROWTH HLS FUND 2007 Lowest contract charges 0.75% 2.32% 7.45% Highest contract charges 2.43% 2.28% 5.64% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.89% 19.46% Highest contract charges 2.45% 2.78% 17.45% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 5.36% 8.05% Highest contract charges 2.40% 4.07% 6.84% Remaining contract charges -- -- -- HARTFORD FUNDAMENTAL GROWTH HLS FUND 2007 Lowest contract charges 0.74% 0.03% 14.26% Highest contract charges 2.42% 0.05% 12.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.95% 8.90% Highest contract charges 2.40% 0.87% 7.12% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 5.76% 13.56% Highest contract charges 2.34% 2.90% 12.32% Remaining contract charges -- -- -- HARTFORD GLOBAL ADVISERS HLS FUND 2007 Lowest contract charges 0.75% 1.09% 15.72% Highest contract charges 2.39% 0.85% 13.83% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.38% 8.02% Highest contract charges 2.40% 3.74% 6.26% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 6.86% 8.24% Highest contract charges 2.36% 5.77% 7.05% Remaining contract charges -- -- -- HARTFORD GLOBAL GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.05% 24.12% Highest contract charges 1.81% -- 17.02% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.00% 13.29% Highest contract charges 2.39% 1.01% 11.44% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 1.78% 13.45% Highest contract charges 2.35% 2.47% 12.21% Remaining contract charges -- -- --
SA-128 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD DISCIPLINED EQUITY HLS FUND 2007 Lowest contract charges 611,853 $1.280301 $783,356 Highest contract charges 30,329 1.436846 43,578 Remaining contract charges 399,610,587 -- 553,589,912 2006 Lowest contract charges 481,740 1.190599 573,559 Highest contract charges 19,067 1.359078 25,914 Remaining contract charges 312,851,648 -- 405,542,040 2005 Lowest contract charges 265,850 1.066732 283,590 Highest contract charges 4,391,111 1.052077 4,619,787 Remaining contract charges 112,141,882 -- 130,024,207 HARTFORD GROWTH HLS FUND 2007 Lowest contract charges 2,143,926 1.576049 3,378,933 Highest contract charges 280,323 1.465205 410,730 Remaining contract charges 20,991,584 -- 31,750,972 2006 Lowest contract charges 2,079,466 1.359730 2,827,513 Highest contract charges 191,195 1.285135 245,711 Remaining contract charges 17,381,715 -- 22,854,310 2005 Lowest contract charges 930,365 1.309557 1,218,366 Highest contract charges 836 1.256062 1,050 Remaining contract charges 8,317,488 -- 10,610,627 HARTFORD GROWTH OPPORTUNITIES HLS FUND 2007 Lowest contract charges 2,923,914 2.102007 6,146,088 Highest contract charges 88,530 1.948859 172,532 Remaining contract charges 77,642,443 -- 164,018,168 2006 Lowest contract charges 1,039,509 1.633478 1,698,014 Highest contract charges 41,823 1.540415 64,424 Remaining contract charges 42,642,309 -- 68,368,946 2005 Lowest contract charges 105,838 1.468754 155,451 Highest contract charges 30,703 1.408825 43,255 Remaining contract charges 12,705,052 -- 18,343,223 HARTFORD HIGH YIELD HLS FUND 2007 Lowest contract charges 834,252 1.417630 1,182,660 Highest contract charges 32,628 1.360119 44,377 Remaining contract charges 30,969,321 -- 44,911,514 2006 Lowest contract charges 501,317 1.389570 696,614 Highest contract charges 31,418 1.356048 42,604 Remaining contract charges 19,641,119 -- 27,445,620 2005 Lowest contract charges 124,508 1.259370 156,802 Highest contract charges 28,409 1.250060 35,513 Remaining contract charges 6,561,765 -- 8,325,071 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD DISCIPLINED EQUITY HLS FUND 2007 Lowest contract charges 0.75% 1.10% 7.53% Highest contract charges 2.44% 1.16% 5.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.45% 11.61% Highest contract charges 2.45% 1.38% 9.73% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 3.31% 9.40% Highest contract charges 2.35% 2.70% 8.20% Remaining contract charges -- -- -- HARTFORD GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.02% 15.91% Highest contract charges 2.39% 0.02% 14.01% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.06% 3.83% Highest contract charges 2.40% 0.07% 2.13% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 13.12% Highest contract charges 2.51% -- 11.84% Remaining contract charges -- -- -- HARTFORD GROWTH OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.75% 0.20% 28.68% Highest contract charges 2.43% 0.21% 26.52% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.44% 11.22% Highest contract charges 2.48% 0.70% 9.34% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 0.54% 25.39% Highest contract charges 2.41% 0.53% 23.98% Remaining contract charges -- -- -- HARTFORD HIGH YIELD HLS FUND 2007 Lowest contract charges 0.75% 9.20% 2.02% Highest contract charges 2.44% 7.93% 0.30% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 18.00% 10.34% Highest contract charges 2.45% 15.94% 8.48% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 6.15% 4.70% Highest contract charges 2.39% -- 3.53% Remaining contract charges -- -- --
SA-129 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD INDEX HLS FUND 2007 Lowest contract charges 340,263 $1.178530 $401,010 Highest contract charges 114,404 1.163428 133,100 Remaining contract charges 17,434,286 -- 27,931,663 2006 Lowest contract charges 275,035 1.128688 310,429 Highest contract charges 19,091 1.133323 21,636 Remaining contract charges 13,877,968 -- 20,250,064 2005 Lowest contract charges 140,097 0.984953 137,989 Highest contract charges 589,608 1.006357 593,356 Remaining contract charges 5,181,956 -- 5,993,290 HARTFORD INTERNATIONAL GROWTH HLS FUND 2007 Lowest contract charges 6,495,766 2.069968 13,446,027 Highest contract charges 1,339,140 1.907291 2,554,129 Remaining contract charges 45,607,878 -- 90,347,454 2006 Lowest contract charges 3,607,301 1.683127 6,071,548 Highest contract charges 980,555 1.576637 1,545,979 Remaining contract charges 28,973,401 -- 46,858,606 2005 Lowest contract charges 995,789 1.366664 1,360,909 Highest contract charges 420,501 1.301496 547,280 Remaining contract charges 10,860,608 -- 14,357,510 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND 2007 Lowest contract charges 388,113 2.531786 982,619 Highest contract charges 4,480 10.128436 45,373 Remaining contract charges 22,716,101 -- 54,697,360 2006 Lowest contract charges 180,249 2.340119 421,801 Highest contract charges 954,606 2.192075 2,092,567 Remaining contract charges 15,308,306 -- 34,196,393 2005 Lowest contract charges 76,520 1.822914 139,489 Highest contract charges 169,863 1.735984 294,880 Remaining contract charges 4,248,922 -- 7,443,343 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND 2007 Lowest contract charges 1,634,445 1.766656 2,887,502 Highest contract charges 8,267 12.199778 100,852 Remaining contract charges 87,395,241 -- 175,880,908 2006 Lowest contract charges 956,669 1.396856 1,336,328 Highest contract charges 2,515,912 1.374614 3,458,408 Remaining contract charges 66,160,047 -- 105,249,980 2005 Lowest contract charges 427,240 1.130783 483,116 Highest contract charges 1,048,806 1.131293 1,186,507 Remaining contract charges 25,156,521 -- 31,777,640 HARTFORD MID CAP GROWTH HLS FUND 2007 Lowest contract charges 1,539 9.808732 15,095 Highest contract charges 108 9.771745 1,054 Remaining contract charges 18,625 -- 182,365 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD INDEX HLS FUND 2007 Lowest contract charges 0.75% 1.94% 4.42% Highest contract charges 2.43% 1.77% 2.66% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.96% 14.59% Highest contract charges 2.44% 1.18% 12.66% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 4.40% 7.98% Highest contract charges 2.36% 7.02% 6.80% Remaining contract charges -- -- -- HARTFORD INTERNATIONAL GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.89% 22.98% Highest contract charges 2.39% 0.79% 20.97% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.23% 23.16% Highest contract charges 2.40% 1.16% 21.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 2.65% 15.40% Highest contract charges 2.34% 2.27% 14.14% Remaining contract charges -- -- -- HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND 2007 Lowest contract charges 0.75% 2.16% 8.19% Highest contract charges 1.83% 5.11% (2.90)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.40% 28.37% Highest contract charges 2.40% 2.82% 26.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 5.39% 18.53% Highest contract charges 2.30% 12.09% 17.24% Remaining contract charges -- -- -- HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.75% 1.38% 26.47% Highest contract charges 1.84% 3.57% 17.19% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.14% 23.53% Highest contract charges 2.40% 3.15% 21.51% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 17.26% Highest contract charges 2.35% -- 15.98% Remaining contract charges -- -- -- HARTFORD MID CAP GROWTH HLS FUND 2007 Lowest contract charges 0.20% 2.36% 3.02% Highest contract charges 0.55% 0.80% 2.83% Remaining contract charges -- -- --
SA-130 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD MONEY MARKET HLS FUND 2007 Lowest contract charges 2,438,385 $1.209133 $2,948,332 Highest contract charges 31,748 1.038826 32,981 Remaining contract charges 110,676,370 -- 144,127,445 2006 Lowest contract charges 1,820,802 1.160839 2,113,655 Highest contract charges 43,771 1.014418 44,402 Remaining contract charges 56,099,570 -- 70,981,637 2005 Lowest contract charges 588,918 1.117034 657,842 Highest contract charges 29,439 0.992855 29,228 Remaining contract charges 16,269,666 -- 20,343,274 HARTFORD MORTGAGE SECURITIES HLS FUND 2007 Lowest contract charges 346,521 1.419566 491,910 Highest contract charges 24,179 1.312991 31,747 Remaining contract charges 8,274,657 -- 13,827,870 2006 Lowest contract charges 236,713 1.383332 327,451 Highest contract charges 24,687 1.301426 32,128 Remaining contract charges 6,698,306 -- 10,505,941 2005 Lowest contract charges 23,182 1.331509 30,867 Highest contract charges 21,544 1.274155 27,451 Remaining contract charges 3,052,566 -- 4,403,065 HARTFORD SMALL CAP VALUE HLS FUND 2007 Lowest contract charges 35 9.130446 316 Highest contract charges 269 9.095988 2,443 Remaining contract charges 11,250 -- 102,589 HARTFORD SMALL COMPANY HLS FUND 2007 Lowest contract charges 293,655 1.827464 536,644 Highest contract charges 3,000 1.546238 4,639 Remaining contract charges 23,422,005 -- 48,599,456 2006 Lowest contract charges 176,308 1.611899 284,190 Highest contract charges 409,539 1.715602 702,606 Remaining contract charges 3,216,245 -- 5,793,529 HARTFORD SMALLCAP GROWTH HLS FUND 2007 Lowest contract charges 381,139 1.414586 539,154 Highest contract charges 36,990 1.311438 48,510 Remaining contract charges 30,718,537 -- 42,760,149 2006 Lowest contract charges 228,554 1.451976 331,859 Highest contract charges 29,797 1.369188 40,797 Remaining contract charges 31,135,583 -- 44,326,740 2005 Lowest contract charges 214,855 1.369036 294,144 Highest contract charges 27,955 1.313122 36,709 Remaining contract charges 21,169,670 -- 28,289,687 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD MONEY MARKET HLS FUND 2007 Lowest contract charges 0.74% 4.75% 4.16% Highest contract charges 2.51% 4.99% 2.41% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 4.72% 3.92% Highest contract charges 2.45% 4.66% 2.17% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.70% 3.52% 1.61% Highest contract charges 2.41% 2.92% 0.47% Remaining contract charges -- -- -- HARTFORD MORTGAGE SECURITIES HLS FUND 2007 Lowest contract charges 0.75% 5.83% 2.62% Highest contract charges 2.43% 6.19% 0.89% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 15.14% 3.89% Highest contract charges 2.45% 11.47% 2.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 2.74% 0.84% Highest contract charges 2.39% -- (0.29)% Remaining contract charges -- -- -- HARTFORD SMALL CAP VALUE HLS FUND 2007 Lowest contract charges -- -- (2.20)% Highest contract charges 0.49% -- (2.38)% Remaining contract charges -- -- -- HARTFORD SMALL COMPANY HLS FUND 2007 Lowest contract charges 0.75% 0.28% 13.37% Highest contract charges 2.41% 1.01% 11.46% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.48% 0.43% 2.66% Highest contract charges 1.53% 0.30% 1.67% Remaining contract charges -- -- -- HARTFORD SMALLCAP GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.39% (2.58)% Highest contract charges 2.44% 0.34% (4.22)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.35% 6.06% Highest contract charges 2.49% 0.28% 4.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 1.13% 17.77% Highest contract charges 2.41% 0.96% 16.45% Remaining contract charges -- -- --
SA-131 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD STOCK HLS FUND 2007 Lowest contract charges 661,207 $1.148022 $759,080 Highest contract charges 181,612 1.125449 204,396 Remaining contract charges 40,486,180 -- 57,760,835 2006 Lowest contract charges 529,042 1.092190 577,813 Highest contract charges 170,662 1.089081 185,865 Remaining contract charges 37,440,539 -- 49,165,248 2005 Lowest contract charges 271,087 0.959768 260,181 Highest contract charges 39,096 0.973451 38,058 Remaining contract charges 22,608,621 -- 24,078,988 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND 2007 Lowest contract charges 3,946,749 1.184437 4,674,675 Highest contract charges 86,449 1.098120 94,932 Remaining contract charges 264,015,313 -- 299,752,419 2006 Lowest contract charges 1,105,315 1.143295 1,263,697 Highest contract charges 96,276 1.078142 103,799 Remaining contract charges 150,695,098 -- 166,233,930 2005 Lowest contract charges 355,989 1.107461 394,244 Highest contract charges 86,891 1.062245 92,299 Remaining contract charges 49,398,440 -- 53,131,761 HARTFORD VALUE HLS FUND 2007 Lowest contract charges 268,937 1.505403 404,859 Highest contract charges 34,787 1.386664 48,237 Remaining contract charges 42,938,794 -- 61,691,870 2006 Lowest contract charges 107,921 1.391771 150,200 Highest contract charges 1,505 1.303971 1,962 Remaining contract charges 13,781,058 -- 18,353,162 2005 Lowest contract charges 45,810 1.151031 52,729 Highest contract charges 2,602 1.096902 2,854 Remaining contract charges 2,988,784 -- 3,325,403 HARTFORD VALUE OPPORTUNITIES HLS FUND 2007 Lowest contract charges 1,494,839 1.561011 2,333,460 Highest contract charges 67,832 1.447249 98,170 Remaining contract charges 41,187,231 -- 62,844,082 2006 Lowest contract charges 825,074 1.678386 1,384,795 Highest contract charges 37,493 1.582768 59,343 Remaining contract charges 32,062,123 -- 53,406,042 2005 Lowest contract charges 368,684 1.420752 523,809 Highest contract charges 21,512 1.362775 29,316 Remaining contract charges 8,520,498 -- 11,861,959 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD STOCK HLS FUND 2007 Lowest contract charges 0.75% 1.07% 5.11% Highest contract charges 2.44% 1.03% 3.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.77% 13.80% Highest contract charges 2.43% 2.36% 11.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 3.58% 12.41% Highest contract charges 2.40% 7.06% 11.15% Remaining contract charges -- -- -- HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND 2007 Lowest contract charges 0.74% 3.43% 3.60% Highest contract charges 2.44% 4.09% 1.85% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.84% 3.24% Highest contract charges 2.45% 3.75% 1.50% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.17% 0.46% Highest contract charges 2.37% -- (0.67)% Remaining contract charges -- -- -- HARTFORD VALUE HLS FUND 2007 Lowest contract charges 0.75% 1.68% 8.17% Highest contract charges 2.42% 1.45% 6.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.89% 20.92% Highest contract charges 2.43% 0.98% 18.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 9.09% 8.14% Highest contract charges 2.15% -- 6.93% Remaining contract charges -- -- -- HARTFORD VALUE OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.75% 1.47% (6.99)% Highest contract charges 2.44% 1.54% (8.56)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.82% 18.13% Highest contract charges 2.48% 1.48% 16.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 2.89% 12.64% Highest contract charges 2.41% 2.22% 11.37% Remaining contract charges -- -- --
SA-132 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD EQUITY INCOME HLS FUND 2007 Lowest contract charges 5,029,682 $1.541964 $7,755,589 Highest contract charges 33,154 1.450037 48,075 Remaining contract charges 21,244,639 -- 31,836,541 2006 Lowest contract charges 2,856,810 1.452696 4,150,076 Highest contract charges 14,272 1.389511 19,832 Remaining contract charges 14,701,082 -- 20,883,395 2005 Lowest contract charges 1,100,730 1.211673 1,333,725 Highest contract charges 76,478 1.180208 90,259 Remaining contract charges 5,163,979 -- 6,170,867 LORD ABBETT ALL VALUE PORTFOLIO 2007 Lowest contract charges 683,646 12.791256 8,744,685 Highest contract charges 623 12.188854 7,590 Remaining contract charges 2,438,467 -- 30,508,290 2006 Lowest contract charges 460,454 12.075767 5,560,321 Highest contract charges 1,109 11.704297 12,976 Remaining contract charges 1,916,688 -- 22,816,633 2005 Lowest contract charges 211,137 10.612875 2,240,775 Highest contract charges 722 10.462724 7,557 Remaining contract charges 1,049,318 -- 11,045,528 LORD ABBETT AMERICA'S VALUE PORTFOLIO 2007 Lowest contract charges 1,005,977 11.971920 12,043,480 Highest contract charges 25,199 11.424297 287,885 Remaining contract charges 1,700,827 -- 19,970,302 2006 Lowest contract charges 529,829 11.692294 6,194,912 Highest contract charges 22,116 11.343054 250,868 Remaining contract charges 1,187,654 -- 13,716,964 2005 Lowest contract charges 219,943 10.283680 2,261,825 Highest contract charges 8,907 10.142435 90,343 Remaining contract charges 622,174 -- 6,359,570 LORD ABBETT BOND DEBENTURE FUND 2007 Lowest contract charges 939,593 11.456197 10,764,160 Highest contract charges 7,725 10.916673 84,329 Remaining contract charges 5,636,444 -- 63,076,451 2006 Lowest contract charges 523,359 10.870047 5,688,948 Highest contract charges 8,353 10.535676 88,000 Remaining contract charges 3,266,287 -- 34,985,269 2005 Lowest contract charges 192,617 10.017399 1,929,524 Highest contract charges 1,148 9.875645 11,339 Remaining contract charges 965,398 -- 9,603,601 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD EQUITY INCOME HLS FUND 2007 Lowest contract charges 0.75% 2.59% 6.15% Highest contract charges 2.43% 3.04% 4.36% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.79% 19.89% Highest contract charges 2.42% 4.90% 17.87% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 5.61% 4.59% Highest contract charges 2.35% 4.42% 3.45% Remaining contract charges -- -- -- LORD ABBETT ALL VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 0.59% 5.93% Highest contract charges 2.44% 0.35% 4.14% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.78% 13.78% Highest contract charges 2.45% 0.70% 11.87% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 1.14% 11.45% Highest contract charges 2.38% 0.84% 10.20% Remaining contract charges -- -- -- LORD ABBETT AMERICA'S VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 3.74% 2.39% Highest contract charges 2.39% 2.97% 0.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.38% 13.70% Highest contract charges 2.39% 3.53% 11.84% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 7.33% 6.50% Highest contract charges 2.33% 6.81% 5.34% Remaining contract charges -- -- -- LORD ABBETT BOND DEBENTURE FUND 2007 Lowest contract charges 0.75% 7.70% 5.39% Highest contract charges 2.45% 5.79% 3.62% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 8.82% 8.51% Highest contract charges 2.44% 10.04% 6.68% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 16.70% 4.62% Highest contract charges 2.37% 28.38% 3.45% Remaining contract charges -- -- --
SA-133 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- LORD ABBETT GROWTH AND INCOME PORTFOLIO 2007 Lowest contract charges 2,618,502 $12.274113 $32,139,787 Highest contract charges 4,251 11.696028 49,722 Remaining contract charges 23,325,418 -- 279,981,336 2006 Lowest contract charges 1,154,086 11.955476 13,797,643 Highest contract charges 3,691 11.587688 42,773 Remaining contract charges 12,550,731 -- 147,760,310 2005 Lowest contract charges 218,817 10.271292 2,247,530 Highest contract charges 366 10.125948 3,704 Remaining contract charges 2,626,144 -- 26,771,660 LORD ABBETT LARGE CAP CORE FUND 2007 Lowest contract charges 255,013 13.100410 3,340,775 Highest contract charges 647 12.520156 8,102 Remaining contract charges 977,123 -- 12,524,025 2006 Lowest contract charges 196,797 11.925730 2,346,959 Highest contract charges 16,504 11.602501 191,485 Remaining contract charges 725,596 -- 8,532,161 2005 Lowest contract charges 98,962 10.641404 1,053,094 Highest contract charges 87 10.521696 917 Remaining contract charges 283,029 -- 2,993,465 MFS CORE EQUITY SERIES 2007 Lowest contract charges 38,964 1.216627 47,405 Highest contract charges 10,545 7.308216 77,068 Remaining contract charges 1,100,576 -- 8,965,301 2006 Lowest contract charges 38,966 1.108918 43,209 Highest contract charges 11,003 6.748313 74,249 Remaining contract charges 1,250,462 -- 9,266,228 2005 Lowest contract charges 54,465 0.987187 53,767 Highest contract charges 11,180 6.086183 68,042 Remaining contract charges 1,375,299 -- 9,098,326 2004 Lowest contract charges 41,892 0.983525 41,202 Highest contract charges 10,498 6.142949 64,490 Remaining contract charges 1,460,226 -- 9,725,673 2003 Lowest contract charges 24,224 0.885965 21,461 Highest contract charges 4,483 5.606041 25,133 Remaining contract charges 1,409,118 -- 8,394,396 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ LORD ABBETT GROWTH AND INCOME PORTFOLIO 2007 Lowest contract charges 0.75% 1.73% 2.67% Highest contract charges 2.44% 1.18% 0.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.38% 16.40% Highest contract charges 2.44% 2.50% 14.44% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 3.16% 7.03% Highest contract charges 1.36% -- 5.82% Remaining contract charges -- -- -- LORD ABBETT LARGE CAP CORE FUND 2007 Lowest contract charges 0.75% 0.70% 9.85% Highest contract charges 2.59% 2.94% 8.00% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.80% 12.07% Highest contract charges 2.39% 0.97% 10.24% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.75% 6.41% Highest contract charges 2.46% 0.37% 5.22% Remaining contract charges -- -- -- MFS CORE EQUITY SERIES 2007 Lowest contract charges 1.30% 0.34% 9.71% Highest contract charges 2.59% 0.34% 8.30% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.46% 12.33% Highest contract charges 2.60% 0.44% 10.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.75% 0.37% Highest contract charges 2.59% 0.75% (0.92)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.30% 11.01% Highest contract charges 2.59% 0.43% 9.58% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.19% 25.74% Highest contract charges 1.63% -- 19.37% Remaining contract charges -- -- --
SA-134 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- MFS EMERGING GROWTH SERIES 2007 Lowest contract charges 28,797 $1.363595 $39,267 Highest contract charges 60,924 6.405207 390,230 Remaining contract charges 1,557,230 -- 11,023,207 2006 Lowest contract charges 28,800 1.140051 32,834 Highest contract charges 62,045 5.425208 336,609 Remaining contract charges 1,796,275 -- 10,744,058 2005 Lowest contract charges 28,806 1.070477 30,836 Highest contract charges 61,057 5.160816 315,106 Remaining contract charges 1,849,177 -- 10,463,520 2004 Lowest contract charges 13,538 0.993214 13,446 Highest contract charges 53,385 4.850916 258,968 Remaining contract charges 2,016,912 -- 10,589,885 2003 Lowest contract charges 11,368 0.890764 10,126 Highest contract charges 5,293 4.407523 23,327 Remaining contract charges 1,970,921 -- 9,219,570 MFS INVESTORS GROWTH STOCK SERIES 2007 Lowest contract charges 5,404 1.159127 6,264 Highest contract charges 12,387 6.987543 86,554 Remaining contract charges 1,011,035 -- 7,667,402 2006 Lowest contract charges 5,430 1.054520 5,726 Highest contract charges 12,945 6.440092 83,365 Remaining contract charges 1,244,343 -- 8,688,201 2005 Lowest contract charges 5,430 0.993086 5,392 Highest contract charges 12,841 6.144286 78,898 Remaining contract charges 1,324,440 -- 8,713,830 2004 Lowest contract charges 6,406 0.962851 6,168 Highest contract charges 11,018 6.035213 66,497 Remaining contract charges 1,365,644 -- 8,825,246 2003 Lowest contract charges 18,452 0.893385 16,484 Highest contract charges 15,728 5.673119 89,227 Remaining contract charges 1,218,367 -- 7,391,624 MFS INVESTORS TRUST SERIES 2007 Lowest contract charges 5,831 1.331219 7,763 Highest contract charges 57,113 10.091082 576,328 Remaining contract charges 2,170,566 -- 22,551,785 2006 Lowest contract charges 6,525 1.222627 7,978 Highest contract charges 59,456 9.389215 558,248 Remaining contract charges 2,434,128 -- 23,393,700 2005 Lowest contract charges 32,008 1.096187 35,087 Highest contract charges 57,289 8.528364 488,583 Remaining contract charges 2,655,349 -- 23,081,261 2004 Lowest contract charges 34,461 1.034845 35,661 Highest contract charges 28,540 8.156435 232,783 Remaining contract charges 2,599,565 -- 21,515,221 2003 Lowest contract charges 23,640 0.941477 22,257 Highest contract charges 4,385 7.517602 32,966 Remaining contract charges 2,028,576 -- 15,413,211 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ MFS EMERGING GROWTH SERIES 2007 Lowest contract charges 1.30% -- 19.61% Highest contract charges 2.59% -- 18.06% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% -- 6.50% Highest contract charges 2.60% -- 5.12% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% -- 7.78% Highest contract charges 2.59% -- 6.39% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 11.50% Highest contract charges 2.57% -- 10.06% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.30% -- 28.55% Highest contract charges 1.63% -- 19.01% Remaining contract charges -- -- -- MFS INVESTORS GROWTH STOCK SERIES 2007 Lowest contract charges 1.29% 0.32% 9.92% Highest contract charges 2.59% 0.33% 8.50% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.29% -- 6.19% Highest contract charges 2.60% -- 4.81% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.39% 3.14% Highest contract charges 2.58% 0.32% 1.81% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 7.78% Highest contract charges 2.59% -- 6.38% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 21.44% Highest contract charges 1.62% -- 14.24% Remaining contract charges -- -- -- MFS INVESTORS TRUST SERIES 2007 Lowest contract charges 1.29% 0.83% 8.88% Highest contract charges 2.59% 0.81% 7.48% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.53% 11.54% Highest contract charges 2.60% 0.52% 10.09% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.56% 5.93% Highest contract charges 2.58% 0.48% 4.56% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.61% 9.92% Highest contract charges 2.53% 0.14% 8.50% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 20.57% Highest contract charges 1.60% -- 16.14% Remaining contract charges -- -- --
SA-135 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- MFS TOTAL RETURN SERIES 2007 Lowest contract charges 207,915 $1.329842 $276,494 Highest contract charges 309,231 13.927118 4,306,697 Remaining contract charges 15,209,015 -- 217,660,744 2006 Lowest contract charges 259,198 1.292758 335,079 Highest contract charges 324,746 13.715825 4,454,155 Remaining contract charges 16,872,811 -- 236,283,998 2005 Lowest contract charges 332,578 1.170452 389,266 Highest contract charges 331,524 12.580684 4,170,798 Remaining contract charges 17,558,165 -- 224,123,127 2004 Lowest contract charges 275,820 1.153245 318,088 Highest contract charges 217,516 12.557976 2,731,557 Remaining contract charges 16,087,509 -- 204,273,585 2003 Lowest contract charges 229,110 1.049521 240,456 Highest contract charges 149,925 11.577974 1,735,832 Remaining contract charges 12,478,962 -- 145,922,447 EQUITY AND INCOME 2007 Lowest contract charges 263,409 15.230246 4,011,786 Highest contract charges 23,255 14.482570 336,799 Remaining contract charges 1,521,990 -- 22,602,790 2006 Lowest contract charges 278,722 14.957667 4,168,996 Highest contract charges 23,276 14.380670 334,726 Remaining contract charges 1,669,102 -- 24,466,318 2005 Lowest contract charges 274,202 13.487418 3,698,280 Highest contract charges 25,650 13.110525 336,279 Remaining contract charges 1,768,563 -- 23,517,328 2004 Lowest contract charges 243,954 12.750251 3,110,468 Highest contract charges 23,098 12.531003 289,444 Remaining contract charges 1,514,545 -- 19,145,651 2003 Lowest contract charges 115,900 11.606186 1,345,159 Highest contract charges 3,846 11.532775 44,358 Remaining contract charges 587,167 -- 6,794,459 CORE PLUS FIXED INCOME 2007 Lowest contract charges 524,392 1.239946 650,218 Highest contract charges 118,745 13.527056 1,606,274 Remaining contract charges 9,396,929 -- 132,055,171 2006 Lowest contract charges 891,362 1.191205 1,061,797 Highest contract charges 118,644 13.165406 1,561,995 Remaining contract charges 10,214,345 -- 138,844,077 2005 Lowest contract charges 1,129,598 1.163384 1,314,156 Highest contract charges 110,382 13.026094 1,437,853 Remaining contract charges 10,686,384 -- 142,781,370 2004 Lowest contract charges 983,600 1.130940 1,112,392 Highest contract charges 65,379 12.828577 838,716 Remaining contract charges 10,689,087 -- 139,686,101 2003 Lowest contract charges 616,339 1.097784 676,607 Highest contract charges 35,596 12.615510 449,061 Remaining contract charges 10,283,696 -- 131,172,611 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ MFS TOTAL RETURN SERIES 2007 Lowest contract charges 1.30% 2.48% 2.87% Highest contract charges 2.59% 2.56% 1.54% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.59% 10.45% Highest contract charges 2.60% 2.31% 9.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 2.06% 1.49% Highest contract charges 2.59% 1.91% 0.18% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.64% 9.88% Highest contract charges 2.57% 0.55% 8.47% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 1.66% 14.82% Highest contract charges 1.63% -- 11.85% Remaining contract charges -- -- -- EQUITY AND INCOME 2007 Lowest contract charges 1.50% 1.82% 1.82% Highest contract charges 2.59% 1.79% 0.71% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% 1.16% 10.90% Highest contract charges 2.60% 1.15% 9.69% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.49% 0.66% 5.78% Highest contract charges 2.59% 0.68% 4.63% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.49% -- 9.86% Highest contract charges 2.57% -- 8.66% Remaining contract charges -- -- -- 2003 Lowest contract charges 0.99% 0.89% 16.06% Highest contract charges 1.61% 1.01% 15.33% Remaining contract charges -- -- -- CORE PLUS FIXED INCOME 2007 Lowest contract charges 1.30% 4.09% 4.09% Highest contract charges 2.59% 3.61% 2.75% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 4.72% 2.39% Highest contract charges 2.60% 3.99% 1.07% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 3.55% 2.87% Highest contract charges 2.59% 3.55% 1.54% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 4.53% 3.02% Highest contract charges 2.57% 3.27% 1.69% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.30% 0.08% 3.29% Highest contract charges 1.62% 0.03% 0.76% Remaining contract charges -- -- --
SA-136 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- EMERGING MARKETS DEBT 2007 Lowest contract charges 53,005 $1.784655 $94,597 Highest contract charges 7,046 22.107798 155,773 Remaining contract charges 529,221 -- 11,175,592 2006 Lowest contract charges 53,395 1.697139 90,623 Highest contract charges 9,285 21.298708 197,757 Remaining contract charges 620,021 -- 12,411,423 2005 Lowest contract charges 21,642 1.551646 33,580 Highest contract charges 9,482 19.727481 187,062 Remaining contract charges 673,492 -- 12,239,295 2004 Lowest contract charges 21,502 1.400388 30,111 Highest contract charges 7,468 18.037236 134,699 Remaining contract charges 666,984 -- 10,893,914 2003 Lowest contract charges 18,776 1.289007 24,203 Highest contract charges 1,567 16.819741 26,353 Remaining contract charges 626,810 -- 9,410,696 EMERGING MARKETS EQUITY 2007 Lowest contract charges 105,819 23.038258 2,437,894 Highest contract charges 11,434 29.399461 336,150 Remaining contract charges 4,943,228 -- 117,176,890 2006 Lowest contract charges 43,349 16.525505 716,343 Highest contract charges 12,579 21.482782 270,229 Remaining contract charges 3,352,293 -- 59,869,961 2005 Lowest contract charges 17,733 12.138274 215,245 Highest contract charges 10,882 16.076611 174,947 Remaining contract charges 1,840,437 -- 26,058,806 2004 Lowest contract charges 65,220 1.443391 94,138 Highest contract charges 4,107 12.326618 50,623 Remaining contract charges 1,006,507 -- 12,426,261 2003 Lowest contract charges 60,294 1.187725 71,613 Highest contract charges 2,982 10.275795 30,647 Remaining contract charges 944,839 -- 9,675,499 HIGH YIELD 2007 Lowest contract charges 58,548 1.391435 81,465 Highest contract charges 59,315 10.862917 644,339 Remaining contract charges 1,983,364 -- 22,532,621 2006 Lowest contract charges 77,194 1.355279 104,619 Highest contract charges 58,825 10.719109 630,546 Remaining contract charges 2,393,088 -- 26,643,846 2005 Lowest contract charges 69,187 1.264029 87,455 Highest contract charges 50,821 10.128146 514,725 Remaining contract charges 2,800,611 -- 29,281,502 2004 Lowest contract charges 140,656 1.267156 178,234 Highest contract charges 26,767 10.286162 275,333 Remaining contract charges 3,320,017 -- 34,977,936 2003 Lowest contract charges 302,834 1.172526 355,081 Highest contract charges 11,011 9.642448 106,175 Remaining contract charges 3,427,784 -- 33,604,831 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ EMERGING MARKETS DEBT 2007 Lowest contract charges 1.30% 7.16% 5.16% Highest contract charges 2.60% 7.16% 3.80% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 10.04% 9.38% Highest contract charges 2.60% 8.89% 7.97% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 5.64% 10.80% Highest contract charges 2.59% 7.56% 9.37% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 6.93% 8.64% Highest contract charges 2.58% 9.11% 7.24% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 26.22% Highest contract charges 1.58% -- 12.57% Remaining contract charges -- -- -- EMERGING MARKETS EQUITY 2007 Lowest contract charges 0.74% 0.35% 39.41% Highest contract charges 2.59% 0.44% 36.85% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.76% 36.14% Highest contract charges 2.60% 0.79% 33.63% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.11% 34.19% Highest contract charges 2.57% 0.34% 30.42% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.66% 21.53% Highest contract charges 2.58% 0.92% 19.96% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 47.74% Highest contract charges 1.58% -- 47.97% Remaining contract charges -- -- -- HIGH YIELD 2007 Lowest contract charges 1.30% 9.49% 2.67% Highest contract charges 2.59% 9.41% 1.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 8.29% 7.22% Highest contract charges 2.60% 8.09% 5.84% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 8.68% (0.25)% Highest contract charges 2.58% 6.72% (1.54)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.31% 4.67% 8.07% Highest contract charges 2.58% 6.26% 6.68% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 24.09% Highest contract charges 1.62% -- 10.53% Remaining contract charges -- -- --
SA-137 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- MID CAP GROWTH 2007 Lowest contract charges 255,481 $15.576117 $3,979,396 Highest contract charges 800 14.842715 11,877 Remaining contract charges 2,038,347 -- 30,934,410 2006 Lowest contract charges 184,498 12.799102 2,361,411 Highest contract charges 711 12.405408 8,823 Remaining contract charges 1,006,632 -- 12,676,944 2005 Lowest contract charges 75,698 11.815831 894,440 Highest contract charges 127 11.648761 1,478 Remaining contract charges 369,411 -- 4,333,983 U.S. MID CAP VALUE 2007 Lowest contract charges 237,453 14.068913 3,340,712 Highest contract charges 79,103 20.076072 1,588,068 Remaining contract charges 5,897,336 -- 97,646,483 2006 Lowest contract charges 98,892 13.156067 1,301,016 Highest contract charges 87,700 19.105897 1,675,578 Remaining contract charges 6,088,556 -- 94,783,859 2005 Lowest contract charges 26,978 10.988986 296,462 Highest contract charges 79,878 16.246380 1,297,736 Remaining contract charges 6,022,762 -- 78,887,992 2004 Lowest contract charges 606,173 1.115456 676,159 Highest contract charges 63,047 14.846750 936,040 Remaining contract charges 4,917,753 -- 68,259,547 2003 Lowest contract charges 263,114 0.986142 259,467 Highest contract charges 19,813 13.297342 263,456 Remaining contract charges 4,347,956 -- 52,932,846 FOCUS GROWTH 2007 Lowest contract charges 3,966,374 1.333634 5,289,691 Highest contract charges 8,958 8.036551 71,989 Remaining contract charges 7,434,350 -- 142,432,719 2006 Lowest contract charges 5,235,780 1.100382 5,761,358 Highest contract charges 8,112 6.733865 54,623 Remaining contract charges 9,217,191 -- 151,778,398 2005 Lowest contract charges 5,526,725 1.110661 6,138,318 Highest contract charges 8,086 6.903285 55,822 Remaining contract charges 11,515,620 -- 202,389,241 2004 Lowest contract charges 5,742,549 0.983629 5,648,538 Highest contract charges 8,090 6.206381 50,212 Remaining contract charges 13,996,404 -- 227,371,668 2003 Lowest contract charges 4,472,818 0.920177 4,115,785 Highest contract charges 27,890 5.900077 164,552 Remaining contract charges 17,194,853 -- 273,164,339 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ MID CAP GROWTH 2007 Lowest contract charges 0.75% -- 21.70% Highest contract charges 2.44% -- 19.65% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 8.32% Highest contract charges 2.43% -- 6.50% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 24.28% Highest contract charges 1.37% -- 22.88% Remaining contract charges -- -- -- U.S. MID CAP VALUE 2007 Lowest contract charges 0.74% 0.60% 6.94% Highest contract charges 2.59% 0.67% 5.08% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.19% 19.72% Highest contract charges 2.60% 0.28% 17.60% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% 0.04% 13.94% Highest contract charges 2.59% 0.32% 9.43% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 0.02% 13.11% Highest contract charges 2.57% 0.02% 11.65% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 39.68% Highest contract charges 1.60% -- 33.23% Remaining contract charges -- -- -- FOCUS GROWTH 2007 Lowest contract charges 1.30% -- 21.20% Highest contract charges 2.59% -- 19.35% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.02% (0.93)% Highest contract charges 2.60% -- (2.45)% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.71% 12.92% Highest contract charges 2.59% 0.45% 11.23% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.38% 6.90% Highest contract charges 2.59% 0.18% 5.19% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.39% 19.01% Highest contract charges 1.63% 0.02% 16.79% Remaining contract charges -- -- --
SA-138 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- BALANCED GROWTH 2007 Lowest contract charges 2,009,582 $1.356218 $2,725,431 Highest contract charges 58,545 13.762785 805,748 Remaining contract charges 3,037,961 -- 57,987,061 2006 Lowest contract charges 2,171,547 1.322920 2,872,785 Highest contract charges 49,004 13.634590 668,155 Remaining contract charges 3,704,180 -- 70,645,313 2005 Lowest contract charges 2,451,168 1.189469 2,915,588 Highest contract charges 53,683 12.453701 668,552 Remaining contract charges 4,337,373 -- 77,937,820 2004 Lowest contract charges 2,034,268 1.113625 2,265,411 Highest contract charges 43,393 11.846797 514,066 Remaining contract charges 4,988,808 -- 86,398,590 2003 Lowest contract charges 1,265,740 1.017026 1,287,290 Highest contract charges 2,734 10.985273 30,029 Remaining contract charges 5,559,743 -- 91,762,173 CAPITAL OPPORTUNITIES 2007 Lowest contract charges 399,955 1.508588 603,368 Highest contract charges 27,978 5.111479 143,009 Remaining contract charges 3,238,039 -- 25,986,320 2006 Lowest contract charges 461,734 1.280881 591,423 Highest contract charges 30,718 4.405475 135,328 Remaining contract charges 4,067,193 -- 28,291,147 2005 Lowest contract charges 512,110 1.203121 616,130 Highest contract charges 24,926 4.204831 104,812 Remaining contract charges 4,897,779 -- 33,672,969 2004 Lowest contract charges 508,885 0.994021 505,842 Highest contract charges 26,501 3.530842 93,573 Remaining contract charges 5,532,055 -- 33,188,412 2003 Lowest contract charges 319,731 0.821432 262,637 Highest contract charges 8,877 2.960393 26,280 Remaining contract charges 6,094,246 -- 31,770,930 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ BALANCED GROWTH 2007 Lowest contract charges 1.30% 2.57% 2.52% Highest contract charges 2.59% 2.42% 0.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.60% 11.22% Highest contract charges 2.60% 2.34% 9.48% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 2.25% 6.81% Highest contract charges 2.59% 2.05% 5.12% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 2.41% 9.50% Highest contract charges 2.58% 2.51% 7.84% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 2.78% 18.29% Highest contract charges 1.63% 1.91% 15.55% Remaining contract charges -- -- -- CAPITAL OPPORTUNITIES 2007 Lowest contract charges 1.30% -- 17.78% Highest contract charges 2.59% -- 16.03% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% -- 6.46% Highest contract charges 2.60% -- 4.77% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% -- 21.04% Highest contract charges 2.59% -- 19.09% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 21.01% Highest contract charges 2.58% -- 19.27% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 39.81% Highest contract charges 1.70% -- 28.07% Remaining contract charges -- -- --
SA-139 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- DEVELOPING GROWTH 2007 Lowest contract charges 879,375 $1.942474 $1,708,164 Highest contract charges 9,506 10.806114 102,719 Remaining contract charges 1,855,953 -- 43,878,117 2006 Lowest contract charges 1,207,626 1.600730 1,933,080 Highest contract charges 9,825 9.042643 88,843 Remaining contract charges 2,093,762 -- 44,333,527 2005 Lowest contract charges 1,218,274 1.465011 1,784,786 Highest contract charges 10,389 8.405217 87,323 Remaining contract charges 2,562,494 -- 52,072,482 2004 Lowest contract charges 1,329,229 1.250444 1,662,127 Highest contract charges 2,901 7.285686 21,134 Remaining contract charges 2,852,600 -- 53,468,881 2003 Lowest contract charges 1,031,037 1.035726 1,067,872 Highest contract charges 5,023 6.131732 30,800 Remaining contract charges 3,221,371 -- 53,712,707 FLEXIBLE INCOME 2007 Lowest contract charges 831,886 1.397865 1,162,864 Highest contract charges 25,268 11.282737 285,091 Remaining contract charges 3,268,660 -- 42,126,286 2006 Lowest contract charges 913,616 1.363163 1,245,403 Highest contract charges 24,019 11.173114 268,368 Remaining contract charges 3,708,222 -- 47,365,201 2005 Lowest contract charges 898,042 1.305789 1,172,653 Highest contract charges 22,011 10.851070 238,842 Remaining contract charges 4,334,562 -- 53,822,165 2004 Lowest contract charges 771,563 1.285868 992,128 Highest contract charges 15,675 10.852128 170,103 Remaining contract charges 4,933,457 -- 61,312,429 2003 Lowest contract charges 356,373 1.217480 433,877 Highest contract charges 6,569 10.446908 68,631 Remaining contract charges 5,602,889 -- 67,481,098 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ DEVELOPING GROWTH 2007 Lowest contract charges 1.30% 0.41% 21.35% Highest contract charges 2.59% 0.15% 19.50% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% -- 9.26% Highest contract charges 2.60% -- 7.58% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% -- 17.16% Highest contract charges 2.58% -- 15.37% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 20.73% Highest contract charges 2.56% -- 18.82% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 39.58% Highest contract charges 1.63% -- 28.47% Remaining contract charges -- -- -- FLEXIBLE INCOME 2007 Lowest contract charges 1.30% 6.13% 2.55% Highest contract charges 2.59% 5.92% 0.98% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 6.44% 4.39% Highest contract charges 2.60% 6.17% 2.97% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 6.94% 1.55% Highest contract charges 2.59% 6.76% (0.01)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 7.63% 5.62% Highest contract charges 2.57% 6.31% 3.88% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 5.22% 12.08% Highest contract charges 1.62% 3.55% 6.24% Remaining contract charges -- -- --
SA-140 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- DIVIDEND GROWTH 2007 Lowest contract charges 4,723,678 $1.226769 $5,794,862 Highest contract charges 56,244 12.275072 690,404 Remaining contract charges 7,932,355 -- 174,098,555 2006 Lowest contract charges 6,191,248 1.191924 7,379,498 Highest contract charges 62,104 12.119250 752,655 Remaining contract charges 9,930,693 -- 219,462,327 2005 Lowest contract charges 6,575,504 1.085444 7,137,341 Highest contract charges 62,934 11.207657 705,339 Remaining contract charges 12,733,934 -- 265,894,212 2004 Lowest contract charges 6,945,112 1.041591 7,233,966 Highest contract charges 43,862 10.922263 479,068 Remaining contract charges 15,466,073 -- 319,436,384 2003 Lowest contract charges 5,455,551 0.974474 5,316,292 Highest contract charges 33,293 10.376439 345,465 Remaining contract charges 17,611,528 -- 356,595,193 GLOBAL EQUITY 2007 Lowest contract charges 1,616,915 1.696135 2,742,506 Highest contract charges 20,172 11.805397 238,137 Remaining contract charges 2,519,889 -- 53,387,964 2006 Lowest contract charges 2,046,311 1.475550 3,019,433 Highest contract charges 21,647 10.431601 225,817 Remaining contract charges 3,115,055 -- 58,932,820 2005 Lowest contract charges 2,264,200 1.229415 2,783,641 Highest contract charges 21,263 8.822506 187,590 Remaining contract charges 3,773,386 -- 61,355,797 2004 Lowest contract charges 2,323,692 1.125673 2,615,718 Highest contract charges 20,750 8.207970 170,319 Remaining contract charges 4,525,620 -- 69,088,206 2003 Lowest contract charges 1,432,825 1.054284 1,510,605 Highest contract charges 1,796 7.807799 14,025 Remaining contract charges 5,395,570 -- 78,880,046 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ DIVIDEND GROWTH 2007 Lowest contract charges 1.30% 1.16% 2.92% Highest contract charges 2.60% 0.92% 1.29% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.33% 9.81% Highest contract charges 2.60% 1.09% 8.13% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 1.27% 4.21% Highest contract charges 2.59% 1.06% 2.61% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.62% 6.89% Highest contract charges 2.58% 1.88% 5.26% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 2.04% 26.09% Highest contract charges 1.62% 1.36% 21.20% Remaining contract charges -- -- -- GLOBAL EQUITY 2007 Lowest contract charges 1.30% 0.65% 14.95% Highest contract charges 2.59% 0.43% 13.17% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.74% 20.02% Highest contract charges 2.60% 0.55% 18.24% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.65% 9.22% Highest contract charges 2.59% 0.46% 7.49% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.25% 6.77% Highest contract charges 2.58% 0.11% 5.13% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.42% 32.98% Highest contract charges 1.63% 0.13% 26.95% Remaining contract charges -- -- --
SA-141 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- GROWTH 2007 Lowest contract charges 667,760 $1.376764 $919,348 Highest contract charges 116,885 8.205665 959,119 Remaining contract charges 3,808,451 -- 43,882,413 2006 Lowest contract charges 871,625 1.143977 997,120 Highest contract charges 124,530 6.926968 862,617 Remaining contract charges 4,573,711 -- 45,388,744 2005 Lowest contract charges 891,071 1.115013 993,556 Highest contract charges 108,792 6.852504 745,499 Remaining contract charges 4,262,311 -- 46,830,657 2004 Lowest contract charges 704,230 0.977539 688,413 Highest contract charges 39,724 6.104294 242,487 Remaining contract charges 3,339,723 -- 39,697,986 2003 Lowest contract charges 419,112 0.920058 385,607 Highest contract charges 11,935 5.834486 69,637 Remaining contract charges 3,234,039 -- 41,795,947 MONEY MARKET 2007 Lowest contract charges 569,155 1.072322 610,317 Highest contract charges 74,895 10.215179 765,068 Remaining contract charges 9,962,218 -- 112,822,944 2006 Lowest contract charges 891,930 1.035260 923,394 Highest contract charges 46,293 10.017061 463,720 Remaining contract charges 9,998,240 -- 111,913,167 2005 Lowest contract charges 621,325 1.002738 623,026 Highest contract charges 33,656 9.853007 331,613 Remaining contract charges 6,945,986 -- 80,170,557 2004 Lowest contract charges 633,558 0.988854 626,496 Highest contract charges 15,700 9.867901 154,929 Remaining contract charges 7,763,998 -- 90,791,693 2003 Lowest contract charges 480,685 0.993199 477,416 Highest contract charges 74,541 10.066503 750,367 Remaining contract charges 9,751,999 -- 115,905,950 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ GROWTH 2007 Lowest contract charges 1.30% -- 20.35% Highest contract charges 2.59% -- 18.46% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% -- 2.60% Highest contract charges 2.60% -- 1.09% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.35% 14.06% Highest contract charges 2.59% 0.27% 12.26% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.22% 6.25% Highest contract charges 2.54% 0.02% 4.63% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.09% 25.27% Highest contract charges 1.62% -- 16.44% Remaining contract charges -- -- -- MONEY MARKET 2007 Lowest contract charges 1.30% 4.84% 3.58% Highest contract charges 2.58% 4.52% 1.98% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 4.44% 3.24% Highest contract charges 2.59% 4.42% 1.67% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 2.72% 1.40% Highest contract charges 2.59% 2.54% (0.15)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.91% (0.44)% Highest contract charges 2.59% 0.94% (1.97)% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.61% (0.66)% Highest contract charges 1.36% 0.15% (1.42)% Remaining contract charges -- -- --
SA-142 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- UTILITIES 2007 Lowest contract charges 826,001 $1.895936 $1,566,045 Highest contract charges 14,385 11.449522 164,696 Remaining contract charges 2,633,494 -- 59,339,068 2006 Lowest contract charges 1,216,657 1.602471 1,949,656 Highest contract charges 14,837 9.826005 145,786 Remaining contract charges 3,095,541 -- 61,810,435 2005 Lowest contract charges 1,235,797 1.347218 1,664,888 Highest contract charges 15,604 8.392261 130,955 Remaining contract charges 3,745,293 -- 67,538,315 2004 Lowest contract charges 1,160,935 1.173772 1,362,673 Highest contract charges 16,771 7.424930 124,523 Remaining contract charges 4,351,463 -- 70,258,536 2003 Lowest contract charges 752,912 0.955583 719,470 Highest contract charges 8,195 6.138064 50,301 Remaining contract charges 5,067,721 -- 69,671,835 EQUALLY WEIGHTED S&P 500 2007 Lowest contract charges 2,269,373 1.504079 3,413,316 Highest contract charges 121,169 15.263891 1,849,503 Remaining contract charges 7,407,375 -- 152,028,597 2006 Lowest contract charges 2,757,833 1.501713 4,141,475 Highest contract charges 132,180 15.474905 2,045,475 Remaining contract charges 8,679,884 -- 184,885,143 2005 Lowest contract charges 3,013,813 1.315013 3,963,204 Highest contract charges 156,214 13.770088 2,151,077 Remaining contract charges 9,439,482 -- 187,033,465 2004 Lowest contract charges 2,942,136 1.235637 3,635,413 Highest contract charges 95,261 13.138524 1,251,585 Remaining contract charges 9,036,144 -- 184,356,586 2003 Lowest contract charges 1,854,100 1.073160 1,989,746 Highest contract charges 19,319 11.591249 223,928 Remaining contract charges 7,958,810 -- 157,451,849 SMALL COMPANY GROWTH 2007 Lowest contract charges 106,050 13.969089 1,481,427 Highest contract charges 45,926 13.404473 615,617 Remaining contract charges 1,069,893 -- 14,618,811 2006 Lowest contract charges 132,946 13.772179 1,830,946 Highest contract charges 46,174 13.361686 616,966 Remaining contract charges 1,159,866 -- 15,715,755 2005 Lowest contract charges 61,604 12.500760 770,096 Highest contract charges 38,133 12.262332 467,602 Remaining contract charges 819,043 -- 10,130,785 2004 Lowest contract charges 5,503 11.241435 61,863 Highest contract charges 20,510 11.148935 228,666 Remaining contract charges 230,988 -- 2,584,365 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ UTILITIES 2007 Lowest contract charges 1.30% 1.77% 18.31% Highest contract charges 2.59% 1.58% 16.52% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.11% 18.95% Highest contract charges 2.60% 1.84% 17.08% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 2.15% 14.78% Highest contract charges 2.59% 1.87% 13.03% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 2.34% 22.83% Highest contract charges 2.58% 2.31% 20.97% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 2.75% 18.92% Highest contract charges 1.63% 2.12% 14.23% Remaining contract charges -- -- -- EQUALLY WEIGHTED S&P 500 2007 Lowest contract charges 1.30% 1.50% 0.16% Highest contract charges 2.59% 1.20% (1.36)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.30% 14.20% Highest contract charges 2.60% 1.01% 12.38% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.94% 6.42% Highest contract charges 2.59% 0.77% 4.81% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.82% 15.14% Highest contract charges 2.57% 0.65% 13.35% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 1.08% 35.38% Highest contract charges 1.61% 0.30% 29.71% Remaining contract charges -- -- -- SMALL COMPANY GROWTH 2007 Lowest contract charges 1.50% -- 1.43% Highest contract charges 2.60% -- 0.32% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% -- 10.17% Highest contract charges 2.60% -- 8.97% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.47% -- 11.20% Highest contract charges 2.58% -- 9.99% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.08% -- 12.41% Highest contract charges 1.92% -- 11.49% Remaining contract charges -- -- --
SA-143 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- GLOBAL FRANCHISE 2007 Lowest contract charges 109,723 $19.407659 $2,129,476 Highest contract charges 90,791 18.455152 1,675,556 Remaining contract charges 1,873,920 -- 35,429,095 2006 Lowest contract charges 110,234 17.945559 1,978,215 Highest contract charges 82,546 17.253444 1,424,197 Remaining contract charges 1,901,413 -- 33,426,027 2005 Lowest contract charges 78,056 14.991994 1,170,214 Highest contract charges 74,780 14.573126 1,089,780 Remaining contract charges 1,703,288 -- 25,142,153 2004 Lowest contract charges 38,080 13.590845 517,536 Highest contract charges 24,431 13.357186 326,324 Remaining contract charges 828,589 -- 11,157,148 2003 Lowest contract charges 11,776 12.234140 144,069 Highest contract charges 15,608 12.156794 189,739 Remaining contract charges 269,786 -- 3,290,389 OPPENHEIMER MIDCAP FUND 2007 Lowest contract charges 13,675 11.938399 163,259 Highest contract charges 517 11.376060 5,877 Remaining contract charges 489,745 -- 5,704,321 2006 Lowest contract charges 1,729 11.343436 19,602 Highest contract charges 1,858 10.994400 20,425 Remaining contract charges 311,478 -- 3,474,115 2005 Lowest contract charges 724 11.128286 8,061 Highest contract charges 1,858 10.970872 20,382 Remaining contract charges 103,319 -- 1,140,671 OPPENHEIMER CAPITAL APPRECIATION FUND 2007 Lowest contract charges 131,777 12.809096 1,687,942 Highest contract charges 3,128 12.205811 38,179 Remaining contract charges 8,880,148 -- 111,023,203 2006 Lowest contract charges 61,339 11.334601 695,273 Highest contract charges 2,879 10.985837 31,623 Remaining contract charges 5,525,571 -- 61,589,138 2005 Lowest contract charges 31,233 10.605266 331,235 Highest contract charges 2,595 10.455204 27,132 Remaining contract charges 2,108,342 -- 22,178,068 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ GLOBAL FRANCHISE 2007 Lowest contract charges 1.50% -- 8.15% Highest contract charges 2.59% -- 6.97% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% 1.34% 19.70% Highest contract charges 2.60% 1.36% 18.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.49% -- 10.31% Highest contract charges 2.58% -- 9.10% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.49% 0.22% 11.09% Highest contract charges 2.56% 0.26% 9.88% Remaining contract charges -- -- -- 2003 Lowest contract charges 0.98% -- 22.34% Highest contract charges 1.62% -- 21.57% Remaining contract charges -- -- -- OPPENHEIMER MIDCAP FUND 2007 Lowest contract charges 0.74% -- 5.25% Highest contract charges 2.47% -- 3.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 1.93% Highest contract charges 2.47% -- 0.21% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 17.17% Highest contract charges 2.39% -- 15.86% Remaining contract charges -- -- -- OPPENHEIMER CAPITAL APPRECIATION FUND 2007 Lowest contract charges 0.75% 0.01% 13.01% Highest contract charges 2.44% 0.01% 11.11% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.15% 6.88% Highest contract charges 2.45% 0.19% 5.08% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.22% Highest contract charges 2.39% -- 7.99% Remaining contract charges -- -- --
SA-144 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- OPPENHEIMER GLOBAL SECURITIES FUND 2007 Lowest contract charges 1,656,358 $14.137670 $23,417,039 Highest contract charges 1,387 10.304583 14,295 Remaining contract charges 25,662,095 -- 354,414,242 2006 Lowest contract charges 723,831 13.427502 9,719,222 Highest contract charges 206,802 13.026465 2,693,904 Remaining contract charges 13,770,335 -- 182,005,470 2005 Lowest contract charges 92,592 11.527071 1,067,313 Highest contract charges 96,913 11.368801 1,101,787 Remaining contract charges 2,746,868 -- 31,411,985 OPPENHEIMER MAIN STREET FUND 2007 Lowest contract charges 56,859 12.344736 701,911 Highest contract charges 2,943 11.763316 34,614 Remaining contract charges 1,592,072 -- 19,181,768 2006 Lowest contract charges 33,525 11.941867 400,364 Highest contract charges 8,311 11.574490 96,192 Remaining contract charges 998,724 -- 11,723,654 2005 Lowest contract charges 32,157 10.484476 337,148 Highest contract charges 8,050 10.336121 83,210 Remaining contract charges 359,481 -- 3,737,933 OPPENHEIMER MAIN STREET SMALL CAP FUND 2007 Lowest contract charges 112,489 12.219796 1,374,592 Highest contract charges 1,129 11.644211 13,151 Remaining contract charges 14,978,099 -- 178,577,475 2006 Lowest contract charges 68,091 12.485517 850,137 Highest contract charges 6,248 12.101367 75,613 Remaining contract charges 10,082,985 -- 123,766,649 2005 Lowest contract charges 12,441 10.971347 136,496 Highest contract charges 5,832 10.816124 63,083 Remaining contract charges 2,777,040 -- 30,219,289 PUTNAM DIVERSIFIED INCOME 2007 Lowest contract charges 381,212 18.865269 7,191,676 Highest contract charges 16,940 13.916279 235,739 Remaining contract charges 3,572,670 -- 61,805,263 2006 Lowest contract charges 103,180 18.253223 1,883,376 Highest contract charges 3,408 13.695602 46,676 Remaining contract charges 1,699,537 -- 28,308,569 2005 Lowest contract charges 14,738 17.301813 254,999 Highest contract charges 1,099 13.204279 14,506 Remaining contract charges 572,567 -- 8,941,378 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ OPPENHEIMER GLOBAL SECURITIES FUND 2007 Lowest contract charges 0.74% 0.85% 5.29% Highest contract charges 1.80% -- (1.60)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.35% 16.49% Highest contract charges 2.40% 0.69% 14.58% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 19.81% Highest contract charges 2.33% -- 18.50% Remaining contract charges -- -- -- OPPENHEIMER MAIN STREET FUND 2007 Lowest contract charges 0.75% 0.63% 3.37% Highest contract charges 2.45% 1.05% 1.63% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.09% 13.90% Highest contract charges 2.45% 0.97% 11.98% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.14% Highest contract charges 2.39% -- 7.91% Remaining contract charges -- -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND 2007 Lowest contract charges 0.75% 0.14% (2.13)% Highest contract charges 2.45% 0.22% (3.78)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.01% 13.80% Highest contract charges 2.46% 0.02% 11.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 17.80% Highest contract charges 2.39% -- 16.48% Remaining contract charges -- -- -- PUTNAM DIVERSIFIED INCOME 2007 Lowest contract charges 0.74% 3.32% 3.35% Highest contract charges 2.43% 2.78% 1.61% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.29% 5.50% Highest contract charges 2.45% 5.97% 3.72% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 2.19% Highest contract charges 2.40% -- 1.04% Remaining contract charges -- -- --
SA-145 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM GLOBAL ASSET ALLOCATION 2007 Lowest contract charges 47,948 $38.469378 $1,844,542 Highest contract charges 44,727 11.236730 502,580 Remaining contract charges 646,439 -- 15,829,489 2006 Lowest contract charges 29,464 37.652345 1,109,417 Highest contract charges 54,797 11.181051 612,685 Remaining contract charges 428,260 -- 9,287,712 2005 Lowest contract charges 12,977 33.613874 436,206 Highest contract charges 31,781 10.147839 322,506 Remaining contract charges 95,742 -- 2,477,510 PUTNAM GROWTH AND INCOME 2007 Lowest contract charges 25,149 55.693138 1,400,633 Highest contract charges 20,908 11.144502 233,005 Remaining contract charges 340,573 -- 9,644,633 2006 Lowest contract charges 14,976 59.718647 894,403 Highest contract charges 22,193 12.148945 269,616 Remaining contract charges 240,346 -- 6,943,688 2005 Lowest contract charges 6,142 51.909104 318,801 Highest contract charges 14,186 10.735847 152,301 Remaining contract charges 71,064 -- 2,048,597 PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND 2007 Lowest contract charges 3,762 9.771491 36,756 Highest contract charges 1,190 9.734619 11,582 Remaining contract charges 19,462 -- 189,748 PUTNAM INTERNATIONAL EQUITY 2007 Lowest contract charges 153,023 26.666709 4,080,629 Highest contract charges 4,289 10.270794 44,051 Remaining contract charges 9,141,993 -- 176,142,686 2006 Lowest contract charges 63,066 24.793041 1,563,620 Highest contract charges 282,850 12.560151 3,552,633 Remaining contract charges 6,914,868 -- 122,230,683 2005 Lowest contract charges 18,888 19.558296 369,410 Highest contract charges 139,793 10.073002 1,408,139 Remaining contract charges 2,821,734 -- 37,304,941 PUTNAM INVESTORS 2007 Lowest contract charges 106,516 10.573923 1,126,293 Highest contract charges 753 7.289828 5,488 Remaining contract charges 4,916,487 -- 45,714,453 2006 Lowest contract charges 66,801 11.233877 750,433 Highest contract charges 16,852 7.889516 132,952 Remaining contract charges 718,428 -- 6,978,839 2005 Lowest contract charges 17,011 9.934290 168,989 Highest contract charges 14,449 7.092883 102,482 Remaining contract charges 101,205 -- 873,168 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM GLOBAL ASSET ALLOCATION 2007 Lowest contract charges 0.75% 0.45% 2.17% Highest contract charges 2.40% 0.50% 0.50% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.41% 12.01% Highest contract charges 2.39% 2.71% 10.18% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 7.04% Highest contract charges 2.35% -- 5.87% Remaining contract charges -- -- -- PUTNAM GROWTH AND INCOME 2007 Lowest contract charges 0.75% 1.12% (6.74)% Highest contract charges 2.39% 1.11% (8.27)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.31% 15.05% Highest contract charges 2.40% 1.35% 13.16% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 8.12% Highest contract charges 2.36% -- 6.94% Remaining contract charges -- -- -- PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND 2007 Lowest contract charges 0.20% -- (1.06)% Highest contract charges 0.56% -- (1.24)% Remaining contract charges -- -- -- PUTNAM INTERNATIONAL EQUITY 2007 Lowest contract charges 0.75% 2.18% 7.56% Highest contract charges 1.85% -- (1.78)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.46% 26.77% Highest contract charges 2.40% 0.52% 24.69% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 14.66% Highest contract charges 2.35% -- 13.41% Remaining contract charges -- -- -- PUTNAM INVESTORS 2007 Lowest contract charges 0.75% 0.30% (5.88)% Highest contract charges 2.44% -- (7.46)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.26% 13.08% Highest contract charges 2.40% 0.40% 11.23% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 13.42% Highest contract charges 2.36% -- 12.18% Remaining contract charges -- -- --
SA-146 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM NEW VALUE 2007 Lowest contract charges 430,085 $21.041934 $9,049,824 Highest contract charges 496 14.754219 7,313 Remaining contract charges 945,187 -- 18,477,612 2006 Lowest contract charges 148,729 22.290074 3,315,170 Highest contract charges 3,839 15.897471 61,038 Remaining contract charges 677,775 -- 14,136,364 2005 Lowest contract charges 56,706 19.357998 1,097,720 Highest contract charges 3,839 14.042955 53,917 Remaining contract charges 301,080 -- 5,440,789 PUTNAM SMALL CAP VALUE 2007 Lowest contract charges 108,047 23.443202 2,532,960 Highest contract charges 1,062 19.242065 20,432 Remaining contract charges 5,491,727 -- 120,977,961 2006 Lowest contract charges 82,053 27.061733 2,220,481 Highest contract charges 1,047 22.593352 23,660 Remaining contract charges 4,143,332 -- 105,687,390 2005 Lowest contract charges 38,348 23.245262 891,403 Highest contract charges 306 19.739785 6,045 Remaining contract charges 1,405,303 -- 30,930,487 PUTNAM THE GEORGE PUTNAM FUND OF BOSTON 2007 Lowest contract charges 208,248 13.832698 2,880,632 Highest contract charges 15,509 12.282903 190,492 Remaining contract charges 1,918,474 -- 25,573,445 2006 Lowest contract charges 170,613 13.805165 2,355,313 Highest contract charges 73,393 12.487367 916,485 Remaining contract charges 1,101,888 -- 14,819,473 2005 Lowest contract charges 68,544 12.427584 851,831 Highest contract charges 9,810 11.428257 112,112 Remaining contract charges 270,851 -- 3,320,197 PUTNAM VISTA 2007 Lowest contract charges 17,238 17.006719 293,156 Highest contract charges 15,968 6.525817 104,205 Remaining contract charges 265,452 -- 2,803,897 2006 Lowest contract charges 14,668 16.505957 242,112 Highest contract charges 11,934 6.439048 76,844 Remaining contract charges 180,358 -- 1,987,505 2005 Lowest contract charges 5,118 15.770447 80,710 Highest contract charges 13,117 6.254512 82,042 Remaining contract charges 64,007 -- 701,094 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM NEW VALUE 2007 Lowest contract charges 0.75% 0.83% (5.60)% Highest contract charges 2.44% 1.49% (7.19)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.82% 15.15% Highest contract charges 2.45% 1.05% 13.21% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.05% Highest contract charges 2.42% -- 7.82% Remaining contract charges -- -- -- PUTNAM SMALL CAP VALUE 2007 Lowest contract charges 0.75% 0.53% (13.37)% Highest contract charges 2.45% 0.57% (14.83)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.27% 16.42% Highest contract charges 2.45% 0.21% 14.46% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 14.65% Highest contract charges 2.43% -- 13.36% Remaining contract charges -- -- -- PUTNAM THE GEORGE PUTNAM FUND OF BOSTON 2007 Lowest contract charges 0.75% 2.56% 0.20% Highest contract charges 2.42% -- (1.49)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.93% 11.09% Highest contract charges 2.39% 0.39% 9.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 4.85% Highest contract charges 2.36% -- 3.70% Remaining contract charges -- -- -- PUTNAM VISTA 2007 Lowest contract charges 0.75% -- 3.03% Highest contract charges 2.39% -- 1.35% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 4.66% Highest contract charges 2.40% -- 2.95% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.71% -- 17.35% Highest contract charges 2.36% -- 16.07% Remaining contract charges -- -- --
SA-147 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM VOYAGER 2007 Lowest contract charges 668 $58.316205 $38,939 Highest contract charges 779 6.780291 5,280 Remaining contract charges 206,033 -- 2,973,855 2006 Lowest contract charges 574 55.681359 32,063 Highest contract charges 779 6.584955 5,128 Remaining contract charges 190,493 -- 2,513,079 2005 Lowest contract charges 258 53.208384 13,747 Highest contract charges 16,928 6.406829 108,456 Remaining contract charges 57,583 -- 1,018,206 ENTERPRISE 2007 Lowest contract charges 206,473 1.166429 240,836 Highest contract charges 13,071 6.329218 82,728 Remaining contract charges 1,432,898 -- 11,423,707 2006 Lowest contract charges 231,435 1.048697 242,707 Highest contract charges 13,394 5.776113 77,368 Remaining contract charges 1,761,252 -- 12,859,785 2005 Lowest contract charges 304,766 0.992186 302,385 Highest contract charges 16,314 5.552645 90,589 Remaining contract charges 2,138,036 -- 15,139,548 2004 Lowest contract charges 221,405 0.929417 205,777 Highest contract charges 10,454 5.282739 55,225 Remaining contract charges 2,472,991 -- 16,710,009 2003 Lowest contract charges 163,502 0.904917 147,956 Highest contract charges 2,894 5.223695 15,117 Remaining contract charges 2,904,258 -- 19,319,847 GROWTH AND INCOME 2007 Lowest contract charges 1,536,034 17.180850 26,390,363 Highest contract charges 224,766 16.242615 3,650,783 Remaining contract charges 13,473,316 -- 210,670,699 2006 Lowest contract charges 709,821 16.884100 11,984,674 Highest contract charges 240,737 16.260056 3,914,398 Remaining contract charges 12,984,579 -- 196,567,309 2005 Lowest contract charges 225,075 14.668103 3,301,424 Highest contract charges 216,156 14.389633 3,110,407 Remaining contract charges 11,667,711 -- 153,092,960 2004 Lowest contract charges 856,405 1.156077 990,071 Highest contract charges 148,989 13.460455 2,005,455 Remaining contract charges 8,473,137 -- 114,156,936 2003 Lowest contract charges 433,350 1.023978 443,741 Highest contract charges 68,068 12.105660 824,002 Remaining contract charges 5,653,768 -- 67,797,744 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM VOYAGER 2007 Lowest contract charges 0.75% -- 4.73% Highest contract charges 2.45% -- 2.97% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.10% 4.65% Highest contract charges 2.46% 0.14% 2.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.64% -- 13.36% Highest contract charges 2.36% -- 12.12% Remaining contract charges -- -- -- ENTERPRISE 2007 Lowest contract charges 1.30% 0.38% 11.23% Highest contract charges 2.59% 0.15% 9.58% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.48% 5.70% Highest contract charges 2.61% 0.17% 4.03% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.65% 6.75% Highest contract charges 2.58% 0.43% 5.11% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.33% 2.71% Highest contract charges 2.55% -- 1.13% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.25% 24.25% Highest contract charges 1.63% -- 18.08% Remaining contract charges -- -- -- GROWTH AND INCOME 2007 Lowest contract charges 0.75% 1.05% 1.76% Highest contract charges 2.59% 1.38% (0.11)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.67% 15.11% Highest contract charges 2.60% 0.93% 13.00% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.99% Highest contract charges 2.59% 0.75% 6.90% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.73% 12.90% Highest contract charges 2.56% 0.10% 11.19% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.32% 26.38% Highest contract charges 1.62% -- 23.45% Remaining contract charges -- -- --
SA-148 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- COMSTOCK 2007 Lowest contract charges 1,156,424 $16.435250 $19,006,123 Highest contract charges 392,284 15.537611 6,095,161 Remaining contract charges 15,420,638 -- 248,107,222 2006 Lowest contract charges 741,739 16.953685 12,575,188 Highest contract charges 417,001 16.327017 6,808,385 Remaining contract charges 14,102,535 -- 236,130,834 2005 Lowest contract charges 297,759 14.719590 4,382,887 Highest contract charges 396,170 14.440094 5,720,729 Remaining contract charges 9,719,112 -- 142,570,772 2004 Lowest contract charges 150,900 14.484780 2,185,754 Highest contract charges 264,888 14.235396 3,770,787 Remaining contract charges 4,596,310 -- 65,939,052 2003 Lowest contract charges 58,020 12.521462 726,498 Highest contract charges 102,532 12.441971 1,275,699 Remaining contract charges 1,382,564 -- 17,253,703 STRATEGIC GROWTH 2007 Lowest contract charges 19,361 15.344436 297,088 Highest contract charges 22,244 14.590661 324,551 Remaining contract charges 250,608 -- 3,749,989 2006 Lowest contract charges 21,397 13.353671 285,746 Highest contract charges 24,631 12.838045 316,216 Remaining contract charges 289,264 -- 3,785,673 2005 Lowest contract charges 22,539 13.208819 297,714 Highest contract charges 22,937 12.839302 294,496 Remaining contract charges 306,976 -- 3,994,714 2004 Lowest contract charges 19,797 12.456970 246,614 Highest contract charges 16,920 12.242380 207,146 Remaining contract charges 316,839 -- 3,910,140 2003 Lowest contract charges 9,129 11.842633 108,109 Highest contract charges 12,343 11.767380 145,245 Remaining contract charges 132,713 -- 1,566,312 AGGRESSIVE GROWTH PORTFOLIO 2007 Lowest contract charges 18,596 14.122344 262,619 Highest contract charges 1,224 13.551542 16,586 Remaining contract charges 78,128 -- 1,077,401 2006 Lowest contract charges 19,592 12.190083 238,816 Highest contract charges 1,615 11.826680 19,101 Remaining contract charges 93,854 -- 1,124,392 2005 Lowest contract charges 7,927 11.793783 93,494 Highest contract charges 1,671 11.568800 19,333 Remaining contract charges 81,059 -- 945,214 2004 Lowest contract charges 1,412 10.774757 15,210 Highest contract charges 1,316 10.686077 14,061 Remaining contract charges 46,093 -- 494,078 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- COMSTOCK 2007 Lowest contract charges 0.75% 1.36% (3.06)% Highest contract charges 2.59% 1.59% (4.84)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.95% 15.18% Highest contract charges 2.60% 1.25% 13.07% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 5.94% Highest contract charges 2.59% 0.82% 1.44% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.49% 0.62% 15.68% Highest contract charges 2.57% 0.08% 14.42% Remaining contract charges -- -- -- 2003 Lowest contract charges 0.99% -- 25.22% Highest contract charges 1.61% -- 24.42% Remaining contract charges -- -- -- STRATEGIC GROWTH 2007 Lowest contract charges 1.50% -- 14.91% Highest contract charges 2.59% -- 13.65% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% -- 1.10% Highest contract charges 2.60% -- (0.01)% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.49% 0.01% 6.04% Highest contract charges 2.59% 0.01% 4.88% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.50% -- 5.19% Highest contract charges 2.56% -- 4.04% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.00% -- 18.43% Highest contract charges 1.60% -- 17.67% Remaining contract charges -- -- -- AGGRESSIVE GROWTH PORTFOLIO 2007 Lowest contract charges 1.50% -- 15.85% Highest contract charges 2.59% -- 14.58% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.49% -- 3.36% Highest contract charges 2.60% -- 2.23% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.48% -- 9.46% Highest contract charges 2.59% -- 8.26% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.10% -- 7.75% Highest contract charges 1.93% -- 6.86% Remaining contract charges -- -- --
SA-149 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- GOVERNMENT PORTFOLIO 2007 Lowest contract charges 180,172 $10.975127 $1,977,413 Highest contract charges 192,174 10.536728 2,024,888 Remaining contract charges 2,942,945 -- 31,607,914 2006 Lowest contract charges 169,275 10.410536 1,762,237 Highest contract charges 145,069 10.105234 1,465,956 Remaining contract charges 2,445,602 -- 25,062,661 2005 Lowest contract charges 75,744 10.249360 776,323 Highest contract charges 113,765 10.058815 1,144,345 Remaining contract charges 1,638,280 -- 16,619,411 2004 Lowest contract charges 4,685 10.074295 47,197 Highest contract charges 29,645 9.996370 296,342 Remaining contract charges 455,462 -- 4,568,181 WELLS FARGO ADVANTAGE VT ASSET ALLOCATION FUND 2007 Lowest contract charges 85,018 1.417654 120,526 Highest contract charges 114,042 1.340980 152,929 Remaining contract charges 281,851 -- 379,448 2006 Lowest contract charges 60,735 1.332802 80,950 Highest contract charges 133,644 1.276570 170,606 Remaining contract charges 275,761 -- 352,240 2005 Lowest contract charges 1,795 1.181729 2,121 Highest contract charges 136,540 1.166029 159,209 Remaining contract charges 249,383 -- 289,589 WELLS FARGO ADVANTAGE VT TOTAL RETURN BOND FUND 2007 Lowest contract charges 120,474 1.257584 151,507 Highest contract charges 56,300 1.189547 66,971 Remaining contract charges 461,655 -- 557,283 2006 Lowest contract charges 74,881 1.197937 89,704 Highest contract charges 90,943 1.147383 104,346 Remaining contract charges 622,452 -- 723,603 2005 Lowest contract charges 20,072 1.146847 23,020 Highest contract charges 86,552 1.131657 97,947 Remaining contract charges 130,607 -- 147,812 WELLS FARGO ADVANTAGE VT EQUITY INCOME FUND 2007 Lowest contract charges 5,370 1.441381 7,741 Highest contract charges 172,110 1.363417 234,658 Remaining contract charges 108,696 -- 151,960 2006 Lowest contract charges 5,396 1.418348 7,652 Highest contract charges 184,230 1.358510 250,278 Remaining contract charges 115,416 -- 159,577 2005 Lowest contract charges 73,912 1.189540 87,921 Highest contract charges 188,838 1.173756 221,649 Remaining contract charges 2,351 -- 2,748 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- GOVERNMENT PORTFOLIO 2007 Lowest contract charges 1.50% 4.52% 5.42% Highest contract charges 2.59% 3.99% 4.27% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% 3.03% 1.57% Highest contract charges 2.60% 4.02% 0.46% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.48% 1.56% 1.74% Highest contract charges 2.58% 2.77% 0.63% Remaining contract charges -- -- -- 2004 Lowest contract charges 0.33% -- 0.37% Highest contract charges 1.91% -- (0.04)% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT ASSET ALLOCATION FUND 2007 Lowest contract charges 1.14% 2.42% 6.37% Highest contract charges 2.39% 2.20% 5.05% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.12% 3.07% 10.86% Highest contract charges 2.40% 2.29% 9.48% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.26% 13.83% 6.16% Highest contract charges 2.36% 2.92% 5.59% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT TOTAL RETURN BOND FUND 2007 Lowest contract charges 1.14% 4.57% 4.98% Highest contract charges 2.41% 4.58% 3.68% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.86% 4.34% 2.67% Highest contract charges 2.40% 4.38% 1.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.55% 3.75% 0.15% Highest contract charges 2.36% 3.78% (0.38)% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT EQUITY INCOME FUND 2007 Lowest contract charges 1.14% 1.52% 1.62% Highest contract charges 2.39% 1.50% 0.36% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.13% 2.40% 17.20% Highest contract charges 2.40% 1.56% 15.74% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.56% 1.98% 5.13% Highest contract charges 2.36% 1.96% 4.57% Remaining contract charges -- -- --
SA-150 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- WELLS FARGO ADVANTAGE VT C&B LARGE CAP VALUE FUND 2007 Lowest contract charges 505,945 $1.305124 $660,321 Highest contract charges 206,978 1.236794 255,990 Remaining contract charges 531,584 -- 673,935 2006 Lowest contract charges 135,445 1.335887 180,940 Highest contract charges 214,731 1.278026 274,432 Remaining contract charges 383,564 -- 499,348 2005 Lowest contract charges 71,165 1.106577 78,750 Highest contract charges 183,800 1.068756 196,437 Remaining contract charges 117,686 -- 127,356 WELLS FARGO ADVANTAGE VT LARGE COMPANY CORE FUND 2007 Lowest contract charges 5,244 1.143314 5,996 Highest contract charges 37,078 1.083419 40,170 Remaining contract charges -- -- -- 2006 Lowest contract charges 5,244 1.130449 5,929 Highest contract charges -- -- -- Remaining contract charges -- -- -- 2005 Lowest contract charges 5,244 0.988859 5,186 Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT INTERNATIONAL CORE FUND 2007 Lowest contract charges 16,523 1.631868 26,964 Highest contract charges 112,146 1.546543 173,439 Remaining contract charges 22,966 -- 36,480 2006 Lowest contract charges 19,540 1.433665 28,014 Highest contract charges 103,796 1.401778 145,499 Remaining contract charges 5,608 -- 8,019 2005 Lowest contract charges 19,540 1.205870 23,563 Highest contract charges 105,520 1.184955 125,036 Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT LARGE COMPANY GROWTH FUND 2007 Lowest contract charges 1,101,916 1.148817 1,265,900 Highest contract charges 84,985 1.086651 92,349 Remaining contract charges 3,376,300 -- 3,739,005 2006 Lowest contract charges 386,459 1.079893 417,333 Highest contract charges 102,633 1.034299 106,154 Remaining contract charges 3,275,646 -- 3,429,010 2005 Lowest contract charges 75,938 1.067331 81,051 Highest contract charges 38,466 1.035131 39,817 Remaining contract charges 1,170,488 -- 1,217,811 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- WELLS FARGO ADVANTAGE VT C&B LARGE CAP VALUE FUND 2007 Lowest contract charges 1.14% 1.28% (2.30)% Highest contract charges 2.10% 1.05% (3.23)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.55% 20.72% Highest contract charges 2.10% 1.51% 19.58% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% 1.50% 3.39% Highest contract charges 2.05% 1.11% 2.73% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT LARGE COMPANY CORE FUND 2007 Lowest contract charges 1.15% -- 1.14% Highest contract charges 2.07% -- 0.18% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.16% 0.74% 14.32% Highest contract charges -- -- -- Remaining contract charges -- -- -- 2005 Lowest contract charges 1.10% 2.08% 3.54% Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT INTERNATIONAL CORE FUND 2007 Lowest contract charges 1.11% 0.01% 11.38% Highest contract charges 2.09% 0.01% 10.33% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.60% 1.71% 18.89% Highest contract charges 2.10% 1.68% 18.30% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.58% 7.68% 11.21% Highest contract charges 2.00% 9.98% 10.84% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT LARGE COMPANY GROWTH FUND 2007 Lowest contract charges 1.14% -- 6.38% Highest contract charges 2.39% -- 5.06% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 1.18% Highest contract charges 2.39% -- (0.08)% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.16% 16.43% Highest contract charges 2.35% 0.26% 15.47% Remaining contract charges -- -- --
SA-151 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- WELLS FARGO ADVANTAGE VT MONEY MARKET FUND 2007 Lowest contract charges 12,028 $1.071732 $12,891 Highest contract charges 185,132 1.015616 188,023 Remaining contract charges 641,464 -- 668,547 2006 Lowest contract charges 48,305 1.036346 50,061 Highest contract charges 127,537 0.991445 126,446 Remaining contract charges 1,657,048 -- 1,666,919 2005 Lowest contract charges 19,573 0.986587 19,311 Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL CAP GROWTH FUND 2007 Lowest contract charges 560,681 1.598511 896,254 Highest contract charges 29,179 1.512039 44,119 Remaining contract charges 1,511,464 -- 2,330,712 2006 Lowest contract charges 167,784 1.420762 238,381 Highest contract charges 40,178 1.360791 54,673 Remaining contract charges 1,529,574 -- 2,106,846 2005 Lowest contract charges 35,887 1.170801 42,017 Highest contract charges 17,658 1.135488 20,051 Remaining contract charges 531,986 -- 606,795 WELLS FARGO ADVANTAGE VT DISCOVERY FUND 2007 Lowest contract charges 6,871 15.443882 106,121 Highest contract charges 3,895 14.952864 58,237 Remaining contract charges 9,653 -- 147,003 2006 Lowest contract charges 4,530 12.771333 57,857 Highest contract charges 1,077 12.580387 13,551 Remaining contract charges 7,172 -- 90,854 2005 Lowest contract charges 150 11.219398 1,684 Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL/MID CAP VALUE FUND 2007 Lowest contract charges 6,090 13.605746 82,865 Highest contract charges 364 13.173244 4,791 Remaining contract charges 12,340 -- 165,166 2006 Lowest contract charges 4,855 13.859145 67,308 Highest contract charges 206 13.587309 2,798 Remaining contract charges 9,835 -- 134,714 2005 Lowest contract charges 4,440 12.114618 53,795 Highest contract charges -- -- -- Remaining contract charges -- -- -- INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- WELLS FARGO ADVANTAGE VT MONEY MARKET FUND 2007 Lowest contract charges 1.16% 4.51% 3.41% Highest contract charges 2.13% 6.18% 2.44% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.27% 6.15% 3.24% Highest contract charges 2.11% 4.73% 2.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.57% 3.14% 0.85% Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL CAP GROWTH FUND 2007 Lowest contract charges 1.14% -- 12.51% Highest contract charges 2.40% -- 11.12% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 21.35% Highest contract charges 2.39% -- 19.84% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 19.95% Highest contract charges 2.35% -- 18.96% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT DISCOVERY FUND 2007 Lowest contract charges 1.14% -- 20.93% Highest contract charges 2.33% -- 19.43% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 13.33% Highest contract charges 2.10% -- 12.26% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.85% -- 6.66% Highest contract charges -- -- -- Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL/MID CAP VALUE FUND 2007 Lowest contract charges 1.15% 0.02% (1.83)% Highest contract charges 2.39% 0.02% (3.05)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 14.40% Highest contract charges 2.37% -- 12.98% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.10% -- 11.89% Highest contract charges -- -- -- Remaining contract charges -- -- --
SA-152 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND 2007 Lowest contract charges 31,397 $12.707062 $398,960 Highest contract charges 573 12.463044 7,143 Remaining contract charges 31,221 -- 391,666 2006 Lowest contract charges 5,142 12.054296 61,982 Highest contract charges 573 11.911783 6,827 Remaining contract charges 3,816 -- 45,654 2005 Lowest contract charges 2,207 10.837413 23,915 Highest contract charges -- -- -- Remaining contract charges -- -- -- INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- WELLS FARGO ADVANTAGE VT OPPORTUNITY FUND 2007 Lowest contract charges 1.14% 0.74% 5.42% Highest contract charges 1.90% 0.60% 4.63% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 10.94% Highest contract charges 1.90% -- 10.11% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.58% -- 4.94% Highest contract charges -- -- -- Remaining contract charges -- -- --
* This represents the annualized contract expenses of the Account for the year indicated and includes only those expenses that are charged through a reduction in the unit values. Excluded are expenses of the Funds and charges made directly to contract owner accounts through the redemption of units. ** These amounts represent the dividends, excluding distributions of capital gains, received by the Sub-Account from the underlying mutual fund, net of management fees assessed by the Fund manager, divided by the average net assets. These ratios exclude those expenses, such as mortality and expense risk charges, that result in direct reductions in the unit values. The recognition of investment income by the Sub-Account is affected by the timing of the declaration of dividends by the fund in which the Sub-Accounts invest. *** This represents the total return for the year indicated and reflects a deduction only for expenses assessed through the daily unit value calculation. The total return does not include any expenses assessed through the redemption of units; inclusion of these expenses in the calculation would result in a reduction in the total return presented. Investment options with a date notation indicate the effective date of that investment option in the Account. The total return is calculated for the year indicated or from the effective date through the end of the reporting period. # Rounded unit values Summary of the Account's expense charges, including Mortality and Expense Risk Charges, Administrative Charges, Riders (if applicable) and Annual Maintenance Fees assessed. These fees are either assessed as a direct reduction in unit values or through a redemption of units for all policies contained within the Account. MORTALITY AND EXPENSE RISK CHARGES: The Company will charge an expense ranging from 0.55% to 1.60% of the contract's value for mortality and expense risks undertaken by the Company. These charges are a reduction in unit values. ADMINISTRATIVE CHARGES: The Company will charge an expense ranging from 0.05% to 0.20% of the contract's value for administrative services provided by the Company. These charges are a reduction in unit values. RIDERS: The Company will charge an expense for various Rider charges, such as MAV/EPB Death Benefit Charge, Principal First Charge, Principal First Preferred Charge, Optional Death Benefit Charge and Earnings Protection Benefit Charge. These deductions range from 0.15% to 0.75%. These charges are a reduction in unit values. The Company will also make deductions for Rider charges related to The Hartford's Income Foundation, The Hartford's Lifetime Income Builder, and The Hartford's Lifetime Income Builder II. The Company initially makes deductions of 0.30%, 0.40%, and 0.40%, respectively. The Company has the right to increase both the Lifetime Income Builder and Lifetime Income Builder II to a maximum charge of 0.75%. These charges are redemption of units. SA-153 SEPARATE ACCOUNT THREE HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 ------------------------------------------------------------------------------- ANNUAL MAINTENANCE FEE: An annual maintenance fee in the amount of $30 may be deducted from the contract's value each contract year. However, this fee is not applicable to contracts with values of $50,000 or more, as determined on the most recent contract anniversary. These expenses are included in surrenders for benefit payments and fees in the accompanying statements of changes in net assets. These charges are redemption of units. SA-154 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-155 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY INDEPENDENT AUDITORS' REPORT FINANCIAL STATEMENTS -- STATUTORY BASIS As of December 31, 2007 and 2006 and for the Years Ended December 31, 2007, 2006 and 2005 Supplemental Schedules Year Ended December 31, 2007 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY CONTENTS
PAGE: -------------------------------------------------------------------------------- Independent Auditors' Report F-2 Financial Statements Statutory Basis: Admitted Assets, Liabilities and Surplus F-4 Statements of Operations F-5 Statements of Changes in Capital and Surplus F-6 Statements of Cash Flows F-7 Notes to Financial Statements F-8 Supplementary Information Schedule I -- Selected Financial Data F-28 Schedule II -- Summary Investment Schedule F-31 Schedule III -- Investment Risks Interrogatories F-32
F-1 INDEPENDENT AUDITORS' REPORT To the Board of Directors of Hartford Life and Annuity Insurance Company Hartford, Connecticut We have audited the accompanying statutory-basis statements of admitted assets, liabilities, and surplus of Hartford Life and Annuity Insurance Company (the "Company") as of December 31, 2007 and 2006, and the related statutory-basis statements of operations, changes in capital and surplus, and cash flows for the three years ended December 31, 2007. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards as established by the Auditing Standards Board (United States) and in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. As described more fully in Note 2 to the financial statements, the Company prepared these financial statements using accounting practices prescribed or permitted by the Insurance Department of the State of Connecticut, and such practices differ from accounting principles generally accepted in the United States of America. The effects on such financial statements of the differences between the statutory basis of accounting and accounting principles generally accepted in the United States of America are also described in Note 2. In our opinion, because of the effects of the matter discussed in the preceding paragraph, the statutory-basis financial statements referred to above do not present fairly, in conformity with accounting principles generally accepted in the United States of America, the financial position of the Company as of December 31, 2007 or 2006, or the results of its operations or its cash flows for the three years ended December 31, 2007. However, in our opinion, the statutory-basis financial statements referred to above present fairly, in all material respects, the admitted assets, liabilities, and surplus of the Company as of December 31, 2007 and 2006, and the results of its operations and its cash flows for the three years ended December 31, 2007, on the basis of accounting described in Note 2. Our 2007 audit was conducted for the purpose of forming an opinion on the basic 2007 statutory-basis financial statements taken as a whole. The supplemental schedule of selected financial data, the summary investment schedule, and the schedule of investment risk interrogatories as of and for the year ended December 31, 2007 are presented for purposes of additional analysis and are not a required part of the basic 2007 statutory-basis financial statements. These schedules are the responsibility of the Company's management. Such schedules have been subjected to the auditing procedures applied in our audit of the basic 2007 statutory-basis financial statements. The effects on these schedules of the differences between the statutory basis of accounting and accounting principles generally accepted in the United States of America, although not reasonably determinable, are presumed to be material. Accordingly, in our opinion, such schedules do not present fairly, in conformity with accounting principles generally accepted in the United States of America, the information shown therein. However, in our opinion, such schedules are fairly stated in all material respects when considered in relation to the basic 2007 statutory-basis financial statements taken as a whole. F-2 As discussed in Note 2 to the financial statements, the Company received approval from the State of Connecticut Insurance Department to change from the continous CARVM to the curtate CARVM reserving methodology. The change resulted in a basis change which decreased reserves by $236 million and was reported as a direct increase to surplus. /s/ Deloitte & Touche LLP Hartford, Connecticut March 27, 2008 F-3 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY ADMITTED ASSETS, LIABILITIES AND SURPLUS (STATUTORY BASIS) (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
AS OF DECEMBER 31, 2007 2006 -------------------------------------------------------------------------------- ADMITTED ASSETS Bonds $5,605,630 $5,036,594 Common and Preferred Stocks 316,558 245,850 Mortgage Loans 350,528 160,595 Real Estate 27,569 25,667 Policy Loans 343,773 324,631 Cash and Short-Term Investments 565,283 467,648 Other Invested Assets 629,835 245,454 -------------- -------------- TOTAL CASH AND INVESTED ASSETS 7,839,176 6,506,439 -------------- -------------- Investment Income Due and Accrued 77,351 66,244 Federal Income Taxes Recoverable 24,162 -- Deferred Tax Asset 145,516 91,537 Other Assets 189,180 104,023 Separate Account Assets 81,072,392 76,317,895 -------------- -------------- TOTAL ADMITTED ASSETS $89,347,777 $83,086,138 -------------- -------------- LIABILITIES Aggregate Reserves for Life and Accident and Health Policies $5,976,074 $6,422,847 Liability for Deposit Type Contracts 73,736 80,785 Policy and Contract Claim Liabilities 31,281 32,635 Asset Valuation Reserve 46,855 41,544 Payable to Parents, Subsidiaries or Affiliates 41,011 30,498 Accrued Expense Allowances and Other Amounts Due From Separate Accounts (2,471,367) (2,438,731) Other Liabilities 2,021,207 930,986 Separate Account Liabilities 81,072,392 76,317,895 -------------- -------------- TOTAL LIABILITIES 86,791,189 81,418,459 -------------- -------------- CAPITAL AND SURPLUS Common Stock -- 3,000 Shares Authorized, 2,000 Shares Issued and Outstanding 2,500 2,500 Gross Paid-In and Contributed Surplus 1,483,869 1,376,953 Aggregate Write-Ins for Other Than Special Surplus Funds 194,430 -- Unassigned Funds 875,789 288,226 -------------- -------------- TOTAL CAPITAL AND SURPLUS 2,556,588 1,667,679 -------------- -------------- TOTAL LIABILITIES, CAPITAL AND SURPLUS $89,347,777 $83,086,138 -------------- --------------
SEE NOTES TO FINANCIAL STATEMENTS. F-4 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF OPERATIONS (STATUTORY BASIS) (AMOUNTS IN THOUSANDS UNLESS OTHERWISE STATED)
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 --------------------------------------------------------------------------------------------------------------------------------- REVENUES Premiums and Annuity Considerations $10,313,501 $9,842,305 $9,152,337 Net Investment Income 348,437 339,347 326,928 Commissions and Expense Allowances on Reinsurance Ceded 333,674 94,873 84,961 Reserve Adjustment on Reinsurance Ceded (1,710,405) (1,659,418) (1,552,540) Fee Income 1,786,396 1,650,017 1,369,610 Other Revenues 83,752 15,635 107,757 -------------- -------------- ------------- TOTAL REVENUES 11,155,355 10,282,759 9,489,053 -------------- -------------- ------------- BENEFITS AND EXPENSES Death and Annuity Benefits 341,654 280,782 265,994 Disability and Other Benefits 7,588 18,311 14,118 Surrenders and Other Fund Withdrawals 9,528,808 9,054,230 6,974,564 Commissions 962,917 864,564 783,178 (Decrease) Increase in Aggregate Reserves for Life and Accident and Health Policies (70,821) 274,407 (11,074) General Insurance Expenses 532,485 528,545 449,607 Net Transfers (from) to Separate Accounts (237,153) (675,124) 1,192,568 Modified Coinsurance Adjustment on Reinsurance Assumed (509,774) (530,122) (483,138) Other Expenses 144,927 55,838 41,735 -------------- -------------- ------------- TOTAL BENEFITS AND EXPENSES 10,700,631 9,871,431 9,227,552 -------------- -------------- ------------- Net gain from operations before federal income tax expense 454,724 411,328 261,501 Federal income tax expense 88,449 31,961 42,463 -------------- -------------- ------------- NET GAIN FROM OPERATIONS 366,275 379,367 219,038 -------------- -------------- ------------- Net realized capital (losses) gains, after tax (81,759) (40,656) 54 -------------- -------------- ------------- NET INCOME $284,516 $338,711 $219,092 -------------- -------------- -------------
SEE NOTES TO FINANCIAL STATEMENTS. F-5 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CHANGES IN CAPITAL AND SURPLUS (STATUTORY BASIS) (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 --------------------------------------------------------------------------------------------------------------------------------- COMMON STOCK -- 3,000 SHARES AUTHORIZED, 2,000 SHARES ISSUED AND OUTSTANDING Balance, Beginning and End of Year $2,500 $2,500 $2,500 ------------- ------------- ------------- GROSS PAID-IN AND CONTRIBUTED SURPLUS, Beginning of Year 1,376,953 1,371,883 1,371,883 Capital Contribution 106,916 5,070 -- ------------- ------------- ------------- BALANCE, END OF YEAR 1,483,869 1,376,953 1,371,883 ------------- ------------- ------------- AGGREGATE WRITE-INS FOR OTHER THAN SPECIAL SURPLUS FUNDS Beginning of Year -- -- -- Gain on Inforce Reinsurance 194,430 -- -- ------------- ------------- ------------- BALANCE, END OF YEAR 194,430 -- -- ------------- ------------- ------------- UNASSIGNED FUNDS Balance, Beginning of Year 288,226 115,883 (66,391) Net Income 284,516 338,711 219,092 Change in Net Unrealized Capital Losses on Common Stocks and Other Invested Assets 262,434 (35,674) (7,075) Change in Net Unrealized Foreign Exchange Capital Losses (5,386) 2,957 (495) Change in Net Deferred Income Tax (82,891) 30,476 82,268 Change in Asset Valuation Reserve (5,311) (6,795) (4,632) Change in Non-Admitted Assets 100,351 (42,153) (106,914) Change in Reserve on Account of Change in Valuation Basis 236,861 -- -- Change in Liability for Reinsurance in Unauthorized Companies (198) (179) 30 Correction of Reserves and Tax Liabilities 4,187 -- -- Dividends to Stockholder (207,000) (115,000) -- ------------- ------------- ------------- BALANCE, END OF YEAR 875,789 288,226 115,883 ------------- ------------- ------------- CAPITAL AND SURPLUS, End of year $2,556,588 $1,667,679 $1,490,266 ------------- ------------- -------------
SEE NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS. F-6 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY STATEMENTS OF CASH FLOWS (STATUTORY BASIS) (AMOUNTS IN THOUSANDS UNLESS OTHERWISE STATED)
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 --------------------------------------------------------------------------------------------------------------------------------- OPERATING ACTIVITIES Premiums and Annuity Considerations $10,306,169 $9,836,688 $9,145,844 Net Investment Income 378,000 383,972 369,012 Miscellaneous Income 493,502 98,373 1,909 --- --- --- Total Income 11,177,671 10,319,033 9,516,765 --- --- --- Benefits Paid 10,132,212 9,346,769 7,273,337 Federal Income Tax Payments (Recoveries) 71,171 (103,806) 71,607 Net Transfers (from) to Separate Accounts (204,517) (188,413) 1,240,273 Other Expenses 332,141 1,011,284 826,693 --- --- --- Total Benefits and Expenses 10,331,007 10,065,834 9,411,910 --- --- --- NET CASH PROVIDED BY OPERATING ACTIVITIES 846,664 253,199 104,855 --- --- --- INVESTING ACTIVITIES PROCEEDS FROM INVESTMENTS SOLD AND MATURED Bonds 1,526,875 1,959,478 2,572,479 Common and Preferred Stocks 149,356 24,070 -- Mortgage Loans 63,357 8,746 11,039 Other (32,175) (16,109) 50,196 --- --- --- Total Investment Proceeds 1,707,413 1,976,185 2,633,714 --- --- --- COST OF INVESTMENTS ACQUIRED Bonds 2,269,295 1,682,961 2,708,647 Common and Preferred Stocks 214,967 140,727 13,467 Mortgage Loans 253,365 70,991 40,175 Real Estate 2,781 1,125 116 Other 384,420 109,533 134,301 --- --- --- Total Investments Acquired 3,124,828 2,005,337 2,896,706 --- --- --- Net Increase in Policy Loans 19,142 720 13,391 --- --- --- NET CASH USED FOR INVESTING ACTIVITIES (1,436,557) (29,872) (276,383) --- --- --- FINANCING AND MISCELLANEOUS ACTIVITIES Capital Contribution 100,000 -- -- Dividends to Stockholder (57,726) (115,000) -- Funds Held Under Reinsurance Treaties with Unauthorized Reinsurers 646,001 -- -- Net Other Cash (Used) Provided (747) 13,463 85,968 --- --- --- NET CASH PROVIDED BY (USED FOR) FINANCING AND MISCELLANEOUS ACTIVITIES 687,528 (101,537) 85,968 --- --- --- Net Increase (Decrease) in Cash and Short-Term Investments 97,635 121,790 (85,560) Cash and Short-Term Investments, Beginning of Year 467,648 345,858 431,418 --- --- --- CASH AND SHORT-TERM INVESTMENTS, END OF YEAR $565,283 $467,648 $345,858 --- --- --- Note: Supplemental disclosures of cash flow information for non-cash transactions: Capital contribution from parent to settle intercompany balances related to stock compensation 6,916 5,070 -- Dividend of Assets to Affiliate Champlain Life Reinsurance Company 149,274 -- --
SEE NOTES TO FINANCIAL STATEMENTS. F-7 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS (STATUTORY BASIS) (IN THOUSANDS) -------------------------------------------------------------------------------- 1. ORGANIZATION AND DESCRIPTION OF BUSINESS: Hartford Life and Annuity Insurance Company (the "Company") is a wholly-owned subsidiary of Hartford Life Insurance Company ("HLIC"), which is an indirect subsidiary of Hartford Life, Inc. ("HLI"). HLI is indirectly owned by The Hartford Financial Services Group, Inc. ("The Hartford"). The Company offers a complete line of fixed and variable annuities, as well as variable, universal and traditional individual life insurance. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: BASIS OF PRESENTATION The accompanying statutory basis financial statements have been prepared in conformity with statutory accounting practices prescribed or permitted by the State of Connecticut Department of Insurance ("the Department"). The Department recognizes only statutory accounting practices prescribed or permitted by Connecticut for determining and reporting the financial condition and results of operations of an insurance company and for determining solvency under State of Connecticut Insurance Law. The National Association of Insurance Commissioners' Accounting Practices and Procedures Manual ("NAIC SAP") has been adopted as a component of prescribed practices by Connecticut. A difference prescribed by Connecticut state law, allows the Company to obtain a reinsurance reserve credit for a reinsurance treaty which provides for a limited right of unilateral cancellation by the reinsurer. Even if the Company did not obtain reinsurance reserve credit for this reinsurance treaty, the Company's risk-based capital would not have triggered a regulatory event. The preparation of financial statements in conformity with statutory accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. The most significant estimates include those used in determining the liability for aggregate reserves for life and accident and health policies, evaluation of other-than-temporary impairments and valuation of derivatives. Although some variability is inherent in these estimates, management believes the amounts provided are adequate. Certain reclassifications have been made to prior year financial information to conform to current year presentation. STATUTORY ACCOUNTING VERSUS ACCOUNTING PRINCIPLES GENERALLY ACCEPTED IN THE UNITED STATES ("GAAP") Statutory accounting principles and GAAP differ in certain significant respects. These differences principally involve: (1) treatment of policy acquisition costs (commissions, underwriting and selling expenses, etc.) and sales inducements which are charged to expense when incurred for statutory purposes rather than capitalized and amortized on a pro-rata basis over the expected life and gross profit stream of the policies for GAAP purposes; (2) recognition of premium revenues, which for statutory purposes are generally recorded as collected or when due during the premium paying period of the contract and which for GAAP purposes, for universal life policies and investment products, generally only consist of charges assessed to policy account balances for cost of insurance, policy administration and surrenders. For GAAP, when policy charges received relate to coverage or services to be provided in the future, the charges are recognized as revenue on a pro-rata basis over the expected life and gross profit stream of the policy. Also, for GAAP purposes, premiums for traditional life insurance policies are recognized as revenues when they are due from policyholders; (3) development of liabilities for future policy benefits, which for statutory purposes predominantly use interest rate and mortality assumptions prescribed by the NAIC, which may vary considerably from interest and mortality assumptions used under GAAP. Additionally for GAAP, reserves for guaranteed minimum death benefits are based on models that involve a range of scenarios and assumptions, including those regarding expected market rates of return and volatility, contract surrender rates and mortality experience, and, reserves for guaranteed withdrawal benefits are considered embedded derivatives and reported at fair value; (4) excluding certain assets designated as non-admitted assets (e.g., negative Interest Maintenance Reserve, and past due agents' balances) from the admitted assets, liabilities and surplus statement for statutory purposes by directly charging surplus; F-8 (5) the calculation of post-retirement benefits obligation which, for statutory accounting, excludes non-vested employees whereas GAAP liabilities include a provision for such employees; statutory and GAAP accounting permit either immediate recognition of the liability or straight-line amortization of the liability over a period not to exceed 20 years. For GAAP, The Hartford's obligation was immediately recognized, whereas, for statutory accounting, the obligation is being recognized ratably over a 20 year period; (6) establishing a formula reserve for realized and unrealized losses due to default and equity risk associated with certain invested assets (Asset Valuation Reserve) for statutory purposes; as well as the deferral and amortization of realized gains and losses, caused by changes in interest rates during the period the asset is held, into income over the original life to maturity of the asset sold (Interest Maintenance Reserve) for statutory purposes; whereas on a GAAP basis, no such formula reserve is required and realized gains and losses are recognized in the period the asset is sold; (7) the reporting of reserves and benefits, net of reinsurance ceded for statutory purposes; whereas on a GAAP basis, reserves are reported gross of reinsurance with reserve credits presented as recoverable assets; (8) the reporting of fixed maturities at amortized cost for NAIC classes 1-5 and the lower of amortized cost or fair value for NAIC class 6 for statutory purposes, whereas GAAP requires that fixed maturities be classified as "held-to-maturity", "available-for-sale" or "trading", based on the Company's intentions with respect to the ultimate disposition of the security and its ability to affect those intentions. The Company's bonds were classified on a GAAP basis as "available-for-sale" and accordingly, those investments and common stocks were reflected at fair value with the corresponding impact included as a separate component of Stockholder's Equity, (9) for statutory purposes separate account liabilities are calculated using prescribed actuarial methodologies, which approximate the market value of separate account assets, less applicable surrender charges. The separate account surplus generated by these reserving methods is recorded as an amount due to or from the separate account on the statutory basis admitted assets, liabilities and surplus statement, with changes reflected in the statutory basis results of operations. On a GAAP basis, separate account assets and liabilities must meet specific conditions to qualify as a separate account asset or liability. Amounts reported for separate accounts assets and liabilities are based upon the fair value of the underlying assets; (10) the consolidation of financial statements for GAAP reporting, whereas statutory accounting requires standalone financial statements with earnings of subsidiaries reflected as changes in unrealized gains or losses in surplus; (11) deferred income taxes, which provide for statutory/tax temporary differences, are subject to limitation and are charged directly to surplus, whereas, GAAP would include GAAP/tax temporary differences and are charged as a component of net income; (12) comprehensive income and its components are not presented in statutory financial statements; (13) for statutory purposes derivative instruments that qualify for hedging, replication, or income generation are accounted for in a manner consistent with the hedged item, cash instrument and covered asset, respectively, typically amortized cost. Derivative instruments held for other investment and risk management activities, which do not receive hedge accounting treatment, receive fair value accounting for statutory purposes and are recorded at fair value with corresponding changes in value reported in unrealized gains and losses within surplus. For GAAP accounting derivative instruments are recorded at fair value with changes in value reported in earnings, with the exception of cash flow hedges and net investment hedges of a foreign operation, which are carried at fair value with changes in value reported as a separate component of Stockholder's Equity. In addition, statutory accounting does not record the hedge ineffectiveness on qualified hedge positions, whereas, GAAP records the hedge ineffectiveness in earnings; and (14) embedded derivatives for statutory accounting are not bifurcated from the host contract, whereas, GAAP accounting requires the embedded derivative to be bifurcated from the host instrument, accounted and reported separately. F-9 As of and for the years ended December 31, the significant differences between Statutory and GAAP basis net income and capital and surplus for the Company are as follows:
2007 2006 2005 --------------------------------------------------------------------------------------------------------------------------------- GAAP Net Income $348,883 $312,900 $288,133 Deferral and amortization of policy acquisition costs, net (583,420) (69,341) (252,771) Change in unearned revenue reserve 205,884 120,820 120,513 Deferred taxes 76,671 (57,573) (63,142) Separate account expense allowance 382,281 143,649 25,180 Benefit reserve adjustment (328,431) (91,421) 73,673 Prepaid reinsurance adjustment 3,703 615 (1,861) Sales inducements (30,167) (21,576) (32,256) Derivatives 263,627 60,110 (211,904) Other, net (54,515) (59,472) 273,527 ------------- ------------- ------------- STATUTORY NET INCOME $284,516 $338,711 $219,092 ------------- ------------- ------------- GAAP Stockholder's Equity $4,153,194 $3,916,947 $3,672,466 Deferred policy acquisition costs (5,187,834) (4,583,199) (4,508,206) Unearned revenue reserve 861,421 648,448 524,372 Deferred taxes 475,659 383,837 383,486 Separate account expense allowance 2,473,554 2,089,536 1,946,328 Unrealized gains on investments 56,340 (117,113) (46,341) Benefit reserve adjustment (44,469) (274,921) (46,363) Asset valuation reserve (46,855) (41,544) (34,749) Interest maintenance reserve -- -- (17,845) Prepaid reinsurance premium (40,877) (33,931) (27,377) Goodwill (170,100) (170,100) (170,100) Reinsurance ceded (569) (200,371) (200,192) Other, net 27,124 50,090 14,787 ------------- ------------- ------------- STATUTORY CAPITAL AND SURPLUS $2,556,588 $1,667,679 $1,490,266 ------------- ------------- -------------
AGGREGATE RESERVES FOR LIFE AND ACCIDENT AND HEALTH POLICIES AND CONTRACTS AND LIABILITY FOR DEPOSIT TYPE CONTRACTS Aggregate reserves for payment of future life, health and annuity benefits are computed in accordance with applicable actuarial standards. Reserves for life insurance policies are generally based on the 1958, 1980 and 2001 Commissioner's Standard Ordinary Mortality Tables and various valuation rates ranging from 2.25% to 6%. Accumulation and on-benefit annuity reserves are based principally on individual and group annuity tables at various rates ranging from 2.50% to 9.50% and using the Commissioner's Annuity Reserve Valuation Method ("CARVM"). For non-interest sensitive ordinary life plans, the Company waives deduction of deferred fractional premiums upon death of insured. Return of the unearned portion of the final premium is governed by the terms of the contract. The Company does not have any forms for which the cash values are in excess of the legally computed reserve. Extra premiums are charged for substandard lives, in addition to the regular gross premiums for the true age. Mean reserves for traditional insurance products are determined by computing the regular mean reserve for the plan at the true age, and adding one-half (1/2) of the extra premium charge for the year. For plans with explicit mortality charges, mean reserves are based on appropriate multiples of standard rates of mortality. During 2007, the State of Connecticut Insurance Department approved changes to certain reserving methodologies. The reserve valuation basis for variable annuities was changed from "continuous" CARVM to "curtate" CARVM. The change resulted in a basis change which lowered reserves by $236,861 and was reported as a direct increase to surplus. As of December 31, 2007 and 2006, the Company had $10,136,370 and $8,037,610, respectively, of insurance in force for which the gross premiums are less than the net premiums according to the standard valuation set by the State of Connecticut. Reserves to cover the above insurance at December 31, 2007 and 2006 totaled $31,284 and $22,702, respectively. The Company has established separate accounts to segregate the assets and liabilities of certain life insurance, pension and annuity contracts that must be segregated from the Company's general account assets under the terms of its contracts. The assets consist primarily of marketable securities and are reported at fair value. Premiums, benefits and expenses relating to these contracts are reported in the statutory basis statements of operations. F-10 An analysis of Annuity Actuarial Reserves and Deposit Liabilities by Withdrawal Characteristics as of December 31, 2007 (including general and separate account liabilities) are as follows
% OF SUBJECT TO DISCRETIONARY WITHDRAWAL: AMOUNT TOTAL -------------------------------------------------------------------------------- With market value adjustment: In a lump sum reflecting changes in interest rates or asset values $1,367 0.00% In installments over 5 years or more, with or w/o reduction in interest rates -- 0.00% At book value, less current surrender charge of 5% or more 783,940 1.01% At market value 74,427,327 95.67% -------------- -------- TOTAL WITH ADJUSTMENT OR AT MARKET VALUE 75,212,634 96.68% -------------- -------- At book value without adjustment (minimal or no charge or adjustment): In a lump sum without adjustment 315,526 0.41% Installments over less than 5 years -- 0.00% In a lump sum subject to a fixed surrender charge of less than 5% 1,918,148 2.47% In a lump sum subject to a surrender charge -- 0.00% All others -- 0.00% Not subject to discretionary withdrawal 346,876 0.45% -------------- -------- TOTAL, GROSS 77,793,184 100.00% Reinsurance ceded -- 0.00% -------------- -------- TOTAL, NET $ 77,793,184 100.00% -------------- -------- Reconciliation of total annuity actuarial reserves and deposit fund liabilities: Life and Accident & Health Annual Statement: Exhibit 5, Annuities Section, Total (net) $3,167,850 Exhibit 5, Supplementary Contract Section, Total (net) 5,215 Exhibit 7, Deposit-Type Contracts Section, Column 1, Line 14 73,736 -------------- Subtotal 3,246,802 Separate Account Annual Statement Exhibit 3, Column 2, Line 0299999 74,546,383 Exhibit 3, Column 2, Line 0399999 -- Policyholder dividend and coupon accumulations -- Policyholder premiums -- Guaranteed interest contracts -- Other contract deposit funds --
INVESTMENTS Investments in bonds are carried at amortized cost except for those securities that are deemed ineligible to be held at amortized cost by the NAIC Securities Valuation Office ("SVO"), which are carried at the lower of amortized cost or fair value. Short-term investments include all investments whose maturities, at the time of acquisition, are one year or less and are stated at amortized cost, which approximates fair value. Unaffiliated common stocks are carried at fair value with the change in the difference from cost recorded as a change in net unrealized capital gains (losses), a component of unassigned surplus. Unaffiliated preferred stocks are carried at cost, lower of cost or amortized cost, or NAIC market values depending on the assigned credit rating and whether the preferred stock is redeemable or non-redeemable. Investments in common and preferred stocks of subsidiaries and affiliates of the Company are carried in accordance with Statement of Statutory Accounting Principles ("SSAP") No. 97 (Investment in Subsidiary, Controlled, and Affiliated Entities, a replacement of SSAP No. 88) based on their underlying equity generally adjusted to a statutory basis. Mortgage loans on real estate are stated at the outstanding principal balance. Policy loans are carried at outstanding balance, which approximates fair value. Interest income on bonds and mortgage loans is recognized when earned on the constant effective yield method based on estimated principal repayments, if applicable. For bonds subject to prepayment risk, yields are recalculated and adjusted periodically to reflect historical and/or estimated future principal repayments. The new effective yields used for fixed rate and variable rate loan-backed securities are recalculated on a retrospective and prospective basis, respectively. The Company has not elected to use the book value as of January 1, 1994 as the cost for applying the retrospective adjustment method to securities purchased prior to that date. Investment income on interest only securities is determined using the prospective method. Prepayment fees on bonds and mortgage loans are recorded in net investment income when earned. Dividends are recorded as earned on the ex-dividend date. For bond investments, other than loan-backed securities, that have had an other-than-temporary impairment loss, income is earned on the effective yield method based upon the new cost basis and the amount and timing of future estimated cash flows. F-11 Due and accrued investment income amounts over 90 days past due are non-admitted. There was no investment income due and accrued excluded from surplus at December 31, 2007 and 2006. Net realized gains and losses from investment sales are determined on a specific identification basis. Net realized capital gains and losses also result from termination or settlement of derivative contracts that do not qualify, or are not designated, as a hedge for accounting purposes. Impairments are recognized within net realized capital losses when investment losses in value are deemed other-than-temporary. Foreign currency transaction gains and losses are also recognized within net realized capital gains and losses. The Asset Valuation Reserve ("AVR") is designed to provide a standardized reserving process for realized and unrealized losses due to default and equity risks associated with invested assets. The AVR balances were $46,855 and $41,544 as of December 31, 2007, 2006 respectively. Additionally, the Interest Maintenance Reserve ("IMR") captures net realized capital gains and losses, net of applicable income taxes, resulting from changes in interest rates and amortizes these gains or losses into income over the life of the bond, preferred stock or mortgage loan sold. The IMR balances as of December 31, 2007 and 2006 were $(10,988), and $(525) respectively. The 2007 and 2006 IMR balances were asset balances and were reflected as a component of non-admitted assets in Unassigned Funds in accordance with statutory accounting practices. The net capital losses captured in the IMR, net of taxes, in 2007, 2006 and 2005 were $(10,549), $(15,707) and $(2,530), respectively. The amount of (expense) or income amortized from the IMR net of taxes in 2007, 2006 and 2005 included in the Company's Statements of Operations, was $(86), $2,664 and $7,879, respectively. Realized capital gains and losses, net of taxes, not included in the IMR are reported in the Statement of Operations. The Company's accounting policy requires that a decline in the value of a bond or equity security, that is not subject to SSAP No. 43 (Loan-backed and Structured Securities), below its cost or amortized cost basis be assessed to determine if the decline is other-than-temporary. If the decline in value of a bond or equity security is other-than-temporary, a charge is recorded in net realized capital losses equal to the difference between the fair value and cost or amortized cost basis of the security. In addition, for securities expected to be sold, an other-than-temporary impairment charge is recognized if the Company does not expect the fair value of a security to recover to its cost or amortized cost basis prior to the expected date of sale. The fair value of the other-than-temporarily impaired investment becomes its new cost basis. The Company has a security monitoring process overseen by a committee of investment and accounting professionals that identifies securities that, due to certain characteristics, as described below, are subjected to an enhanced analysis on a quarterly basis. Securities that are in an unrealized loss position are reviewed at least quarterly to determine if an other-than-temporary impairment is present based on certain quantitative and qualitative factors. The primary factors considered in evaluating whether a decline in value for securities not subject to SSAP No. 43 is other-than-temporary include: (a) the length of time and the extent to which the fair value has been less than cost or amortized cost, (b) the financial condition, credit rating and near-term prospects of the issuer, (c) whether the debtor is current on contractually obligated interest and principal payments, and (d) the intent and ability of the Company to retain the investment for a period of time sufficient to allow for recovery. Once an impairment charge has been recorded, the Company continues to review the other-than-temporarily impaired securities for further other-than-temporary impairments on an ongoing basis. Additionally, for certain securitized financial assets with contractual cash flows (including asset-backed securities), SSAP No. 43 requires the Company to periodically update their best estimate of cash flows over the life of the security. If management determines that the estimated undiscounted cash flows of a security are less than its amortized cost then an other-than-temporary impairment charge is recognized equal to the difference between the amortized cost and estimated undiscounted cash flows of the security. The estimated undiscounted cash flows of the impaired investment become its new cost basis. Estimating future cash flows is a quantitative and qualitative process that incorporates information received from third party sources along with certain internal assumptions and judgments regarding the future performance of the underlying collateral. As a result, actual results may differ from estimates. In addition, projections of expected future cash flows may change based upon new information regarding the performance of the underlying collateral. Net realized capital losses resulting from write-downs for other-than-temporary impairments on corporate and asset-backed fixed maturities was $560, $0 and $2,219 for the years ended December 31, 2007, 2006 and 2005. Net realized capital losses resulting from write-downs for other-than-temporary impairments on equities was $1,664, $0 and $0 for the years ended December 31, 2007, 2006 and 2005, respectively. Mortgage loans on real estate are considered to be impaired when management estimates that, based upon current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. For mortgage loans that are determined to be impaired, a valuation allowance is established for the difference between the carrying amount and the Company's share of the fair value of the collateral. Changes in valuation allowances are recorded in net realized capital gains and losses. The Company does not have a valuation reserve as of December 31, 2007, 2006 and 2005, respectively. F-12 The Company may at any time use derivative instruments, including swaps, caps, floors, options, futures and forwards. On the date the derivative contract is entered into, the Company designates the derivative as being held for hedging (fair value, cash flow, or net investment in a foreign operation), replication, income generation, or other investment and/or risk management activities, which primarily involve managing asset or liability related risks which do not qualify for hedge accounting under Statement of Statutory Accounting Principles ("SSAP") No. 86, "Accounting for Derivative Instruments and Hedging, Income Generation, and Replication (Synthetic Asset) Transactions". The Company's derivative transactions are permitted uses of derivatives under the derivatives use plan required by the State of Connecticut insurance department. Derivatives used in hedging relationships are accounted for in a manner consistent with the item hedged. Typically, cost paid or consideration received at inception of a contract is reported on the Statements of Admitted Assets, Liabilities and Surplus as an asset or liability, respectively, and amortized through net investment income over the term of the hedged item. Periodic cash flows and accruals of income/expense are recorded in a manner consistent with the hedged item. Upon termination of the derivative, any gain or loss is adjusted into the basis of the hedged item. Derivatives used in replication relationships are accounted for in a manner consistent with the cash instrument and the replicated asset. Typically, cost paid or consideration received at inception of the contract is recorded on the Statement of Admitted Assets, Liabilities and Surplus as a derivative asset or liability, respectively, and amortized through net investment income over the term of the derivative. Periodic cash flows and accruals of income/expense are recorded as a component of derivative net investment income. Upon termination of the derivative, any gain or loss is recorded as a realized capital gain or loss. Derivatives used in income generation relationships are accounted for in a manner consistent with the associated covered asset. Typically, consideration received at inception of the contract is recorded on the Statement of Admitted Assets, Liabilities and Surplus as a derivative liability and amortized through net investment income over the term of the derivative. Upon termination, any remaining derivative liability, along with any disposition payments are recorded as realized capital gain or loss. Derivatives held for other investment and/or risk management activities receive fair value accounting. The derivatives are carried on the Statement of Admitted Assets, Liabilities and Surplus at fair value and the changes in fair value are recorded in capital and surplus as unrealized gains and losses. Periodic cash flows and accruals of income/expense are recorded as a component of derivative net investment income. ADOPTION OF ACCOUNTING STANDARDS SSAP NO. 97 -- INVESTMENTS IN SUBSIDIARY, CONTROLLED AND AFFILIATED ENTITIES (SSAP No. 97), was issued by the Statutory Accounting Issues Working Group of the NAIC's Accounting Practice and Procedures Task force during 2007. SSAP No. 97 defines the appropriate valuation for subsidiaries and affiliates of insurance companies. It was effective on January 1, 2008, and did not have a material impact on the Company's financial statements. 3. INVESTMENTS: For the years ended December 31, (A) COMPONENTS OF NET INVESTMENT INCOME
2007 2006 2005 -------------------------------------------------------------------------------- Interest income from bonds and short-term investments $335,302 $306,123 $301,532 Interest income from policy loans 21,532 21,199 22,418 Interest income from mortgage loans 17,414 9,591 4,933 Interest and dividends from other investments 9,101 9,577 4,968 ----------- ---------- ----------- Gross investment income 383,349 346,490 333,851 Less: investment expenses 34,912 7,143 6,923 ----------- ---------- ----------- NET INVESTMENT INCOME $348,437 $339,347 $326,928 ----------- ---------- -----------
(B) COMPONENTS OF NET UNREALIZED CAPITAL LOSSES ON BONDS
2007 2006 2005 -------------------------------------------------------------------------------- Gross unrealized capital gains $86,420 $95,839 $108,881 Gross unrealized capital losses (152,307) (62,923) (67,624) ----------- --------- ----------- Net unrealized capital (losses) gains (65,887) 32,916 41,257 Balance, beginning of year 32,916 41,257 221,650 ----------- --------- ----------- CHANGE IN NET UNREALIZED CAPITAL LOSSES ON BONDS AND SHORT-TERM INVESTMENTS $(98,803) $(8,341) $(180,393) ----------- --------- -----------
F-13 (C) COMPONENTS OF NET UNREALIZED CAPITAL (LOSSES) GAINS ON COMMON STOCKS AND PREFERRED STOCKS
2007 2006 2005 -------------------------------------------------------------------------------- Gross unrealized capital gains $1,751 $3,778 $1,002 Gross unrealized capital losses (56,041) (36,376) (31,971) --------- --------- --------- Net unrealized capital losses (54,290) (32,598) (30,969) Balance, beginning of year (32,598) (30,969) (30,975) --------- --------- --------- CHANGE IN NET UNREALIZED CAPITAL (LOSSES) GAINS ON COMMON STOCKS AND PREFERRED STOCKS $(21,692) $(1,629) $6 --------- --------- ---------
(D) COMPONENTS OF NET REALIZED CAPITAL (LOSSES) GAINS
2007 2006 2005 -------------------------------------------------------------------------------- Bonds and short-term investments $(13,496) $(19,176) $(912) Common stocks (11) 43 -- Preferred stocks (2,546) (502) -- Other invested assets (72,007) (40,976) (7,003) --------- --------- -------- Realized capital losses (88,060) (60,611) (7,915) Capital gains tax benefit 4,248 (4,248) (5,439) --------- --------- -------- Net realized capital losses, after tax (92,308) (56,363) (2,476) Less: amounts transferred to IMR (10,549) (15,707) (2,530) --------- --------- -------- NET REALIZED CAPITAL (LOSSES) GAINS, AFTER TAX $(81,759) $(40,665) $54 --------- --------- --------
For the years ended December 31, 2007, 2006 and 2005, sales of unaffiliated bonds and short-term investments resulted in proceeds of $1,478,584, $1,771,232 and $2,440,767, gross realized capital gains of $13,287, $9,836 and $18,351, and gross realized capital losses of $26,224, $29,012 and $19,087 respectively, before transfers to the IMR. For the years ended December 31, 2007, 2006 and 2005, sales of common and preferred stocks resulted in proceeds of $149,356, $24,070 and $0, gross realized capital gains of $62, $43 and $0, and gross realized capital losses of $955, $502 and $0, respectively. (E) INVESTMENTS -- DERIVATIVE INSTRUMENTS OVERVIEW The Company may at any time use derivative instruments, including swaps, caps, floors, options, forwards and futures, in order to achieve one of four Company approved objectives: to hedge risk arising from interest rate, price, credit spread including issuer default, equity market, or currency exchange rate risk or volatility; to manage liquidity; to control transaction costs; or to enter into income generation or replication transactions. On the date the derivative contract is entered into, the Company designates the derivative as hedging (fair value, cash flow, or net investment in a foreign operation), income generation, replication, or held for other investment and/or risk management activities, which primarily involve managing asset or liability related risks which do not qualify for hedge accounting under SSAP No. 86 "Accounting for Derivative Instruments and Hedging, Income Generation, and Replication (Synthetic Asset) Transactions". The Company's derivative transactions are permitted uses of derivatives under the derivatives use plan required by the State of Connecticut insurance department. Interest rate swaps, index and total return swaps, and volatility swaps involve the periodic exchange of cash flows with other parties, at specified intervals, calculated using the agreed upon rates, indices, or other financial variables, and notional principal amounts. Generally, no cash or principal payments are exchanged at the inception of the contract. Typically, at the time a swap is entered into, the cash flow streams exchanged by the counterparties are equal in value. Credit default swaps entitle one party to receive a periodic fee in exchange for an obligation to compensate the other party should a credit event occur on the part of the issuer. Interest rate cap and floor contracts entitle the purchaser to receive from the issuer at specified dates, the amount, if any, by which a specified market rate exceeds the cap strike rate or falls below the floor strike rate, applied to a notional principal amount. A premium payment is made by the purchaser of the contract at its inception, and no principal payments are exchanged. Forward contracts are customized commitments to either purchase or sell designated financial instruments, at a future date, for a specified price and may be settled in cash or through delivery of the underlying instrument. Financial futures are standardized commitments to either purchase or sell designated financial instruments, at a future date, for a specified price and may be settled in cash or through delivery of the underlying instrument. Futures contracts trade on organized exchanges. Margin requirements for futures are met by pledging securities, and changes in the futures' contract values are settled daily in cash. F-14 Option contracts grant the purchaser, in return for a premium payment, the right to either purchase from or sell to the issuer a financial instrument at a specified price, within a specified period or on a stated date. Foreign currency swaps exchange an initial principal amount in two currencies, agreeing to re-exchange the currencies at a future date, at an agreed upon exchange rate. There may also be a periodic exchange of payments at specified intervals calculated using the agreed upon rates and exchanged principal amounts. STRATEGIES The notional value, fair value and carrying value of derivative instruments used during the year are disclosed in the strategy discussion below. During the years 2007 and 2006, the Company did not transact in or hold any positions related to net investment hedges in a foreign operation, fair value hedges, or income generation transactions. The notional amounts of derivative contracts represent the basis upon which pay or receive amounts are calculated and are not reflective of credit risk. Notional amounts pertaining to derivative instruments held at December 31, 2007 and 2006, were $17,006,125 and $8,246,014, respectively. The fair value of derivative instruments is based upon widely accepted pricing valuation models which utilize independent third party data as inputs or independent broker quotations. The fair value of derivative instruments held at December 31, 2007 and 2006, were $472,283 and $212,798, respectively. As of December 31, 2007 and 2006, the average fair value for derivatives held for other investment and/or risk management activities was $314,434 and $169,198, respectively. As of December 31, 2007 and 2006, the carrying value of derivative instruments was $466,251 and $235,338, respectively. During the reporting period, the Company did not have any gains or losses recognized in unrealized gains or losses due to either a component of derivative gains or losses excluded from hedge effectiveness or due to derivatives no longer qualifying for hedge accounting. CASH-FLOW HEDGES Interest rate swaps: Interest rate swaps are primarily used to convert interest receipts on floating-rate fixed maturity investments to fixed rate cash flows. The Company did not hedge forecasted transactions other than the interest payments on floating-rate securities. There were no gains and losses classified in unrealized gains and losses related to cash flow hedges that have been discontinued because it was no longer probable that the original forecasted transactions would occur by the end of the originally specified time period. As of December 31, 2007 and 2006, interest rate swaps used in cash flow hedge relationships had a notional value of $150,000 and $195,000, respectively, a fair value of $(341) and $(2,860), respectively, and a carrying value of $0. Foreign currency swaps: Foreign currency swaps are used to convert foreign denominated cash flows associated with certain foreign denominated fixed maturity investments to U.S. dollars. The foreign fixed maturities are primarily denominated in Euros and are hedged to minimize cash flow fluctuations due to changes in currency rates. As of December 31, 2007 and 2006, foreign currency swaps used in cash flow hedge relationships had a notional value of $192,393 and $159,723, respectively, a fair value of $(23,535) and $(19,605), respectively, and a carrying value of $(29,875) and $0, respectively. REPLICATION TRANSACTIONS Credit Default Swaps: The Company periodically enters into credit default swaps as part of replication transactions. Credit default swaps used in replication transactions had a notional value at December 31, 2007 and 2006, of $7,500, a fair value of $33 and $(75), respectively, and a carrying value of $0. OTHER INVESTMENT AND RISK MANAGEMENT ACTIVITIES Interest rate caps and swaptions: The Company is exposed to policyholder surrenders during a rising interest rate environment. Interest rate cap and swaption contracts are used to mitigate the Company's loss in a rising interest rate environment. The increase in yield from the cap and swaption contracts in a rising interest rate environment may be used to raise credited rates, thereby increasing the Company's competitiveness and reducing the policyholder's incentive to surrender. As of December 31, 2007 and 2006, interest rate caps and swaptions used to mitigate risk in a rising interest rate environment had a notional value of $580,767 and $1,054,077, respectively, a fair value of $2,435 and $2,594, respectively, and a carrying value of $2,435 and $2,594, respectively. For the years ended December 31, 2007 and 2006, derivative contracts in this strategy reported a loss of $(6,239) and $(235), respectively, in realized capital gains and losses. During the year 2005, there were no realized gains and losses. Credit default swaps: The Company enters into swap agreements in which the Company reduces or assumes credit exposure from an individual entity, referenced index, or asset pool. As of December 31, 2007 and 2006, credit default swaps had a notional value of $447,700 and $88,000, respectively, a fair value of $3,597 and $(379), respectively, and a carrying value of $3,597 and $(379), respectively. For the years ended December 31, 2007, 2006 and 2005, credit derivatives reported a gain of $1,453, a loss of $(19) and a gain of $641, respectively, in realized capital gains and losses. F-15 Futures contracts, equity index options, total return index, and interest rate swap contracts: The Company enters into interest rate futures, S&P 500 and NASDAQ index futures contracts and put and call options, as well as interest rate, total return Europe, Australasia, and Far East ("EAFE") and equity volatility and dividend swap contracts to hedge exposure to the volatility associated with the portion of the guaranteed minimum withdrawal benefit ("GMWB") liabilities which are not reinsured and to periodically hedge anticipated GMWB new business. In 2007, the Company entered into a customized swap contract to hedge certain risk components for the remaining term of certain blocks of non-reinsured GMWB riders. As of December 31, 2007 and 2006, derivative contracts in this strategy had a notional value of $14,946,569 and $5,708,864, respectively, a fair value of $495,575 and $235,076, respectively, and a carrying value of $495,575 and $235,076, respectively. For the years ended December 31, 2007, 2006 and 2005, derivative contracts in this strategy reported a loss of $(48,528), $(25,898) and $(753), respectively, in realized capital gains and losses. Interest rate swaps: The Company enters into interest rates swaps to terminate existing swaps in hedging relationships, and thereby offsetting the changes in value in the original swap. In addition, interest rate swaps are used to manage duration risk between assets and liabilities. As of December 31, 2007 and 2006, interest rate swaps had a notional value of $636,500 and $616,500, respectively, a fair value of $(1,777) and $(2,941), respectively, and a carrying value of $(1,777) and $(2,941), respectively. For the years ended December 31, 2007 and 2006, derivative contracts in this strategy reported a gain of $447 and $772, respectively, in realized capital gains and losses. During the year 2005, there were no realized gains and losses. Equity index options: The Company purchases S&P 500 options contracts to economically hedge the statutory reserve impact due to a decline in the equity markets. As of December 31, 2007 and 2006, derivative contracts in this strategy had a notional value $0 and $375,850, respectively, a fair value of $0 and $1,271, respectively, and a carrying value of $0 and $1,271, respectively. For the years ended December 31, 2007 and 2006, derivative contracts in this strategy reported a loss of $(16,876) and $(6,573), respectively, in realized capital gains and losses. During the year 2005, there were no realized gains and losses. Foreign currency swaps: The Company enters into foreign currency swaps to hedge the foreign currency exposures in certain of its foreign fixed maturity investments. As of December 31, 2007 and 2006, foreign currency swaps had a notional value of $44,196 and $40,000, respectively, a fair value of $(3,756) and $(283), respectively, and a carrying value of $(3,756) and $(283), respectively. For the years ended December 31, 2007, 2006 and 2005, derivative contracts in this strategy reported a gain of $559, a loss of $(805) and $(1,788), respectively, in realized capital gains and losses. Warrants: During 2003, the Company received warrant contracts as part of a reinsurance treaty settlement. As of December 31, 2007 and 2006, the warrants had a notional value of $500, a fair value of $52 and $0, respectively, and a carrying value of $52 and $0, respectively. There were no realized gains and losses during the years 2007, 2006 and 2005. CREDIT RISK The Company's derivatives counterparty exposure policy establishes market-based credit limits, favors long-term financial stability and creditworthiness, and typically requires credit enhancement/credit risk reducing agreements. Credit risk is measured as the amount owed to the Company based on current market conditions and potential payment obligations between the Company and its counterparties. Credit exposures are generally quantified daily, netted by counterparty for each legal entity of the Company, and collateral is pledged to and held by, or on behalf of, the Company to the extent the current value of derivatives exceeds the exposure policy thresholds which do not exceed $10,000. The Company also minimizes the credit risk in derivative instruments by entering into transactions with high quality counterparties rated A2/A or better, which are monitored by the Company's internal compliance unit and reviewed frequently by senior management. In addition, the compliance unit monitors counterparty credit exposure on a monthly basis to ensure compliance with Company policies and statutory limitations. The Company also maintains a policy of requiring that derivative contracts, other than exchange traded contracts and currency forward contracts, be governed by an International Swaps and Derivatives Association Master Agreement which is structured by legal entity and by counterparty and permits right of offset. To date, the Company has not incurred any losses on derivative instruments due to counterparty nonperformance. (F) CONCENTRATION OF CREDIT RISK The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk. The Company is not exposed to any concentration of credit risk of a single issuer greater than 10% of the Company's capital and surplus other than U.S. government, certain U.S. government agencies and short term investment pool as of December 31, 2007 and 2006. F-16 (G) BONDS, SHORT-TERM INVESTMENTS, COMMON STOCKS AND PREFERRED STOCKS
DECEMBER 31, 2007 GROSS GROSS ESTIMATED STATEMENT UNREALIZED UNREALIZED FAIR VALUE GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- BONDS AND SHORT-TERM INVESTMENTS U.S. government and government agencies and authorities: -- Guaranteed and sponsored $21,766 $489 $ -- $22,255 -- Guaranteed and sponsored -- asset-backed 610,221 8,476 (3,611) 615,086 States, municipalities and political subdivisions 36,155 -- (1,693) 34,462 International governments 16,739 439 (102) 17,076 Public utilities 467,158 3,364 (11,666) 458,856 All other corporate -- excluding asset-backed 2,156,711 47,235 (40,854) 2,163,092 All other corporate -- asset-backed 2,296,880 26,417 (94,381) 2,228,916 Short-term investments 476,505 -- -- 476,505 ------------- --------- ------------ ------------- TOTAL BONDS AND SHORT-TERM INVESTMENTS $6,082,135 $86,420 $(152,307) $6,016,248 ------------- --------- ------------ -------------
DECEMBER 31, 2007 GROSS GROSS ESTIMATED UNREALIZED UNREALIZED FAIR COST GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS Common stock -- unaffiliated $6,662 $1,425 $(3) $8,084 Common stock -- affiliated 36,884 -- (30,221) 6,663 ------------- --------- ------------ ------------- TOTAL COMMON STOCKS $43,546 $1,425 $(30,224) $14,747 ------------- --------- ------------ -------------
DECEMBER 31, 2007 GROSS GROSS ESTIMATED STATEMENT UNREALIZED UNREALIZED FAIR VALUE GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS Preferred stock -- unaffiliated $301,811 $326 $(25,817) $276,320 ------------- --------- ------------ ------------- TOTAL PREFERRED STOCKS $301,811 $326 $(25,817) $276,320 ------------- --------- ------------ -------------
DECEMBER 31, 2006 GROSS GROSS ESTIMATED STATEMENT UNREALIZED UNREALIZED FAIR VALUE GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- BONDS AND SHORT-TERM INVESTMENTS U.S. government and government agencies and authorities: -- Guaranteed and sponsored $24,639 $2 $(172) $24,469 -- Guaranteed and sponsored -- asset-backed 669,419 5,876 (7,797) 667,498 States, municipalities and political subdivisions 36,164 -- (1,267) 34,897 International governments 37,345 1,704 (447) 38,602 Public utilities 450,849 7,852 (8,749) 449,952 All other corporate -- excluding asset-backed 2,118,796 56,768 (29,167) 2,146,397 All other corporate -- asset-backed 1,672,157 23,637 (15,324) 1,680,470 Short-term investments 395,954 -- -- 395,954 Parents, subsidiaries and affiliates 27,225 -- -- 27,225 ------------- --------- ------------ ------------- TOTAL BONDS AND SHORT-TERM INVESTMENTS $5,432,548 $95,839 $(62,923) $5,465,464 ------------- --------- ------------ -------------
DECEMBER 31, 2006 GROSS GROSS ESTIMATED UNREALIZED UNREALIZED FAIR COST GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- COMMON STOCKS Common stock -- unaffiliated $5,922 $1,448 $(9) $7,361 Common stock -- affiliated 36,884 -- (31,069) 5,815 ------------- --------- ------------ ------------- TOTAL COMMON STOCKS $42,806 $1,448 $(31,078) $13,176 ------------- --------- ------------ -------------
F-17
DECEMBER 31, 2006 GROSS GROSS ESTIMATED STATEMENT UNREALIZED UNREALIZED FAIR VALUE GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS Preferred stock -- unaffiliated $232,674 $2,330 $(5,298 ) $229,706 ------------- --------- ------------ --- ------------- TOTAL PREFERRED STOCKS $232,674 $2,330 $(5,298 ) $229,706 ------------- --------- ------------ --- -------------
The statement value and estimated fair value of bonds at December 31, 2007 by estimated maturity year are shown below. Estimated maturities may differ from contractual maturities due to call or prepayment provisions. Asset-backed securities, including mortgage-backed securities and collateralized mortgage obligations, are distributed to maturity year based on the Company's estimate of the rate of future prepayments of principal over the remaining lives of the securities. These estimates are developed using prepayment speeds provided in broker consensus data. Such estimates are derived from prepayment speeds experienced at the interest rate levels projected for the applicable underlying collateral. Actual prepayment experience may vary from these estimates.
STATEMENT ESTIMATED VALUE FAIR VALUE -------------------------------------------------------------------------------- MATURITY Due in one year or less $794,682 $790,941 Due after one year through five years 1,960,800 1,937,752 Due after five years through ten years 2,005,158 1,981,594 Due after ten years 1,321,495 1,305,961 ------------ ------------ TOTAL $6,082,135 $6,016,248 ------------ ------------
At December 31, 2007 and 2006, securities with a statement value of $3,805 and $3,509, respectively, were on deposit with government agencies as required by law in various jurisdictions in which the Company conducts business. (H) MORTGAGE LOANS The maximum and minimum lending rates for the Company's mortgage loans outstanding were 9.38% and 5.26% during 2007 and 2006. During 2007 and 2006, the Company did not reduce interest rates on any outstanding mortgage loans. For loans held at December 31, 2007 and 2006, the highest loan to value percentage of any one loan at the time of loan origination, exclusive of insured, guaranteed, purchase money mortgages or construction loans was 79.23%. There were no taxes, assessments or amounts advanced and not included in the mortgage loan total. As of December 31, 2007 and 2006, the Company did not hold mortgages with interest more than 180 days past due. There were no impaired mortgage loans as of December 31, 2007 and 2006. (I) RESTRUCTURED DEBT IN WHICH THE COMPANY IS A CREDITOR The Company did not have investments in restructured loans as of December 31, 2007, 2006 and 2005. (J) FAIR VALUE OF FINANCIAL INSTRUMENTS
2007 2006 STATEMENT ESTIMATED STATEMENT ESTIMATED VALUE FAIR VALUE VALUE FAIR VALUE --------------------------------------------------------------------------------------------------------------------------------- ADMITTED ASSETS Bonds and short-term investments $6,082,135 6,016,248 $5,432,548 5,465,464 Preferred stocks 301,811 276,320 232,674 229,706 Common stocks 14,747 14,747 13,176 13,176 Mortgage loans 350,528 351,604 160,595 159,537 Derivative related assets (1) 473,685 479,381 244,422 244,422 Policy loans 343,773 343,773 324,631 324,631 Other invested assets 183,719 183,719 26,759 26,759 LIABILITIES Liability for deposit type contracts $73,736 $73,736 $80,785 $80,785 Derivative related liabilities (1) 7,434 6,790 9,084 9,084 ------------ ------------ ------------ ------------
(1) Included derivatives held for other investment and risk management activities as of December 31, 2007 and 2006, with a fair value asset position of $490,565 and $244,422, respectively, and a liability position of $5,561 and $9,084, respectively. Excludes derivative contracts that receive hedge accounting and have a zero statement value at December 31, 2007 and 2006. These derivatives are not reported on the balance sheet and have a fair value as of December 31, 2007 and 2006, of $(308) and ($22,540), respectively. F-18 The following methods and assumptions were used to estimate the fair value of each class of financial instruments: the fair value for bonds, preferred stocks and common stocks are published by the NAIC or are determined by independent third party pricing service market quotations, independent broker quotations, or pricing matrices that use data provided by external sources; the amortized cost of short-term investments approximate fair value; the fair values of mortgage loans are estimated using discounted cash flow calculations based on current incremental lending rates for similar type loans; policy loans carrying amounts approximate fair value; the fair value of derivative instruments is based upon either independent market quotations for exchange traded derivative contracts and independent third party pricing sources or pricing valuation models which utilize independent third party data as inputs; and the fair value of liabilities on deposit funds and other benefits is determined by forecasting future cash flows and discounting the forecasted cash flows at current market rates. (K) SECURITIES LENDING AND COLLATERAL ARRANGEMENTS The Company participates in a securities lending program to generate additional income, whereby certain domestic fixed income securities are loaned for a specified period of time from the Company's investment portfolio to qualifying third parties, via a lending agent. Borrowers of these securities provide collateral of 102% of the market value of the loaned securities. Acceptable collateral may be in the form of cash or U.S. Government securities. The market value of the loaned securities is monitored and additional collateral is obtained if the market value of the collateral falls below 100% of the market value of the loaned securities. Under the terms of the securities lending program, the lending agent indemnifies the Company against borrower defaults. As of December 31, 2007 and 2006, the statement value of the loaned securities was approximately $388,666 and $75,823, respectively, and was included in bonds in the Statements of Admitted Assets, Liabilities and Surplus. The Company earns income from the cash collateral or receives a fee from the borrower. The Company recorded before-tax income from securities lending transactions, net of lending fees, of $489, $192 and $159 for the years ended December 31, 2007, 2006 and 2005, respectively, which was included in net investment income. The Company also enters into various collateral arrangements in connection with its derivative instruments, which require both the pledging and accepting of collateral. As of December 31, 2007 and 2006, collateral pledged of $10,939 and $7,889, respectively, was included in bonds, on the Statements of Admitted Assets, Liabilities and Surplus. As of December 31, 2007 and 2006, the Company had accepted collateral relating to the securities lending program and derivative instruments consisting of cash, U.S. Government and U.S. Government agency securities with a statement value of $799,664 and $217,287, respectively. At December 31, 2007 and 2006, cash collateral of $667,016 and $172,047, respectively, was invested and recorded in the Statements of Admitted Assets, Liabilities and Surplus in bonds and cash and short-term investments securities with a corresponding amount recorded in other liabilities. The Company is only permitted by contract to sell or repledge the noncash collateral in the event of a default by the counterparty and none of the collateral has been sold or repledged at December 31, 2007 and 2006. As of December 31, 2007 and 2006, all collateral accepted was held in separate custodial accounts. (1) SECURITY UNREALIZED LOSS AGING The Company has a security monitoring process overseen by a committee of investment and accounting professionals that, on a quarterly basis, identifies securities in an unrealized loss position that could potentially be other-than-temporarily impaired. For further discussion regarding the Company's other-than-temporary impairment policy, see Note No. 2, Summary of Significant Accounting Policies. Due to the issuers' continued satisfaction of the securities' obligations in accordance with their contractual terms and the expectation that they will continue to do so, management's intent and ability to hold these securities for a period of time sufficient to allow for any anticipated recovery in market value, as well as the evaluation of the fundamentals of the issuers' financial condition and other objective evidence, the Company believes that the prices of the securities in the sectors identified in the tables below were temporarily depressed as of December 31, 2007 and 2006. The following table presents cost or statement value, fair value, and unrealized losses for the Company's bonds and equity securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2007:
LESS THAN 12 MONTHS 12 MONTHS OR MORE AMORTIZED FAIR UNREALIZED AMORTIZED FAIR COST VALUE LOSSES COST VALUE --------------------------------------------------------------------------------------------------------- U.S. Gov't and Gov't agencies & authorities -- guaranteed & sponsored $ -- $ -- $ -- $110 $110 -- guaranteed & sponsored - - asset-backed 44,618 44,107 (511) 190,627 187,527 States, municipalities & political subdivisions 35,000 33,354 (1,646) 1,155 1,108 International Governments -- -- -- 14,074 13,972 Public utilities 172,959 166,639 (6,320) 111,623 106,277 All other corporate including international 627,727 609,966 (17,761) 477,236 454,143 All other corporate-asset-backed 1,053,508 974,477 (79,031) 475,498 460,148 ----------- ----------- ----------- ----------- ----------- TOTAL FIXED MATURITIES 1,933,812 1,828,543 (105,269) 1,270,323 1,223,285 Common stock -- unaffiliated -- -- -- 3 -- Common stock -- affiliated -- -- -- 36,884 6,663 Preferred stock -- unaffiliated 207,806 188,684 (19,122) 69,480 62,785 ----------- ----------- ----------- ----------- ----------- TOTAL EQUITY 207,806 188,684 (19,122) 106,367 69,448 ----------- ----------- ----------- ----------- ----------- TOTAL SECURITIES $2,141,618 $2,017,227 $(124,391) $1,376,690 $1,292,733 ----------- ----------- ----------- ----------- ----------- 12 MONTHS OR MORE TOTAL UNREALIZED AMORTIZED FAIR UNREALIZED LOSSES COST VALUE LOSSES ------------------------ ------------------------------------------------------------------------- U.S. Gov't and Gov't agencies & authorities -- guaranteed & sponsored $ -- $110 $110 $ -- -- guaranteed & sponsored - - asset-backed (3,100) 235,245 231,634 (3,611) States, municipalities & political subdivisions (47) 36,155 34,462 (1,693) International Governments (102) 14,074 13,972 (102) Public utilities (5,346) 284,582 272,916 (11,666) All other corporate including international (23,093) 1,104,963 1,064,109 (40,854) All other corporate-asset-backed (15,350) 1,529,006 1,434,625 (94,381) ---------- ----------- ----------- ----------- TOTAL FIXED MATURITIES (47,038) 3,204,135 3,051,828 (152,307) Common stock -- unaffiliated (3) 3 -- (3) Common stock -- affiliated (30,221) 36,884 6,663 (30,221) Preferred stock -- unaffiliated (6,695) 277,286 251,469 (25,817) ---------- ----------- ----------- ----------- TOTAL EQUITY (36,919) 314,173 258,132 (56,041) ---------- ----------- ----------- ----------- TOTAL SECURITIES $(83,957) $3,518,308 $3,309,960 $(208,348) ---------- ----------- ----------- -----------
F-19 The following discussion refers to the data presented in the table above, excluding affiliated common stock. The Company holds 100% of the common stock of a foreign insurance subsidiary which is stated at GAAP carrying value adjusted for certain items non-admitted for U.S. Statutory rules if applicable. The Company does not have any current plans to dispose of this investment. As of December 31, 2007, fixed maturities, comprised of approximately 590 securities, accounted for approximately 86% of the Company's total unrealized loss amount. The remaining 14% primarily consisted of non-redeemable preferred stock in the financial services sector, the majority of which were in an unrealized loss position for less than twelve months. There were no fixed maturities or equity securities as of December 31, 2007, with a fair value less than 80% of the security's amortized cost for more than six continuous months other than certain asset backed securities ("ABS") and collateralized mortgage backed securities ("CMBS") accounted for under SSAP No. 43. Based on management's best estimate of future cash flows, there were no such ABS and CMBS in an unrealized loss position as of December 31, 2007 that were deemed to be other-than-temporarily impaired. Fixed maturity securities in an unrealized loss position for less than twelve months were comprised of approximately 245 securities. The majority of these securities are investment grade fixed maturities depressed due to changes in credit spreads from the date of purchase. As of December 31, 2007, 85% were securities priced at or greater than 85% of amortized cost. The remaining securities were primarily composed of CMBS, ABS, and other corporate securities in the financial services sector, of which 75% had a credit rating of BBB or above as of December 31, 2007. The severity of the depression resulted from credit spread widening due to tightened lending conditions and the market's flight to quality securities. Fixed maturity securities depressed for twelve months or more as of December 31, 2007 were comprised of approximately 350 securities, with the majority of the unrealized loss amount relating to CMBS, corporate fixed maturities within the industrial and financial services sector and ABS. The CMBS in an unrealized loss position for twelve months or more as of December 31, 2007 were primarily the results of credit spreads widening from the security purchase date. The recent price depression resulted from widening credit spreads primarily due to tightened lending conditions and the market's flight to quality securities. However, commercial real estate fundamentals still appear strong with delinquencies, defaults and losses holding to relatively low levels. Substantially all of these securities are investment grade securities with an average price of 95% of amortized cost as of December 31, 2007. Future changes in fair value of these securities are primarily dependent on sector fundamentals, credit spread movements and changes in interest rates. Corporate securities in an unrealized loss position for twelve months or more as of December 31, 2007 were primarily the result of credit spreads widening from the security purchase date primarily due to tightened lending conditions and the market's flight to quality securities. Substantially all of these securities are investment grade with an average price of 95% of amortized cost. Future changes in fair value of these securities are primarily dependent on the extent of future issuer credit losses, return of liquidity, and changes in general market conditions, including interest rates and credit spread movements. The following table presents amortized cost, fair value, and unrealized losses for the Company's bond and equity securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2006.
LESS THAN 12 MONTHS 12 MONTHS OR MORE AMORTIZED FAIR UNREALIZED AMORTIZED FAIR COST VALUE LOSSES COST VALUE ---------------------------------------------------------------------------------------------------------------- U.S. Gov't and Gov't agencies & authorities -- guaranteed & sponsored $7,988 $7,967 $(21) $11,657 $11,506 -- guaranteed & sponsored -- asset- backed 57,489 56,968 (521) 302,471 295,195 States, municipalities & political subdivisions 26,164 25,591 (573) 10,000 9,306 International Governments -- -- -- 14,663 14,216 Public utilities 99,646 98,353 (1,293) 171,165 163,709 All other corporate including international 465,006 459,063 (5,943) 671,415 648,191 All other corporate -- asset-backed 317,346 314,913 (2,433) 561,586 548,695 ----------- ----------- ---------- ----------- ----------- TOTAL FIXED MATURITIES 973,639 962,855 (10,784) 1,742,957 1,690,818 Common stock -- unaffiliated -- -- -- 516 507 Common stock -- affiliated -- -- -- 36,884 5,815 Preferred stock -- unaffiliated 83,674 82,501 (1,173) 99,048 94,923 ----------- ----------- ---------- ----------- ----------- TOTAL EQUITY 83,674 82,501 (1,173) 136,448 101,245 ----------- ----------- ---------- ----------- ----------- TOTAL SECURITIES $1,057,313 $1,045,356 $(11,957) $1,879,405 $1,792,063 ----------- ----------- ---------- ----------- ----------- 12 MONTHS OR MORE TOTAL UNREALIZED AMORTIZED FAIR UNREALIZED LOSSES COST VALUE LOSSES ------------------------ ------------------------------------------------------------------------------- U.S. Gov't and Gov't agencies & authorities -- guaranteed & sponsored $(151) $19,645 $19,473 $(172) -- guaranteed & sponsored -- asset- backed (7,276) 359,960 352,163 (7,797) States, municipalities & political subdivisions (694) 36,164 34,897 (1,267) International Governments (447) 14,663 14,216 (447) Public utilities (7,456) 270,811 262,062 (8,749) All other corporate including international (23,224) 1,136,421 1,107,254 (29,167) All other corporate -- asset-backed (12,891) 878,932 863,608 (15,324) ---------- ------------- ------------- ------------- TOTAL FIXED MATURITIES (52,139) 2,716,596 2,653,673 (62,923) Common stock -- unaffiliated (9) 516 507 (9) Common stock -- affiliated (31,069) 36,884 5,815 (31,069) Preferred stock -- unaffiliated (4,125) 182,722 177,424 (5,298) ---------- ------------- ------------- ------------- TOTAL EQUITY (35,203) 220,122 183,746 (36,376) ---------- ------------- ------------- ------------- TOTAL SECURITIES $(87,342) $2,936,718 $2,837,419 $(99,299) ---------- ------------- ------------- -------------
The Company holds 100% of the common stock of a foreign insurance subsidiary which is stated at GAAP carrying value adjusted for certain items non-admitted for U.S. Statutory rules if applicable in the Statements of Admitted Assets, Liabilities and Surplus. The Company does not have any current plans to dispose of this investment. F-20 As of December 31, 2006, fixed maturities represented approximately 63% of the Company's total unrealized loss amount which was comprised of approximately 590 different securities. Approximately 90% of the total unrealized loss amount was comprised of securities with fair value to amortized cost ratios as of December 31, 2005 greater than 90%. The Company held no securities as of December 31, 2005 that were in an unrealized loss position in excess of $2,359. Securities in an unrealized loss position for less than twelve months were comprised of approximately 190 securities of which 96%, or $10,407, were comprised of securities with fair value to amortized cost ratios at or greater than 85%. The majority of these securities are investment grade securities depressed due to changes in interest rates from the date of purchase. The securities depressed for twelve months or more as of December 31, 2006 were comprised of approximately 400 securities. Of the twelve months or more unrealized loss amount 91%, or $47,628, was comprised of securities with fair value to amortized cost ratios as of December 31, 2006 greater than 90%. The majority of the securities depressed for twelve months or more are investment grade securities depressed primarily due to changes in interest rates from the date of purchase. The evaluation for other-than-temporary impairments is a quantitative and qualitative process, which is subject to risks and uncertainties in the determination of whether declines in the fair value of investments are other-than-temporary. The risks and uncertainties include changes in general economic conditions, the issuer's financial condition or near term recovery prospects and the effects of changes in interest rates. 4. INCOME TAXES: The Company and The Hartford have entered into a tax sharing agreement under which each member of the consolidated U.S. Federal income tax return will make payments between them such that, with respect to any period, the amount of taxes to be paid by the Company, subject to certain adjustments, generally will be determined as though the Company was filing a separate Federal income tax return. (a) The components of the net deferred tax asset/(liability) as of December 31, are as follows:
2007 2006 -------------------------------------------------------------------------------- Total of all deferred tax assets (admitted and non-admitted) $610,815 $598,106 Total of all deferred tax liabilities (116,655) (44,644) ------------ ---------- Net deferred assets (admitted and non-admitted) 494,160 553,462 Net admitted deferred assets 145,516 91,537 ------------ ---------- Total deferred tax assets non-admitted $348,644 $461,925 Increase in deferred taxes non-admitted $(113,281) $46,114 ------------ ----------
(b) There were no unrecognized deferred tax liabilities. (c) The components of incurred income tax expense and the change in deferred tax assets and deferred tax liabilities as of December 31, are as follows:
2007 2006 2005 -------------------------------------------------------------------------------- Federal $88,449 $31,961 $42,463 Federal income tax on capital gains 4,248 (4,248) (5,439) --------- --------- --------- CURRENT INCOME TAXES INCURRED $92,697 $27,713 $37,024 --------- --------- ---------
The changes in the main components of deferred tax assets and deferred tax liabilities are as follows: Deferred tax assets resulting from book/tax difference:
2007 2006 CHANGE -------------------------------------------------------------------------------- Reserves $25,989 $50,141 $(24,152) Tax DAC 283,943 266,428 17,515 Unrealized Losses 54,684 28,465 26,219 Bonds and Other Investments 53,588 30,220 23,368 Minimum Tax Credit/Foreign Tax Credits 164,056 184,765 (20,709) Other 28,555 38,087 (9,532) ----------- ----------- ------------ TOTAL DEFERRED TAX ASSETS $610,815 $598,106 $12,709 ----------- ----------- ------------ DEFERRED TAX ASSETS NON-ADMITTED $348,644 $461,925 $(113,281) ----------- ----------- ------------
F-21 Deferred tax liabilities resulting from book/tax difference:
2007 2006 CHANGE -------------------------------------------------------------------------------- Bonds and Other Investments $ -- $(21,397) $21,397 Accrued Deferred Compensation (2,153) (4,627) 2,474 Reserves (87,097) -- (87,097) Deferred and Uncollected (19,853) (17,661) (2,192) Other (7,552) (959) (6,593) ------------ ---------- ---------- TOTAL DEFERRED TAX LIABILITIES $(116,655) $(44,644) $(72,011) ------------ ---------- ---------- TOTAL ADMITTED DEFERRED TAX ASSETS $145,516 $91,537 $53,979 ------------ ---------- ----------
2007 2006 CHANGE -------------------------------------------------------------------------------- Total deferred tax assets $610,815 $598,106 $12,709 Total deferred tax liabilities (116,655) (44,644) (72,011) ----------- ---------- --------- Net deferred tax asset (liability) $494,160 $553,462 $(59,302) Adjust for stock compensation transfer 2,630 Adjust for change in deferred tax on unrealized gains (losses) (26,219) --------- Adjustment change in net deferred income tax $(82,891) ---------
(d) The Company's income tax expense and change in deferred tax assets and deferred tax liabilities as of December 31, differs from the amount obtained by applying the Federal statutory rate of 35% to the Net Gain from Operations Before Federal Income Tax Expense for the following reasons:
EFFECTIVE EFFECTIVE EFFECTIVE 2007 TAX RATE 2006 TAX RATE 2005 TAX RATE ------------------------------------------------------------------------------------------------------------------------------------ Tax provision at statutory rate $132,025 35.0% $128,249 35.0% $89,641 35.0% Tax preferred investments (100,000) (26.5)% (107,070) (29.2)% (114,783) (44.8)% IMR adjustment (3,662) (1.0)% (6,430) (1.8)% (3,643) (1.4)% Gain on reinsurance booked to surplus 68,051 18.0% -- -- -- -- Correction of deferred balances 8,698 2.3% -- -- -- -- 2005 Tax Return true up adjustment -- -- (3,636) (1.0)% -- -- Foreign Tax Credits (12,692) (3.3)% (11,157) (3.0)% -- -- Change in basis of reserves booked to surplus 82,901 22.0% -- -- -- -- Other 267 0.1% (2,719) (0.7)% (1,526) (0.6)% ----------- ------ ----------- ------ ----------- ------ TOTAL $175,588 46.6% $(2,763) (0.7)% $(30,311) (11.8)% ----------- ------ ----------- ------ ----------- ------
EFFECTIVE EFFECTIVE EFFECTIVE 2007 TAX RATE 2006 TAX RATE 2005 TAX RATE --------------------------------------------------------------------------------------------------------------------------------- Federal and foreign income tax incurred $92,697 24.6% $27,713 6.8% $37,025 14.4% Adjusted change in net deferred income taxes 82,891 22.0% (30,476) (7.5)% (67,336) (26.2)% ----------- ----- ---------- ----- ---------- ------ TOTAL STATUTORY INCOME TAXES $175,588 46.6% $(2,763) (0.7)% $(30,311) (11.8)% ----------- ----- ---------- ----- ---------- ------
(e) As of December 31, 2007, the Company had no operating loss carry forward and no foreign tax credit carryforward. The following are year to date income taxes incurred in the current and prior years that will be available for recoupment in the event of future net losses: 2007 $66,530 2006 $61,303 2005 $41,532
(f) The Company's Federal income tax return is consolidated within The Hartford Financial Services Group, Inc. consolidated Federal income tax return. The method of allocation between the companies is subject to written agreement, approved by the Board of Directors. Allocation is based upon separate return calculations with current credit for net losses, to the extent the losses provide a benefit in the consolidated return. Intercompany tax balances are settled quarterly. F-22 5. REINSURANCE: The Company has a reinsurance agreement under which the reinsurer has a limited right to unilaterally cancel any reinsurance for reasons other than for nonpayment of premium or other similar credits. The estimated amount of aggregate reduction in surplus of this limited right to unilaterally cancel this reinsurance agreement by the reinsurer for which cancellation results in a net obligation of the Company to the reinsurer, and for which such obligation is not presently accrued is $248,182 in 2007, an increase of $7,492 from the 2006 balance of $240,690. The total amount of reinsurance credits taken for this agreement is $381,819 in 2007, an increase of $11,527 from the 2006 balance of $370,292. Effective August 31, 2005, the Company entered into a reinsurance agreement with Hartford Life Insurance K.K. ("HLIKK") (the "Reinsurance Agreement"). Through the Reinsurance Agreement, HLIKK agreed to cede and the Company agreed to reinsure 100% of the risks associated with the in-force and prospective guaranteed minimum income benefits ("GMIB") riders issued by HLIKK on its variable annuity business. In connection with accepting the GMIB risk for the in-force riders, on the effective date the Company received premiums collected since inception by HLIKK related to the in-force riders of $25,466. Effective July 31, 2006, the Reinsurance Agreement was modified to include the guaranteed minimum death benefits ("GMDB") on covered contracts that have an associated GMIB rider. The modified reinsurance agreement applies to all contracts, GMIB riders and GMDB riders in-force and issued as of July 31, 2006 and prospectively, except for policies and GMIB riders issued prior to April 1, 2005, which were recaptured. Additionally, a tiered premium structure was implemented. On the date of the recapture, the Company forgave the reinsurance premiums collected since inception on all GMIB riders issued prior to April 1, 2005 and paid HLIKK $38,354. GMIB riders issued by HLIKK subsequent to April 1, 2005 continue to be reinsured by the Company. In connection with the Reinsurance Agreement, the Company collected premiums of $47,999 as of December 31, 2007, and $5,313, net of the recaptured premiums, as of December 31, 2006 and holds reserves of $66,677 and $28,863 at December 31, 2007 and 2006, respectively. Effective September 30, 2007, the Company entered into another reinsurance agreement where HLIKK agreed to cede and the Company agreed to reinsure 100% of the risks associated with the in-force and prospective guaranteed minimum accumulation benefits ("GMAB"), GMIB and GMDB riders issued by HLIKK on certain of its variable annuity business. In connection with this agreement, the Company collected premiums of $8,416 as of December 31, 2007 and holds reserves of $8,429 at December 31, 2007. The amount of reinsurance recoverables from reinsurers was $27,577 and $11,213 at December 31, 2007 and 2006, respectively. The effect of reinsurance as of and for the years ended December 31, is summarized as follows:
DIRECT ASSUMED CEDED NET --------------------------------------------------------------------------------------------------------------------------------- 2007 Aggregate Reserves for Life and Accident and Health Policies $6,974,834 $1,050,543 $(2,049,303) $5,976,074 Policy and Contract Claim Liabilities $47,256 $14,423 $(30,399) $31,281 Premium and Annuity Considerations $11,045,000 $241,808 $(973,307) $10,313,501 Death, Annuity, Disability and Other Benefits $334,482 $115,945 $(101,185) $349,242 Surrenders and Other Fund Withdrawals $10,633,115 $624,725 $(1,729,032) $9,528,808
DIRECT ASSUMED CEDED NET --------------------------------------------------------------------------------------------------------------------------------- 2006 Aggregate Reserves for Life and Accident and Health Policies $6,189,958 $1,385,824 $(1,152,935) $6,422,847 Policy and Contract Claim Liabilities $51,900 $13,508 $(32,773) $32,635 Premium and Annuity Considerations $9,936,139 $210,011 $(303,845) $9,842,305 Death, Annuity, Disability and Other Benefits $275,788 $106,626 $(83,321) $299,093 Surrenders and Other Fund Withdrawals $10,086,669 $673,938 $(1,706,377) $9,054,230
DIRECT ASSUMED CEDED NET --------------------------------------------------------------------------------------------------------------------------------- 2005 Aggregate Reserves for Life and Accident and Health Policies $5,709,495 $1,474,084 $(1,033,127) $6,150,452 Policy and Contract Claim Liabilities $21,717 $9,087 $(5,885) $24,919 Premium and Annuity Considerations $9,133,178 $270,423 $(251,264) $9,152,337 Death, Annuity, Disability and Other Benefits $214,103 $115,716 $(49,707) $280,112 Surrenders and Other Fund Withdrawals $7,991,353 $624,025 $(1,640,814) $6,974,564
F-23 6. PREMIUM AND ANNUITY CONSIDERATIONS (DEFERRED AND UNCOLLECTED) The following presents premium and annuity considerations (deferred and uncollected) as of December 31,
2007 GROSS NET OF LOADING -------------------------------------------------------------------------------- TYPE Ordinary New Business $3,418 $3,775 Ordinary Renewal 45,181 52,893 Group Life 30 56 --------- --------- TOTAL $48,629 $56,724 --------- ---------
2006 GROSS NET OF LOADING -------------------------------------------------------------------------------- TYPE Ordinary New Business $4,060 $4,785 Ordinary Renewal 38,012 45,615 Group Life 32 60 --------- --------- TOTAL $42,104 $50,460 --------- ---------
7. RELATED PARTY TRANSACTIONS: Transactions between the Company and its affiliates, relate principally to tax settlements, reinsurance, insurance coverages, rental and service fees, capital contributions and payments of dividends. Investment management fees were allocated by Hartford Investment Management Company and are a component of net investment income. Substantially all general insurance expenses related to the Company, including rent and benefit plan expenses, are initially paid by The Hartford. Direct expenses are allocated using specific identification and indirect expenses are allocated using other applicable methods. Indirect expenses include those for corporate areas which, depending on type, are allocated based on either a percentage of direct expenses or on utilization. During 2006 the Company revised its method of allocating certain indirect expenses. The Company has also invested in bonds of its indirect affiliate, HL Investment Advisors, Inc., and common stock of its subsidiary, Hartford Life, Ltd. The HL Investment Advisors, Inc. bond was sold in December 2007. Effective November 1, 2007, the Company has entered into a coinsurance with funds withheld and a modified coinsurance reinsurance agreement with Champlain Life Reinsurance Company, an affiliated reinsurance company domiciled in Vermont. The reinsurer is unauthorized in the State of Connecticut. This Agreement takes into account State of Vermont prescribed practice that allows a letter of credit to back a certain portion of statutory reserves and a prescribed practice for the reinsurer to recognize a net liability for inuring YRT reinsurance contracted by the ceding company. The letter of credit held by the affiliated reinsurer has been assigned to the Company and as such also provides collateral for the unauthorized reinsurance. The increase in surplus, net of federal income tax, resulting from the reinsurance agreement is $194,430 and is identified separately on the Admitted Assets, Liabilities and Surplus statement. This surplus benefit will be amortized into income on a net of tax basis as earnings emerge from the business reinsured, resulting in a net zero impact to surplus. At December 31, 2007 and 2006, the Company reported $32,272 and $10,339, respectively, as a receivable from and $41,011 and $30,498, respectively, as a payable to parents, subsidiaries and affiliates. The terms of the written settlement agreement require that these amounts be settled generally within 30 days. Related party transactions may not be indicative of the costs that would have been incurred on a stand alone basis. For additional information, see Notes 4, 5, 8 and 11. 8. PENSION, RETIREMENT, AND OTHER POST-RETIREMENT AND POST-EMPLOYMENT BENEFITS: All employees hired by The Hartford's life insurance companies are included in The Hartford's non-contributory defined benefit pension plans. These plans provide pension benefits that are based on years of service and the employee's compensation during the last ten years of employment. The Hartford's funding policy is to contribute annually an amount between the minimum funding requirements set forth in the Employee Retirement Income Security Act of 1974, as amended, and the maximum amount that can be deducted for U.S. Federal income tax purposes. Generally, pension costs are funded through the purchase of group pension contracts sold by affiliates. The costs that were allocated to the Company for pension related expenses were $12,807, $10,717 and $8,226 for 2007, 2006 and 2005, respectively. Employees of The Hartford's life insurance companies are also provided, through The Hartford, certain health care and life insurance benefits for eligible retired employees. The contribution for health care benefits depends on the retiree's date of retirement and years of service. In addition, this benefit plan has a defined dollar cap, which limits average company F-24 contributions. The Hartford has prefunded a portion of the health care and life insurance obligations through trust funds where such prefunding can be accomplished on a tax effective basis. Postretirement health care and life insurance benefits expense allocated to the Company was not material to the results of operations for 2007, 2006 or 2005. Substantially all employees of the Company are eligible to participate in the Hartford's Investment and Savings Plan under which designated contributions may be invested in common stock of The Hartford or certain other investments. These contributions are matched, up to 3% of compensation, by the Company. In addition, the Company allocates 1.5% of base salary to the plan for each eligible employee earning less than $100,000 and 0.5% of base salary for all other eligible employees. The cost allocated to the Company for the years ended December 31, 2007 and 2006 and 2005 was $5,528 and $4,113 and $3,326, respectively. 9. CAPITAL AND SURPLUS AND SHAREHOLDER DIVIDEND RESTRICTIONS: The maximum amount of dividends which can be paid to shareholders by Connecticut domiciled insurance companies, without prior approval, is generally restricted to the greater of 10% of surplus as of the preceding December 31st or the net gain from operations after dividends to policyholders, Federal income taxes and before realized capital gains or (losses) for the previous year. In addition, if any dividend exceeds the insurer's earned surplus, it requires the prior approval of the Connecticut Insurance Commissioner. Dividends are paid as determined by the Board of Directors and are not cumulative. In 2007 and 2006, dividends of $207,000 and $115,000, respectively, were paid. In 2005, no dividends were paid or declared. The amount available for dividends in 2008 is approximately $366,275. The portion of unassigned funds (surplus) represented or reduced by cumulative unrealized gains and losses is $114,240. 10. SEPARATE ACCOUNTS: The Company maintained separate account assets totaling $81,072,392 and $76,317,895 as of December 31, 2007 and 2006, respectively. Separate account assets are segregated from other investments and reported at fair value. Separate account liabilities are determined in accordance with prescribed actuarial methodologies, which approximate the market value less applicable surrender charges. The resulting surplus is recorded in the general account Statements of Operations as a component of Net Transfers to Separate Accounts. The Company's separate accounts are non-guaranteed, wherein the policyholder assumes substantially all the investment risks and rewards. Investment income (including investment gains and losses) and interest credited to policyholders on separate account assets are not separately reflected in the statutory statements of operations. Separate account fees, net of minimum guarantees, were $1,542,870, $1,378,577 and $1,369,610 for the years ended December 31, 2007, 2006 and 2005, respectively, and are recorded as a component of fee income on the Company's statutory basis Statements of Operations. F-25 An analysis of the Separate Accounts as of December 31, 2007 is as follows:
NONINDEXED GUARANTEED NON- LESS THAN NONINDEXED GUARANTEED OR EQUAL GUARANTEED SEPARATE TO 4% MORE THAN 4% ACCOUNTS TOTAL --------------------------------------------------------------------------------------------------------------------------------- 1. Premiums considerations or deposits for the year ended 2006 $ -- $ -- $7,121,542 $7,121,542 2. Reserves @ year end -- -- -- -- I. For accounts with assets at: -- -- -- -- a. Market value -- -- 78,639,797 78,639,797 b. Amortized cost -- -- -- -- ---- ---- -------------- -------------- c. Total reserves $ -- $ -- $78,639,797 $78,639,797 ---- ---- -------------- -------------- II. By withdrawal characteristics: a. Subject to discretionary withdrawal $ -- $ -- $ -- $ -- b. With MVA adjustment -- -- -- -- c. @ BV without MV adjustment and with surrender charge of 5% or more -- -- -- -- d. @ Market value -- -- 78,520,741 78,520,741 e. @ BV without MV adjustment and with surrender charge less than 5% -- -- -- -- ---- ---- -------------- -------------- f. Subtotal $ -- $ -- $78,520,741 $78,520,741 g. Not subject to discretionary withdrawal -- -- 119,056 119,056 ---- ---- -------------- -------------- h. Total $ -- $ -- $78,639,797 $78,639,797 ---- ---- -------------- --------------
Below is the reconciliation of Net Transfers (from) to Separate Accounts as of December 31,
2007 2006 2005 --------------------------------------------------------------------------------------------------------------------------------- Transfer to Separate Accounts $7,121,542 $6,907,635 $6,181,003 Transfer from Separate Accounts (7,340,251) (7,637,822) (5,041,408) ------------- ------------- ------------- Net Transfer (from) to Separate Accounts (218,708) (730,187) 1,139,595 Internal Exchanges & Other Separate Account Activity (18,445) 55,063 52,973 ------------- ------------- ------------- Transfer (from) to Separate Accounts on the Statement of Operations $(237,153) $(675,124) $1,192,568 ------------- ------------- -------------
11. CORRECTION OF ERRORS: During an analysis of reserving systems in 2007, the Company discovered an error in the reserves for certain individual annuity products. These annuity products have a 4 year surrender charge, however, they were coded in the reserving system with a 7 year surrender charge. As a result reported reserves have been understated and surplus has been overstated. The correction related to prior years was booked directly to reserves and surplus in the amount of $32,469. During an analysis of federal income taxes in 2007, the Company discovered an error in the liability relating to prior years. A portion of total taxes has been inadvertently misclassified between current and deferred taxes, and inadvertently misallocated among certain affiliates. As a result, the reported current federal income tax recoverable and surplus have been understated. The correction was booked directly to federal income tax recoverable and surplus in the amount of $36,656. The net admitted deferred tax asset is unaffected, as the adjustment to the total deferred tax asset is offset by a change in the nonadmitted portion. 12. COMMITMENTS AND CONTINGENT LIABILITIES: (A) LITIGATION The Company is or may become involved in various legal actions, some of which assert claims for substantial amounts. Management expects that the ultimate liability, if any, with respect to such lawsuits, after consideration of provisions made for estimated losses and costs of defense, will not be material to the consolidated financial condition of the Company. On July 23, 2007, The Hartford entered into an agreement (the "Agreement") with the New York Attorney General's Office, the Connecticut Attorney General's Office, and the Illinois Attorney General's Office to resolve (i) the previously disclosed investigations by these Attorneys General regarding, among other things, The Hartford's compensation agreements with brokers, alleged participation in arrangements to submit inflated bids, sale of fixed and individual annuities used to fund structured settlements, and marketing and sale of individual and group variable annuity products and (ii) the previously disclosed investigation by the New York Attorney General's Office of aspects of The Hartford's variable annuity and mutual F-26 fund operations related to market timing. In light of the Agreement, the Staff of the Securities and Exchange Commission has informed The Hartford that it has determined to conclude its previously disclosed investigation into market timing without taking any action. Under the terms of the Agreement, The Hartford paid $115 million, of which $84 million represents restitution for market timing, $5 million represents restitution for issues relating to the compensation of brokers, and $26 million is a civil penalty. Hartford Life & Annuity recorded charges of $50 million, after-tax, in the aggregate through the second quarter of 2007 to establish a reserve for the market timing matters. (B) GUARANTY FUNDS Under insurance guaranty fund laws in each state, the District of Columbia and Puerto Rico, insurers licensed to do business can be assessed by state insurance guaranty association for certain obligations of insolvent insurance companies to policyholders and claimants. Part of the assessments paid by the Company pursuant to these laws may be used as credits for a portion of the associated premium taxes. The Company paid guaranty fund assessments of approximately $519, $308 and $1,450 in 2007, 2006 and 2005, respectively, of which $480, $279 and $1,020 in 2007, 2006 and 2005, respectively, increased the creditable amount against premium taxes. The Company has a guaranty fund receivable of $3,881 and $3,914 as of December 31, 2007 and 2006, respectively. (C) LEASES As discussed in Note 7, transactions with The Hartford include rental of facilities and equipment. The rent paid by the Company to Hartford Fire for space occupied was $12,104, $15,719 and $16,470 in 2007, 2006 and 2005, respectively. Future minimum rental commitments are as follows: 2008 7,870 2009 5,068 2010 3,654 2011 2,246 Thereafter 1,482 --------- Total $20,320 ---------
The principal executive office of the Company, together with its parent and other life insurance affiliates, is located in Simsbury, Connecticut. The Company's allocated rental expense is recognized over the term of the primary sublease for the facility located in Simsbury, Connecticut, which expires on December 31, 2010, and amounted to $4,953, $4,891 and $12,860 in 2007, 2006 and 2005, respectively. (D) TAX MATTERS The Company's federal income tax returns are routinely audited by the Internal Revenue Service ("IRS"). The IRS began its audit of the 2002-2003 tax years in 2005 and the Company expects the audit to be concluded in early 2008. The 2004 through 2006 examination will begin in 2008. Management believes that adequate provision has been made in the financial statements for any potential assessments that may result from tax examinations and other tax-related matters for all open tax years. The separate account dividends received deduction ("DRD") is estimated for the current year using information from the prior year-end, adjusted for current year equity market performance. The estimated DRD is generally updated in the third quarter for the provision-to-filed-return adjustments, and in the fourth quarter based on current year ultimate mutual fund distributions and fee income from the Company's variable insurance products. The actual current year DRD can vary from estimates based on, but not limited to, changes in eligible dividends received by the mutual funds, amounts of distributions from these mutual funds, amounts of short-term capital gains at the mutual fund level and the Company's taxable income before the DRD. The Company receives a foreign tax credit ("FTC") against its U.S. tax liability for foreign taxes paid by the Company including payments from its separate account assets. The separate account FTC is estimated for the current year using information from the most recent filed return, adjusted for the change in the allocation of separate account investments to the international equity markets during the current year. The actual current year FTC can vary from the estimates due to the actual FTC's passed through by the mutual funds. (E) FUNDING OBLIGATION At December 31, 2007, the Company had an outstanding commitment totaling $16,373, of which $10,532 related to funding limited partnership investments and $5,841 related to a mortgage loan funding that has commitment period that expires in less than one year. ***** F-27 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SCHEDULE I -- SELECTED FINANCIAL DATA DECEMBER 31, 2007 (AMOUNTS IN THOUSANDS UNLESS OTHERWISE STATED) INVESTMENT INCOME EARNED: U.S. Government Bonds $2,359 Bonds Exempt from U.S. Tax 45 Other Bonds (unaffiliated) 311,409 Bonds of Affiliates 910 Preferred Stocks (unaffiliated) 15,327 Preferred Stocks of affiliates -- Common Stocks (unaffiliated) 748 Common Stocks of affiliates -- Mortgage Loans 17,414 Real Estate 1,805 Contract loans 21,532 Cash/short-term Investments 20,579 Derivative Instruments (16,152) Other Invested Assets -- Aggregate Write-ins for Investment Income 7,373 ------------- GROSS INVESTMENT INCOME 383,349 Less: Investment Expenses 34,912 ------------- NET INVESTMENT INCOME $348,437 ------------- REAL ESTATE OWNED -- BOOK VALUE LESS ENCUMBRANCES: $27,569 ------------- MORTGAGE LOANS -- BOOK VALUE: Farm Mortgages $14,319 Residential Mortgages -- Commercial Mortgages 336,209 TOTAL MORTGAGE LOANS $350,528 ------------- MORTGAGE LOANS BY STANDING -- BOOK VALUE: Good Standing $350,528 Good Standing with Restructured Terms -- Interest Overdue More Than 90 Days -- Not In Foreclosure -- Foreclosure In Process -- OTHER LONG TERM ASSETS -- STATEMENT VALUE: $9,672 ------------- COLLATERAL LOANS $ -- ------------- BONDS AND STOCKS OF PARENTS, SUBSIDIARIES AND AFFILIATES -- BOOK VALUE: Bonds $ -- Preferred Stocks -- Common Stocks 6,663 BONDS AND SHORT-TERM INVESTMENTS BY MATURITY AND CLASS: By Maturity -- Statement Value Due within one year or less $794,682 Over 1 year through 5 years 1,960,800 Over 5 years through 10 years 2,005,158 Over 10 years through 20 years 617,377 Over 20 years 704,118 ------------- TOTAL BY MATURITY $6,082,135 ------------- By Class -- Statement Value Class 1 $4,518,111 Class 2 1,377,489 Class 3 163,975 Class 4 17,394 Class 5 4,286 Class 6 880 ------------- TOTAL BY CLASS $6,082,135 -------------
F-28 Total Publicly Traded $4,285,074 Total Privately Placed 1,797,061 ------------- TOTAL BY MAJOR TYPE $6,082,135 ------------- INVESTMENT BALANCES: Preferred Stocks -- Statement Value $301,811 Common Stocks -- Market Value 14,747 Short-Term Investments -- Book Value 476,505 Options, Caps, and Floors Owned -- Statement Value 404,762 Options, Caps, and Floors Written and Inforce -- Statement Value -- Collar, Swap, and Forward Agreements Open -- Statement Value 61,489 Financial Futures Contracts Open -- Current Value 399,820 Cash on Deposit 71,359 Cash Equivalents 17,419 LIFE INSURANCE IN FORCE: Industrial $ -- Ordinary 79,464,073 Credit Life -- Group Life 197,838 AMOUNT OF ACCIDENTAL DEATH INSURANCE IN FORCE UNDER: Ordinary Policies $52,276 POLICIES WITH DISABILITY PROVISIONS IN FORCE: Industrial $ -- Ordinary 5,347,444 Credit Life -- Group Life 5,670 SUPPLEMENTARY CONTRACTS IN FORCE: Ordinary -- Not Involving Life Contingencies Amount on Deposit $ -- Income Payable -- Ordinary -- Involving Life Contingencies Amount on Deposit $1 Income Payable 3,390 Group -- Not Involving Life Contingencies Amount on Deposit $ -- Income Payable -- Group -- Involving Life Contingencies Amount on Deposit $ -- Income Payable -- ANNUITIES: Ordinary: Immediate -- Amount of Income Payable $45,960 Deferred -- Fully Paid Account Balance 80,673,716 Deferred -- Not Fully Paid -- Account Balance 95,478 Group: Amount of Income Payable $79 Fully Paid Account Balance 355,682 Not Fully Paid -- Account Balance -- ACCIDENT AND HEALTH INSURANCE -- PREMIUMS IN FORCE: Group $ -- Credit -- Ordinary 1,127 DEPOSIT FUNDS AND DIVIDEND ACCUMULATIONS: Deposit Funds -- Account Balance $39,202 Dividend Accumulations -- Account Balance 129
F-29 CLAIM PAYMENTS: Group Accident & Health 2007 $ -- 2006 -- 2005 -- 2004 -- 2003 -- Prior -- Other Accident & Health 2007 $563 2006 257 2005 112 2004 33 2003 145 Prior 766 Other Coverages that use Development Methods to Calculate Claim Reserves 2007 $ -- 2006 -- 2005 -- 2004 -- 2003 -- Prior --
F-30 HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SCHEDULE II -- SUMMARY INVESTMENT SCHEDULE DECEMBER 31, 2007 (AMOUNTS IN THOUSANDS UNLESS OTHERWISE STATED)
ADMITTED ASSETS AS GROSS INVESTMENT REPORTED IN THE HOLDINGS ANNUAL STATEMENT INVESTMENTCATEGORIES AMOUNT PERCENTAGE AMOUNT PERCENTAGE --------------------------------------------------------------------------------------------------------------------------------- 1. Bonds: 1.1 U.S. treasury securities $21,767 0.3 $21,767 0.3 1.2 U.S. government agency obligations (excluding mortgage-backed securities): 1.21 issued by U.S. government agencies -- -- -- -- 1.22 issued by U.S. government sponsored agencies -- -- -- -- 1.3 Foreign government (including Canada, excluding 5,071 0.1 5,071 0.1 mortgage-backed securities) 1.4 Securities issued by states, territories and possessions and political subdivisions in the U.S: 1.41 State, territories, and possessions general 1,155 -- 1,155 -- obligations 1.42 Political subdivisions of states, territories -- -- -- -- & possessions & political subdivisions general obligations 1.43 Revenue and assessment obligations 35,000 0.4 35,000 0.4 1.41 Industrial development and similar obligations -- -- -- -- 1.5 Mortgage-backed securities (includes residential and commercial MBS): 1.51 Pass-through securities: 1.511 Issued or guaranteed by GNMA 18,344 0.2 18,344 0.2 1.512 Issued or guaranteed bly FNMA and FHLMC 377,186 4.8 377,186 4.8 1.513 All other -- -- -- -- 1.52 CMOs and REMICs: 1.521 Issued or guaranteed by GNMA, FNMA, and 148,490 1.9 148,490 1.9 FHLMC or VA 1.522 Issued by non-U.S. Government issuers and -- -- -- -- collateralized by MBS issued or guaranteed by GNMA, FNMA, FHLMC or VA 1.523 All other 2,089,693 26.7 2,089,693 26.7 2. Other debt and other fixed income securities (excluding short-term): 2.1 Unaffiliated domestic securities (includes credit 1,821,585 23.2 1,821,585 23.2 tenant loans rated by the SVO) 2.2 Unaffiliated foreign securities 1,087,341 13.9 1,087,341 13.9 2.3 Affiliated securities -- -- -- -- 3. Equity Interests: 3.1 Investment in mutual funds 8,084 0.1 8,084 0.1 3.2 Preferred stocks: 3.21 Affiliated -- -- -- -- 3.22 Unaffiliated 301,811 3.9 301,811 3.9 3.3 Publicly traded securities (excluding preferred stocks): 3.31 Affiliated -- -- -- -- 3.32 Unaffiliated -- -- -- -- 3.4 Other equity securities: 3.41 Affiliated 6,663 0.1 6,663 0.1 3.42 Unaffiliated -- -- -- -- 3.5 Other equity securities including tangible personal property under lease: 3.51 Affiliated -- -- -- -- 3.52 Unaffiliated -- -- -- -- 4. Mortgage loans: 4.1 Construction and land development -- -- -- -- 4.2 Agricultural -- -- -- -- 4.3 Single family residential properties -- -- -- -- 4.4 Multifamily residential properties -- -- -- -- 4.5 Commercial loans 350,528 4.5 350,528 4.5 4.6 Mezzanine real estate loans -- -- -- -- 5. Real estate investments 5.1 Property occupied by company 27,569 0.4 27,569 0.4 5.2 Property held for production of income -- -- -- -- 5.3 Property held for sale -- -- -- -- 6. Policy Loans 343,773 4.4 343,773 4.4 7. Receivables for securities 146,476 1.9 146,476 1.9 8. Cash and short-term investments 565,283 7.2 565,283 7.2 9. Other invested assets 483,357 6.2 483,357 6.2 ------------ ------ ----------- ------ 10. TOTAL INVESTED ASSETS $7,839,176 100.0 $7,839,176 100.0 ------------ ------ ----------- ------
F-31 SCHEDULE III -- INVESTMENT RISKS INTERROGATORIES Due April 1 For the year ended December 31, 2007 Of HARTFORD LIFE AND ANNUITY INSURANCE COMPANY Address (City, State, Zip Code): SIMSBURY CT 06089 NAIC Group Code 0091 NAIC Company Code 71153 Employer's ID Number 39-1052598
The Investment Risks Interrogatories are to be filed by April 1. They are also to be included with the Audited Statutory Financial Statements. Answer the following interrogatories by reporting the applicable U.S. dollar amounts and percentages of the reporting entity's total admitted assets held in that category of investments. 1. Reporting entity's total admitted assets as reported on $8,275,384,866 Page 2 of this annual statement.
2. Ten largest exposures to a single issuer/borrower/investment.
4 PERCENTAGE 2 OF TOTAL 1 DESCRIPTION 3 ADMITTED ISSUER OF EXPOSURE AMOUNT ASSETS --------------------------------------------------------------------------------------------------------------------------------- 2.01 SHORT TERM INVESTMENT POOL (STIP) BOND $297,454,961 3.594 % 2.02 GOLDENTREE LOAN OPPORTUNITIES BOND $125,000,000 1.511 % 2.03 JP MORGAN TREASURY PLUS BOND $79,293,511 0.958 % 2.04 NORTHWOODS CAPITAL LTD WOODS_07-8A BOND $75,000,000 0.906 % 2.05 BANK OF NEW YORK CASH RESERVE ACCT BOND $62,599,084 0.756 % 2.06 HTFD REGENCY CENTERS FIXED LIFE MORTGAGE LOAN $60,000,000 0.725 % 2.07 UNION PACIFIC CORPORATION BOND $60,000,000 0.725 % 2.08 HUTCHISON WHAMPOA LIMITED BOND $56,650,421 0.685 % 2.09 CBS CORP BOND $55,160,453 0.667 % 2.10 PARCS LTD BOND $49,825,283 0.602 %
3. Amounts and percentages of the reporting entity's total admitted assets held in bonds and preferred stocks by NAIC rating.
BONDS 1 2 --------------------------------------------------------------------------------------------------------------------------------- 3.01 NAIC-1 $4,518,110,874 54.597 % 3.02 NAIC-2 $1,377,489,022 16.646 % 3.03 NAIC-3 $163,975,331 1.981 % 3.04 NAIC-4 $17,394,081 0.210 % 3.05 NAIC-5 $4,285,823 0.052 % 3.06 NAIC-6 $880,000 0.011 %
PREFERRED STOCKS 3 4 --------------------------------------------------------------------------------------------------------------------------------- 3.07 P/RP-1 $147,902,029 1.787 % 3.08 P/RP-2 $122,237,327 1.477 % 3.09 P/RP-3 $31,362,160 0.379 % 3.10 P/RP-4 $ 0.000 % 3.11 P/RP-5 $309,220 0.004 % 3.12 P/RP-6 $ 0.000 %
F-32 4. Assets held in foreign investments: 4.01 Are assets held in foreign Yes / / No x investments less than 2.5% of the reporting entity's total admitted assets? 4.02 Total admitted assets held in $1,074,069,210 12.979% foreign investments 4.03 Foreign-currency-denominated $248,406,483 3.002% investments 4.04 Insurance liabilities denominated $ 0.000% in that same foreign currency If response to 4.01 above is yes, responses are not required for interrogatories 5-10.
5. Aggregate foreign investment exposure categorized by NAIC sovereign rating:
1 2 --------------------------------------------------------------------------------------------------------------------------------- 5.01 Countries rated NAIC-1 $1,074,069,210 12.979% 5.02 Countries rated NAIC-2 $ 0.000% 5.03 Countries rated NAIC-3 or below $ 0.000%
6. Two largest foreign investment exposures to a single country, categorized by the country's NAIC sovereign rating: 1 2 --------------------------------------- -------------- Countries rated NAIC-1: 6.01 Country: CAYMAN ISLANDS $289,516,077 3.499% 6.02 Country: UNITED KINGDOM $168,863,880 2.041% Countries rated NAIC-2: 6.03 Country: $ 0.000% 6.04 Country: $ 0.000% Countries rated NAIC-3 or below: 6.05 Country: $ 0.000% 6.06 Country: $ 0.000%
1 2 --------------------------------------------------------------------------------------------------------------------------------- 7. Aggregate unhedged foreign currency exposure: $ 0.000%
8. Aggregate unhedged foreign currency exposure categorized by NAIC sovereign rating: 8.01 Countries rated NAIC-1 $ 0.000% 8.02 Countries rated NAIC-2 $ 0.000% 8.03 Countries rated NAIC-3 or below $ 0.000%
9. Two largest unhedged foreign currency exposures to a single country, categorized by the country's NAIC sovereign rating:
1 2 --------------------------------------------------------------------------------------------------------------------------------- Countries rated NAIC-1: 9.01 Country: $ 0.000% 9.02 Country: $ 0.000% Countries rated NAIC-2: 9.03 Country: $ 0.000% 9.04 Country: $ 0.000% Countries rated NAIC-3 or below: 9.05 Country: $ 0.000% 9.06 Country: $ 0.000%
F-33 10. Ten largest non-sovereign (i.e. non-governmental) foreign issues:
1 2 ISSUER NAIC RATING 3 4 ------------------------------------------------------------------------------------------------ 10.01 GOLDENTREE LOAN 1FE $125,000,000 1.511% OPPORTUNITIES 10.02 NORTHWOODS CAPITAL LTD 1FE $75,000,000 0.906% WOODS_07-8A 10.03 HUTCHISON WHAMPOA LIMITED 1FE $56,650,421 0.685% 10.04 TELECOM ITALIA S.P.A 2FE $36,039,407 0.436% 10.05 COCA-COLA AMATIL LIMITED 1 $34,632,536 0.419% 10.06 EDIZIONE HOLDING 1FE $29,241,006 0.353% 10.07 LLOYDS TSB GROUP PLC PIA $27,478,825 0.332% 10.08 CENT CDO 14 LTD IFE $25,200,000 0.305% 10.09 FRANCE TELECOM IFE $24,303,826 0.294% 10.10 CREDIT AGRICOLE SA PILFE $20,000,000 0.242%
11. Amounts and percentages of the reporting entity's total admitted assets held in Canadian investments and unhedged Canadian currency exposure: 11.01 Are assets held in Canadian Yes / / No x investments less than 2.5% of the reporting entity's total admitted assets? If response to 11.01 is yes, detail is not required for the remainder of Interrogatory 11.
11.02 Total admitted assets held in $209,209,163 2.528% Canadian Investments 11.03 Canadian currency-denominated $12,827,398 0.155% investments 11.04 Canadian-denominated insurance $ 0.000% liabilities 11.05 Unhedged Canadian currency exposure $ 0.000%
12. Report aggregate amounts and percentages of the reporting entity's total admitted assets held in investments with contractual sales restrictions. 12.01 Are assets held in investments with Yes x No / / contractual sales restrictions less than 2.5% of the reporting entity's total admitted assets?
If response to 12.01 is yes, responses are not required for the remainder of Interrogatory 12.
1 2 3 ------------------------------------------------------------------------------------------------------ 12.02 Aggregate statement value of $ 0.000% investments with contractual sales restrictions: Largest 3 investments with contractual sales restrictions: 12.03 $ 0.000% 12.04 $ 0.000% 12.05 $ 0.000%
13. Amounts and percentages of admitted assets held in the largest 10 equity interests: 13.01 Are assets held in equity interest less than 2.5% of Yes / / No the reporting entity's total admitted assets? x If response to 13.01 above is yes, responses are not required for the remainder of Interrogatory 13.
1 NAME OF ISSUER 2 3 --------------------------------------------------------------------------------------------------------- 13.02 LLOYDS TSB GROUP PLC $27,478,825 0.332% 13.03 GOLDMAN SACHS GROUP INC $27,459,000 0.332% 13.04 CREDIT AGRICOLE SA $20,000,000 0.242% 13.05 CHUBB CORPORATION (THE) $19,981,421 0.241% 13.06 BANCO BILBAO VIZCAYA ARGENTARIA $19,792,200 0.239% S.A. 13.07 BNP PARIBAS $19,000,000 0.230% 13.08 TORONTO-DOMINION BANK (THE) $14,578,000 0.176% 13.09 RESONA HOLDINGS INC $14,089,908 0.170% 13.10 NIB CAPITAL NV $13,847,931 0.167% 13.11 SOCIETE GENERALE $12,600,000 0.152%
F-34 14. Amounts and percentages of the reporting entity's total admitted assets held in nonaffiliated, privately placed equities: 14.01 Are assets held in nonaffiliated, Yes x No / / privately placed equities less than 2.5% of the reporting entity's total admitted assets? If response to 14.01 above is yes, responses are not required for the remainder of Interrogatory 14.
1 2 3 --------------------------------------------------------------------------------------- 14.02 Aggregate statement value of $ 0.000% investments held in nonaffiliated, privately placed equities: Largest 3 investments held in nonaffiliated, privately placed equities: 14.03 $ 0.000% 14.04 $ 0.000% 14.05 $ 0.000%
15. Amounts and percentages of the reporting entity's total admitted assets held in general partnership interests: 15.01 Are assets held in general Yes x No / / partnership interests less than 2.5% of the reporting entity's total admitted assets? If response to 15.01 above is yes, responses are not required for the remainder of Interrogatory 15.
1 2 3 --------------------------------------------------------------------------------------- 15.02 Aggregate statement value of $ 0.000% investments held in general partnership interests: Largest 3 investments in general partnership interests: 15.03 $ 0.000% 15.04 $ 0.000% 15.05 $ 0.000%
16. Amounts and percentages of the reporting entity's total admitted assets held in mortgage loans: 16.01 Are mortgage loans reported in Yes / / No x Schedule B less than 2.5% of the reporting entity's total admitted assets? If response to 16.01 above is yes, responses are not required for the remainder of Interrogatory 16 and Interrogatory 17.
1 TYPE (RESIDENTIAL, COMMERCIAL, AGRICULTURAL) 2 3 --------------------------------------------------------------------------------------- 16.02 HTFD REGENCY CENTERS FIXED LIFE $60,000,000 0.725% 16.03 WACHOVIA MONTCLAIR PLAZA PN 2006 $49,621,270 0.600% 16.04 FORTIS $41,740,409 0.504% 16.05 HTFD_1880 CENTURY PARK EAST WHLN 06 $35,000,000 0.423% 16.06 JPMC DRA PORTFOLIO PNO5 $35,000,000 0.423% 16.07 HTFD ESTATE ON QUARRY LAKES WHLN 2007 $23,527,504 0.284% 16.08 HTFD CHANNEL ISLANDS WHLN 2007 $18,753,334 0.227% 16.09 HTFD ST. JOHNS PROP. HQ BLDG. WHLN 06 $11,431,811 0.138% 16.10 PRINCIPAL SANDS POINT PN 06 $11,427,989 0.138% 16.11 KB FISERVE BLDG WHLN 06 $7,849,189 0.095%
Amount and percentage of the reporting entity's total admitted assets held in the following categories of mortgage loans:
LOANS --------------------------------------------------------------------------------------- 16.12 Construction loans $ 0.000% 16.13 Mortgage loans over 90 days past due $ 0.000% 16.14 Mortgage loans in the process of $ 0.000% foreclosure 16.15 Mortgage loans foreclosed $ 0.000% 16.16 Restructured mortgage loans $ 0.000%
F-35 17. Aggregate mortgage loans having the following loan-to-value ratios as determined from the most current appraisal as of the annual statement date:
RESIDENTIAL COMMERCIAL AGRICULTURAL LOAN-TO-VALUE 1 2 3 4 5 6 -------------------------------------------------------------------------------------------------------------------------------- 17.01 above 95% $ 0.000% $ 0.000% $ 0.000% 17.02 91% to 95% $ 0.000% $ 0.000% $ 0.000% 17.03 81% to 90% $ 0.000% $ 0.000% $ 0.000% 17.04 71% to 80% $ 0.000% $107,080,645 1.294% $ 0.000% 17.05 below 70% $ 0.000% $195,624,239 2.364% $14,319,074 0.173%
18. Amounts and percentages of the reporting entity's total admitted assets held in each of the five largest investments in real estate: 18.01 Are assets held in real estate reported Yes x No / / less than 2.5% of the reporting entity's total admitted assets? If response to 18.01 above is yes, responses are not required for the remainder of Interrogatory 18. Largest five investments in any one parcel or group of contiguous parcels of real estate.
DESCRIPTION 2 3 -------------------------------------------------------------------------------- 18.02 $ 0.000 % 18.03 $ 0.000 % 18.04 $ 0.000 % 18.05 $ 0.000 % 18.06 $ 0.000 %
19. Report aggregate amounts and percentages of the reporting entity's total admitted assets held in investments in mezzanine real estate loans. 19.01 Are assets held in investments held in mezzanine real Yes x No / / estate loans less than 2.5% of the reporting entity's admitted assets? Is response to 19.01 is yes, responses are not required for the remainder of Interrogatory 19.
1 2 3 -------------------------------------------------------------------------------- 19.02 Aggregate $ 0.000 % statement value of investments held in mezzanine real estate loans Largest three investments held in mezzanine real estate loans. 19.03 $ 0.000 % 19.04 $ 0.000 % 19.05 $ 0.000 %
20. Amounts and percentages of the reporting entity's total admitted assets subject to the following types of agreements:
AT END OF EACH QUARTER AT YEAR-END 1ST QTR 2ND QTR 3RD QTR 1 2 3 4 5 --------------------------------------------------------------------------------------------------------------------------------- 20.01 Securities lending (do $388,665,636 4.697 % $197,522,197 $224,652,392 $409,563,021 not include assets held as collateral for such transactions) 20.02 Repurchase agreements $ 0.000 % $ $ $ 20.03 Reverse repurchase $ 0.000 % $ $ $ agreements 20.04 Dollar repurchase $ 0.000 % $ $ $ agreements 20.05 Dollar reverse $ 0.000 % $ $ $ repurchase agreements
F-36 21. Amounts and percentages indicated below for warrants not attached to other financial instruments, options, caps and floors:
OWNED WRITTEN 1 2 3 4 --------------------------------------------------------------------------------------------------------------------------------- 21.01 Hedging $ 0.000 % $ 0.000 % 21.02 Income generation $ 0.000 % $ 0.000 % 21.03 Other $404,761,614 4.891 % $ 0.000 %
22. Amounts and percentages of the reporting entity's total admitted assets of potential exposure for collars, swaps, and forwards:
AT END OF EACH QUARTER AT YEAR-END 1ST QTR 2ND QTR 3RD QTR 1 2 3 4 5 --------------------------------------------------------------------------------------------------------------------------------- 22.01 Hedging $3,489,804 0.042 % $3,404,726 $3,081,019 $3,641,617 22.02 Income generation $ 0.000 % $ $ $ 22.03 Replications $112,363 0.001 % $279,371 $219,338 $113,929 22.04 Other $340,510,916 4.115 % $23,117,070 $340,865,942 $344,677,551
23. Amounts and percentages of the reporting entity's total admitted assets of potential exposure for futures contracts:
AT END OF EACH QUARTER AT YEAR-END 1ST QTR 2ND QTR 3RD QTR 1 2 3 4 5 --------------------------------------------------------------------------------------------------------------------------------- 23.01 Hedging $ 0.000 % $ $ $ 23.02 Income generation $ 0.000 % $ $ $ 23.03 Replications $ 0.000 % $ $ $ 23.04 Other $7,779,300 0.094 % $5,724,450 $13,907,600 $5,077,150
F-37 PART C OTHER INFORMATION ITEM 24. FINANCIAL STATEMENTS AND EXHIBITS (a) All financial statements are included in Part A and Part B of the Registration Statement. (b) (1) Resolution of the Board of Directors of Hartford Life and Annuity Insurance Company ("Hartford") authorizes the establishment of the Separate Account.(1) (2) Not applicable. (3) (a) Principal Underwriter Agreement.(2) (3) (b) Amended and Restated Principal Underwriter Agreement.(3) (3) (c) Form of Dealer Agreement.(2) (4) Form of Individual Flexible Premium Variable Annuity Contract.(4) (5) Form of Application.(4) (6) (a) Certificate of Incorporation of Hartford.(5) (6) (b) Bylaws of Hartford.(6) (7) Form of Reinsurance Agreement.(7) (8) Form of Fund Participation Agreement.(8) (9) Opinion and Consent of Richard J. Wirth, Senior Counsel. (10) Consent of Deloitte & Touche LLP. (11) No financial statements are omitted. (12) Not applicable. (99) Copy of Power of Attorney. ------------ (1) Incorporated by reference to Post-Effective Amendment No. 2, to the Registration Statement File No. 33-80732, dated May 1, 1995. (2) Incorporated by reference to Post-Effective Amendment No. 3, to the Registration Statement File No. 33-73568, dated April 29, 1996. (3) Incorporated by reference to Post-Effective Amendment No. 9, to the Registration Statement, File No. 333-119415, filed on July 20, 2007. (4) Incorporated by reference to Pre-Effective Amendment No. 1, to the Registration Statement File No. 333-1010934, filed on April 7, 2003. (5) Incorporated by reference to Post-Effective Amendment No. 7, to the Registration Statement File No. 333-69487, filed April 9, 2001. (6) Incorporated by reference to Post-Effective Amendment No. 27, to the Registration Statement File No. 33-73570, filed on April 12, 1999. (7) Incorporated by reference to Post-Effective Amendment No. 2, to the Registration Statement File No. 333-91921, filed on August 25, 2000. (8) The footnote to the Fund Participation Agreement is: Incorporated by reference to Post-Effective Amendment No. 7, File No. 333-119418, filed on September 17, 2007. ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
NAME POSITION WITH HARTFORD ------------------------------------------------------------------------------------------------------------------ Robert Arena Senior Vice President Simpa Baiye Assistant Actuary David A. Carlson Director of Taxes, Senior Vice President Richard G. Costello Vice President and Secretary Rochelle S. Cummings Vice President James Davey Senior Vice President Peter Delehanty Senior Vice President John Giamalis Senior Vice President, Treasurer Christopher M. Grinnell Assistant Vice President Daniel R. Guilbert Actuary, Vice President Susan M. Hess Assistant Vice President Charles E. Hunt Vice President Jeannie M. Iannello Vice President Anne Iezzi Vice President, Chief Compliance Officer Stephen T. Joyce Senior Vice President Thomas P. Kalmbach Vice President and Actuary John Keenan Senior Vice President Diane Krajewski Assistant Vice President Alan J. Kreczko Executive Vice President, General Counsel Glenn D. Lammey Chief Financial Officer, Executive Vice President, Director* Dawn M. LeBlanc Assistant Vice President Debra L. Ludovissie Assistant Vice President Joseph F. Mahoney Vice President Kenneth A. McCullum Senior Vice President and Actuary Ernest M. McNeill, Jr. Senior Vice President and Chief Accounting Officer* Jonathan L. Mercier Assistant Vice President Vernon Meyer Senior Vice President Peter J. Michalik Vice President John J. Mittelstadt Assistant Vice President Brian Murphy Executive Vice President Colleen B. Pernerewski Chief Compliance Officer of Separate Accounts Craig R. Raymond Senior Vice President Sharon Ritchey Senior Vice President Michael J. Roscoe Vice President and Actuary Richard Rubin Assistant Vice President Wade A. Seward Vice President Martin A. Swanson Vice President Charles D. Tatro Actuary, Assistant Vice President James E. Trimble Senior Vice President and Chief Actuary Charles N. Vest Vice President and Actuary Andrew J. Waggoner Vice President Jean H. Walker Vice President John C. Walters President, Chief Executive Officer and Chairman of the Board, Director* Richard J. Wirth Assistant Vice President Lizabeth H. Zlatkus Executive Vice President, Director* David M. Znamierowski Executive Vice President and Chief Investment Officer, Director*
Unless otherwise indicated, the principal business address of each of the above individuals is Hartford Plaza, Hartford, CT 06115. * Denotes Board of Directors. ITEM 26. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR REGISTRANT. Incorporated by reference to Post-Effective Amendment No. 8, to the Registration Statement File No. 333-119414, filed on February 8, 2008. ITEM 27. NUMBER OF CONTRACT OWNERS As of January 31, 2008, there were 26,934 Contract Owners. ITEM 28. INDEMNIFICATION Section 33-776 of the Connecticut General Statutes states that: "a corporation may provide indemnification of, or advance expenses to, a director, officer, employee or agent only as permitted by sections 33-770 to 33-779, inclusive." ARTICLE VIII, Section 1(a) of the By-laws of the Depositor (as amended and restated effective July 25, 2000) provides that the Corporation, to the fullest extent permitted by applicable law as then in effect, shall indemnify any person who was or is a director or officer of the Corporation and who was or is threatened to be made a defendant or respondent in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative and whether formal or informal (including, without limitation, any action, suit or proceeding by or in the right of the Corporation to procure a judgment in its favor) (each, a Proceeding"), by reason of the fact that such a person was or is a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, trustee, employee or agent of another domestic or foreign corporation, partnership, joint venture, trust, employee benefit plan or other entity (a "Covered Entity"), against all expenses (including attorneys' fees), judgments, fines and amounts paid in settlement and actually and reasonably incurred by such person in connection with such Proceeding. Any such former or present director or officer of the Corporation finally determined to be entitled to indemnification as provided in this Article VIII is hereinafter called an "Indemnitee". Until such final determination is made such former or present director or officer shall be a "Potential Indemnitee" for purposes of this Article VIII. Notwithstanding the foregoing provisions of this Section 1(a), the Corporation shall not indemnify an Indemnitee with respect to any Proceeding commenced by such Indemnitee unless the commencement of such Proceeding by such Indemnitee has been approved by a majority vote of the Disinterested Directors (as defined in Section 5(d)); provided however, that such approval of a majority of the Disinterested Directors shall not be required with respect to any Proceeding commenced by such Indemnitee after a Change in Control (as defined in Section 5(d)) has occurred. Insofar as indemnification for liability arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. ITEM 29. PRINCIPAL UNDERWRITERS (a) HSD acts as principal underwriter for the following investment companies: Hartford Life Insurance Company - DC Variable Account I Hartford Life Insurance Company - Separate Account One Hartford Life Insurance Company - Separate Account Two Hartford Life Insurance Company - Separate Account Two (DC Variable Account II) Hartford Life Insurance Company - Separate Account Two (QP Variable Account) Hartford Life Insurance Company - Separate Account Two (Variable Account "A") Hartford Life Insurance Company - Separate Account Two (NQ Variable Account) Hartford Life Insurance Company - Separate Account Ten Hartford Life Insurance Company - Separate Account Three Hartford Life Insurance Company - Separate Account Five Hartford Life Insurance Company - Separate Account Seven Hartford Life Insurance Company - Separate Account Eleven Hartford Life Insurance Company - Separate Account Twelve Hartford Life and Annuity Insurance Company - Separate Account One Hartford Life and Annuity Insurance Company - Separate Account Ten Hartford Life and Annuity Insurance Company - Separate Account Three Hartford Life and Annuity Insurance Company - Separate Account Five Hartford Life and Annuity Insurance Company - Separate Account Six Hartford Life and Annuity Insurance Company - Separate Account Seven American Maturity Life Insurance Company - Separate Account AMLVA American Maturity Life Insurance Company - Separate Account One Nutmeg Life Insurance Company - Separate Account One (b) Directors and Officers of HSD
POSITIONS AND OFFICES NAME WITH UNDERWRITER ------------------------------------------------------------------------------------------------------------ Robert Arena Senior Vice President/Business Line Principal and Director Diana Benken Chief Financial Officer and Controller/FINOP James Davey Senior Vice President/Business Line Principal Peter Delehanty Senior Vice President/IIP Marketing John N. Gamalis Treasurer Stephen T. Joyce Senior Vice President/Business Line Principal Kenneth A. McCullum Senior Vice President Vernon Meyer Senior Vice President Brian Murphy Director Mark A. Sides Chief Legal Officer and Secretary Martin A. Swanson Vice President/Marketing John C. Walters Chief Executive Officer, President and Director William Wilcox Chief Legal Officer, AML Chief Compliance Officer
Unless otherwise indicated, the principal business address of each of the above individuals is Hartford Plaza, Hartford, Connecticut 06115. ITEM 30. LOCATION OF ACCOUNTS AND RECORDS All of the accounts, books, records or other documents required to be kept by Section 31(a) of the Investment Company Act of 1940 and rules thereunder are maintained by Hartford at 200 Hopmeadow Street, Simsbury, Connecticut 06089. ITEM 31. MANAGEMENT SERVICES All management contracts are discussed in Part A and Part B of this Registration Statement. ITEM 32. UNDERTAKINGS (a) The Registrant hereby undertakes to file a post-effective amendment to this Registration Statement as frequently as is necessary to ensure that the audited financial statements in the Registration Statement are never more than 16 months old so long as payments under the variable annuity Contracts may be accepted. (b) The Registrant hereby undertakes to include either (1) as part of any application to purchase a Contract offered by the Prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a post card or similar written communication affixed to or included in the Prospectus that the applicant can remove to send for a Statement of Additional Information. (c) The Registrant hereby undertakes to deliver any Statement of Additional Information and any financial statements required to be made available under this Form promptly upon written or oral request. (d) Hartford hereby represents that the aggregate fees and charges under the Contract are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by Hartford. The Registrant is relying on the no-action letter issued by the Division of Investment Management to American Counsel of Life Insurance, Ref. No. IP-6-88, November 28, 1988. Registrant has complied with conditions one through four of the no-action letter. SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all the requirements for effectiveness of this Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Registration Statement to be signed on its behalf, in the Town of Simsbury, and State of Connecticut on this 24th day of April, 2008. HARTFORD LIFE AND ANNUITY INSURANCE COMPANY SEPARATE ACCOUNT THREE (Registrant) By: John C. Walters *By: /s/ Richard J. Wirth ----------------------------------- ----------------------------------- John C. Walters, Richard J. Wirth President, Chief Executive Officer Attorney-in-Fact and Chairman of the Board*
HARTFORD LIFE AND ANNUITY INSURANCE COMPANY (Depositor) By: John C. Walters ----------------------------------- John C. Walters, President, Chief Executive Officer and Chairman of the Board*
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons and in the capacities and on the dates indicated. Glenn D. Lammey, Chief Financial Officer, Executive Vice President, Director* John C. Walters, President, Chief Executive Officer, Chairman of the Board, Director* Lizabeth H. Zlatkus, Executive Vice President, Director* *By: /s/ Richard J. Wirth ----------------------------------- David M. Znamierowski, Executive Vice President, Richard J. Wirth Chief Investment Officer, Director* Attorney-in-Fact Date: April 24, 2008
333-119416 EXHIBIT INDEX (9) Opinion and Consent of Richard J. Wirth, Senior Counsel. (10) Consent of Deloitte & Touche LLP. (99) Copy of Power of Attorney.