485BPOS 1 a08-3366_1485bpos.txt 485BPOS AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 24, 2008. FILE NO. 333-119415 811-08584 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- 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. 13 /X/ REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 AMENDMENT NO. 168 /X/ HARTFORD LIFE INSURANCE COMPANY SEPARATE ACCOUNT THREE (Exact Name of Registrant) HARTFORD LIFE 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 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 EDGE 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 AllianceBerstein 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 Insitutional 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 5.5% $50,000 - $99,999 4.5% $100,000 - $249,999 3.5% $250,000 - $499,999 2.5% $500,000 - $999,999 2.0% $1,000,000+ 1.0% CONTINGENT DEFERRED SALES CHARGE* (as a percentage of Premium Payments) First Year 0% Second Year 0% Third Year 0% Fourth Year 0% Fifth Year 0% Sixth Year 0% Seventh Year 0% Eighth Year 0% 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 0.55% Administrative Charge 0.20% Total Separate Account Annual Expenses 0.75% 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 1.80% 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 $1,125 3 years $2,259 5 years $3,373 10 years $6,069
(2) If you annuitize at the end of the applicable time period: 1 year $1,020 3 years $2,154 5 years $3,268 10 years $5,964
(3) If you do not Surrender your variable annuity: 1 year $1,125 3 years $2,259 5 years $3,373 10 years $6,069
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. - 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 Letter of Intent to Submit Anticipated Premium Endorsement 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 Letter of Intent to Submit Anticipated Premium Endorsement 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 for Core and Plus Contracts and six years for Outlook Contracts. 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%. - SOUTH CAROLINA -- The Letter of Intent to Submit Anticipated Premium Endorsement is not available. - TEXAS -- The Letter of Intent to Submit Anticipated Premium Endorsement is not available. 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 Letter of Intent to Submit Anticipated Premium Endorsement is not available. 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 $12.097 $10.714 $9.751 Accumulation Unit Value at end of period $12.639 $12.097 $10.714 Number of Accumulation Units outstanding at end of period (in thousands) 8 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.921 $10.643 $9.738 Accumulation Unit Value at end of period $12.355 $11.921 $10.643 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.699 $12.030 $10.000 Accumulation Unit Value at end of period $15.252 $13.699 $12.030 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 $13.518 $11.966 $10.000 Accumulation Unit Value at end of period $14.930 $13.518 $11.966 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.378 -- -- (a) Accumulation Unit Value at end of period $10.542 -- -- 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 $10.366 -- -- (a) Accumulation Unit Value at end of period $10.518 -- -- 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 $14.909 $11.117 $9.329 Accumulation Unit Value at end of period $15.624 $14.909 $11.117 Number of Accumulation Units outstanding at end of period (in thousands) 10 5 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.692 $11.043 $9.316 Accumulation Unit Value at end of period $15.273 $14.692 $11.043 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.039 $10.621 $9.427 Accumulation Unit Value at end of period $12.132 $12.039 $10.621 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.863 $10.550 $9.414 Accumulation Unit Value at end of period $11.859 $11.863 $10.550 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $12.452 $10.366 $9.640 Accumulation Unit Value at end of period $11.845 $12.452 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.271 $10.297 $9.627 Accumulation Unit Value at end of period $11.579 $12.271 $10.297 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.609 $11.401 $9.576 Accumulation Unit Value at end of period $14.681 $12.609 $11.401 Number of Accumulation Units outstanding at end of period (in thousands) 54 29 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.425 $11.325 $9.563 Accumulation Unit Value at end of period $14.351 $12.425 $11.325 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.654 -- -- (a) Accumulation Unit Value at end of period $9.571 -- -- 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 $9.642 -- -- (a) Accumulation Unit Value at end of period $9.550 -- -- 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 $12.442 $10.452 $9.557 Accumulation Unit Value at end of period $12.506 $12.442 $10.452 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.260 $10.382 $9.544 Accumulation Unit Value at end of period $12.225 $12.260 $10.382 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.321 $10.703 $9.567 Accumulation Unit Value at end of period $14.232 $11.321 $10.703 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 $11.155 $10.631 $9.554 Accumulation Unit Value at end of period $13.912 $11.155 $10.631 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.557 $11.255 $9.331 Accumulation Unit Value at end of period $14.375 $12.557 $11.255 Number of Accumulation Units outstanding at end of period (in thousands) 10 10 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.374 $11.180 $9.318 Accumulation Unit Value at end of period $14.052 $12.374 $11.180 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1
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 $12.061 $10.475 $8.966 Accumulation Unit Value at end of period $12.623 $12.061 $10.475 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 $11.885 $10.405 $8.953 Accumulation Unit Value at end of period $12.339 $11.885 $10.405 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.212 $1.103 $1.016 Accumulation Unit Value at end of period $1.282 $1.212 $1.103 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 $1.277 $1.172 $1.085 Accumulation Unit Value at end of period $1.341 $1.277 $1.172 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.191 $1.067 $0.975 Accumulation Unit Value at end of period $1.280 $1.191 $1.067 Number of Accumulation Units outstanding at end of period (in thousands) 91 61 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.381 $1.247 $1.146 Accumulation Unit Value at end of period $1.473 $1.381 $1.247 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.659 $1.389 $1.285 Accumulation Unit Value at end of period $1.783 $1.659 $1.389 Number of Accumulation Units outstanding at end of period (in thousands) 375 198 21 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.570 $1.325 $1.233 Accumulation Unit Value at end of period $1.674 $1.570 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 24 24 24 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.453 $1.212 $1.158 Accumulation Unit Value at end of period $1.542 $1.453 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 50 48 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.416 $1.191 $1.145 Accumulation Unit Value at end of period $1.492 $1.416 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 20 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.190 $1.093 $0.962 Accumulation Unit Value at end of period $1.360 $1.190 $1.093 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 $1.137 $1.052 $0.932 Accumulation Unit Value at end of period $1.289 $1.137 $1.052 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 $1.302 $1.206 $1.114 Accumulation Unit Value at end of period $1.507 $1.302 $1.206 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 $1.971 $1.839 $1.708 Accumulation Unit Value at end of period $2.262 $1.971 $1.839 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 $1.434 $1.266 $1.116 Accumulation Unit Value at end of period $1.780 $1.434 $1.266 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.047 $1.821 $1.614 Accumulation Unit Value at end of period $2.520 $2.047 $1.821 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.360 $1.310 $1.158 Accumulation Unit Value at end of period $1.576 $1.360 $1.310 Number of Accumulation Units outstanding at end of period (in thousands) 75 73 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.309 $1.271 $1.130 Accumulation Unit Value at end of period $1.505 $1.309 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 6 6 6 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.633 $1.469 $1.171 Accumulation Unit Value at end of period $2.102 $1.633 $1.469 Number of Accumulation Units outstanding at end of period (in thousands) 53 27 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.573 $1.426 $1.143 Accumulation Unit Value at end of period $2.008 $1.573 $1.426 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.259 $1.203 Accumulation Unit Value at end of period $1.418 $1.390 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 26 29 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.378 $1.259 $1.209 Accumulation Unit Value at end of period $1.395 $1.378 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.129 $0.985 $0.912 Accumulation Unit Value at end of period $1.179 $1.129 $0.985 Number of Accumulation Units outstanding at end of period (in thousands) 55 33 17 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.228 $4.599 $4.282 Accumulation Unit Value at end of period $5.415 $5.228 $4.599 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $1.683 $1.367 $1.184 Accumulation Unit Value at end of period $2.070 $1.683 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) 104 62 18 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.608 $1.316 $1.147 Accumulation Unit Value at end of period $1.962 $1.608 $1.316 Number of Accumulation Units outstanding at end of period (in thousands) 13 -- -- HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.397 $1.131 $0.964 Accumulation Unit Value at end of period $1.767 $1.397 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 66 8 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.485 $1.212 $1.039 Accumulation Unit Value at end of period $1.863 $1.485 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.340 $1.823 $1.538 Accumulation Unit Value at end of period $2.532 $2.340 $1.823 Number of Accumulation Units outstanding at end of period (in thousands) 11 4 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.236 $1.756 $1.489 Accumulation Unit Value at end of period $2.399 $2.236 $1.756 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.538 -- -- (a) Accumulation Unit Value at end of period $9.828 -- -- 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 $9.526 -- -- (a) Accumulation Unit Value at end of period $9.806 -- -- 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 $9.522 -- -- (a) Accumulation Unit Value at end of period $9.809 -- -- 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 $9.511 -- -- (a) Accumulation Unit Value at end of period $9.787 -- -- 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 $1.161 $1.117 $1.099 Accumulation Unit Value at end of period $1.209 $1.161 $1.117 Number of Accumulation Units outstanding at end of period (in thousands) 87 81 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.120 $1.108 Accumulation Unit Value at end of period $1.193 $1.155 $1.120 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $1.383 $1.332 $1.320 Accumulation Unit Value at end of period $1.420 $1.383 $1.332 Number of Accumulation Units outstanding at end of period (in thousands) 7 1 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.879 $2.793 $2.785 Accumulation Unit Value at end of period $2.931 $2.879 $2.793 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.452 $1.369 $1.162 Accumulation Unit Value at end of period $1.415 $1.452 $1.369 Number of Accumulation Units outstanding at end of period (in thousands) 68 40 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.404 $1.334 $1.139 Accumulation Unit Value at end of period $1.357 $1.404 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.336 -- -- (a) Accumulation Unit Value at end of period $9.130 -- -- 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 $9.325 -- -- (a) Accumulation Unit Value at end of period $9.110 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.612 $1.570 -- Accumulation Unit Value at end of period $1.827 $1.612 -- Number of Accumulation Units outstanding at end of period (in thousands) 32 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.770 $1.733 -- Accumulation Unit Value at end of period $1.991 $1.770 -- 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 $1.092 $0.960 $0.854 Accumulation Unit Value at end of period $1.148 $1.092 $0.960 Number of Accumulation Units outstanding at end of period (in thousands) 19 16 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.220 $1.081 $0.967 Accumulation Unit Value at end of period $1.272 $1.220 $1.081 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.535 $1.476 $1.462 Accumulation Unit Value at end of period $1.595 $1.535 $1.476 Number of Accumulation Units outstanding at end of period (in thousands) 423 209 17 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.459 $1.414 $1.408 Accumulation Unit Value at end of period $1.503 $1.459 $1.414 Number of Accumulation Units outstanding at end of period (in thousands) 15 15 15
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 $1.143 $1.107 $1.102 Accumulation Unit Value at end of period $1.184 $1.143 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 96 57 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.101 $1.075 $1.076 Accumulation Unit Value at end of period $1.132 $1.101 $1.075 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 20 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.392 $1.151 $1.064 Accumulation Unit Value at end of period $1.505 $1.392 $1.151 Number of Accumulation Units outstanding at end of period (in thousands) 6 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.330 $1.108 $1.030 Accumulation Unit Value at end of period $1.427 $1.330 $1.108 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.678 $1.421 $1.261 Accumulation Unit Value at end of period $1.561 $1.678 $1.421 Number of Accumulation Units outstanding at end of period (in thousands) 11 6 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.616 $1.379 $1.231 Accumulation Unit Value at end of period $1.491 $1.616 $1.379 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.076 $10.613 $9.522 Accumulation Unit Value at end of period $12.791 $12.076 $10.613 Number of Accumulation Units outstanding at end of period (in thousands) 16 18 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.900 $10.542 $9.509 Accumulation Unit Value at end of period $12.504 $11.900 $10.542 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.692 $10.284 $9.656 Accumulation Unit Value at end of period $11.972 $11.692 $10.284 Number of Accumulation Units outstanding at end of period (in thousands) 14 14 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.522 $10.215 $9.642 Accumulation Unit Value at end of period $11.703 $11.522 $10.215 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.870 $10.017 $9.575 Accumulation Unit Value at end of period $11.456 $10.870 $10.017 Number of Accumulation Units outstanding at end of period (in thousands) 26 15 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.711 $9.950 $9.561 Accumulation Unit Value at end of period $11.199 $10.711 $9.950 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $11.955 $10.271 $9.597 Accumulation Unit Value at end of period $12.274 $11.955 $10.271 Number of Accumulation Units outstanding at end of period (in thousands) 50 23 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.781 $10.203 $9.584 Accumulation Unit Value at end of period $11.999 $11.781 $10.203 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.926 $10.641 $10.000 Accumulation Unit Value at end of period $13.100 $11.926 $10.641 Number of Accumulation Units outstanding at end of period (in thousands) 10 5 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.585 $10.000 Accumulation Unit Value at end of period $12.824 $11.768 $10.585 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 $11.335 $10.605 $9.710 Accumulation Unit Value at end of period $12.809 $11.335 $10.605 Number of Accumulation Units outstanding at end of period (in thousands) 7 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.169 $10.534 $9.697 Accumulation Unit Value at end of period $12.522 $11.169 $10.534 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.428 $11.527 $9.621 Accumulation Unit Value at end of period $14.138 $13.428 $11.527 Number of Accumulation Units outstanding at end of period (in thousands) 40 20 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.232 $11.450 $9.608 Accumulation Unit Value at end of period $13.820 $13.232 $11.450 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.942 $10.484 $9.606 Accumulation Unit Value at end of period $12.345 $11.942 $10.484 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.414 $9.593 Accumulation Unit Value at end of period $12.068 $11.768 $10.414 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.486 $10.971 $9.313 Accumulation Unit Value at end of period $12.220 $12.486 $10.971 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 $12.303 $10.898 $9.301 Accumulation Unit Value at end of period $11.945 $12.303 $10.898 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1
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 $11.343 $11.128 $9.497 Accumulation Unit Value at end of period $11.938 $11.343 $11.128 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 $11.178 $11.054 $9.484 Accumulation Unit Value at end of period $11.670 $11.178 $11.054 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $18.253 $17.302 $16.932 Accumulation Unit Value at end of period $18.865 $18.253 $17.302 Number of Accumulation Units outstanding at end of period (in thousands) 5 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.711 $16.922 $16.649 Accumulation Unit Value at end of period $18.159 $17.711 $16.922 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $37.652 $33.614 $31.404 Accumulation Unit Value at end of period $38.469 $37.652 $33.614 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $36.533 $32.876 $30.879 Accumulation Unit Value at end of period $37.028 $36.533 $32.876 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $59.719 $51.909 $48.011 Accumulation Unit Value at end of period $55.693 $59.719 $51.909 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 $57.943 $50.770 $47.208 Accumulation Unit Value at end of period $53.606 $57.943 $50.770 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.793 $19.558 $17.057 Accumulation Unit Value at end of period $26.667 $24.793 $19.558 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $24.056 $19.129 $16.772 Accumulation Unit Value at end of period $25.668 $24.056 $19.129 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.876 -- -- (a) Accumulation Unit Value at end of period $9.771 -- -- 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 $9.865 -- -- (a) Accumulation Unit Value at end of period $9.750 -- -- 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 $11.234 $9.934 $8.759 Accumulation Unit Value at end of period $10.574 $11.234 $9.934 Number of Accumulation Units outstanding at end of period (in thousands) 11 11 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.900 $9.716 $8.613 Accumulation Unit Value at end of period $10.178 $10.900 $9.716 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $22.290 $19.358 $17.752 Accumulation Unit Value at end of period $21.042 $22.290 $19.358 Number of Accumulation Units outstanding at end of period (in thousands) 10 8 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.627 $18.933 $17.455 Accumulation Unit Value at end of period $20.254 $21.627 $18.933 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $27.062 $23.245 $20.274 Accumulation Unit Value at end of period $23.443 $27.062 $23.245 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.257 $22.735 $19.936 Accumulation Unit Value at end of period $22.565 $26.257 $22.735 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.805 $12.428 $11.853 Accumulation Unit Value at end of period $13.833 $13.805 $12.428 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.395 $12.155 $11.655 Accumulation Unit Value at end of period $13.314 $13.395 $12.155 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.506 $15.770 $13.439 Accumulation Unit Value at end of period $17.007 $16.506 $15.770 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.015 $15.424 $13.214 Accumulation Unit Value at end of period $16.370 $16.015 $15.424 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $55.681 $53.208 $46.938 Accumulation Unit Value at end of period $58.316 $55.681 $53.208 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 $54.026 $52.041 $46.153 Accumulation Unit Value at end of period $56.131 $54.026 $52.041 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $16.526 $12.138 $9.045 Accumulation Unit Value at end of period $23.038 $16.526 $12.138 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 (50 BPS) Accumulation Unit Value at beginning of period $16.285 $12.057 $9.033 Accumulation Unit Value at end of period $22.522 $16.285 $12.057 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.799 $11.816 $9.508 Accumulation Unit Value at end of period $15.576 $12.799 $11.816 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.612 $11.737 $9.495 Accumulation Unit Value at end of period $15.227 $12.612 $11.737 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.156 $10.989 $9.644 Accumulation Unit Value at end of period $14.069 $13.156 $10.989 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.964 $10.916 $9.631 Accumulation Unit Value at end of period $13.753 $12.964 $10.916 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.954 $14.720 $13.894 Accumulation Unit Value at end of period $16.435 $16.954 $14.720 Number of Accumulation Units outstanding at end of period (in thousands) 21 11 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.706 $14.621 $13.875 Accumulation Unit Value at end of period $16.066 $16.706 $14.621 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.884 $14.668 $13.336 Accumulation Unit Value at end of period $17.181 $16.884 $14.668 Number of Accumulation Units outstanding at end of period (in thousands) 18 8 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.638 $14.570 $13.318 Accumulation Unit Value at end of period $16.795 $16.638 $14.570 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
(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 $12.097 $10.714 $9.751 of period Accumulation Unit Value at end of $12.639 $12.097 $10.714 period Number of Accumulation Units 635 184 16 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 $11.921 $10.643 $9.738 of period Accumulation Unit Value at end of $12.355 $11.921 $10.643 period Number of Accumulation Units 1 1 1 outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $13.699 $12.030 $10.000 of period Accumulation Unit Value at end of $15.252 $13.699 $12.030 period Number of Accumulation Units 16 4 1 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 $13.518 $11.966 $10.000 of period Accumulation Unit Value at end of $14.930 $13.518 $11.966 period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $10.378 -- -- (a) of period Accumulation Unit Value at end of $10.542 -- -- period Number of Accumulation Units 2 -- -- 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 $10.366 -- -- (a) of period Accumulation Unit Value at end of $10.518 -- -- period 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 $14.909 $11.117 $9.329 of period Accumulation Unit Value at end of $15.624 $14.909 $11.117 period Number of Accumulation Units 591 219 41 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 $14.692 $11.043 $9.316 of period Accumulation Unit Value at end of $15.273 $14.692 $11.043 period Number of Accumulation Units 14 15 -- outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.039 $10.621 $9.427 of period Accumulation Unit Value at end of $12.132 $12.039 $10.621 period Number of Accumulation Units 114 50 22 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 $11.863 $10.550 $9.414 of period Accumulation Unit Value at end of $11.859 $11.863 $10.550 period Number of Accumulation Units 1 1 -- outstanding at end of period (in thousands) ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.452 $10.366 $9.640 of period Accumulation Unit Value at end of $11.845 $12.452 $10.366 period Number of Accumulation Units 88 54 32 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 $12.271 $10.297 $9.627 of period Accumulation Unit Value at end of $11.579 $12.271 $10.297 period Number of Accumulation Units -- -- 1 outstanding at end of period (in thousands)
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 $12.609 $11.401 $9.576 of period Accumulation Unit Value at end of $14.681 $12.609 $11.401 period Number of Accumulation Units 2,667 1,289 271 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 $12.425 $11.325 $9.563 of period Accumulation Unit Value at end of $14.351 $12.425 $11.325 period Number of Accumulation Units 51 29 32 outstanding at end of period (in thousands) FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $9.654 -- -- (a) of period Accumulation Unit Value at end of $9.571 -- -- 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 $9.642 -- -- (a) of period Accumulation Unit Value at end of $9.550 -- -- period 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 $12.442 $10.452 $9.557 of period Accumulation Unit Value at end of $12.506 $12.442 $10.452 period Number of Accumulation Units 232 170 31 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 $12.260 $10.382 $9.544 of period Accumulation Unit Value at end of $12.225 $12.260 $10.382 period Number of Accumulation Units 3 1 1 outstanding at end of period (in thousands) FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $11.321 $10.703 $9.567 of period Accumulation Unit Value at end of $14.232 $11.321 $10.703 period Number of Accumulation Units 30 20 4 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 $11.155 $10.631 $9.554 of period Accumulation Unit Value at end of $13.912 $11.155 $10.631 period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands) FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.557 $11.255 $9.331 of period Accumulation Unit Value at end of $14.375 $12.557 $11.255 period Number of Accumulation Units 395 249 67 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 $12.374 $11.180 $9.318 of period Accumulation Unit Value at end of $14.052 $12.374 $11.180 period Number of Accumulation Units 6 4 1 outstanding at end of period (in thousands) FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning $12.061 $10.475 $8.966 of period Accumulation Unit Value at end of $12.623 $12.061 $10.475 period Number of Accumulation Units 26 10 3 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 $11.885 $10.405 $8.953 of period Accumulation Unit Value at end of $12.339 $11.885 $10.405 period Number of Accumulation Units -- -- -- outstanding at end of period (in thousands)
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 $1.212 $1.103 $1.016 Accumulation Unit Value at end of period $1.282 $1.212 $1.103 Number of Accumulation Units outstanding at end of period (in thousands) 710 468 273 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.277 $1.172 $1.085 Accumulation Unit Value at end of period $1.341 $1.277 $1.172 Number of Accumulation Units outstanding at end of period (in thousands) 42 42 36 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.191 $1.067 $0.975 Accumulation Unit Value at end of period $1.280 $1.191 $1.067 Number of Accumulation Units outstanding at end of period (in thousands) 612 482 266 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.381 $1.247 $1.146 Accumulation Unit Value at end of period $1.473 $1.381 $1.247 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.659 $1.389 $1.285 Accumulation Unit Value at end of period $1.783 $1.659 $1.389 Number of Accumulation Units outstanding at end of period (in thousands) 20,730 9,400 2,446 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.570 $1.325 $1.233 Accumulation Unit Value at end of period $1.674 $1.570 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 719 645 256 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.453 $1.212 $1.158 Accumulation Unit Value at end of period $1.542 $1.453 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 5,030 2,857 1,101 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.416 $1.191 $1.145 Accumulation Unit Value at end of period $1.492 $1.416 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 460 481 79 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.190 $1.093 $0.962 Accumulation Unit Value at end of period $1.360 $1.190 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 42 12 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.137 $1.052 $0.932 Accumulation Unit Value at end of period $1.289 $1.137 $1.052 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 $1.302 $1.206 $1.114 Accumulation Unit Value at end of period $1.507 $1.302 $1.206 Number of Accumulation Units outstanding at end of period (in thousands) 803 549 315 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.971 $1.839 $1.708 Accumulation Unit Value at end of period $2.262 $1.971 $1.839 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $1.434 $1.266 $1.116 Accumulation Unit Value at end of period $1.780 $1.434 $1.266 Number of Accumulation Units outstanding at end of period (in thousands) 715 392 177 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.047 $1.821 $1.614 Accumulation Unit Value at end of period $2.520 $2.047 $1.821 Number of Accumulation Units outstanding at end of period (in thousands) 6 -- -- HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.360 $1.310 $1.158 Accumulation Unit Value at end of period $1.576 $1.360 $1.310 Number of Accumulation Units outstanding at end of period (in thousands) 2,144 2,079 930 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.309 $1.271 $1.130 Accumulation Unit Value at end of period $1.505 $1.309 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 406 445 110 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.633 $1.469 $1.171 Accumulation Unit Value at end of period $2.102 $1.633 $1.469 Number of Accumulation Units outstanding at end of period (in thousands) 2,924 1,040 106 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.573 $1.426 $1.143 Accumulation Unit Value at end of period $2.008 $1.573 $1.426 Number of Accumulation Units outstanding at end of period (in thousands) 209 81 57 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.259 $1.203 Accumulation Unit Value at end of period $1.418 $1.390 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 834 501 125 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.378 $1.259 $1.209 Accumulation Unit Value at end of period $1.395 $1.378 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 3 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.129 $0.985 $0.912 Accumulation Unit Value at end of period $1.179 $1.129 $0.985 Number of Accumulation Units outstanding at end of period (in thousands) 340 275 140 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.228 $4.599 $4.282 Accumulation Unit Value at end of period $5.415 $5.228 $4.599 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.683 $1.367 $1.184 Accumulation Unit Value at end of period $2.070 $1.683 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) 6,496 3,607 919 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.608 $1.316 $1.147 Accumulation Unit Value at end of period $1.962 $1.608 $1.316 Number of Accumulation Units outstanding at end of period (in thousands) 170 171 114
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 $1.397 $1.131 $0.964 Accumulation Unit Value at end of period $1.767 $1.397 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 1,634 957 427 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.485 $1.212 $1.039 Accumulation Unit Value at end of period $1.863 $1.485 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 25 17 18 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.340 $1.823 $1.538 Accumulation Unit Value at end of period $2.532 $2.340 $1.823 Number of Accumulation Units outstanding at end of period (in thousands) 388 180 77 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.236 $1.756 $1.489 Accumulation Unit Value at end of period $2.399 $2.236 $1.756 Number of Accumulation Units outstanding at end of period (in thousands) 217 247 -- HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.538 -- -- (a) Accumulation Unit Value at end of period $9.828 -- -- 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 $9.526 -- -- (a) Accumulation Unit Value at end of period $9.806 -- -- 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 $9.522 -- -- (a) Accumulation Unit Value at end of period $9.809 -- -- 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 $9.511 -- -- (a) Accumulation Unit Value at end of period $9.787 -- -- 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 $1.161 $1.117 $1.099 Accumulation Unit Value at end of period $1.209 $1.161 $1.117 Number of Accumulation Units outstanding at end of period (in thousands) 2,438 1,821 589 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.155 $1.120 $1.108 Accumulation Unit Value at end of period $1.193 $1.155 $1.120 Number of Accumulation Units outstanding at end of period (in thousands) -- 19 -- HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.383 $1.332 $1.320 Accumulation Unit Value at end of period $1.420 $1.383 $1.332 Number of Accumulation Units outstanding at end of period (in thousands) 347 237 23 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.879 $2.793 $2.785 Accumulation Unit Value at end of period $2.931 $2.879 $2.793 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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 $1.612 $1.570 -- Accumulation Unit Value at end of period $1.827 $1.612 -- Number of Accumulation Units outstanding at end of period (in thousands) 185 59 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.770 $1.733 -- Accumulation Unit Value at end of period $1.991 $1.770 -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.452 $1.369 $1.162 Accumulation Unit Value at end of period $1.415 $1.452 $1.369 Number of Accumulation Units outstanding at end of period (in thousands) 349 194 119 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.404 $1.334 $1.139 Accumulation Unit Value at end of period $1.357 $1.404 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 6 7 12 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.336 -- -- (a) Accumulation Unit Value at end of period $9.130 -- -- 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 $9.325 -- -- (a) Accumulation Unit Value at end of period $9.110 -- -- 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 $1.092 $0.960 $0.854 Accumulation Unit Value at end of period $1.148 $1.092 $0.960 Number of Accumulation Units outstanding at end of period (in thousands) 661 529 271 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.220 $1.081 $0.967 Accumulation Unit Value at end of period $1.272 $1.220 $1.081 Number of Accumulation Units outstanding at end of period (in thousands) 78 79 66 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.535 $1.476 $1.462 Accumulation Unit Value at end of period $1.595 $1.535 $1.476 Number of Accumulation Units outstanding at end of period (in thousands) 16,312 7,356 2,517 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.459 $1.414 $1.408 Accumulation Unit Value at end of period $1.503 $1.459 $1.414 Number of Accumulation Units outstanding at end of period (in thousands) 198 158 131 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.107 $1.102 Accumulation Unit Value at end of period $1.184 $1.143 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 3,947 1,105 356 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.101 $1.075 $1.076 Accumulation Unit Value at end of period $1.132 $1.101 $1.075 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 16
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 $1.392 $1.151 $1.064 Accumulation Unit Value at end of period $1.505 $1.392 $1.151 Number of Accumulation Units outstanding at end of period (in thousands) 269 108 46 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.330 $1.108 $1.030 Accumulation Unit Value at end of period $1.427 $1.330 $1.108 Number of Accumulation Units outstanding at end of period (in thousands) 17 17 9 HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.678 $1.421 $1.261 Accumulation Unit Value at end of period $1.561 $1.678 $1.421 Number of Accumulation Units outstanding at end of period (in thousands) 1,495 825 369 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.616 $1.379 $1.231 Accumulation Unit Value at end of period $1.491 $1.616 $1.379 Number of Accumulation Units outstanding at end of period (in thousands) 406 381 64 LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.076 $10.613 $9.522 Accumulation Unit Value at end of period $12.791 $12.076 $10.613 Number of Accumulation Units outstanding at end of period (in thousands) 684 460 211 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.900 $10.542 $9.509 Accumulation Unit Value at end of period $12.504 $11.900 $10.542 Number of Accumulation Units outstanding at end of period (in thousands) 21 23 14 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.692 $10.284 $9.656 Accumulation Unit Value at end of period $11.972 $11.692 $10.284 Number of Accumulation Units outstanding at end of period (in thousands) 1,006 530 220 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.522 $10.215 $9.642 Accumulation Unit Value at end of period $11.703 $11.522 $10.215 Number of Accumulation Units outstanding at end of period (in thousands) 29 22 11 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.870 $10.017 $9.575 Accumulation Unit Value at end of period $11.456 $10.870 $10.017 Number of Accumulation Units outstanding at end of period (in thousands) 940 523 193 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.711 $9.950 $9.561 Accumulation Unit Value at end of period $11.199 $10.711 $9.950 Number of Accumulation Units outstanding at end of period (in thousands) 7 9 5 LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.955 $10.271 $9.597 Accumulation Unit Value at end of period $12.274 $11.955 $10.271 Number of Accumulation Units outstanding at end of period (in thousands) 2,619 1,154 219 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.781 $10.203 $9.584 Accumulation Unit Value at end of period $11.999 $11.781 $10.203 Number of Accumulation Units outstanding at end of period (in thousands) 44 19 12
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 $11.926 $10.641 $10.000 Accumulation Unit Value at end of period $13.100 $11.926 $10.641 Number of Accumulation Units outstanding at end of period (in thousands) 255 197 99 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.585 $10.000 Accumulation Unit Value at end of period $12.824 $11.768 $10.585 Number of Accumulation Units outstanding at end of period (in thousands) 3 6 1 OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.335 $10.605 $9.710 Accumulation Unit Value at end of period $12.809 $11.335 $10.605 Number of Accumulation Units outstanding at end of period (in thousands) 132 61 31 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.169 $10.534 $9.697 Accumulation Unit Value at end of period $12.522 $11.169 $10.534 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.428 $11.527 $9.621 Accumulation Unit Value at end of period $14.138 $13.428 $11.527 Number of Accumulation Units outstanding at end of period (in thousands) 1,648 715 84 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.232 $11.450 $9.608 Accumulation Unit Value at end of period $13.820 $13.232 $11.450 Number of Accumulation Units outstanding at end of period (in thousands) 18 6 7 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.942 $10.484 $9.606 Accumulation Unit Value at end of period $12.345 $11.942 $10.484 Number of Accumulation Units outstanding at end of period (in thousands) 57 34 32 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.414 $9.593 Accumulation Unit Value at end of period $12.068 $11.768 $10.414 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.486 $10.971 $9.313 Accumulation Unit Value at end of period $12.220 $12.486 $10.971 Number of Accumulation Units outstanding at end of period (in thousands) 112 68 12 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.303 $10.898 $9.301 Accumulation Unit Value at end of period $11.945 $12.303 $10.898 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.343 $11.128 $9.497 Accumulation Unit Value at end of period $11.938 $11.343 $11.128 Number of Accumulation Units outstanding at end of period (in thousands) 14 2 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.178 $11.054 $9.484 Accumulation Unit Value at end of period $11.670 $11.178 $11.054 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1
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 $18.253 $17.302 $16.932 Accumulation Unit Value at end of period $18.865 $18.253 $17.302 Number of Accumulation Units outstanding at end of period (in thousands) 381 103 15 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.711 $16.922 $16.649 Accumulation Unit Value at end of period $18.159 $17.711 $16.922 Number of Accumulation Units outstanding at end of period (in thousands) 9 -- -- PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $37.652 $33.614 $31.404 Accumulation Unit Value at end of period $38.469 $37.652 $33.614 Number of Accumulation Units outstanding at end of period (in thousands) 48 29 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $36.533 $32.876 $30.879 Accumulation Unit Value at end of period $37.028 $36.533 $32.876 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $59.719 $51.909 $48.011 Accumulation Unit Value at end of period $55.693 $59.719 $51.909 Number of Accumulation Units outstanding at end of period (in thousands) 25 15 6 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $57.943 $50.770 $47.208 Accumulation Unit Value at end of period $53.606 $57.943 $50.770 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.793 $19.558 $17.057 Accumulation Unit Value at end of period $26.667 $24.793 $19.558 Number of Accumulation Units outstanding at end of period (in thousands) 153 63 19 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $24.056 $19.129 $16.772 Accumulation Unit Value at end of period $25.668 $24.056 $19.129 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.876 -- -- (a) Accumulation Unit Value at end of period $9.771 -- -- 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 $9.865 -- -- (a) Accumulation Unit Value at end of period $9.750 -- -- 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 $11.234 $9.934 $8.759 Accumulation Unit Value at end of period $10.574 $11.234 $9.934 Number of Accumulation Units outstanding at end of period (in thousands) 107 67 17 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.900 $9.716 $8.613 Accumulation Unit Value at end of period $10.178 $10.900 $9.716 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 --
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 $22.290 $19.358 $17.752 Accumulation Unit Value at end of period $21.042 $22.290 $19.358 Number of Accumulation Units outstanding at end of period (in thousands) 430 149 49 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.627 $18.933 $17.455 Accumulation Unit Value at end of period $20.254 $21.627 $18.933 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $27.062 $23.245 $20.274 Accumulation Unit Value at end of period $23.443 $27.062 $23.245 Number of Accumulation Units outstanding at end of period (in thousands) 108 82 33 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.257 $22.735 $19.936 Accumulation Unit Value at end of period $22.565 $26.257 $22.735 Number of Accumulation Units outstanding at end of period (in thousands) 5 5 4 PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.805 $12.428 $11.853 Accumulation Unit Value at end of period $13.833 $13.805 $12.428 Number of Accumulation Units outstanding at end of period (in thousands) 208 171 69 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.395 $12.155 $11.655 Accumulation Unit Value at end of period $13.314 $13.395 $12.155 Number of Accumulation Units outstanding at end of period (in thousands) 5 7 5 PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.506 $15.770 $13.439 Accumulation Unit Value at end of period $17.007 $16.506 $15.770 Number of Accumulation Units outstanding at end of period (in thousands) 17 15 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.015 $15.424 $13.214 Accumulation Unit Value at end of period $16.370 $16.015 $15.424 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 2 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $55.681 $53.208 $46.938 Accumulation Unit Value at end of period $58.316 $55.681 $53.208 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $54.026 $52.041 $46.153 Accumulation Unit Value at end of period $56.131 $54.026 $52.041 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.526 $12.138 $9.045 Accumulation Unit Value at end of period $23.038 $16.526 $12.138 Number of Accumulation Units outstanding at end of period (in thousands) 106 43 18 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.285 $12.057 $9.033 Accumulation Unit Value at end of period $22.522 $16.285 $12.057 Number of Accumulation Units outstanding at end of period (in thousands) 14 12 --
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 $12.799 $11.816 $9.508 Accumulation Unit Value at end of period $15.576 $12.799 $11.816 Number of Accumulation Units outstanding at end of period (in thousands) 255 184 76 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.612 $11.737 $9.495 Accumulation Unit Value at end of period $15.227 $12.612 $11.737 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.156 $10.989 $9.644 Accumulation Unit Value at end of period $14.069 $13.156 $10.989 Number of Accumulation Units outstanding at end of period (in thousands) 237 99 27 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.964 $10.916 $9.631 Accumulation Unit Value at end of period $13.753 $12.964 $10.916 Number of Accumulation Units outstanding at end of period (in thousands) 6 5 1 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.954 $14.720 $13.894 Accumulation Unit Value at end of period $16.435 $16.954 $14.720 Number of Accumulation Units outstanding at end of period (in thousands) 1,156 742 298 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.706 $14.621 $13.875 Accumulation Unit Value at end of period $16.066 $16.706 $14.621 Number of Accumulation Units outstanding at end of period (in thousands) 18 18 11 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.884 $14.668 $13.336 Accumulation Unit Value at end of period $17.181 $16.884 $14.668 Number of Accumulation Units outstanding at end of period (in thousands) 1,536 710 225 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.638 $14.570 $13.318 Accumulation Unit Value at end of period $16.795 $16.638 $14.570 Number of Accumulation Units outstanding at end of period (in thousands) 18 15 9
(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"). 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% EDGE $1,000 $1,000 Premium $0 $50k $100k $250k $500k FESC(3) 5.5% 4.5% 3.5% 2.5% 2.0% 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% EDGE $1MM+ 1% 0.55% No 7% OUTLOOK 1.40% No 5.75% PLUS 6 7 8 9+ 6% 5% 4% 0% 1.40% Yes(4) 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 Contingent Deferred Sales Charge (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 -------------------------------------------------------------------------------- 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. 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. (3) Front-end Sales Charges (FESC) do not reflect Rights of Accumulation. Under the Rights of Accumulation program, we will use the aggregate amount of Eligible Investments to calculate the applicable sales charge. For Contracts bought after November 1, 2005, Eligible Investments are (a) any other individual variable annuity from us or our affiliates subject to a front-end sales charge and (b) Class A shares of any retail mutual fund of an Underlying Fund family held by you as owner or joint owner. Your Financial Intermediary must be the broker of record for Eligible Investments. For earlier contracts, Eligible Investments are any individual annuity contract or variable life insurance policy from us or our affiliates and shares of any mutual fund or 529 plan that we have approved owned by you, your spouse or any immediate family member. Eligible Investments must be identified in your application (or comparable request for annuity) and each time you make subsequent Premium Payments. Premium Payments received through any other means of transmission will be subject to a sales charge based on the lower of your most recent sales charge level on record under this program or the otherwise applicable sales charge. APP A-3 -------------------------------------------------------------------------------- We also accept Letters of Intent as a basis to reduce sales charges. A Letter of Intent is a commitment to invest a certain amount of Premium Payments within 13 months from the date you purchase your Contract in exchange for which we deduct a sales charge based on the total amount you plan on investing over this time period. If you don't make the Premium Payments promised, we will recalculate the sales charge based on your actual Premium Payments and proportionately deduct this charge from your Sub-Accounts. We may accept a Letter of Intent for another 13 month period. This feature is not available in NY, NJ, SC, TX and WA. (4) 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. APP A-4 -------------------------------------------------------------------------------- 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 Edge $1,125 $2,259 $3,373 $6,069 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 Edge $1,020 $2,154 $3,268 $5,964 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 Edge $1,125 $2,259 $3,373 $6,069 Outlook $689 $2,035 $3,337 $6,406 Plus $689 $2,035 $3,337 $6,406
APP A-5 -------------------------------------------------------------------------------- III. INVESTMENT OPTIONS(5) (STANDARD)
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. AllianceBernstein VPS Maximize total return AllianceBernstein L.P. X X X X X Balanced Wealth Strategy consistent with Advisor's Portfolio -- Class B determination of reasonable risk AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X X Global Research Growth Portfolio -- Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X X International Growth Portfolio -- Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X X International Value Portfolio -- Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X X Small/Mid Cap Value Portfolio -- Class B AllianceBernstein VPS Long-term growth of capital AllianceBernstein L.P. X X X X X Value Portfolio -- Class B FIDELITY VARIABLE INSURANCE PRODUCTS FUNDS Fidelity VIP Contrafund(R) Long-term capital Fidelity Management & X X X X X Portfolio -- Service appreciation Research Company Class 2 Fidelity VIP Dynamic Seeks capital appreciation FMR X X X X X Capital Appreciation Sub-advised by FMR Co., Inc. Portfolio -- Service and Fidelity Research and Class 2 Analysis Company Fidelity VIP Equity-Income Reasonable income. Fund will Fidelity Management & X X X X X Portfolio -- Service also consider potential for Research Company Class 2 capital appreciation. Fidelity VIP Growth Capital appreciation Fidelity Management & X X X X X Portfolio -- Service Research Company Class 2 Fidelity VIP Mid Cap Long-term growth of capital Fidelity Management & X X X X X Portfolio -- Service Research Company Class 2 Fidelity VIP Value Seeks capital appreciation Fidelity Management & X X X X X Strategies Portfolio -- Research Company Service Class 2 HARTFORD HLS SERIES FUND II, INC. Hartford Growth Capital appreciation HL Investment Advisors, LLC X X X X X Opportunities HLS Fund -- Sub-advised by Wellington Class IA Management Company, LLP
APP A-6 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford LargeCap Growth Long-term growth of capital HL Investment Advisors, LLC X X X X X HLS Fund -- Class IA Sub-advised by Hartford Investment Management Company Hartford MidCap Growth HLS Long-term growth of capital HL Investment Advisors, LLC X X X X X Fund -- Class IA Sub-advised by Hartford Investment Management Company Hartford SmallCap Growth Maximize capital HL Investment Advisors, LLC X 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 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 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 X Opportunities HLS Fund -- Sub-advised by Wellington Class IA Management Company, LLP HARTFORD SERIES FUND, INC. Hartford Advisers HLS Fund Maximum long-term total HL Investment Advisors, LLC X X X X X -- Class IA return Sub-advised by Wellington Management Company, LLP Hartford Disciplined Growth of capital HL Investment Advisors, LLC X 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 X Growth HLS Fund -- Class consistent with growth of Sub-advised by Wellington IA capital Management Company, LLP Hartford Equity Income HLS High level of current income HL Investment Advisors, LLC X X X X X Fund -- Class IA consistent with growth of Sub-advised by Wellington capital Management Company, LLP
APP A-7 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford Fundamental Long-term capital HL Investment Advisors, LLC X X X X X Growth HLS Fund -- Class appreciation Sub-advised by Wellington IA (1) Management Company, LLP Hartford Global Advisers Maximum long-term total rate HL Investment Advisors, LLC X X X X X HLS Fund -- Class IA of return Sub-advised by Wellington Management Company, LLP Hartford Global Equity HLS Seeks long term capital HL Investment Advisors, LLC X X X X X Fund -- Class IA appreciation Sub-advised by Wellington Management Company, LLP Hartford Global Growth HLS Growth of capital HL Investment Advisors, LLC X X X X X 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 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 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 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 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 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 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 X Fund -- Class IA* consistent with liquidity Sub-advised by Hartford and preservation of capital Investment Management Company
APP A-8 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Hartford Mortgage Maximum current income HL Investment Advisors, LLC X 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 HLS Growth of capital HL Investment Advisors, LLC X X X X X Fund -- Class IA Sub-advised by Wellington Management Company, LLP and Hartford Investment Management Company Hartford Stock HLS Fund -- Long-term growth of capital HL Investment Advisors, LLC X X X X X Class IA Sub-advised by Wellington Management Company, LLP Hartford Total Return Bond Competitive total return, HL Investment Advisors, LLC X X X X X HLS Fund -- Class IA with income as a secondary Sub-advised by Hartford objective Investment Management Company Hartford Value HLS Fund -- Long-term total return HL Investment Advisors, LLC X 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 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 X Value Portfolio -- Class appreciation VC Lord Abbett Bond-Debenture High current income and Lord, Abbett & Co. LLC X X X X X Portfolio -- Class VC capital appreciation to produce a high total return Lord Abbett Growth and Long-term growth of capital Lord, Abbett & Co. LLC X X X X X Income Portfolio -- Class and income without excessive VC fluctuations in market value Lord Abbett Large-Cap Core Growth of capital and growth Lord, Abbett & Co. LLC X X X X X Portfolio -- Class VC of income consistent with reasonable risk
APP A-9 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- OPPENHEIMER VARIABLE ACCOUNT FUNDS Oppenheimer Capital Seeks to achieve capital OppenheimerFunds, Inc. X 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 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. Oppenheimer Main Street Seeks a high total return OppenheimerFunds, Inc. X 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 X Small Cap Fund(R)/VA -- appreciation from small Service Shares company stocks. Oppenheimer MidCap Fund/VA Seeks to achieve capital OppenheimerFunds, Inc. X X X X X -- Service Shares appreciation by investing in "growth-type" companies. PUTNAM VARIABLE TRUST Putnam VT Diversified As high a level of current Putnam Investment X X X X X Income Fund -- Class IB income as Putnam Management Management, LLC Sub- advised believes is consistent with by Putnam Investments preservation of capital Limited Putnam VT Global Asset High level of long-term Putnam Investment X 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 X Income Fund -- Class IB+ income Management, LLC Putnam VT International Capital appreciation Putnam Investment X X X X X Equity Fund -- Class IB Management, LLC Sub-advised by Putnam Investments Limited Putnam VT International Capital growth. Current Putnam Management Sub- X X X X X Growth and Income Fund -- income is a secondary advised by Putnam Class IB objective Investments Limited
APP A-10 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- Putnam VT Investors Fund Long-term growth of capital Putnam Investment X 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 X -- Class IB appreciation Management, LLC Putnam VT Small Cap Value Capital appreciation Putnam Investment X X X X X Fund -- Class IB Management, LLC Putnam VT The George A balanced investment Putnam Investment X 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 X Class IB Management, LLC Putnam VT Voyager Fund -- Capital appreciation Putnam Investment X X X X X Class IB+ Management, LLC THE UNIVERSAL INSTITUTIONAL FUNDS, INC. Van Kampen -- UIF Emerging Long-term capital Morgan Stanley Investment X X X X X Markets Equity Portfolio appreciation by investing Management Inc. -- 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 X Growth Portfolio --Class investing primarily in Management Inc. II common stocks and other equity securities. Van Kampen -- UIF U.S. Mid Above-average total return Morgan Stanley Investment X X X X X 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.
APP A-11 --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE INVESTMENT ADVISER/SUB- FUNDING OPTION SUMMARY ADVISER CORE ACCESS EDGE PLUS OUTLOOK --------------------------------------------------------------------------------------------------------------------------------- VAN KAMPEN LIFE INVESTMENT TRUST Van Kampen LIT Comstock Capital growth and income Van Kampen Asset Management X 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 X Income Portfolio --Class growth of capital and income II primarily through investments in common stocks. Fixed Accumulation Preservation of capital General Account X 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, be-fore 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 advance in connection with this feature. The Fixed Accumulation Feature is currently not available to Plus and Outlook products. APP A-12 -------------------------------------------------------------------------------- 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 Edge variable annuity to me at the following address: ---------------------------------------------------------------- Name ---------------------------------------------------------------- Address ---------------------------------------------------------------- City/State Zip Code PART B STATEMENT OF ADDITIONAL INFORMATION HARTFORD LIFE INSURANCE COMPANY SEPARATE ACCOUNT THREE THE DIRECTOR M EDGE 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 Insurance Company, Attn: U.S. Wealth Management, 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 consolidated balance sheets of Hartford Life Insurance Company (the "Company") as of December 31, 2007 and 2006, and the related consolidated statements of income, changes in stockholder's equity 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 February 20, 2008 and the statements of assets and liabilities of Hartford Life 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: $76,038,094; 2006: $76,991,638; and 2005: $38,481,029. 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 non-standardized total return includes the impact of a minimum 1% sales charge, if applicable, and the Annual Maintenance Fee is 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 The following information should be read in conjunction with the financial statements for the Separate Account included in this 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 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 of period $12.097 $10.714 $9.751 Accumulation Unit Value at end of period $12.639 $12.097 $10.714 Number of Accumulation Units outstanding at end of period (in thousands) 8 3 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.053 $10.696 $9.748 Accumulation Unit Value at end of period $12.567 $12.053 $10.696 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.031 $10.688 $9.746 Accumulation Unit Value at end of period $12.531 $12.031 $10.688 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 $11.987 $10.670 $9.743 Accumulation Unit Value at end of period $12.461 $11.987 $10.670 Number of Accumulation Units outstanding at end of period (in thousands) 7 8 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.987 $10.670 $9.743 Accumulation Unit Value at end of period $12.461 $11.987 $10.670 Number of Accumulation Units outstanding at end of period (in thousands) 7 8 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.921 $10.643 $9.738 Accumulation Unit Value at end of period $12.355 $11.921 $10.643 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.699 $12.030 $10.000 Accumulation Unit Value at end of period $15.252 $13.699 $12.030 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 $13.654 $12.014 $10.000 Accumulation Unit Value at end of period $15.171 $13.654 $12.014 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.631 $12.006 $10.000 Accumulation Unit Value at end of period $15.130 $13.631 $12.006 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 $13.585 $11.990 $10.000 Accumulation Unit Value at end of period $15.050 $13.585 $11.990 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 $13.585 $11.990 $10.000 Accumulation Unit Value at end of period $15.050 $13.585 $11.990 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 $13.518 $11.966 $10.000 Accumulation Unit Value at end of period $14.930 $13.518 $11.966 Number of Accumulation Units 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 of period $10.378 -- -- (a) Accumulation Unit Value at end of period $10.542 -- -- 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 $10.375 -- -- (a) Accumulation Unit Value at end of period $10.536 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.373 -- -- (a) Accumulation Unit Value at end of period $10.533 -- -- 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 $10.370 -- -- (a) Accumulation Unit Value at end of period $10.527 -- -- 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 $10.370 -- -- (a) Accumulation Unit Value at end of period $10.527 -- -- 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 $10.366 -- -- (a) Accumulation Unit Value at end of period $10.518 -- -- 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 $14.909 $11.117 $9.329 Accumulation Unit Value at end of period $15.624 $14.909 $11.117 Number of Accumulation Units outstanding at end of period (in thousands) 10 5 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.854 $11.099 $9.326 Accumulation Unit Value at end of period $15.535 $14.854 $11.099 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.827 $11.089 $9.324 Accumulation Unit Value at end of period $15.491 $14.827 $11.089 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 $14.773 $11.071 $9.321 Accumulation Unit Value at end of period $15.404 $14.773 $11.071 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.773 $11.071 $9.321 Accumulation Unit Value at end of period $15.404 $14.773 $11.071 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.692 $11.043 $9.316 Accumulation Unit Value at end of period $15.273 $14.692 $11.043 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.039 $10.621 $9.427 Accumulation Unit Value at end of period $12.132 $12.039 $10.621 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 --
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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 $11.995 $10.604 $9.423 Accumulation Unit Value at end of period $12.063 $11.995 $10.604 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.973 $10.595 $9.422 Accumulation Unit Value at end of period $12.029 $11.973 $10.595 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 $11.929 $10.577 $9.418 Accumulation Unit Value at end of period $11.961 $11.929 $10.577 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.929 $10.577 $9.418 Accumulation Unit Value at end of period $11.961 $11.929 $10.577 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.863 $10.550 $9.414 Accumulation Unit Value at end of period $11.859 $11.863 $10.550 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.452 $10.366 $9.640 Accumulation Unit Value at end of period $11.845 $12.452 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.407 $10.349 $9.637 Accumulation Unit Value at end of period $11.778 $12.407 $10.349 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.384 $10.340 $9.635 Accumulation Unit Value at end of period $11.744 $12.384 $10.340 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 $12.339 $10.323 $9.632 Accumulation Unit Value at end of period $11.678 $12.339 $10.323 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.339 $10.323 $9.632 Accumulation Unit Value at end of period $11.678 $12.339 $10.323 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 (50 BPS) Accumulation Unit Value at beginning of period $12.271 $10.297 $9.627 Accumulation Unit Value at end of period $11.579 $12.271 $10.297 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.609 $11.401 $9.576 Accumulation Unit Value at end of period $14.681 $12.609 $11.401 Number of Accumulation Units outstanding at end of period (in thousands) 54 29 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 $12.563 $11.382 $9.573 Accumulation Unit Value at end of period $14.598 $12.563 $11.382 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 $12.540 $11.372 $9.571 Accumulation Unit Value at end of period $14.556 $12.540 $11.372 Number of Accumulation Units outstanding at end of period (in thousands) 5 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.494 $11.353 $9.568 Accumulation Unit Value at end of period $14.474 $12.494 $11.353 Number of Accumulation Units outstanding at end of period (in thousands) 16 17 8 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.494 $11.353 $9.568 Accumulation Unit Value at end of period $14.474 $12.494 $11.353 Number of Accumulation Units outstanding at end of period (in thousands) 16 17 8 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.425 $11.325 $9.563 Accumulation Unit Value at end of period $14.351 $12.425 $11.325 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.654 -- -- (a) Accumulation Unit Value at end of period $9.571 -- -- 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 $9.651 -- -- (a) Accumulation Unit Value at end of period $9.566 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.649 -- -- (a) Accumulation Unit Value at end of period $9.563 -- -- 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 $9.647 -- -- (a) Accumulation Unit Value at end of period $9.558 -- -- 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 $9.647 -- -- (a) Accumulation Unit Value at end of period $9.558 -- -- 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 $9.642 -- -- (a) Accumulation Unit Value at end of period $9.550 -- -- 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 $12.442 $10.452 $9.557 Accumulation Unit Value at end of period $12.506 $12.442 $10.452 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.396 $10.435 $9.554 Accumulation Unit Value at end of period $12.435 $12.396 $10.435 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 Accumulation Unit Value at beginning of period $12.373 $10.426 $9.552 Accumulation Unit Value at end of period $12.400 $12.373 $10.426 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 $12.328 $10.409 $9.549 Accumulation Unit Value at end of period $12.330 $12.328 $10.409 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.328 $10.409 $9.549 Accumulation Unit Value at end of period $12.330 $12.328 $10.409 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.260 $10.382 $9.544 Accumulation Unit Value at end of period $12.225 $12.260 $10.382 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.321 $10.703 $9.567 Accumulation Unit Value at end of period $14.232 $11.321 $10.703 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 $11.279 $10.685 $9.564 Accumulation Unit Value at end of period $14.151 $11.279 $10.685 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.258 $10.676 $9.562 Accumulation Unit Value at end of period $14.111 $11.258 $10.676 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 $11.217 $10.658 $9.559 Accumulation Unit Value at end of period $14.031 $11.217 $10.658 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 $11.217 $10.658 $9.559 Accumulation Unit Value at end of period $14.031 $11.217 $10.658 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 $11.155 $10.631 $9.554 Accumulation Unit Value at end of period $13.912 $11.155 $10.631 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.557 $11.255 $9.331 Accumulation Unit Value at end of period $14.375 $12.557 $11.255 Number of Accumulation Units outstanding at end of period (in thousands) 10 10 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.511 $11.237 $9.328 Accumulation Unit Value at end of period $14.293 $12.511 $11.237 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.488 $11.227 $9.326 Accumulation Unit Value at end of period $14.253 $12.488 $11.227 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 PREFERRED Accumulation Unit Value at beginning of period $12.442 $11.208 $9.323 Accumulation Unit Value at end of period $14.172 $12.442 $11.208 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.442 $11.208 $9.323 Accumulation Unit Value at end of period $14.172 $12.442 $11.208 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.374 $11.180 $9.318 Accumulation Unit Value at end of period $14.052 $12.374 $11.180 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.061 $10.475 $8.966 Accumulation Unit Value at end of period $12.623 $12.061 $10.475 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 $12.017 $10.458 $8.963 Accumulation Unit Value at end of period $12.551 $12.017 $10.458 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.995 $10.449 $8.961 Accumulation Unit Value at end of period $12.516 $11.995 $10.449 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 $11.951 $10.432 $8.958 Accumulation Unit Value at end of period $12.445 $11.951 $10.432 Number of Accumulation Units outstanding at end of period (in thousands) 2 3 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.951 $10.432 $8.958 Accumulation Unit Value at end of period $12.445 $11.951 $10.432 Number of Accumulation Units outstanding at end of period (in thousands) 2 3 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.885 $10.405 $8.953 Accumulation Unit Value at end of period $12.339 $11.885 $10.405 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.212 $1.103 $1.016 Accumulation Unit Value at end of period $1.282 $1.212 $1.103 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 $1.207 $1.101 $1.016 Accumulation Unit Value at end of period $1.275 $1.207 $1.101 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.205 $1.100 $1.016 Accumulation Unit Value at end of period $1.272 $1.205 $1.100 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 $5.240 $4.793 $4.431 Accumulation Unit Value at end of period $5.518 $5.240 $4.793 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 THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.240 $4.793 $4.431 Accumulation Unit Value at end of period $5.518 $5.240 $4.793 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 $1.277 $1.172 $1.085 Accumulation Unit Value at end of period $1.341 $1.277 $1.172 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.191 $1.067 $0.975 Accumulation Unit Value at end of period $1.280 $1.191 $1.067 Number of Accumulation Units outstanding at end of period (in thousands) 91 61 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.186 $1.065 $0.975 Accumulation Unit Value at end of period $1.273 $1.186 $1.065 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.184 $1.064 $0.975 Accumulation Unit Value at end of period $1.269 $1.184 $1.064 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 $1.426 $1.284 $1.178 Accumulation Unit Value at end of period $1.526 $1.426 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 26 26 24 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.426 $1.284 $1.178 Accumulation Unit Value at end of period $1.526 $1.426 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 26 26 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.381 $1.247 $1.146 Accumulation Unit Value at end of period $1.473 $1.381 $1.247 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.659 $1.389 $1.285 Accumulation Unit Value at end of period $1.783 $1.659 $1.389 Number of Accumulation Units outstanding at end of period (in thousands) 375 198 21 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.653 $1.386 $1.285 Accumulation Unit Value at end of period $1.772 $1.653 $1.386 Number of Accumulation Units outstanding at end of period (in thousands) 41 36 9 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.650 $1.385 $1.285 Accumulation Unit Value at end of period $1.767 $1.650 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 49 29 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.909 $3.289 $3.054 Accumulation Unit Value at end of period $4.179 $3.909 $3.289 Number of Accumulation Units outstanding at end of period (in thousands) 55 61 22 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $3.909 $3.289 $3.054 Accumulation Unit Value at end of period $4.179 $3.909 $3.289 Number of Accumulation Units outstanding at end of period (in thousands) 55 61 22
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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 $1.570 $1.325 $1.233 Accumulation Unit Value at end of period $1.674 $1.570 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 24 24 24 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.453 $1.212 $1.158 Accumulation Unit Value at end of period $1.542 $1.453 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 50 48 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.447 $1.210 $1.158 Accumulation Unit Value at end of period $1.533 $1.447 $1.210 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.445 $1.209 $1.158 Accumulation Unit Value at end of period $1.529 $1.445 $1.209 Number of Accumulation Units outstanding at end of period (in thousands) 36 21 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.434 $1.202 $1.153 Accumulation Unit Value at end of period $1.514 $1.434 $1.202 Number of Accumulation Units outstanding at end of period (in thousands) 60 53 25 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.434 $1.202 $1.153 Accumulation Unit Value at end of period $1.514 $1.434 $1.202 Number of Accumulation Units outstanding at end of period (in thousands) 60 53 25 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.416 $1.191 $1.145 Accumulation Unit Value at end of period $1.492 $1.416 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 20 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.190 $1.093 $0.962 Accumulation Unit Value at end of period $1.360 $1.190 $1.093 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 $1.185 $1.091 $0.962 Accumulation Unit Value at end of period $1.352 $1.185 $1.091 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.183 $1.090 $0.962 Accumulation Unit Value at end of period $1.348 $1.183 $1.090 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 $1.165 $1.076 $0.950 Accumulation Unit Value at end of period $1.325 $1.165 $1.076 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 $1.165 $1.076 $0.950 Accumulation Unit Value at end of period $1.325 $1.165 $1.076 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 $1.137 $1.052 $0.932 Accumulation Unit Value at end of period $1.289 $1.137 $1.052 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 GLOBAL ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.302 $1.206 $1.114 Accumulation Unit Value at end of period $1.507 $1.302 $1.206 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 $1.297 $1.203 $1.113 Accumulation Unit Value at end of period $1.498 $1.297 $1.203 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.295 $1.202 $1.113 Accumulation Unit Value at end of period $1.494 $1.295 $1.202 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 $2.034 $1.892 $1.754 Accumulation Unit Value at end of period $2.341 $2.034 $1.892 Number of Accumulation Units outstanding at end of period (in thousands) 12 18 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.034 $1.892 $1.754 Accumulation Unit Value at end of period $2.341 $2.034 $1.892 Number of Accumulation Units outstanding at end of period (in thousands) 12 18 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.971 $1.839 $1.708 Accumulation Unit Value at end of period $2.262 $1.971 $1.839 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 $1.434 $1.266 $1.116 Accumulation Unit Value at end of period $1.780 $1.434 $1.266 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.429 $1.264 $1.116 Accumulation Unit Value at end of period $1.770 $1.429 $1.264 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.426 $1.263 $1.115 Accumulation Unit Value at end of period $1.765 $1.426 $1.263 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 $2.112 $1.874 $1.657 Accumulation Unit Value at end of period $2.609 $2.112 $1.874 Number of Accumulation Units outstanding at end of period (in thousands) 18 14 14 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.112 $1.874 $1.657 Accumulation Unit Value at end of period $2.609 $2.112 $1.874 Number of Accumulation Units outstanding at end of period (in thousands) 18 14 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.047 $1.821 $1.614 Accumulation Unit Value at end of period $2.520 $2.047 $1.821 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.360 $1.310 $1.158 Accumulation Unit Value at end of period $1.576 $1.360 $1.310 Number of Accumulation Units outstanding at end of period (in thousands) 75 73 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 $1.355 $1.307 $1.157 Accumulation Unit Value at end of period $1.567 $1.355 $1.307 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.352 $1.306 $1.157 Accumulation Unit Value at end of period $1.563 $1.352 $1.306 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 $1.336 $1.293 $1.147 Accumulation Unit Value at end of period $1.541 $1.336 $1.293 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 $1.336 $1.293 $1.147 Accumulation Unit Value at end of period $1.541 $1.336 $1.293 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 $1.309 $1.271 $1.130 Accumulation Unit Value at end of period $1.505 $1.309 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 6 6 6 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.633 $1.469 $1.171 Accumulation Unit Value at end of period $2.102 $1.633 $1.469 Number of Accumulation Units outstanding at end of period (in thousands) 53 27 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.627 $1.466 $1.171 Accumulation Unit Value at end of period $2.090 $1.627 $1.466 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.624 $1.465 $1.171 Accumulation Unit Value at end of period $2.084 $1.624 $1.465 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.605 $1.450 $1.160 Accumulation Unit Value at end of period $2.055 $1.605 $1.450 Number of Accumulation Units outstanding at end of period (in thousands) 36 39 11 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.605 $1.450 $1.160 Accumulation Unit Value at end of period $2.055 $1.605 $1.450 Number of Accumulation Units outstanding at end of period (in thousands) 36 39 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.573 $1.426 $1.143 Accumulation Unit Value at end of period $2.008 $1.573 $1.426 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.259 $1.203 Accumulation Unit Value at end of period $1.418 $1.390 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 26 29 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.384 $1.257 $1.202 Accumulation Unit Value at end of period $1.410 $1.384 $1.257 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 Accumulation Unit Value at beginning of period $1.382 $1.256 $1.202 Accumulation Unit Value at end of period $1.406 $1.382 $1.256 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 $1.423 $1.296 $1.242 Accumulation Unit Value at end of period $1.444 $1.423 $1.296 Number of Accumulation Units outstanding at end of period (in thousands) -- 30 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.423 $1.296 $1.242 Accumulation Unit Value at end of period $1.444 $1.423 $1.296 Number of Accumulation Units outstanding at end of period (in thousands) -- 30 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.378 $1.259 $1.209 Accumulation Unit Value at end of period $1.395 $1.378 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.129 $0.985 $0.912 Accumulation Unit Value at end of period $1.179 $1.129 $0.985 Number of Accumulation Units outstanding at end of period (in thousands) 55 33 17 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.125 $0.983 $0.912 Accumulation Unit Value at end of period $1.172 $1.125 $0.983 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.122 $0.982 $0.912 Accumulation Unit Value at end of period $1.169 $1.122 $0.982 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 $5.396 $4.733 $4.397 Accumulation Unit Value at end of period $5.606 $5.396 $4.733 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 $5.396 $4.733 $4.397 Accumulation Unit Value at end of period $5.606 $5.396 $4.733 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 $5.228 $4.599 $4.282 Accumulation Unit Value at end of period $5.415 $5.228 $4.599 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.683 $1.367 $1.184 Accumulation Unit Value at end of period $2.070 $1.683 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) 104 62 18 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.677 $1.364 $1.184 Accumulation Unit Value at end of period $2.058 $1.677 $1.364 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.674 $1.363 $1.184 Accumulation Unit Value at end of period $2.052 $1.674 $1.363 Number of Accumulation Units outstanding at end of period (in thousands) 35 23 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 $1.649 $1.345 $1.170 Accumulation Unit Value at end of period $2.018 $1.649 $1.345 Number of Accumulation Units outstanding at end of period (in thousands) 88 102 33 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.649 $1.345 $1.170 Accumulation Unit Value at end of period $2.018 $1.649 $1.345 Number of Accumulation Units outstanding at end of period (in thousands) 88 102 33 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.608 $1.316 $1.147 Accumulation Unit Value at end of period $1.962 $1.608 $1.316 Number of Accumulation Units outstanding at end of period (in thousands) 13 -- -- HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.397 $1.131 $0.964 Accumulation Unit Value at end of period $1.767 $1.397 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 66 8 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.392 $1.129 $0.964 Accumulation Unit Value at end of period $1.757 $1.392 $1.129 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.389 $1.128 $0.964 Accumulation Unit Value at end of period $1.752 $1.389 $1.128 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 $2.575 $2.095 $1.792 Accumulation Unit Value at end of period $3.240 $2.575 $2.095 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.575 $2.095 $1.792 Accumulation Unit Value at end of period $3.240 $2.575 $2.095 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.485 $1.212 $1.039 Accumulation Unit Value at end of period $1.863 $1.485 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.340 $1.823 $1.538 Accumulation Unit Value at end of period $2.532 $2.340 $1.823 Number of Accumulation Units outstanding at end of period (in thousands) 11 4 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.332 $1.820 $1.537 Accumulation Unit Value at end of period $2.517 $2.332 $1.820 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $2.327 $1.818 $1.537 Accumulation Unit Value at end of period $2.510 $2.327 $1.818 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.292 $1.795 $1.519 Accumulation Unit Value at end of period $2.468 $2.292 $1.795 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 THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.292 $1.795 $1.519 Accumulation Unit Value at end of period $2.468 $2.292 $1.795 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 $2.236 $1.756 $1.489 Accumulation Unit Value at end of period $2.399 $2.236 $1.756 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.538 -- -- (a) Accumulation Unit Value at end of period $9.828 -- -- 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 $9.535 -- -- (a) Accumulation Unit Value at end of period $9.822 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.533 -- -- (a) Accumulation Unit Value at end of period $9.820 -- -- 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 $9.531 -- -- (a) Accumulation Unit Value at end of period $9.814 -- -- 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 $9.531 -- -- (a) Accumulation Unit Value at end of period $9.814 -- -- 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 $9.526 -- -- (a) Accumulation Unit Value at end of period $9.806 -- -- 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 $9.522 -- -- (a) Accumulation Unit Value at end of period $9.809 -- -- 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 $9.519 -- -- (a) Accumulation Unit Value at end of period $9.803 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.518 -- -- (a) Accumulation Unit Value at end of period $9.800 -- -- 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 $9.515 -- -- (a) Accumulation Unit Value at end of period $9.795 -- -- 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 $9.515 -- -- (a) Accumulation Unit Value at end of period $9.795 -- -- 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 $9.511 -- -- (a) Accumulation Unit Value at end of period $9.787 -- -- 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 $1.161 $1.117 $1.099 Accumulation Unit Value at end of period $1.209 $1.161 $1.117 Number of Accumulation Units outstanding at end of period (in thousands) 87 81 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.157 $1.115 $1.099 Accumulation Unit Value at end of period $1.202 $1.157 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.154 $1.114 $1.099 Accumulation Unit Value at end of period $1.199 $1.154 $1.114 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 $1.994 $1.929 $1.905 Accumulation Unit Value at end of period $2.067 $1.994 $1.929 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 $1.994 $1.929 $1.905 Accumulation Unit Value at end of period $2.067 $1.994 $1.929 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 $1.155 $1.120 $1.108 Accumulation Unit Value at end of period $1.193 $1.155 $1.120 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.383 $1.332 $1.320 Accumulation Unit Value at end of period $1.420 $1.383 $1.332 Number of Accumulation Units outstanding at end of period (in thousands) 7 1 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.378 $1.329 $1.320 Accumulation Unit Value at end of period $1.412 $1.378 $1.329 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.376 $1.328 $1.320 Accumulation Unit Value at end of period $1.408 $1.376 $1.328 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 $2.972 $2.875 $2.860 Accumulation Unit Value at end of period $3.034 $2.972 $2.875 Number of Accumulation Units outstanding at end of period (in thousands) 8 8 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.972 $2.875 $2.860 Accumulation Unit Value at end of period $3.034 $2.972 $2.875 Number of Accumulation Units outstanding at end of period (in thousands) 8 8 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.879 $2.793 $2.785 Accumulation Unit Value at end of period $2.931 $2.879 $2.793 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 SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.452 $1.369 $1.162 Accumulation Unit Value at end of period $1.415 $1.452 $1.369 Number of Accumulation Units outstanding at end of period (in thousands) 68 40 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.447 $1.367 $1.162 Accumulation Unit Value at end of period $1.407 $1.447 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.444 $1.366 $1.162 Accumulation Unit Value at end of period $1.403 $1.444 $1.366 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 $1.427 $1.352 $1.152 Accumulation Unit Value at end of period $1.383 $1.427 $1.352 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.427 $1.352 $1.152 Accumulation Unit Value at end of period $1.383 $1.427 $1.352 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.404 $1.334 $1.139 Accumulation Unit Value at end of period $1.357 $1.404 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.336 -- -- (a) Accumulation Unit Value at end of period $9.130 -- -- 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 $9.333 -- -- (a) Accumulation Unit Value at end of period $9.125 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.332 -- -- (a) Accumulation Unit Value at end of period $9.123 -- -- 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 $9.329 -- -- (a) Accumulation Unit Value at end of period $9.118 -- -- 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 $9.329 -- -- (a) Accumulation Unit Value at end of period $9.118 -- -- 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 $9.325 -- -- (a) Accumulation Unit Value at end of period $9.110 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.612 $1.570 -- Accumulation Unit Value at end of period $1.827 $1.612 -- Number of Accumulation Units outstanding at end of period (in thousands) 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 $1.594 $1.555 -- Accumulation Unit Value at end of period $1.804 $1.594 -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.579 $1.541 -- Accumulation Unit Value at end of period $1.784 $1.579 -- 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 $2.575 $2.516 -- Accumulation Unit Value at end of period $2.905 $2.575 -- Number of Accumulation Units outstanding at end of period (in thousands) 11 11 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.575 $2.516 -- Accumulation Unit Value at end of period $2.905 $2.575 -- Number of Accumulation Units outstanding at end of period (in thousands) 11 11 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.770 $1.733 -- Accumulation Unit Value at end of period $1.991 $1.770 -- 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 $1.092 $0.960 $0.854 Accumulation Unit Value at end of period $1.148 $1.092 $0.960 Number of Accumulation Units outstanding at end of period (in thousands) 19 16 2 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.088 $0.958 $0.853 Accumulation Unit Value at end of period $1.142 $1.088 $0.958 Number of Accumulation Units outstanding at end of period (in thousands) 22 22 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.086 $0.957 $0.853 Accumulation Unit Value at end of period $1.138 $1.086 $0.957 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 $6.728 $5.942 $5.303 Accumulation Unit Value at end of period $7.036 $6.728 $5.942 Number of Accumulation Units outstanding at end of period (in thousands) 4 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.728 $5.942 $5.303 Accumulation Unit Value at end of period $7.036 $6.728 $5.942 Number of Accumulation Units outstanding at end of period (in thousands) 4 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.220 $1.081 $0.967 Accumulation Unit Value at end of period $1.272 $1.220 $1.081 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.535 $1.476 $1.462 Accumulation Unit Value at end of period $1.595 $1.535 $1.476 Number of Accumulation Units outstanding at end of period (in thousands) 423 209 17 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.530 $1.473 $1.462 Accumulation Unit Value at end of period $1.586 $1.530 $1.473 Number of Accumulation Units outstanding at end of period (in thousands) 10 9 --
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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 $1.527 $1.472 $1.461 Accumulation Unit Value at end of period $1.581 $1.527 $1.472 Number of Accumulation Units outstanding at end of period (in thousands) 71 28 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.249 $3.139 $3.120 Accumulation Unit Value at end of period $3.358 $3.249 $3.139 Number of Accumulation Units outstanding at end of period (in thousands) 89 83 25 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $3.249 $3.139 $3.120 Accumulation Unit Value at end of period $3.358 $3.249 $3.139 Number of Accumulation Units outstanding at end of period (in thousands) 89 83 25 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.459 $1.414 $1.408 Accumulation Unit Value at end of period $1.503 $1.459 $1.414 Number of Accumulation Units outstanding at end of period (in thousands) 15 15 15 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.107 $1.102 Accumulation Unit Value at end of period $1.184 $1.143 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 96 57 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.139 $1.106 $1.102 Accumulation Unit Value at end of period $1.178 $1.139 $1.106 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.137 $1.105 $1.102 Accumulation Unit Value at end of period $1.174 $1.137 $1.105 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 $1.123 $1.093 $1.092 Accumulation Unit Value at end of period $1.158 $1.123 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 95 84 22 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.123 $1.093 $1.092 Accumulation Unit Value at end of period $1.158 $1.123 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 95 84 22 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.101 $1.075 $1.076 Accumulation Unit Value at end of period $1.132 $1.101 $1.075 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 20 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.392 $1.151 $1.064 Accumulation Unit Value at end of period $1.505 $1.392 $1.151 Number of Accumulation Units outstanding at end of period (in thousands) 6 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.387 $1.149 $1.064 Accumulation Unit Value at end of period $1.497 $1.387 $1.149 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.384 $1.148 $1.064 Accumulation Unit Value at end of period $1.493 $1.384 $1.148 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 $1.363 $1.133 $1.051 Accumulation Unit Value at end of period $1.467 $1.363 $1.133 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 $1.363 $1.133 $1.051 Accumulation Unit Value at end of period $1.467 $1.363 $1.133 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 $1.330 $1.108 $1.030 Accumulation Unit Value at end of period $1.427 $1.330 $1.108 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.678 $1.421 $1.261 Accumulation Unit Value at end of period $1.561 $1.678 $1.421 Number of Accumulation Units outstanding at end of period (in thousands) 11 6 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.672 $1.418 $1.261 Accumulation Unit Value at end of period $1.552 $1.672 $1.418 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.669 $1.417 $1.261 Accumulation Unit Value at end of period $1.548 $1.669 $1.417 Number of Accumulation Units outstanding at end of period (in thousands) 7 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.649 $1.403 $1.250 Accumulation Unit Value at end of period $1.526 $1.649 $1.403 Number of Accumulation Units outstanding at end of period (in thousands) 11 11 11 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.649 $1.403 $1.250 Accumulation Unit Value at end of period $1.526 $1.649 $1.403 Number of Accumulation Units outstanding at end of period (in thousands) 11 11 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.616 $1.379 $1.231 Accumulation Unit Value at end of period $1.491 $1.616 $1.379 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.076 $10.613 $9.522 Accumulation Unit Value at end of period $12.791 $12.076 $10.613 Number of Accumulation Units outstanding at end of period (in thousands) 16 18 8 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.031 $10.595 $9.519 Accumulation Unit Value at end of period $12.719 $12.031 $10.595 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.009 $10.586 $9.517 Accumulation Unit Value at end of period $12.683 $12.009 $10.586 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.965 $10.568 $9.514 Accumulation Unit Value at end of period $12.611 $11.965 $10.568 Number of Accumulation Units outstanding at end of period (in thousands) 11 13 7
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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 $11.965 $10.568 $9.514 Accumulation Unit Value at end of period $12.611 $11.965 $10.568 Number of Accumulation Units outstanding at end of period (in thousands) 11 13 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.900 $10.542 $9.509 Accumulation Unit Value at end of period $12.504 $11.900 $10.542 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.692 $10.284 $9.656 Accumulation Unit Value at end of period $11.972 $11.692 $10.284 Number of Accumulation Units outstanding at end of period (in thousands) 14 14 9 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.649 $10.266 $9.652 Accumulation Unit Value at end of period $11.904 $11.649 $10.266 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.628 $10.258 $9.651 Accumulation Unit Value at end of period $11.870 $11.628 $10.258 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.585 $10.241 $9.647 Accumulation Unit Value at end of period $11.803 $11.585 $10.241 Number of Accumulation Units outstanding at end of period (in thousands) 13 15 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.585 $10.241 $9.647 Accumulation Unit Value at end of period $11.803 $11.585 $10.241 Number of Accumulation Units outstanding at end of period (in thousands) 13 15 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.522 $10.215 $9.642 Accumulation Unit Value at end of period $11.703 $11.522 $10.215 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.870 $10.017 $9.575 Accumulation Unit Value at end of period $11.456 $10.870 $10.017 Number of Accumulation Units outstanding at end of period (in thousands) 26 15 4 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.830 $10.001 $9.571 Accumulation Unit Value at end of period $11.391 $10.830 $10.001 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.810 $9.992 $9.570 Accumulation Unit Value at end of period $11.359 $10.810 $9.992 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.771 $9.975 $9.566 Accumulation Unit Value at end of period $11.295 $10.771 $9.975 Number of Accumulation Units outstanding at end of period (in thousands) 10 15 10 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.771 $9.975 $9.566 Accumulation Unit Value at end of period $11.295 $10.771 $9.975 Number of Accumulation Units outstanding at end of period (in thousands) 10 15 10
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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 $10.711 $9.950 $9.561 Accumulation Unit Value at end of period $11.199 $10.711 $9.950 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.955 $10.271 $9.597 Accumulation Unit Value at end of period $12.274 $11.955 $10.271 Number of Accumulation Units outstanding at end of period (in thousands) 50 23 5 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.912 $10.254 $9.594 Accumulation Unit Value at end of period $12.205 $11.912 $10.254 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 $11.890 $10.245 $9.592 Accumulation Unit Value at end of period $12.170 $11.890 $10.245 Number of Accumulation Units outstanding at end of period (in thousands) 3 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.846 $10.228 $9.589 Accumulation Unit Value at end of period $12.101 $11.846 $10.228 Number of Accumulation Units outstanding at end of period (in thousands) 26 21 14 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.846 $10.228 $9.589 Accumulation Unit Value at end of period $12.101 $11.846 $10.228 Number of Accumulation Units outstanding at end of period (in thousands) 26 21 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.781 $10.203 $9.584 Accumulation Unit Value at end of period $11.999 $11.781 $10.203 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.926 $10.641 $10.000 Accumulation Unit Value at end of period $13.100 $11.926 $10.641 Number of Accumulation Units outstanding at end of period (in thousands) 10 5 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.886 $10.627 $10.000 Accumulation Unit Value at end of period $13.031 $11.886 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.866 $10.620 $10.000 Accumulation Unit Value at end of period $12.996 $11.866 $10.620 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 $11.827 $10.606 $10.000 Accumulation Unit Value at end of period $12.927 $11.827 $10.606 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.827 $10.606 $10.000 Accumulation Unit Value at end of period $12.927 $11.827 $10.606 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.585 $10.000 Accumulation Unit Value at end of period $12.824 $11.768 $10.585 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.335 $10.605 $9.710 Accumulation Unit Value at end of period $12.809 $11.335 $10.605 Number of Accumulation Units outstanding at end of period (in thousands) 7 2 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.293 $10.587 $9.707 Accumulation Unit Value at end of period $12.737 $11.293 $10.587 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.272 $10.579 $9.705 Accumulation Unit Value at end of period $12.700 $11.272 $10.579 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 $11.231 $10.561 $9.702 Accumulation Unit Value at end of period $12.629 $11.231 $10.561 Number of Accumulation Units outstanding at end of period (in thousands) 3 1 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.231 $10.561 $9.702 Accumulation Unit Value at end of period $12.629 $11.231 $10.561 Number of Accumulation Units outstanding at end of period (in thousands) 3 1 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.169 $10.534 $9.697 Accumulation Unit Value at end of period $12.522 $11.169 $10.534 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.428 $11.527 $9.621 Accumulation Unit Value at end of period $14.138 $13.428 $11.527 Number of Accumulation Units outstanding at end of period (in thousands) 40 20 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.378 $11.508 $9.618 Accumulation Unit Value at end of period $14.058 $13.378 $11.508 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.354 $11.498 $9.616 Accumulation Unit Value at end of period $14.018 $13.354 $11.498 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.305 $11.479 $9.613 Accumulation Unit Value at end of period $13.939 $13.305 $11.479 Number of Accumulation Units outstanding at end of period (in thousands) 13 13 9 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.305 $11.479 $9.613 Accumulation Unit Value at end of period $13.939 $13.305 $11.479 Number of Accumulation Units outstanding at end of period (in thousands) 13 13 9 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.232 $11.450 $9.608 Accumulation Unit Value at end of period $13.820 $13.232 $11.450 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.942 $10.484 $9.606 Accumulation Unit Value at end of period $12.345 $11.942 $10.484 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 --
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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 $11.898 $10.467 $9.603 Accumulation Unit Value at end of period $12.275 $11.898 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.876 $10.458 $9.602 Accumulation Unit Value at end of period $12.240 $11.876 $10.458 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 $11.833 $10.441 $9.598 Accumulation Unit Value at end of period $12.171 $11.833 $10.441 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 $11.833 $10.441 $9.598 Accumulation Unit Value at end of period $12.171 $11.833 $10.441 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 $11.768 $10.414 $9.593 Accumulation Unit Value at end of period $12.068 $11.768 $10.414 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.486 $10.971 $9.313 Accumulation Unit Value at end of period $12.220 $12.486 $10.971 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 $12.440 $10.953 $9.310 Accumulation Unit Value at end of period $12.151 $12.440 $10.953 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.417 $10.944 $9.309 Accumulation Unit Value at end of period $12.116 $12.417 $10.944 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 $12.371 $10.925 $9.305 Accumulation Unit Value at end of period $12.048 $12.371 $10.925 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 $12.371 $10.925 $9.305 Accumulation Unit Value at end of period $12.048 $12.371 $10.925 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 $12.303 $10.898 $9.301 Accumulation Unit Value at end of period $11.945 $12.303 $10.898 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.343 $11.128 $9.497 Accumulation Unit Value at end of period $11.938 $11.343 $11.128 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 $11.302 $11.110 $9.494 Accumulation Unit Value at end of period $11.871 $11.302 $11.110 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 Accumulation Unit Value at beginning of period $11.281 $11.100 $9.492 Accumulation Unit Value at end of period $11.837 $11.281 $11.100 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 $11.240 $11.082 $9.489 Accumulation Unit Value at end of period $11.770 $11.240 $11.082 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 $11.240 $11.082 $9.489 Accumulation Unit Value at end of period $11.770 $11.240 $11.082 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 $11.178 $11.054 $9.484 Accumulation Unit Value at end of period $11.670 $11.178 $11.054 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $18.253 $17.302 $16.932 Accumulation Unit Value at end of period $18.865 $18.253 $17.302 Number of Accumulation Units outstanding at end of period (in thousands) 5 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $18.186 $17.273 $16.926 Accumulation Unit Value at end of period $18.758 $18.186 $17.273 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $18.153 $17.258 $16.923 Accumulation Unit Value at end of period $18.705 $18.153 $17.258 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $17.940 $17.090 $16.781 Accumulation Unit Value at end of period $18.449 $17.940 $17.090 Number of Accumulation Units outstanding at end of period (in thousands) 3 4 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.940 $17.090 $16.781 Accumulation Unit Value at end of period $18.449 $17.940 $17.090 Number of Accumulation Units outstanding at end of period (in thousands) 3 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.711 $16.922 $16.649 Accumulation Unit Value at end of period $18.159 $17.711 $16.922 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $37.652 $33.614 $31.404 Accumulation Unit Value at end of period $38.469 $37.652 $33.614 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $37.514 $33.558 $31.393 Accumulation Unit Value at end of period $38.252 $37.514 $33.558 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $37.445 $33.529 $31.388 Accumulation Unit Value at end of period $38.143 $37.445 $33.529 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 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 PREFERRED Accumulation Unit Value at beginning of period $37.006 $33.203 $31.124 Accumulation Unit Value at end of period $37.621 $37.006 $33.203 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 $37.006 $33.203 $31.124 Accumulation Unit Value at end of period $37.621 $37.006 $33.203 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 $36.533 $32.876 $30.879 Accumulation Unit Value at end of period $37.028 $36.533 $32.876 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $59.719 $51.909 $48.011 Accumulation Unit Value at end of period $55.693 $59.719 $51.909 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 $59.500 $51.822 $47.995 Accumulation Unit Value at end of period $55.378 $59.500 $51.822 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $59.390 $51.779 $47.986 Accumulation Unit Value at end of period $55.221 $59.390 $51.779 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 $58.694 $51.274 $47.582 Accumulation Unit Value at end of period $54.465 $58.694 $51.274 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 $58.694 $51.274 $47.582 Accumulation Unit Value at end of period $54.465 $58.694 $51.274 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 $57.943 $50.770 $47.208 Accumulation Unit Value at end of period $53.606 $57.943 $50.770 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.793 $19.558 $17.057 Accumulation Unit Value at end of period $26.667 $24.793 $19.558 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $24.702 $19.526 $17.051 Accumulation Unit Value at end of period $26.516 $24.702 $19.526 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $24.657 $19.509 $17.048 Accumulation Unit Value at end of period $26.441 $24.657 $19.509 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 $24.368 $19.319 $16.905 Accumulation Unit Value at end of period $26.079 $24.368 $19.319 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 3
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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 $24.368 $19.319 $16.905 Accumulation Unit Value at end of period $26.079 $24.368 $19.319 Number of Accumulation Units outstanding at end of period (in thousands) 5 4 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $24.056 $19.129 $16.772 Accumulation Unit Value at end of period $25.668 $24.056 $19.129 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.876 -- -- (a) Accumulation Unit Value at end of period $9.771 -- -- 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 $9.873 -- -- (a) Accumulation Unit Value at end of period $9.766 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.872 -- -- (a) Accumulation Unit Value at end of period $9.763 -- -- 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 $9.869 -- -- (a) Accumulation Unit Value at end of period $9.758 -- -- 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 $9.869 -- -- (a) Accumulation Unit Value at end of period $9.758 -- -- 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 $9.865 -- -- (a) Accumulation Unit Value at end of period $9.750 -- -- 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 $11.234 $9.934 $8.759 Accumulation Unit Value at end of period $10.574 $11.234 $9.934 Number of Accumulation Units outstanding at end of period (in thousands) 11 11 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.193 $9.918 $8.756 Accumulation Unit Value at end of period $10.514 $11.193 $9.918 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.172 $9.909 $8.755 Accumulation Unit Value at end of period $10.484 $11.172 $9.909 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.041 $9.813 $8.681 Accumulation Unit Value at end of period $10.341 $11.041 $9.813 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 $11.041 $9.813 $8.681 Accumulation Unit Value at end of period $10.341 $11.041 $9.813 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 $10.900 $9.716 $8.613 Accumulation Unit Value at end of period $10.178 $10.900 $9.716 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $22.290 $19.358 $17.752 Accumulation Unit Value at end of period $21.042 $22.290 $19.358 Number of Accumulation Units outstanding at end of period (in thousands) 10 8 2 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $22.208 $19.326 $17.746 Accumulation Unit Value at end of period $20.923 $22.208 $19.326 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $22.168 $19.309 $17.743 Accumulation Unit Value at end of period $20.864 $22.168 $19.309 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 PREFERRED Accumulation Unit Value at beginning of period $21.908 $19.121 $17.594 Accumulation Unit Value at end of period $20.578 $21.908 $19.121 Number of Accumulation Units outstanding at end of period (in thousands) 8 8 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.908 $19.121 $17.594 Accumulation Unit Value at end of period $20.578 $21.908 $19.121 Number of Accumulation Units outstanding at end of period (in thousands) 8 8 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.627 $18.933 $17.455 Accumulation Unit Value at end of period $20.254 $21.627 $18.933 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $27.062 $23.245 $20.274 Accumulation Unit Value at end of period $23.443 $27.062 $23.245 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $26.962 $23.206 $20.267 Accumulation Unit Value at end of period $23.310 $26.962 $23.206 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $26.913 $23.187 $20.264 Accumulation Unit Value at end of period $23.244 $26.913 $23.187 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 $26.598 $22.961 $20.093 Accumulation Unit Value at end of period $22.926 $26.598 $22.961 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.598 $22.961 $20.093 Accumulation Unit Value at end of period $22.926 $26.598 $22.961 Number of Accumulation Units outstanding at end of period (in thousands) 1 2 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.257 $22.735 $19.936 Accumulation Unit Value at end of period $22.565 $26.257 $22.735 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
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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 $13.805 $12.428 $11.853 Accumulation Unit Value at end of period $13.833 $13.805 $12.428 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.755 $12.407 $11.849 Accumulation Unit Value at end of period $13.754 $13.755 $12.407 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.729 $12.396 $11.847 Accumulation Unit Value at end of period $13.715 $13.729 $12.396 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.568 $12.276 $11.747 Accumulation Unit Value at end of period $13.528 $13.568 $12.276 Number of Accumulation Units outstanding at end of period (in thousands) 2 3 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.568 $12.276 $11.747 Accumulation Unit Value at end of period $13.528 $13.568 $12.276 Number of Accumulation Units outstanding at end of period (in thousands) 2 3 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.395 $12.155 $11.655 Accumulation Unit Value at end of period $13.314 $13.395 $12.155 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.506 $15.770 $13.439 Accumulation Unit Value at end of period $17.007 $16.506 $15.770 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.445 $15.744 $13.434 Accumulation Unit Value at end of period $16.910 $16.445 $15.744 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.415 $15.731 $13.432 Accumulation Unit Value at end of period $16.863 $16.415 $15.731 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 $16.223 $15.578 $13.319 Accumulation Unit Value at end of period $16.632 $16.223 $15.578 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 $16.223 $15.578 $13.319 Accumulation Unit Value at end of period $16.632 $16.223 $15.578 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 $16.015 $15.424 $13.214 Accumulation Unit Value at end of period $16.370 $16.015 $15.424 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $55.681 $53.208 $46.938 Accumulation Unit Value at end of period $58.316 $55.681 $53.208 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 THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $55.477 $53.119 $46.921 Accumulation Unit Value at end of period $57.986 $55.477 $53.119 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $55.375 $53.075 $46.913 Accumulation Unit Value at end of period $57.822 $55.375 $53.075 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 $54.726 $52.558 $46.518 Accumulation Unit Value at end of period $57.030 $54.726 $52.558 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 $54.726 $52.558 $46.518 Accumulation Unit Value at end of period $57.030 $54.726 $52.558 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 $54.026 $52.041 $46.153 Accumulation Unit Value at end of period $56.131 $54.026 $52.041 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.526 $12.138 $9.045 Accumulation Unit Value at end of period $23.038 $16.526 $12.138 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.465 $12.118 $9.042 Accumulation Unit Value at end of period $22.908 $16.465 $12.118 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.435 $12.108 $9.041 Accumulation Unit Value at end of period $22.843 $16.435 $12.108 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 $16.374 $12.088 $9.038 Accumulation Unit Value at end of period $22.714 $16.374 $12.088 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.374 $12.088 $9.038 Accumulation Unit Value at end of period $22.714 $16.374 $12.088 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.285 $12.057 $9.033 Accumulation Unit Value at end of period $22.522 $16.285 $12.057 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.799 $11.816 $9.508 Accumulation Unit Value at end of period $15.576 $12.799 $11.816 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.752 $11.796 $9.504 Accumulation Unit Value at end of period $15.488 $12.752 $11.796 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 Accumulation Unit Value at beginning of period $12.729 $11.786 $9.503 Accumulation Unit Value at end of period $15.444 $12.729 $11.786 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.682 $11.766 $9.500 Accumulation Unit Value at end of period $15.357 $12.682 $11.766 Number of Accumulation Units outstanding at end of period (in thousands) 2 6 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.682 $11.766 $9.500 Accumulation Unit Value at end of period $15.357 $12.682 $11.766 Number of Accumulation Units outstanding at end of period (in thousands) 2 6 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.612 $11.737 $9.495 Accumulation Unit Value at end of period $15.227 $12.612 $11.737 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.156 $10.989 $9.644 Accumulation Unit Value at end of period $14.069 $13.156 $10.989 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.108 $10.971 $9.641 Accumulation Unit Value at end of period $13.989 $13.108 $10.971 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.084 $10.961 $9.639 Accumulation Unit Value at end of period $13.950 $13.084 $10.961 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 $13.036 $10.943 $9.636 Accumulation Unit Value at end of period $13.871 $13.036 $10.943 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.036 $10.943 $9.636 Accumulation Unit Value at end of period $13.871 $13.036 $10.943 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.964 $10.916 $9.631 Accumulation Unit Value at end of period $13.753 $12.964 $10.916 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.954 $14.720 $13.894 Accumulation Unit Value at end of period $16.435 $16.954 $14.720 Number of Accumulation Units outstanding at end of period (in thousands) 21 11 2 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.891 $14.695 $13.889 Accumulation Unit Value at end of period $16.342 $16.891 $14.695 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.860 $14.683 $13.887 Accumulation Unit Value at end of period $16.296 $16.860 $14.683 Number of Accumulation Units outstanding at end of period (in thousands) 6 5 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.799 $14.658 $13.882 Accumulation Unit Value at end of period $16.204 $16.799 $14.658 Number of Accumulation Units outstanding at end of period (in thousands) 10 11 4
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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 $16.799 $14.658 $13.882 Accumulation Unit Value at end of period $16.204 $16.799 $14.658 Number of Accumulation Units outstanding at end of period (in thousands) 10 11 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.706 $14.621 $13.875 Accumulation Unit Value at end of period $16.066 $16.706 $14.621 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.884 $14.668 $13.336 Accumulation Unit Value at end of period $17.181 $16.884 $14.668 Number of Accumulation Units outstanding at end of period (in thousands) 18 8 2 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.822 $14.644 $13.332 Accumulation Unit Value at end of period $17.084 $16.822 $14.644 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.791 $14.631 $13.330 Accumulation Unit Value at end of period $17.035 $16.791 $14.631 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.730 $14.607 $13.325 Accumulation Unit Value at end of period $16.939 $16.730 $14.607 Number of Accumulation Units outstanding at end of period (in thousands) 9 10 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.730 $14.607 $13.325 Accumulation Unit Value at end of period $16.939 $16.730 $14.607 Number of Accumulation Units outstanding at end of period (in thousands) 9 10 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.638 $14.570 $13.318 Accumulation Unit Value at end of period $16.795 $16.638 $14.570 Number of Accumulation Units outstanding at end of period (in thousands) -- -- --
(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 $12.097 $10.714 $9.751 of period Accumulation Unit Value at end of $12.639 $12.097 $10.714 period Number of Accumulation Units 635 184 16 outstanding at end of period (in thousands) WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $12.053 $10.696 $9.748 of period Accumulation Unit Value at end of $12.567 $12.053 $10.696 period Number of Accumulation Units 26 14 3 outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning $12.031 $10.688 $9.746 of period Accumulation Unit Value at end of $12.531 $12.031 $10.688 period Number of Accumulation Units 45 17 -- outstanding at end of period (in thousands) WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning $11.987 $10.670 $9.743 of period Accumulation Unit Value at end of $12.461 $11.987 $10.670 period Number of Accumulation Units 133 55 4 outstanding at end of period (in thousands)
37 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.987 $10.670 $9.743 Accumulation Unit Value at end of period $12.461 $11.987 $10.670 Number of Accumulation Units outstanding at end of period (in thousands) 133 55 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.921 $10.643 $9.738 Accumulation Unit Value at end of period $12.355 $11.921 $10.643 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 ALLIANCEBERNSTEIN VPS GLOBAL RESEARCH GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.699 $12.030 $10.000 Accumulation Unit Value at end of period $15.252 $13.699 $12.030 Number of Accumulation Units outstanding at end of period (in thousands) 16 4 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.654 $12.014 $10.000 Accumulation Unit Value at end of period $15.171 $13.654 $12.014 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.631 $12.006 $10.000 Accumulation Unit Value at end of period $15.130 $13.631 $12.006 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 $13.585 $11.990 $10.000 Accumulation Unit Value at end of period $15.050 $13.585 $11.990 Number of Accumulation Units outstanding at end of period (in thousands) 12 9 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.585 $11.990 $10.000 Accumulation Unit Value at end of period $15.050 $13.585 $11.990 Number of Accumulation Units outstanding at end of period (in thousands) 12 9 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.518 $11.966 $10.000 Accumulation Unit Value at end of period $14.930 $13.518 $11.966 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.378 -- -- (a) Accumulation Unit Value at end of period $10.542 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.375 -- -- (a) Accumulation Unit Value at end of period $10.536 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.373 -- -- (a) Accumulation Unit Value at end of period $10.533 -- -- 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 $10.370 -- -- (a) Accumulation Unit Value at end of period $10.527 -- -- 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 $10.370 -- -- (a) Accumulation Unit Value at end of period $10.527 -- -- 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 $10.366 -- -- (a) Accumulation Unit Value at end of period $10.518 -- -- 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 $14.909 $11.117 $9.329 Accumulation Unit Value at end of period $15.624 $14.909 $11.117 Number of Accumulation Units outstanding at end of period (in thousands) 591 219 41 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.854 $11.099 $9.326 Accumulation Unit Value at end of period $15.535 $14.854 $11.099 Number of Accumulation Units outstanding at end of period (in thousands) 19 15 2 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $14.827 $11.089 $9.324 Accumulation Unit Value at end of period $15.491 $14.827 $11.089 Number of Accumulation Units outstanding at end of period (in thousands) 46 22 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $14.773 $11.071 $9.321 Accumulation Unit Value at end of period $15.404 $14.773 $11.071 Number of Accumulation Units outstanding at end of period (in thousands) 223 121 20 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.773 $11.071 $9.321 Accumulation Unit Value at end of period $15.404 $14.773 $11.071 Number of Accumulation Units outstanding at end of period (in thousands) 223 121 20 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $14.692 $11.043 $9.316 Accumulation Unit Value at end of period $15.273 $14.692 $11.043 Number of Accumulation Units outstanding at end of period (in thousands) 14 15 -- ALLIANCEBERNSTEIN VPS SMALL/MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.039 $10.621 $9.427 Accumulation Unit Value at end of period $12.132 $12.039 $10.621 Number of Accumulation Units outstanding at end of period (in thousands) 114 50 22 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.995 $10.604 $9.423 Accumulation Unit Value at end of period $12.063 $11.995 $10.604 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 $11.973 $10.595 $9.422 Accumulation Unit Value at end of period $12.029 $11.973 $10.595 Number of Accumulation Units outstanding at end of period (in thousands) 12 4 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.929 $10.577 $9.418 Accumulation Unit Value at end of period $11.961 $11.929 $10.577 Number of Accumulation Units outstanding at end of period (in thousands) 23 20 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.929 $10.577 $9.418 Accumulation Unit Value at end of period $11.961 $11.929 $10.577 Number of Accumulation Units outstanding at end of period (in thousands) 23 20 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.863 $10.550 $9.414 Accumulation Unit Value at end of period $11.859 $11.863 $10.550 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 --
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VPS VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.452 $10.366 $9.640 Accumulation Unit Value at end of period $11.845 $12.452 $10.366 Number of Accumulation Units outstanding at end of period (in thousands) 88 54 32 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.407 $10.349 $9.637 Accumulation Unit Value at end of period $11.778 $12.407 $10.349 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 $12.384 $10.340 $9.635 Accumulation Unit Value at end of period $11.744 $12.384 $10.340 Number of Accumulation Units outstanding at end of period (in thousands) 5 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.339 $10.323 $9.632 Accumulation Unit Value at end of period $11.678 $12.339 $10.323 Number of Accumulation Units outstanding at end of period (in thousands) 25 14 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.339 $10.323 $9.632 Accumulation Unit Value at end of period $11.678 $12.339 $10.323 Number of Accumulation Units outstanding at end of period (in thousands) 25 14 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.271 $10.297 $9.627 Accumulation Unit Value at end of period $11.579 $12.271 $10.297 Number of Accumulation Units outstanding at end of period (in thousands) -- -- 1 FIDELITY VIP CONTRAFUND(R) PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.609 $11.401 $9.576 Accumulation Unit Value at end of period $14.681 $12.609 $11.401 Number of Accumulation Units outstanding at end of period (in thousands) 2,667 1,289 271 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.563 $11.382 $9.573 Accumulation Unit Value at end of period $14.598 $12.563 $11.382 Number of Accumulation Units outstanding at end of period (in thousands) 129 104 52 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.540 $11.372 $9.571 Accumulation Unit Value at end of period $14.556 $12.540 $11.372 Number of Accumulation Units outstanding at end of period (in thousands) 210 112 16 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.494 $11.353 $9.568 Accumulation Unit Value at end of period $14.474 $12.494 $11.353 Number of Accumulation Units outstanding at end of period (in thousands) 551 428 122 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.494 $11.353 $9.568 Accumulation Unit Value at end of period $14.474 $12.494 $11.353 Number of Accumulation Units outstanding at end of period (in thousands) 551 428 122 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.425 $11.325 $9.563 Accumulation Unit Value at end of period $14.351 $12.425 $11.325 Number of Accumulation Units outstanding at end of period (in thousands) 51 29 32 FIDELITY VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.654 -- -- (a) Accumulation Unit Value at end of period $9.571 -- -- 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 THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.651 -- -- (a) Accumulation Unit Value at end of period $9.566 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.649 -- -- (a) Accumulation Unit Value at end of period $9.563 -- -- 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 $9.647 -- -- (a) Accumulation Unit Value at end of period $9.558 -- -- 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 $9.647 -- -- (a) Accumulation Unit Value at end of period $9.558 -- -- 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 $9.642 -- -- (a) Accumulation Unit Value at end of period $9.550 -- -- 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 $12.442 $10.452 $9.557 Accumulation Unit Value at end of period $12.506 $12.442 $10.452 Number of Accumulation Units outstanding at end of period (in thousands) 232 170 31 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.396 $10.435 $9.554 Accumulation Unit Value at end of period $12.435 $12.396 $10.435 Number of Accumulation Units outstanding at end of period (in thousands) 12 15 7 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.373 $10.426 $9.552 Accumulation Unit Value at end of period $12.400 $12.373 $10.426 Number of Accumulation Units outstanding at end of period (in thousands) 25 14 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.328 $10.409 $9.549 Accumulation Unit Value at end of period $12.330 $12.328 $10.409 Number of Accumulation Units outstanding at end of period (in thousands) 76 46 17 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.328 $10.409 $9.549 Accumulation Unit Value at end of period $12.330 $12.328 $10.409 Number of Accumulation Units outstanding at end of period (in thousands) 76 46 17 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.260 $10.382 $9.544 Accumulation Unit Value at end of period $12.225 $12.260 $10.382 Number of Accumulation Units outstanding at end of period (in thousands) 3 1 1 FIDELITY VIP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.321 $10.703 $9.567 Accumulation Unit Value at end of period $14.232 $11.321 $10.703 Number of Accumulation Units outstanding at end of period (in thousands) 30 20 4 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.279 $10.685 $9.564 Accumulation Unit Value at end of period $14.151 $11.279 $10.685 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 --
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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 $11.258 $10.676 $9.562 Accumulation Unit Value at end of period $14.111 $11.258 $10.676 Number of Accumulation Units outstanding at end of period (in thousands) 4 2 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.217 $10.658 $9.559 Accumulation Unit Value at end of period $14.031 $11.217 $10.658 Number of Accumulation Units outstanding at end of period (in thousands) 30 9 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.217 $10.658 $9.559 Accumulation Unit Value at end of period $14.031 $11.217 $10.658 Number of Accumulation Units outstanding at end of period (in thousands) 30 9 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.155 $10.631 $9.554 Accumulation Unit Value at end of period $13.912 $11.155 $10.631 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- FIDELITY VIP MID CAP PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.557 $11.255 $9.331 Accumulation Unit Value at end of period $14.375 $12.557 $11.255 Number of Accumulation Units outstanding at end of period (in thousands) 395 249 67 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.511 $11.237 $9.328 Accumulation Unit Value at end of period $14.293 $12.511 $11.237 Number of Accumulation Units outstanding at end of period (in thousands) 14 14 4 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.488 $11.227 $9.326 Accumulation Unit Value at end of period $14.253 $12.488 $11.227 Number of Accumulation Units outstanding at end of period (in thousands) 37 21 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.442 $11.208 $9.323 Accumulation Unit Value at end of period $14.172 $12.442 $11.208 Number of Accumulation Units outstanding at end of period (in thousands) 96 86 35 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.442 $11.208 $9.323 Accumulation Unit Value at end of period $14.172 $12.442 $11.208 Number of Accumulation Units outstanding at end of period (in thousands) 96 86 35 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.374 $11.180 $9.318 Accumulation Unit Value at end of period $14.052 $12.374 $11.180 Number of Accumulation Units outstanding at end of period (in thousands) 6 4 1 FIDELITY VIP VALUE STRATEGIES PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.061 $10.475 $8.966 Accumulation Unit Value at end of period $12.623 $12.061 $10.475 Number of Accumulation Units outstanding at end of period (in thousands) 26 10 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.017 $10.458 $8.963 Accumulation Unit Value at end of period $12.551 $12.017 $10.458 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.995 $10.449 $8.961 Accumulation Unit Value at end of period $12.516 $11.995 $10.449 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 PREFERRED Accumulation Unit Value at beginning of period $11.951 $10.432 $8.958 Accumulation Unit Value at end of period $12.445 $11.951 $10.432 Number of Accumulation Units outstanding at end of period (in thousands) 9 14 13 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.951 $10.432 $8.958 Accumulation Unit Value at end of period $12.445 $11.951 $10.432 Number of Accumulation Units outstanding at end of period (in thousands) 9 14 13 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.885 $10.405 $8.953 Accumulation Unit Value at end of period $12.339 $11.885 $10.405 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD ADVISERS HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.212 $1.103 $1.016 Accumulation Unit Value at end of period $1.282 $1.212 $1.103 Number of Accumulation Units outstanding at end of period (in thousands) 710 468 273 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.207 $1.101 $1.016 Accumulation Unit Value at end of period $1.275 $1.207 $1.101 Number of Accumulation Units outstanding at end of period (in thousands) 81 66 51 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.205 $1.100 $1.016 Accumulation Unit Value at end of period $1.272 $1.205 $1.100 Number of Accumulation Units outstanding at end of period (in thousands) 140 92 65 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.240 $4.793 $4.431 Accumulation Unit Value at end of period $5.518 $5.240 $4.793 Number of Accumulation Units outstanding at end of period (in thousands) 130 117 60 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.240 $4.793 $4.431 Accumulation Unit Value at end of period $5.518 $5.240 $4.793 Number of Accumulation Units outstanding at end of period (in thousands) 130 117 60 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.277 $1.172 $1.085 Accumulation Unit Value at end of period $1.341 $1.277 $1.172 Number of Accumulation Units outstanding at end of period (in thousands) 42 42 36 HARTFORD DISCIPLINED EQUITY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.191 $1.067 $0.975 Accumulation Unit Value at end of period $1.280 $1.191 $1.067 Number of Accumulation Units outstanding at end of period (in thousands) 612 482 266 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.186 $1.065 $0.975 Accumulation Unit Value at end of period $1.273 $1.186 $1.065 Number of Accumulation Units outstanding at end of period (in thousands) 84 85 58 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.184 $1.064 $0.975 Accumulation Unit Value at end of period $1.269 $1.184 $1.064 Number of Accumulation Units outstanding at end of period (in thousands) 91 86 98 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.426 $1.284 $1.178 Accumulation Unit Value at end of period $1.526 $1.426 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 318 267 196
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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 $1.426 $1.284 $1.178 Accumulation Unit Value at end of period $1.526 $1.426 $1.284 Number of Accumulation Units outstanding at end of period (in thousands) 318 267 196 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.381 $1.247 $1.146 Accumulation Unit Value at end of period $1.473 $1.381 $1.247 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD DIVIDEND AND GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.659 $1.389 $1.285 Accumulation Unit Value at end of period $1.783 $1.659 $1.389 Number of Accumulation Units outstanding at end of period (in thousands) 20,730 9,400 2,446 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.653 $1.386 $1.285 Accumulation Unit Value at end of period $1.772 $1.653 $1.386 Number of Accumulation Units outstanding at end of period (in thousands) 1,141 1,048 546 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.650 $1.385 $1.285 Accumulation Unit Value at end of period $1.767 $1.650 $1.385 Number of Accumulation Units outstanding at end of period (in thousands) 1,546 754 204 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.909 $3.289 $3.054 Accumulation Unit Value at end of period $4.179 $3.909 $3.289 Number of Accumulation Units outstanding at end of period (in thousands) 2,130 1,622 526 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $3.909 $3.289 $3.054 Accumulation Unit Value at end of period $4.179 $3.909 $3.289 Number of Accumulation Units outstanding at end of period (in thousands) 2,130 1,622 526 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.570 $1.325 $1.233 Accumulation Unit Value at end of period $1.674 $1.570 $1.325 Number of Accumulation Units outstanding at end of period (in thousands) 719 645 256 HARTFORD EQUITY INCOME HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.453 $1.212 $1.158 Accumulation Unit Value at end of period $1.542 $1.453 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 5,030 2,857 1,101 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.447 $1.210 $1.158 Accumulation Unit Value at end of period $1.533 $1.447 $1.210 Number of Accumulation Units outstanding at end of period (in thousands) 341 300 190 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.445 $1.209 $1.158 Accumulation Unit Value at end of period $1.529 $1.445 $1.209 Number of Accumulation Units outstanding at end of period (in thousands) 578 314 102 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.434 $1.202 $1.153 Accumulation Unit Value at end of period $1.514 $1.434 $1.202 Number of Accumulation Units outstanding at end of period (in thousands) 2,086 1,874 1,030 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.434 $1.202 $1.153 Accumulation Unit Value at end of period $1.514 $1.434 $1.202 Number of Accumulation Units outstanding at end of period (in thousands) 2,086 1,874 1,030
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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 $1.416 $1.191 $1.145 Accumulation Unit Value at end of period $1.492 $1.416 $1.191 Number of Accumulation Units outstanding at end of period (in thousands) 460 481 79 HARTFORD FUNDAMENTAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.190 $1.093 $0.962 Accumulation Unit Value at end of period $1.360 $1.190 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 42 12 3 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.185 $1.091 $0.962 Accumulation Unit Value at end of period $1.352 $1.185 $1.091 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.183 $1.090 $0.962 Accumulation Unit Value at end of period $1.348 $1.183 $1.090 Number of Accumulation Units outstanding at end of period (in thousands) 4 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.165 $1.076 $0.950 Accumulation Unit Value at end of period $1.325 $1.165 $1.076 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 $1.165 $1.076 $0.950 Accumulation Unit Value at end of period $1.325 $1.165 $1.076 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 $1.137 $1.052 $0.932 Accumulation Unit Value at end of period $1.289 $1.137 $1.052 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 $1.302 $1.206 $1.114 Accumulation Unit Value at end of period $1.507 $1.302 $1.206 Number of Accumulation Units outstanding at end of period (in thousands) 803 549 315 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.297 $1.203 $1.113 Accumulation Unit Value at end of period $1.498 $1.297 $1.203 Number of Accumulation Units outstanding at end of period (in thousands) 38 23 5 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.295 $1.202 $1.113 Accumulation Unit Value at end of period $1.494 $1.295 $1.202 Number of Accumulation Units outstanding at end of period (in thousands) 65 34 21 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.034 $1.892 $1.754 Accumulation Unit Value at end of period $2.341 $2.034 $1.892 Number of Accumulation Units outstanding at end of period (in thousands) 177 110 32 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.034 $1.892 $1.754 Accumulation Unit Value at end of period $2.341 $2.034 $1.892 Number of Accumulation Units outstanding at end of period (in thousands) 177 110 32 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.971 $1.839 $1.708 Accumulation Unit Value at end of period $2.262 $1.971 $1.839 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 GLOBAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.434 $1.266 $1.116 Accumulation Unit Value at end of period $1.780 $1.434 $1.266 Number of Accumulation Units outstanding at end of period (in thousands) 715 392 177 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.429 $1.264 $1.116 Accumulation Unit Value at end of period $1.770 $1.429 $1.264 Number of Accumulation Units outstanding at end of period (in thousands) 79 73 55 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.426 $1.263 $1.115 Accumulation Unit Value at end of period $1.765 $1.426 $1.263 Number of Accumulation Units outstanding at end of period (in thousands) 203 197 114 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.112 $1.874 $1.657 Accumulation Unit Value at end of period $2.609 $2.112 $1.874 Number of Accumulation Units outstanding at end of period (in thousands) 132 130 57 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.112 $1.874 $1.657 Accumulation Unit Value at end of period $2.609 $2.112 $1.874 Number of Accumulation Units outstanding at end of period (in thousands) 132 130 57 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.047 $1.821 $1.614 Accumulation Unit Value at end of period $2.520 $2.047 $1.821 Number of Accumulation Units outstanding at end of period (in thousands) 6 -- -- HARTFORD GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.360 $1.310 $1.158 Accumulation Unit Value at end of period $1.576 $1.360 $1.310 Number of Accumulation Units outstanding at end of period (in thousands) 2,144 2,079 930 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.355 $1.307 $1.157 Accumulation Unit Value at end of period $1.567 $1.355 $1.307 Number of Accumulation Units outstanding at end of period (in thousands) 260 315 149 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.352 $1.306 $1.157 Accumulation Unit Value at end of period $1.563 $1.352 $1.306 Number of Accumulation Units outstanding at end of period (in thousands) 341 393 91 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.336 $1.293 $1.147 Accumulation Unit Value at end of period $1.541 $1.336 $1.293 Number of Accumulation Units outstanding at end of period (in thousands) 860 933 602 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.336 $1.293 $1.147 Accumulation Unit Value at end of period $1.541 $1.336 $1.293 Number of Accumulation Units outstanding at end of period (in thousands) 860 933 602 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.309 $1.271 $1.130 Accumulation Unit Value at end of period $1.505 $1.309 $1.271 Number of Accumulation Units outstanding at end of period (in thousands) 406 445 110 HARTFORD GROWTH OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.633 $1.469 $1.171 Accumulation Unit Value at end of period $2.102 $1.633 $1.469 Number of Accumulation Units outstanding at end of period (in thousands) 2,924 1,040 106
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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 $1.627 $1.466 $1.171 Accumulation Unit Value at end of period $2.090 $1.627 $1.466 Number of Accumulation Units outstanding at end of period (in thousands) 171 258 153 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.624 $1.465 $1.171 Accumulation Unit Value at end of period $2.084 $1.624 $1.465 Number of Accumulation Units outstanding at end of period (in thousands) 320 135 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.605 $1.450 $1.160 Accumulation Unit Value at end of period $2.055 $1.605 $1.450 Number of Accumulation Units outstanding at end of period (in thousands) 1,334 660 127 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.605 $1.450 $1.160 Accumulation Unit Value at end of period $2.055 $1.605 $1.450 Number of Accumulation Units outstanding at end of period (in thousands) 1,334 660 127 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.573 $1.426 $1.143 Accumulation Unit Value at end of period $2.008 $1.573 $1.426 Number of Accumulation Units outstanding at end of period (in thousands) 209 81 57 HARTFORD HIGH YIELD HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.390 $1.259 $1.203 Accumulation Unit Value at end of period $1.418 $1.390 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 834 501 125 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.384 $1.257 $1.202 Accumulation Unit Value at end of period $1.410 $1.384 $1.257 Number of Accumulation Units outstanding at end of period (in thousands) 86 268 186 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.382 $1.256 $1.202 Accumulation Unit Value at end of period $1.406 $1.382 $1.256 Number of Accumulation Units outstanding at end of period (in thousands) 52 46 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.423 $1.296 $1.242 Accumulation Unit Value at end of period $1.444 $1.423 $1.296 Number of Accumulation Units outstanding at end of period (in thousands) 264 169 83 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.423 $1.296 $1.242 Accumulation Unit Value at end of period $1.444 $1.423 $1.296 Number of Accumulation Units outstanding at end of period (in thousands) 264 169 83 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.378 $1.259 $1.209 Accumulation Unit Value at end of period $1.395 $1.378 $1.259 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 3 HARTFORD INDEX HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.129 $0.985 $0.912 Accumulation Unit Value at end of period $1.179 $1.129 $0.985 Number of Accumulation Units outstanding at end of period (in thousands) 340 275 140 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.125 $0.983 $0.912 Accumulation Unit Value at end of period $1.172 $1.125 $0.983 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 Accumulation Unit Value at beginning of period $1.122 $0.982 $0.912 Accumulation Unit Value at end of period $1.169 $1.122 $0.982 Number of Accumulation Units outstanding at end of period (in thousands) 18 3 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $5.396 $4.733 $4.397 Accumulation Unit Value at end of period $5.606 $5.396 $4.733 Number of Accumulation Units outstanding at end of period (in thousands) 16 2 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.396 $4.733 $4.397 Accumulation Unit Value at end of period $5.606 $5.396 $4.733 Number of Accumulation Units outstanding at end of period (in thousands) 16 2 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $5.228 $4.599 $4.282 Accumulation Unit Value at end of period $5.415 $5.228 $4.599 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD INTERNATIONAL GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.683 $1.367 $1.184 Accumulation Unit Value at end of period $2.070 $1.683 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) 6,496 3,607 919 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.677 $1.364 $1.184 Accumulation Unit Value at end of period $2.058 $1.677 $1.364 Number of Accumulation Units outstanding at end of period (in thousands) 412 564 274 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.674 $1.363 $1.184 Accumulation Unit Value at end of period $2.052 $1.674 $1.363 Number of Accumulation Units outstanding at end of period (in thousands) 836 551 115 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.649 $1.345 $1.170 Accumulation Unit Value at end of period $2.018 $1.649 $1.345 Number of Accumulation Units outstanding at end of period (in thousands) 1,844 1,458 574 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.649 $1.345 $1.170 Accumulation Unit Value at end of period $2.018 $1.649 $1.345 Number of Accumulation Units outstanding at end of period (in thousands) 1,844 1,458 574 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.608 $1.316 $1.147 Accumulation Unit Value at end of period $1.962 $1.608 $1.316 Number of Accumulation Units outstanding at end of period (in thousands) 170 171 114 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.397 $1.131 $0.964 Accumulation Unit Value at end of period $1.767 $1.397 $1.131 Number of Accumulation Units outstanding at end of period (in thousands) 1,634 957 427 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.392 $1.129 $0.964 Accumulation Unit Value at end of period $1.757 $1.392 $1.129 Number of Accumulation Units outstanding at end of period (in thousands) 53 82 53 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.389 $1.128 $0.964 Accumulation Unit Value at end of period $1.752 $1.389 $1.128 Number of Accumulation Units outstanding at end of period (in thousands) 181 157 7
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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 $2.575 $2.095 $1.792 Accumulation Unit Value at end of period $3.240 $2.575 $2.095 Number of Accumulation Units outstanding at end of period (in thousands) 351 297 72 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.575 $2.095 $1.792 Accumulation Unit Value at end of period $3.240 $2.575 $2.095 Number of Accumulation Units outstanding at end of period (in thousands) 351 297 72 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.485 $1.212 $1.039 Accumulation Unit Value at end of period $1.863 $1.485 $1.212 Number of Accumulation Units outstanding at end of period (in thousands) 25 17 18 HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $2.340 $1.823 $1.538 Accumulation Unit Value at end of period $2.532 $2.340 $1.823 Number of Accumulation Units outstanding at end of period (in thousands) 388 180 77 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.332 $1.820 $1.537 Accumulation Unit Value at end of period $2.517 $2.332 $1.820 Number of Accumulation Units outstanding at end of period (in thousands) 18 18 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $2.327 $1.818 $1.537 Accumulation Unit Value at end of period $2.510 $2.327 $1.818 Number of Accumulation Units outstanding at end of period (in thousands) 23 14 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.292 $1.795 $1.519 Accumulation Unit Value at end of period $2.468 $2.292 $1.795 Number of Accumulation Units outstanding at end of period (in thousands) 194 146 59 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.292 $1.795 $1.519 Accumulation Unit Value at end of period $2.468 $2.292 $1.795 Number of Accumulation Units outstanding at end of period (in thousands) 194 146 59 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.236 $1.756 $1.489 Accumulation Unit Value at end of period $2.399 $2.236 $1.756 Number of Accumulation Units outstanding at end of period (in thousands) 217 247 -- HARTFORD LARGECAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.538 -- -- (a) Accumulation Unit Value at end of period $9.828 -- -- 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 $9.535 -- -- (a) Accumulation Unit Value at end of period $9.822 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.533 -- -- (a) Accumulation Unit Value at end of period $9.820 -- -- 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 $9.531 -- -- (a) Accumulation Unit Value at end of period $9.814 -- -- 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 THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $9.531 -- -- (a) Accumulation Unit Value at end of period $9.814 -- -- 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 $9.526 -- -- (a) Accumulation Unit Value at end of period $9.806 -- -- 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 $9.522 -- -- (a) Accumulation Unit Value at end of period $9.809 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $9.519 -- -- (a) Accumulation Unit Value at end of period $9.803 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.518 -- -- (a) Accumulation Unit Value at end of period $9.800 -- -- 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 $9.515 -- -- (a) Accumulation Unit Value at end of period $9.795 -- -- 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 $9.515 -- -- (a) Accumulation Unit Value at end of period $9.795 -- -- 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 $9.511 -- -- (a) Accumulation Unit Value at end of period $9.787 -- -- 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 $1.161 $1.117 $1.099 Accumulation Unit Value at end of period $1.209 $1.161 $1.117 Number of Accumulation Units outstanding at end of period (in thousands) 2,438 1,821 589 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.157 $1.115 $1.099 Accumulation Unit Value at end of period $1.202 $1.157 $1.115 Number of Accumulation Units outstanding at end of period (in thousands) 48 55 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.154 $1.114 $1.099 Accumulation Unit Value at end of period $1.199 $1.154 $1.114 Number of Accumulation Units outstanding at end of period (in thousands) 15 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.994 $1.929 $1.905 Accumulation Unit Value at end of period $2.067 $1.994 $1.929 Number of Accumulation Units outstanding at end of period (in thousands) 248 184 4 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.994 $1.929 $1.905 Accumulation Unit Value at end of period $2.067 $1.994 $1.929 Number of Accumulation Units outstanding at end of period (in thousands) 248 184 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 $1.155 $1.120 $1.108 Accumulation Unit Value at end of period $1.193 $1.155 $1.120 Number of Accumulation Units outstanding at end of period (in thousands) -- 19 -- HARTFORD MORTGAGE SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.383 $1.332 $1.320 Accumulation Unit Value at end of period $1.420 $1.383 $1.332 Number of Accumulation Units outstanding at end of period (in thousands) 347 237 23 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.378 $1.329 $1.320 Accumulation Unit Value at end of period $1.412 $1.378 $1.329 Number of Accumulation Units outstanding at end of period (in thousands) 4 4 2 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.376 $1.328 $1.320 Accumulation Unit Value at end of period $1.408 $1.376 $1.328 Number of Accumulation Units outstanding at end of period (in thousands) 10 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.972 $2.875 $2.860 Accumulation Unit Value at end of period $3.034 $2.972 $2.875 Number of Accumulation Units outstanding at end of period (in thousands) 81 89 76 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.972 $2.875 $2.860 Accumulation Unit Value at end of period $3.034 $2.972 $2.875 Number of Accumulation Units outstanding at end of period (in thousands) 81 89 76 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.879 $2.793 $2.785 Accumulation Unit Value at end of period $2.931 $2.879 $2.793 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- HARTFORD SMALL COMPANY HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.612 $1.570 -- Accumulation Unit Value at end of period $1.827 $1.612 -- Number of Accumulation Units outstanding at end of period (in thousands) 185 59 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.594 $1.555 -- Accumulation Unit Value at end of period $1.804 $1.594 -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.592 $1.553 -- Accumulation Unit Value at end of period $1.799 $1.592 -- Number of Accumulation Units outstanding at end of period (in thousands) 11 7 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $2.575 $2.516 -- Accumulation Unit Value at end of period $2.905 $2.575 -- Number of Accumulation Units outstanding at end of period (in thousands) 21 4 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $2.575 $2.516 -- Accumulation Unit Value at end of period $2.905 $2.575 -- Number of Accumulation Units outstanding at end of period (in thousands) 21 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.770 $1.733 -- Accumulation Unit Value at end of period $1.991 $1.770 -- 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 SMALLCAP GROWTH HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.452 $1.369 $1.162 Accumulation Unit Value at end of period $1.415 $1.452 $1.369 Number of Accumulation Units outstanding at end of period (in thousands) 349 194 119 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.447 $1.367 $1.162 Accumulation Unit Value at end of period $1.407 $1.447 $1.367 Number of Accumulation Units outstanding at end of period (in thousands) 41 237 120 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.444 $1.366 $1.162 Accumulation Unit Value at end of period $1.403 $1.444 $1.366 Number of Accumulation Units outstanding at end of period (in thousands) 42 45 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.427 $1.352 $1.152 Accumulation Unit Value at end of period $1.383 $1.427 $1.352 Number of Accumulation Units outstanding at end of period (in thousands) 206 178 53 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.427 $1.352 $1.152 Accumulation Unit Value at end of period $1.383 $1.427 $1.352 Number of Accumulation Units outstanding at end of period (in thousands) 206 178 53 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.404 $1.334 $1.139 Accumulation Unit Value at end of period $1.357 $1.404 $1.334 Number of Accumulation Units outstanding at end of period (in thousands) 6 7 12 HARTFORD SMALLCAP VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.336 -- -- (a) Accumulation Unit Value at end of period $9.130 -- -- 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 $9.333 -- -- (a) Accumulation Unit Value at end of period $9.125 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.332 -- -- (a) Accumulation Unit Value at end of period $9.123 -- -- 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 $9.329 -- -- (a) Accumulation Unit Value at end of period $9.118 -- -- 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 $9.329 -- -- (a) Accumulation Unit Value at end of period $9.118 -- -- 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 $9.325 -- -- (a) Accumulation Unit Value at end of period $9.110 -- -- 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 $1.092 $0.960 $0.854 Accumulation Unit Value at end of period $1.148 $1.092 $0.960 Number of Accumulation Units outstanding at end of period (in thousands) 661 529 271
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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 $1.088 $0.958 $0.853 Accumulation Unit Value at end of period $1.142 $1.088 $0.958 Number of Accumulation Units outstanding at end of period (in thousands) 60 60 50 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.086 $0.957 $0.853 Accumulation Unit Value at end of period $1.138 $1.086 $0.957 Number of Accumulation Units outstanding at end of period (in thousands) 86 118 44 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $6.728 $5.942 $5.303 Accumulation Unit Value at end of period $7.036 $6.728 $5.942 Number of Accumulation Units outstanding at end of period (in thousands) 67 50 6 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $6.728 $5.942 $5.303 Accumulation Unit Value at end of period $7.036 $6.728 $5.942 Number of Accumulation Units outstanding at end of period (in thousands) 67 50 6 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.220 $1.081 $0.967 Accumulation Unit Value at end of period $1.272 $1.220 $1.081 Number of Accumulation Units outstanding at end of period (in thousands) 78 79 66 HARTFORD TOTAL RETURN BOND HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.535 $1.476 $1.462 Accumulation Unit Value at end of period $1.595 $1.535 $1.476 Number of Accumulation Units outstanding at end of period (in thousands) 16,312 7,356 2,517 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.530 $1.473 $1.462 Accumulation Unit Value at end of period $1.586 $1.530 $1.473 Number of Accumulation Units outstanding at end of period (in thousands) 842 657 319 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.527 $1.472 $1.461 Accumulation Unit Value at end of period $1.581 $1.527 $1.472 Number of Accumulation Units outstanding at end of period (in thousands) 1,050 468 78 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $3.249 $3.139 $3.120 Accumulation Unit Value at end of period $3.358 $3.249 $3.139 Number of Accumulation Units outstanding at end of period (in thousands) 1,803 1,053 436 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $3.249 $3.139 $3.120 Accumulation Unit Value at end of period $3.358 $3.249 $3.139 Number of Accumulation Units outstanding at end of period (in thousands) 1,803 1,053 436 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.459 $1.414 $1.408 Accumulation Unit Value at end of period $1.503 $1.459 $1.414 Number of Accumulation Units outstanding at end of period (in thousands) 198 158 131 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.143 $1.107 $1.102 Accumulation Unit Value at end of period $1.184 $1.143 $1.107 Number of Accumulation Units outstanding at end of period (in thousands) 3,947 1,105 356 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.139 $1.106 $1.102 Accumulation Unit Value at end of period $1.178 $1.139 $1.106 Number of Accumulation Units outstanding at end of period (in thousands) 134 160 66
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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 $1.137 $1.105 $1.102 Accumulation Unit Value at end of period $1.174 $1.137 $1.105 Number of Accumulation Units outstanding at end of period (in thousands) 326 120 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.123 $1.093 $1.092 Accumulation Unit Value at end of period $1.158 $1.123 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 1,200 375 63 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.123 $1.093 $1.092 Accumulation Unit Value at end of period $1.158 $1.123 $1.093 Number of Accumulation Units outstanding at end of period (in thousands) 1,200 375 63 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.101 $1.075 $1.076 Accumulation Unit Value at end of period $1.132 $1.101 $1.075 Number of Accumulation Units outstanding at end of period (in thousands) 20 20 16 HARTFORD VALUE HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.392 $1.151 $1.064 Accumulation Unit Value at end of period $1.505 $1.392 $1.151 Number of Accumulation Units outstanding at end of period (in thousands) 269 108 46 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.387 $1.149 $1.064 Accumulation Unit Value at end of period $1.497 $1.387 $1.149 Number of Accumulation Units outstanding at end of period (in thousands) 23 23 16 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.384 $1.148 $1.064 Accumulation Unit Value at end of period $1.493 $1.384 $1.148 Number of Accumulation Units outstanding at end of period (in thousands) 35 34 30 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.363 $1.133 $1.051 Accumulation Unit Value at end of period $1.467 $1.363 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 340 283 66 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.363 $1.133 $1.051 Accumulation Unit Value at end of period $1.467 $1.363 $1.133 Number of Accumulation Units outstanding at end of period (in thousands) 340 283 66 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.330 $1.108 $1.030 Accumulation Unit Value at end of period $1.427 $1.330 $1.108 Number of Accumulation Units outstanding at end of period (in thousands) 17 17 9 HARTFORD VALUE OPPORTUNITIES HLS FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $1.678 $1.421 $1.261 Accumulation Unit Value at end of period $1.561 $1.678 $1.421 Number of Accumulation Units outstanding at end of period (in thousands) 1,495 825 369 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $1.672 $1.418 $1.261 Accumulation Unit Value at end of period $1.552 $1.672 $1.418 Number of Accumulation Units outstanding at end of period (in thousands) 112 291 227 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $1.669 $1.417 $1.261 Accumulation Unit Value at end of period $1.548 $1.669 $1.417 Number of Accumulation Units outstanding at end of period (in thousands) 234 186 --
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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 $1.649 $1.403 $1.250 Accumulation Unit Value at end of period $1.526 $1.649 $1.403 Number of Accumulation Units outstanding at end of period (in thousands) 566 514 232 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.649 $1.403 $1.250 Accumulation Unit Value at end of period $1.526 $1.649 $1.403 Number of Accumulation Units outstanding at end of period (in thousands) 566 514 232 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $1.616 $1.379 $1.231 Accumulation Unit Value at end of period $1.491 $1.616 $1.379 Number of Accumulation Units outstanding at end of period (in thousands) 406 381 64 LORD ABBETT ALL VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.076 $10.613 $9.522 Accumulation Unit Value at end of period $12.791 $12.076 $10.613 Number of Accumulation Units outstanding at end of period (in thousands) 684 460 211 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.031 $10.595 $9.519 Accumulation Unit Value at end of period $12.719 $12.031 $10.595 Number of Accumulation Units outstanding at end of period (in thousands) 53 53 28 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.009 $10.586 $9.517 Accumulation Unit Value at end of period $12.683 $12.009 $10.586 Number of Accumulation Units outstanding at end of period (in thousands) 104 75 19 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.965 $10.568 $9.514 Accumulation Unit Value at end of period $12.611 $11.965 $10.568 Number of Accumulation Units outstanding at end of period (in thousands) 214 208 124 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.965 $10.568 $9.514 Accumulation Unit Value at end of period $12.611 $11.965 $10.568 Number of Accumulation Units outstanding at end of period (in thousands) 214 208 124 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.900 $10.542 $9.509 Accumulation Unit Value at end of period $12.504 $11.900 $10.542 Number of Accumulation Units outstanding at end of period (in thousands) 21 23 14 LORD ABBETT AMERICA'S VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.692 $10.284 $9.656 Accumulation Unit Value at end of period $11.972 $11.692 $10.284 Number of Accumulation Units outstanding at end of period (in thousands) 1,006 530 220 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.649 $10.266 $9.652 Accumulation Unit Value at end of period $11.904 $11.649 $10.266 Number of Accumulation Units outstanding at end of period (in thousands) 86 91 45 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.628 $10.258 $9.651 Accumulation Unit Value at end of period $11.870 $11.628 $10.258 Number of Accumulation Units outstanding at end of period (in thousands) 125 84 25 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.585 $10.241 $9.647 Accumulation Unit Value at end of period $11.803 $11.585 $10.241 Number of Accumulation Units outstanding at end of period (in thousands) 278 233 143
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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 $11.585 $10.241 $9.647 Accumulation Unit Value at end of period $11.803 $11.585 $10.241 Number of Accumulation Units outstanding at end of period (in thousands) 278 233 143 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.522 $10.215 $9.642 Accumulation Unit Value at end of period $11.703 $11.522 $10.215 Number of Accumulation Units outstanding at end of period (in thousands) 29 22 11 LORD ABBETT BOND-DEBENTURE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $10.870 $10.017 $9.575 Accumulation Unit Value at end of period $11.456 $10.870 $10.017 Number of Accumulation Units outstanding at end of period (in thousands) 940 523 193 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.830 $10.001 $9.571 Accumulation Unit Value at end of period $11.391 $10.830 $10.001 Number of Accumulation Units outstanding at end of period (in thousands) 62 73 46 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $10.810 $9.992 $9.570 Accumulation Unit Value at end of period $11.359 $10.810 $9.992 Number of Accumulation Units outstanding at end of period (in thousands) 99 63 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $10.771 $9.975 $9.566 Accumulation Unit Value at end of period $11.295 $10.771 $9.975 Number of Accumulation Units outstanding at end of period (in thousands) 281 224 125 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.771 $9.975 $9.566 Accumulation Unit Value at end of period $11.295 $10.771 $9.975 Number of Accumulation Units outstanding at end of period (in thousands) 281 224 125 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.711 $9.950 $9.561 Accumulation Unit Value at end of period $11.199 $10.711 $9.950 Number of Accumulation Units outstanding at end of period (in thousands) 7 9 5 LORD ABBETT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.955 $10.271 $9.597 Accumulation Unit Value at end of period $12.274 $11.955 $10.271 Number of Accumulation Units outstanding at end of period (in thousands) 2,619 1,154 219 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.912 $10.254 $9.594 Accumulation Unit Value at end of period $12.205 $11.912 $10.254 Number of Accumulation Units outstanding at end of period (in thousands) 117 107 55 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.890 $10.245 $9.592 Accumulation Unit Value at end of period $12.170 $11.890 $10.245 Number of Accumulation Units outstanding at end of period (in thousands) 211 117 28 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.846 $10.228 $9.589 Accumulation Unit Value at end of period $12.101 $11.846 $10.228 Number of Accumulation Units outstanding at end of period (in thousands) 519 402 153 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.846 $10.228 $9.589 Accumulation Unit Value at end of period $12.101 $11.846 $10.228 Number of Accumulation Units outstanding at end of period (in thousands) 519 402 153
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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 $11.781 $10.203 $9.584 Accumulation Unit Value at end of period $11.999 $11.781 $10.203 Number of Accumulation Units outstanding at end of period (in thousands) 44 19 12 LORD ABBETT LARGE-CAP CORE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.926 $10.641 $10.000 Accumulation Unit Value at end of period $13.100 $11.926 $10.641 Number of Accumulation Units outstanding at end of period (in thousands) 255 197 99 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.886 $10.627 $10.000 Accumulation Unit Value at end of period $13.031 $11.886 $10.627 Number of Accumulation Units outstanding at end of period (in thousands) 23 22 2 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.866 $10.620 $10.000 Accumulation Unit Value at end of period $12.996 $11.866 $10.620 Number of Accumulation Units outstanding at end of period (in thousands) 29 21 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.827 $10.606 $10.000 Accumulation Unit Value at end of period $12.927 $11.827 $10.606 Number of Accumulation Units outstanding at end of period (in thousands) 49 36 14 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.827 $10.606 $10.000 Accumulation Unit Value at end of period $12.927 $11.827 $10.606 Number of Accumulation Units outstanding at end of period (in thousands) 49 36 14 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.585 $10.000 Accumulation Unit Value at end of period $12.824 $11.768 $10.585 Number of Accumulation Units outstanding at end of period (in thousands) 3 6 1 OPPENHEIMER CAPITAL APPRECIATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.335 $10.605 $9.710 Accumulation Unit Value at end of period $12.809 $11.335 $10.605 Number of Accumulation Units outstanding at end of period (in thousands) 132 61 31 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.293 $10.587 $9.707 Accumulation Unit Value at end of period $12.737 $11.293 $10.587 Number of Accumulation Units outstanding at end of period (in thousands) 11 13 13 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.272 $10.579 $9.705 Accumulation Unit Value at end of period $12.700 $11.272 $10.579 Number of Accumulation Units outstanding at end of period (in thousands) 22 12 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.231 $10.561 $9.702 Accumulation Unit Value at end of period $12.629 $11.231 $10.561 Number of Accumulation Units outstanding at end of period (in thousands) 29 14 11 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.231 $10.561 $9.702 Accumulation Unit Value at end of period $12.629 $11.231 $10.561 Number of Accumulation Units outstanding at end of period (in thousands) 29 14 11 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.169 $10.534 $9.697 Accumulation Unit Value at end of period $12.522 $11.169 $10.534 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1
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AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 -------------------------------------------------------------------------------------- OPPENHEIMER GLOBAL SECURITIES FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.428 $11.527 $9.621 Accumulation Unit Value at end of period $14.138 $13.428 $11.527 Number of Accumulation Units outstanding at end of period (in thousands) 1,648 715 84 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.378 $11.508 $9.618 Accumulation Unit Value at end of period $14.058 $13.378 $11.508 Number of Accumulation Units outstanding at end of period (in thousands) 62 57 28 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.354 $11.498 $9.616 Accumulation Unit Value at end of period $14.018 $13.354 $11.498 Number of Accumulation Units outstanding at end of period (in thousands) 122 54 5 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.305 $11.479 $9.613 Accumulation Unit Value at end of period $13.939 $13.305 $11.479 Number of Accumulation Units outstanding at end of period (in thousands) 334 251 54 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.305 $11.479 $9.613 Accumulation Unit Value at end of period $13.939 $13.305 $11.479 Number of Accumulation Units outstanding at end of period (in thousands) 334 251 54 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.232 $11.450 $9.608 Accumulation Unit Value at end of period $13.820 $13.232 $11.450 Number of Accumulation Units outstanding at end of period (in thousands) 18 6 7 OPPENHEIMER MAIN STREET FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.942 $10.484 $9.606 Accumulation Unit Value at end of period $12.345 $11.942 $10.484 Number of Accumulation Units outstanding at end of period (in thousands) 57 34 32 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.898 $10.467 $9.603 Accumulation Unit Value at end of period $12.275 $11.898 $10.467 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.876 $10.458 $9.602 Accumulation Unit Value at end of period $12.240 $11.876 $10.458 Number of Accumulation Units outstanding at end of period (in thousands) 4 -- -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.833 $10.441 $9.598 Accumulation Unit Value at end of period $12.171 $11.833 $10.441 Number of Accumulation Units outstanding at end of period (in thousands) 17 12 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.833 $10.441 $9.598 Accumulation Unit Value at end of period $12.171 $11.833 $10.441 Number of Accumulation Units outstanding at end of period (in thousands) 17 12 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.768 $10.414 $9.593 Accumulation Unit Value at end of period $12.068 $11.768 $10.414 Number of Accumulation Units outstanding at end of period (in thousands) 2 -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND(R) WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.486 $10.971 $9.313 Accumulation Unit Value at end of period $12.220 $12.486 $10.971 Number of Accumulation Units outstanding at end of period (in thousands) 112 68 12
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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 $12.440 $10.953 $9.310 Accumulation Unit Value at end of period $12.151 $12.440 $10.953 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.417 $10.944 $9.309 Accumulation Unit Value at end of period $12.116 $12.417 $10.944 Number of Accumulation Units outstanding at end of period (in thousands) 14 5 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.371 $10.925 $9.305 Accumulation Unit Value at end of period $12.048 $12.371 $10.925 Number of Accumulation Units outstanding at end of period (in thousands) 24 20 6 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.371 $10.925 $9.305 Accumulation Unit Value at end of period $12.048 $12.371 $10.925 Number of Accumulation Units outstanding at end of period (in thousands) 24 20 6 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.303 $10.898 $9.301 Accumulation Unit Value at end of period $11.945 $12.303 $10.898 Number of Accumulation Units outstanding at end of period (in thousands) 1 -- -- OPPENHEIMER MIDCAP FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $11.343 $11.128 $9.497 Accumulation Unit Value at end of period $11.938 $11.343 $11.128 Number of Accumulation Units outstanding at end of period (in thousands) 14 2 1 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.302 $11.110 $9.494 Accumulation Unit Value at end of period $11.871 $11.302 $11.110 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.281 $11.100 $9.492 Accumulation Unit Value at end of period $11.837 $11.281 $11.100 Number of Accumulation Units outstanding at end of period (in thousands) 8 2 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.240 $11.082 $9.489 Accumulation Unit Value at end of period $11.770 $11.240 $11.082 Number of Accumulation Units outstanding at end of period (in thousands) 3 -- -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.240 $11.082 $9.489 Accumulation Unit Value at end of period $11.770 $11.240 $11.082 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 $11.178 $11.054 $9.484 Accumulation Unit Value at end of period $11.670 $11.178 $11.054 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 1 PUTNAM VT DIVERSIFIED INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $18.253 $17.302 $16.932 Accumulation Unit Value at end of period $18.865 $18.253 $17.302 Number of Accumulation Units outstanding at end of period (in thousands) 381 103 15 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $18.186 $17.273 $16.926 Accumulation Unit Value at end of period $18.758 $18.186 $17.273 Number of Accumulation Units outstanding at end of period (in thousands) 8 9 5
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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 $18.153 $17.258 $16.923 Accumulation Unit Value at end of period $18.705 $18.153 $17.258 Number of Accumulation Units outstanding at end of period (in thousands) 32 10 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $17.940 $17.090 $16.781 Accumulation Unit Value at end of period $18.449 $17.940 $17.090 Number of Accumulation Units outstanding at end of period (in thousands) 60 24 3 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.940 $17.090 $16.781 Accumulation Unit Value at end of period $18.449 $17.940 $17.090 Number of Accumulation Units outstanding at end of period (in thousands) 60 24 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $17.711 $16.922 $16.649 Accumulation Unit Value at end of period $18.159 $17.711 $16.922 Number of Accumulation Units outstanding at end of period (in thousands) 9 -- -- PUTNAM VT GLOBAL ASSET ALLOCATION FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $37.652 $33.614 $31.404 Accumulation Unit Value at end of period $38.469 $37.652 $33.614 Number of Accumulation Units outstanding at end of period (in thousands) 48 29 13 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $37.514 $33.558 $31.393 Accumulation Unit Value at end of period $38.252 $37.514 $33.558 Number of Accumulation Units outstanding at end of period (in thousands) 3 4 3 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $37.445 $33.529 $31.388 Accumulation Unit Value at end of period $38.143 $37.445 $33.529 Number of Accumulation Units outstanding at end of period (in thousands) 7 4 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $37.006 $33.203 $31.124 Accumulation Unit Value at end of period $37.621 $37.006 $33.203 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $37.006 $33.203 $31.124 Accumulation Unit Value at end of period $37.621 $37.006 $33.203 Number of Accumulation Units outstanding at end of period (in thousands) 4 3 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $36.533 $32.876 $30.879 Accumulation Unit Value at end of period $37.028 $36.533 $32.876 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $59.719 $51.909 $48.011 Accumulation Unit Value at end of period $55.693 $59.719 $51.909 Number of Accumulation Units outstanding at end of period (in thousands) 25 15 6 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $59.500 $51.822 $47.995 Accumulation Unit Value at end of period $55.378 $59.500 $51.822 Number of Accumulation Units outstanding at end of period (in thousands) -- 1 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $59.390 $51.779 $47.986 Accumulation Unit Value at end of period $55.221 $59.390 $51.779 Number of Accumulation Units outstanding at end of period (in thousands) 3 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 $58.694 $51.274 $47.582 Accumulation Unit Value at end of period $54.465 $58.694 $51.274 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $58.694 $51.274 $47.582 Accumulation Unit Value at end of period $54.465 $58.694 $51.274 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $57.943 $50.770 $47.208 Accumulation Unit Value at end of period $53.606 $57.943 $50.770 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL EQUITY FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $24.793 $19.558 $17.057 Accumulation Unit Value at end of period $26.667 $24.793 $19.558 Number of Accumulation Units outstanding at end of period (in thousands) 153 63 19 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $24.702 $19.526 $17.051 Accumulation Unit Value at end of period $26.516 $24.702 $19.526 Number of Accumulation Units outstanding at end of period (in thousands) 3 3 -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $24.657 $19.509 $17.048 Accumulation Unit Value at end of period $26.441 $24.657 $19.509 Number of Accumulation Units outstanding at end of period (in thousands) 19 11 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $24.368 $19.319 $16.905 Accumulation Unit Value at end of period $26.079 $24.368 $19.319 Number of Accumulation Units outstanding at end of period (in thousands) 24 13 2 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $24.368 $19.319 $16.905 Accumulation Unit Value at end of period $26.079 $24.368 $19.319 Number of Accumulation Units outstanding at end of period (in thousands) 24 13 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $24.056 $19.129 $16.772 Accumulation Unit Value at end of period $25.668 $24.056 $19.129 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT INTERNATIONAL GROWTH AND INCOME FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $9.876 -- -- (a) Accumulation Unit Value at end of period $9.771 -- -- 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 $9.873 -- -- (a) Accumulation Unit Value at end of period $9.766 -- -- Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $9.872 -- -- (a) Accumulation Unit Value at end of period $9.763 -- -- 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 $9.869 -- -- (a) Accumulation Unit Value at end of period $9.758 -- -- Number of Accumulation Units outstanding at end of period (in thousands) 4 -- --
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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 $9.869 -- -- (a) Accumulation Unit Value at end of period $9.758 -- -- 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 $9.865 -- -- (a) Accumulation Unit Value at end of period $9.750 -- -- 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 $11.234 $9.934 $8.759 Accumulation Unit Value at end of period $10.574 $11.234 $9.934 Number of Accumulation Units outstanding at end of period (in thousands) 107 67 17 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.193 $9.918 $8.756 Accumulation Unit Value at end of period $10.514 $11.193 $9.918 Number of Accumulation Units outstanding at end of period (in thousands) 7 7 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $11.172 $9.909 $8.755 Accumulation Unit Value at end of period $10.484 $11.172 $9.909 Number of Accumulation Units outstanding at end of period (in thousands) 12 5 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $11.041 $9.813 $8.681 Accumulation Unit Value at end of period $10.341 $11.041 $9.813 Number of Accumulation Units outstanding at end of period (in thousands) 15 13 1 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $11.041 $9.813 $8.681 Accumulation Unit Value at end of period $10.341 $11.041 $9.813 Number of Accumulation Units outstanding at end of period (in thousands) 15 13 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $10.900 $9.716 $8.613 Accumulation Unit Value at end of period $10.178 $10.900 $9.716 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- PUTNAM VT NEW VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $22.290 $19.358 $17.752 Accumulation Unit Value at end of period $21.042 $22.290 $19.358 Number of Accumulation Units outstanding at end of period (in thousands) 430 149 49 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $22.208 $19.326 $17.746 Accumulation Unit Value at end of period $20.923 $22.208 $19.326 Number of Accumulation Units outstanding at end of period (in thousands) 18 14 5 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $22.168 $19.309 $17.743 Accumulation Unit Value at end of period $20.864 $22.168 $19.309 Number of Accumulation Units outstanding at end of period (in thousands) 32 16 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $21.908 $19.121 $17.594 Accumulation Unit Value at end of period $20.578 $21.908 $19.121 Number of Accumulation Units outstanding at end of period (in thousands) 78 45 21 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $21.908 $19.121 $17.594 Accumulation Unit Value at end of period $20.578 $21.908 $19.121 Number of Accumulation Units outstanding at end of period (in thousands) 78 45 21
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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 $21.627 $18.933 $17.455 Accumulation Unit Value at end of period $20.254 $21.627 $18.933 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- PUTNAM VT SMALL CAP VALUE FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $27.062 $23.245 $20.274 Accumulation Unit Value at end of period $23.443 $27.062 $23.245 Number of Accumulation Units outstanding at end of period (in thousands) 108 82 33 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $26.962 $23.206 $20.267 Accumulation Unit Value at end of period $23.310 $26.962 $23.206 Number of Accumulation Units outstanding at end of period (in thousands) 11 11 5 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $26.913 $23.187 $20.264 Accumulation Unit Value at end of period $23.244 $26.913 $23.187 Number of Accumulation Units outstanding at end of period (in thousands) 15 15 3 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $26.598 $22.961 $20.093 Accumulation Unit Value at end of period $22.926 $26.598 $22.961 Number of Accumulation Units outstanding at end of period (in thousands) 35 37 21 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.598 $22.961 $20.093 Accumulation Unit Value at end of period $22.926 $26.598 $22.961 Number of Accumulation Units outstanding at end of period (in thousands) 35 37 21 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $26.257 $22.735 $19.936 Accumulation Unit Value at end of period $22.565 $26.257 $22.735 Number of Accumulation Units outstanding at end of period (in thousands) 5 5 4 PUTNAM VT THE GEORGE PUTNAM FUND OF BOSTON WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.805 $12.428 $11.853 Accumulation Unit Value at end of period $13.833 $13.805 $12.428 Number of Accumulation Units outstanding at end of period (in thousands) 208 171 69 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.755 $12.407 $11.849 Accumulation Unit Value at end of period $13.754 $13.755 $12.407 Number of Accumulation Units outstanding at end of period (in thousands) 32 29 16 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $13.729 $12.396 $11.847 Accumulation Unit Value at end of period $13.715 $13.729 $12.396 Number of Accumulation Units outstanding at end of period (in thousands) 20 16 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.568 $12.276 $11.747 Accumulation Unit Value at end of period $13.528 $13.568 $12.276 Number of Accumulation Units outstanding at end of period (in thousands) 98 91 68 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.568 $12.276 $11.747 Accumulation Unit Value at end of period $13.528 $13.568 $12.276 Number of Accumulation Units outstanding at end of period (in thousands) 98 91 68 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.395 $12.155 $11.655 Accumulation Unit Value at end of period $13.314 $13.395 $12.155 Number of Accumulation Units outstanding at end of period (in thousands) 5 7 5
63 -------------------------------------------------------------------------------
AS OF DECEMBER 31, SUB-ACCOUNT 2007 2006 2005 ------------------------------------------------------------------------------------------- PUTNAM VT VISTA FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.506 $15.770 $13.439 Accumulation Unit Value at end of period $17.007 $16.506 $15.770 Number of Accumulation Units outstanding at end of period (in thousands) 17 15 5 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.445 $15.744 $13.434 Accumulation Unit Value at end of period $16.910 $16.445 $15.744 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 $16.415 $15.731 $13.432 Accumulation Unit Value at end of period $16.863 $16.415 $15.731 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 $16.223 $15.578 $13.319 Accumulation Unit Value at end of period $16.632 $16.223 $15.578 Number of Accumulation Units outstanding at end of period (in thousands) 2 4 -- WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.223 $15.578 $13.319 Accumulation Unit Value at end of period $16.632 $16.223 $15.578 Number of Accumulation Units outstanding at end of period (in thousands) 2 4 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.015 $15.424 $13.214 Accumulation Unit Value at end of period $16.370 $16.015 $15.424 Number of Accumulation Units outstanding at end of period (in thousands) 2 2 2 PUTNAM VT VOYAGER FUND WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $55.681 $53.208 $46.938 Accumulation Unit Value at end of period $58.316 $55.681 $53.208 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $55.477 $53.119 $46.921 Accumulation Unit Value at end of period $57.986 $55.477 $53.119 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $55.375 $53.075 $46.913 Accumulation Unit Value at end of period $57.822 $55.375 $53.075 Number of Accumulation Units outstanding at end of period (in thousands) 1 1 -- WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $54.726 $52.558 $46.518 Accumulation Unit Value at end of period $57.030 $54.726 $52.558 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 $54.726 $52.558 $46.518 Accumulation Unit Value at end of period $57.030 $54.726 $52.558 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 $54.026 $52.041 $46.153 Accumulation Unit Value at end of period $56.131 $54.026 $52.041 Number of Accumulation Units outstanding at end of period (in thousands) -- -- -- VAN KAMPEN -- UIF EMERGING MARKETS EQUITY PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.526 $12.138 $9.045 Accumulation Unit Value at end of period $23.038 $16.526 $12.138 Number of Accumulation Units outstanding at end of period (in thousands) 106 43 18
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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 $16.465 $12.118 $9.042 Accumulation Unit Value at end of period $22.908 $16.465 $12.118 Number of Accumulation Units outstanding at end of period (in thousands) 5 5 1 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.435 $12.108 $9.041 Accumulation Unit Value at end of period $22.843 $16.435 $12.108 Number of Accumulation Units outstanding at end of period (in thousands) 10 6 1 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.374 $12.088 $9.038 Accumulation Unit Value at end of period $22.714 $16.374 $12.088 Number of Accumulation Units outstanding at end of period (in thousands) 117 52 7 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.374 $12.088 $9.038 Accumulation Unit Value at end of period $22.714 $16.374 $12.088 Number of Accumulation Units outstanding at end of period (in thousands) 117 52 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.285 $12.057 $9.033 Accumulation Unit Value at end of period $22.522 $16.285 $12.057 Number of Accumulation Units outstanding at end of period (in thousands) 14 12 -- VAN KAMPEN -- UIF MID CAP GROWTH PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $12.799 $11.816 $9.508 Accumulation Unit Value at end of period $15.576 $12.799 $11.816 Number of Accumulation Units outstanding at end of period (in thousands) 255 184 76 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.752 $11.796 $9.504 Accumulation Unit Value at end of period $15.488 $12.752 $11.796 Number of Accumulation Units outstanding at end of period (in thousands) 21 18 6 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $12.729 $11.786 $9.503 Accumulation Unit Value at end of period $15.444 $12.729 $11.786 Number of Accumulation Units outstanding at end of period (in thousands) 45 36 7 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $12.682 $11.766 $9.500 Accumulation Unit Value at end of period $15.357 $12.682 $11.766 Number of Accumulation Units outstanding at end of period (in thousands) 61 58 24 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.682 $11.766 $9.500 Accumulation Unit Value at end of period $15.357 $12.682 $11.766 Number of Accumulation Units outstanding at end of period (in thousands) 61 58 24 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.612 $11.737 $9.495 Accumulation Unit Value at end of period $15.227 $12.612 $11.737 Number of Accumulation Units outstanding at end of period (in thousands) 2 1 -- VAN KAMPEN -- UIF U.S. MID CAP VALUE PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $13.156 $10.989 $9.644 Accumulation Unit Value at end of period $14.069 $13.156 $10.989 Number of Accumulation Units outstanding at end of period (in thousands) 237 99 27 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.108 $10.971 $9.641 Accumulation Unit Value at end of period $13.989 $13.108 $10.971 Number of Accumulation Units outstanding at end of period (in thousands) 8 4 1
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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 $13.084 $10.961 $9.639 Accumulation Unit Value at end of period $13.950 $13.084 $10.961 Number of Accumulation Units outstanding at end of period (in thousands) 17 9 2 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $13.036 $10.943 $9.636 Accumulation Unit Value at end of period $13.871 $13.036 $10.943 Number of Accumulation Units outstanding at end of period (in thousands) 34 18 4 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $13.036 $10.943 $9.636 Accumulation Unit Value at end of period $13.871 $13.036 $10.943 Number of Accumulation Units outstanding at end of period (in thousands) 34 18 4 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $12.964 $10.916 $9.631 Accumulation Unit Value at end of period $13.753 $12.964 $10.916 Number of Accumulation Units outstanding at end of period (in thousands) 6 5 1 VAN KAMPEN LIT COMSTOCK PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.954 $14.720 $13.894 Accumulation Unit Value at end of period $16.435 $16.954 $14.720 Number of Accumulation Units outstanding at end of period (in thousands) 1,156 742 298 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.891 $14.695 $13.889 Accumulation Unit Value at end of period $16.342 $16.891 $14.695 Number of Accumulation Units outstanding at end of period (in thousands) 94 96 55 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.860 $14.683 $13.887 Accumulation Unit Value at end of period $16.296 $16.860 $14.683 Number of Accumulation Units outstanding at end of period (in thousands) 154 109 19 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.799 $14.658 $13.882 Accumulation Unit Value at end of period $16.204 $16.799 $14.658 Number of Accumulation Units outstanding at end of period (in thousands) 291 270 164 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.799 $14.658 $13.882 Accumulation Unit Value at end of period $16.204 $16.799 $14.658 Number of Accumulation Units outstanding at end of period (in thousands) 291 270 164 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.706 $14.621 $13.875 Accumulation Unit Value at end of period $16.066 $16.706 $14.621 Number of Accumulation Units outstanding at end of period (in thousands) 18 18 11 VAN KAMPEN LIT GROWTH AND INCOME PORTFOLIO WITHOUT ANY OPTIONAL BENEFITS Accumulation Unit Value at beginning of period $16.884 $14.668 $13.336 Accumulation Unit Value at end of period $17.181 $16.884 $14.668 Number of Accumulation Units outstanding at end of period (in thousands) 1,536 710 225 WITH THE HARTFORD'S PRINCIPAL FIRST PREFERRED Accumulation Unit Value at beginning of period $16.822 $14.644 $13.332 Accumulation Unit Value at end of period $17.084 $16.822 $14.644 Number of Accumulation Units outstanding at end of period (in thousands) 70 71 31 WITH MAV/EPB DEATH BENEFIT Accumulation Unit Value at beginning of period $16.791 $14.631 $13.330 Accumulation Unit Value at end of period $17.035 $16.791 $14.631 Number of Accumulation Units outstanding at end of period (in thousands) 145 85 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 $16.730 $14.607 $13.325 Accumulation Unit Value at end of period $16.939 $16.730 $14.607 Number of Accumulation Units outstanding at end of period (in thousands) 299 234 124 WITH THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.730 $14.607 $13.325 Accumulation Unit Value at end of period $16.939 $16.730 $14.607 Number of Accumulation Units outstanding at end of period (in thousands) 299 234 124 WITH MAV/EPB DEATH BENEFIT AND THE HARTFORD'S PRINCIPAL FIRST (50 BPS) Accumulation Unit Value at beginning of period $16.638 $14.570 $13.318 Accumulation Unit Value at end of period $16.795 $16.638 $14.570 Number of Accumulation Units outstanding at end of period (in thousands) 18 15 9
(a) Inception date November 12, 2007. REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM THE CONTRACT OWNERS OF HARTFORD LIFE INSURANCE COMPANY SEPARATE ACCOUNT THREE AND THE BOARD OF DIRECTORS OF HARTFORD LIFE 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 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 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 INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH VP INTERNATIONAL PORTFOLIO GROWTH PORTFOLIO VALUE PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 3,317,612 185,168 6,191,585 ============= ============ ============== Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $40,834,276 $2,486,402 $135,512,151 ============= ============ ============== Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $43,029,423 $2,727,525 $154,046,640 Due from Hartford Life Insurance Company 120,584 1,915 375,648 Receivable from fund shares sold -- -- -- Other assets -- -- 1 ------------- ------------ -------------- Total Assets 43,150,007 2,729,440 154,422,289 ------------- ------------ -------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 120,584 1,915 375,648 Other liabilities -- -- -- ------------- ------------ -------------- Total Liabilities 120,584 1,915 375,648 ------------- ------------ -------------- NET ASSETS: For Variable Annuity Contract Liabilities $43,029,423 $2,727,525 $154,046,641 ============= ============ ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-2 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN AMERICAN FUNDS VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL GLOBAL GROWTH VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- 172,018 Other 1,007,120 4,638,773 21,086 -- ============= ============= ========== ============ Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- $2,915,800 Other $17,991,917 $63,870,070 $553,774 -- ============= ============= ========== ============ Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- $4,300,452 Other $17,151,245 $63,968,684 $521,465 -- Due from Hartford Life Insurance Company 26,163 264,910 11,912 -- Receivable from fund shares sold -- -- -- 1,873 Other assets -- 1 -- -- ------------- ------------- ---------- ------------ Total Assets 17,177,408 64,233,595 533,377 4,302,325 ------------- ------------- ---------- ------------ LIABILITIES: Due to Hartford Life Insurance Company -- -- -- 1,873 Payable for fund shares purchased 26,163 264,910 11,912 -- Other liabilities -- -- -- -- ------------- ------------- ---------- ------------ Total Liabilities 26,163 264,910 11,912 1,873 ------------- ------------- ---------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $17,151,245 $63,968,685 $521,465 $4,300,452 ============= ============= ========== ============ AMERICAN FUNDS AMERICAN FUNDS GROWTH-INCOME AMERICAN FUNDS GROWTH FUND FUND INTERNATIONAL FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 510,054 593,959 681,668 Other -- -- -- ============= ============= ============= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 $24,260,576 $19,041,559 $10,831,397 Other -- -- -- ============= ============= ============= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 $34,030,792 $25,100,711 $16,850,838 Other -- -- -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 3,957 6,508 5,296 Other assets -- -- -- ------------- ------------- ------------- Total Assets 34,034,749 25,107,219 16,856,134 ------------- ------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company 3,957 6,508 5,296 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------- ------------- ------------- Total Liabilities 3,957 6,508 5,296 ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $34,030,792 $25,100,711 $16,850,838 ============= ============= =============
(a) From inception November 12, 2007 to December 31, 2007. SA-3 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL BB&T CAPITAL CAPITALIZATION BB&T MID CAP MANAGER FUND GROWTH VIF EQUITY VIF SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 195,575 -- -- Other -- 200,604 167,452 ============ ============ ============ Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 $3,201,626 -- -- Other -- $3,246,486 $1,845,509 ============ ============ ============ Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 $5,270,761 -- -- Other -- $3,669,055 $1,729,776 Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 5,530 12,279 221 Other assets -- -- -- ------------ ------------ ------------ Total Assets 5,276,291 3,681,334 1,729,997 ------------ ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company 5,530 12,279 221 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------ ------------ ------------ Total Liabilities 5,530 12,279 221 ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $5,270,761 $3,669,055 $1,729,776 ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-4 -------------------------------------------------------------------------------
BB&T SPECIAL BB&T LARGE OPPORTUNITIES BB&T TOTAL EVERGREEN VA CAP VIF EQUITY VIF RETURN BOND VIF BALANCED FUND SUB-ACCOUNT (B) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- 40,122 Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 315,273 891,484 290,431 -- ============ ============= ============ ========== Cost: Class I -- -- -- $596,836 Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $5,040,767 $12,890,871 $2,870,381 -- ============ ============= ============ ========== Market Value: Class I -- -- -- $621,494 Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $4,322,391 $14,290,483 $2,910,114 -- Due from Hartford Life Insurance Company -- 13,026 17,525 1,563 Receivable from fund shares sold 3,275 -- -- -- Other assets -- -- 30 -- ------------ ------------- ------------ ---------- Total Assets 4,325,666 14,303,509 2,927,669 623,057 ------------ ------------- ------------ ---------- LIABILITIES: Due to Hartford Life Insurance Company 3,275 -- -- -- Payable for fund shares purchased -- 13,026 17,525 1,563 Other liabilities -- -- -- -- ------------ ------------- ------------ ---------- Total Liabilities 3,275 13,026 17,525 1,563 ------------ ------------- ------------ ---------- NET ASSETS: For Variable Annuity Contract Liabilities $4,322,391 $14,290,483 $2,910,144 $621,494 ============ ============= ============ ========== EVERGREEN VA EVERGREEN VA INTERNATIONAL EVERGREEN VA GROWTH FUND EQUITY FUND OMEGA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I 376,550 119,366 2,237 Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============ ========= Cost: Class I $5,562,878 $1,978,984 $37,277 Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============ ========= Market Value: Class I $5,279,228 $2,010,131 $44,335 Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- Due from Hartford Life Insurance Company -- 22,101 -- Receivable from fund shares sold 140 -- 3 Other assets -- -- -- ------------ ------------ --------- Total Assets 5,279,368 2,032,232 44,338 ------------ ------------ --------- LIABILITIES: Due to Hartford Life Insurance Company 140 -- 3 Payable for fund shares purchased -- 22,101 -- Other liabilities -- -- -- ------------ ------------ --------- Total Liabilities 140 22,101 3 ------------ ------------ --------- NET ASSETS: For Variable Annuity Contract Liabilities $5,279,228 $2,010,131 $44,335 ============ ============ =========
(b) Effective February 9, 2007, BB&T Large Cap Growth VIF merged with BB&T Large Cap VIF. SA-5 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
EVERGREEN VA EVERGREEN VA SPECIAL VALUES FUNDAMENTAL FIDELITY(R) VIP FUND LARGE CAP FUND EQUITY-INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I 879,468 12,743 -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- 3,141,768 ============= ========== ============= Cost: Class I $14,690,508 $243,569 -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- $79,870,208 ============= ========== ============= Market Value: Class I $11,951,973 $246,329 -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- $74,051,461 Due from Hartford Life Insurance Company 23,729 -- 163,471 Receivable from fund shares sold -- 12 -- Other assets 2 -- -- ------------- ---------- ------------- Total Assets 11,975,704 246,341 74,214,932 ------------- ---------- ------------- LIABILITIES: Due to Hartford Life Insurance Company -- 12 -- Payable for fund shares purchased 23,729 -- 163,471 Other liabilities -- -- -- ------------- ---------- ------------- Total Liabilities 23,729 12 163,471 ------------- ---------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $11,951,975 $246,329 $74,051,461 ============= ========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-6 -------------------------------------------------------------------------------
FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP GROWTH CONTRAFUND(R) MID CAP VALUE STRATEGIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 573,997 14,960,778 2,814,479 550,592 ============= ============== ============== ============ Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $19,915,891 $460,724,344 $93,625,813 $7,230,589 ============= ============== ============== ============ Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $25,628,953 $410,822,945 $100,279,865 $6,948,465 Due from Hartford Life Insurance Company 9,440 1,070,233 90,694 6,493 Receivable from fund shares sold -- -- -- -- Other assets -- -- 1 -- ------------- -------------- -------------- ------------ Total Assets 25,638,393 411,893,178 100,370,560 6,954,958 ------------- -------------- -------------- ------------ LIABILITIES: Due to Hartford Life Insurance Company -- -- -- -- Payable for fund shares purchased 9,440 1,070,233 90,694 6,493 Other liabilities -- 3 -- -- ------------- -------------- -------------- ------------ Total Liabilities 9,440 1,070,236 90,694 6,493 ------------- -------------- -------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $25,628,953 $410,822,942 $100,279,866 $6,948,465 ============= ============== ============== ============ FIDELITY(R) VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FRANKLIN STRATEGIC APPRECIATION CAP GROWTH INCOME SECURITIES PORTFOLIO SECURITIES FUND FUND SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- 1,269,988 Class 2 2,410 172,748 -- Other -- -- -- ========= ============ ============= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- $15,554,271 Class 2 $23,254 $3,149,329 -- Other -- -- -- ========= ============ ============= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- $16,230,440 Class 2 $21,639 $3,957,663 -- Other -- -- -- Due from Hartford Life Insurance Company 4,870 -- -- Receivable from fund shares sold -- 1,050 18,704 Other assets -- -- -- --------- ------------ ------------- Total Assets 26,509 3,958,713 16,249,144 --------- ------------ ------------- LIABILITIES: Due to Hartford Life Insurance Company -- 1,050 18,704 Payable for fund shares purchased 4,870 -- -- Other liabilities -- -- -- --------- ------------ ------------- Total Liabilities 4,870 1,050 18,704 --------- ------------ ------------- NET ASSETS: For Variable Annuity Contract Liabilities $21,639 $3,957,663 $16,230,440 ========= ============ =============
(a) From inception November 12, 2007 to December 31, 2007. SA-7 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
TEMPLETON MUTUAL SHARES DEVELOPING MARKETS TEMPLETON GROWTH SECURITIES FUND SECURITIES FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- 195,104 -- Class 2 693,232 -- 259,331 Other -- -- -- ============= ============ ============ Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- $1,591,107 -- Class 2 $10,159,967 -- $2,841,257 Other -- -- -- ============= ============ ============ Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- $3,154,826 -- Class 2 $13,996,363 -- $4,004,067 Other -- -- -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 1,768 632 595 Other assets -- -- -- ------------- ------------ ------------ Total Assets 13,998,131 3,155,458 4,004,662 ------------- ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company 1,768 632 595 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------- ------------ ------------ Total Liabilities 1,768 632 595 ------------- ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $13,996,363 $3,154,826 $4,004,067 ============= ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-8 -------------------------------------------------------------------------------
HARTFORD HARTFORD HARTFORD LARGECAP HARTFORD TOTAL DIVIDEND AND ADVISERS GROWTH RETURN BOND GROWTH HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 1,348,632 5,102 34,655,584 14,005,367 ============= ========== ============== ============== Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $31,023,896 $100,978 $396,094,632 $319,044,477 ============= ========== ============== ============== Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $28,287,155 $100,909 $386,265,276 $312,977,703 Due from Hartford Life Insurance Company 49,086 599 896,382 488,080 Receivable from fund shares sold -- -- -- -- Other assets -- -- 28 20 ------------- ---------- -------------- -------------- Total Assets 28,336,241 101,508 387,161,686 313,465,803 ------------- ---------- -------------- -------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- -- Payable for fund shares purchased 49,086 599 896,382 488,080 Other liabilities 6 -- -- -- ------------- ---------- -------------- -------------- Total Liabilities 49,092 599 896,382 488,080 ------------- ---------- -------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $28,287,149 $100,909 $386,265,304 $312,977,723 ============= ========== ============== ============== HARTFORD FUNDAMENTAL HARTFORD HARTFORD GROWTH GLOBAL ADVISERS GLOBAL GROWTH HLS FUND HLS FUND HLS FUND SUB-ACCOUNT (C) SUB-ACCOUNT SUB-ACCOUNT (D) ----------------------------- ---------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 152,519 362,856 396,554 ============ ============ ============ Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $1,636,972 $4,685,193 $7,984,031 ============ ============ ============ Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $1,692,496 $4,938,379 $8,890,530 Due from Hartford Life Insurance Company -- 49,387 6,460 Receivable from fund shares sold 155 -- -- Other assets -- -- -- ------------ ------------ ------------ Total Assets 1,692,651 4,987,766 8,896,990 ------------ ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company 155 -- -- Payable for fund shares purchased -- 49,387 6,460 Other liabilities -- -- -- ------------ ------------ ------------ Total Liabilities 155 49,387 6,460 ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $1,692,496 $4,938,379 $8,890,530 ============ ============ ============
(a) From inception November 12, 2007 to December 31, 2007. (c) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. (d) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. SA-9 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD DISCIPLINED HARTFORD GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 17,433,877 936,511 1,632,037 ============== ============= ============= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $232,237,911 $11,771,418 $52,416,980 ============== ============= ============= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $262,380,259 $12,542,884 $53,455,580 Due from Hartford Life Insurance Company -- 12,111 122,234 Receivable from fund shares sold 19,067 -- -- Other assets -- -- 3 -------------- ------------- ------------- Total Assets 262,399,326 12,554,995 53,577,817 -------------- ------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company 19,067 -- -- Payable for fund shares purchased -- 12,111 122,234 Other liabilities 6 -- -- -------------- ------------- ------------- Total Liabilities 19,073 12,111 122,234 -------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $262,380,253 $12,542,884 $53,455,583 ============== ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-10 -------------------------------------------------------------------------------
HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL HARTFORD HIGH HARTFORD INDEX GROWTH SMALL COMPANY YIELD HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (E) SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 2,948,104 290,813 2,739,244 996,571 ============ =========== ============ ============ Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $28,309,268 $9,471,177 $38,383,619 $16,527,103 ============ =========== ============ ============ Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $26,135,341 $9,172,268 $39,632,227 $15,019,671 Due from Hartford Life Insurance Company 46,737 -- 102,858 20,932 Receivable from fund shares sold -- 49,267 -- -- Other assets 1 2 1 -- ------------ ----------- ------------ ------------ Total Assets 26,182,079 9,221,537 39,735,086 15,040,603 ------------ ----------- ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company -- 49,267 -- -- Payable for fund shares purchased 46,737 -- 102,858 20,932 Other liabilities -- -- -- -- ------------ ----------- ------------ ------------ Total Liabilities 46,737 49,267 102,858 20,932 ------------ ----------- ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $26,135,342 $9,172,270 $39,632,228 $15,019,671 ============ =========== ============ ============ HARTFORD INTERNATIONAL HARTFORD OPPORTUNITIES HARTFORD MIDCAP MONEY MARKET HLS FUND GROWTH HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ----------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 5,039,417 14,663 59,926,556 =========== ========= =========== Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $73,872,029 $160,921 $59,926,556 =========== ========= =========== Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $78,718,161 $149,469 $59,926,556 Due from Hartford Life Insurance Company 20,903 -- -- Receivable from fund shares sold -- 19 776,797 Other assets -- -- 44 ----------- --------- ----------- Total Assets 78,739,064 149,488 60,703,397 ----------- --------- ----------- LIABILITIES: Due to Hartford Life Insurance Company -- 19 776,796 Payable for fund shares purchased 20,903 -- -- Other liabilities 7 -- -- ----------- --------- ----------- Total Liabilities 20,910 19 776,796 ----------- --------- ----------- NET ASSETS: For Variable Annuity Contract Liabilities $78,718,154 $149,469 $59,926,601 =========== ========= ===========
(a) From inception November 12, 2007 to December 31, 2007. (e) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-11 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD MORTGAGE HARTFORD HARTFORD SMALL SECURITIES SMALLCAP VALUE COMPANY HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ---------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 794,485 4,176 863,548 ============ ========= ============= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $8,899,316 $47,390 $17,361,023 ============ ========= ============= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $8,397,335 $44,651 $16,076,828 Due from Hartford Life Insurance Company 76,454 -- 239,720 Receivable from fund shares sold -- 5 -- Other assets -- -- -- ------------ --------- ------------- Total Assets 8,473,789 44,656 16,316,548 ------------ --------- ------------- LIABILITIES: Due to Hartford Life Insurance Company -- 5 -- Payable for fund shares purchased 76,454 -- 239,720 Other liabilities 1 -- 2 ------------ --------- ------------- Total Liabilities 76,455 5 239,722 ------------ --------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $8,397,334 $44,651 $16,076,826 ============ ========= =============
(a) From inception November 12, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-12 -------------------------------------------------------------------------------
HARTFORD HARTFORD U.S. SMALLCAP GOVERNMENT GROWTH HARTFORD STOCK SECURITIES HARTFORD VALUE HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 1,149,565 448,282 14,340,772 2,039,374 ============== ============== ================ ============== Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $24,324,374 $22,383,024 $158,353,718 $26,138,644 ============== ============== ================ ============== Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $21,505,263 $21,119,732 $159,909,641 $26,170,488 Due from Hartford Life Insurance Company 11,824 14,016 489,464 422,873 Receivable from fund shares sold -- -- -- -- Other assets 3 1 -- -- -------------- -------------- ---------------- -------------- Total Assets 21,517,090 21,133,749 160,399,105 26,593,361 -------------- -------------- ---------------- -------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- -- Payable for fund shares purchased 11,824 14,016 489,464 422,873 Other liabilities -- -- 14 2 -------------- -------------- ---------------- -------------- Total Liabilities 11,824 14,016 489,478 422,875 -------------- -------------- ---------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $21,505,266 $21,119,733 $159,909,627 $26,170,486 ============== ============== ================ ============== HARTFORD VALUE HARTFORD HUNTINGTON VA OPPORTUNITIES EQUITY INCOME INCOME EQUITY HLS FUND HLS FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 1,271,385 826,518 231,264 ============== ============== ============= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $24,215,899 $11,403,258 $2,803,761 ============== ============== ============= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $19,607,555 $11,819,143 $2,800,602 Due from Hartford Life Insurance Company 27,500 -- -- Receivable from fund shares sold -- 16,489 14,588 Other assets -- -- 1 -------------- -------------- ------------- Total Assets 19,635,055 11,835,632 2,815,191 -------------- -------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company -- 16,489 14,588 Payable for fund shares purchased 27,500 -- -- Other liabilities 1 -- -- -------------- -------------- ------------- Total Liabilities 27,501 16,489 14,588 -------------- -------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $19,607,554 $11,819,143 $2,800,603 ============== ============== =============
SA-13 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA DIVIDEND HUNTINGTON VA MID CORP CAPTURE FUND GROWTH FUND AMERICA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 434,541 179,495 175,953 =========== =========== =========== Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $5,504,212 $1,715,626 $2,981,528 =========== =========== =========== Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $5,114,552 $1,949,318 $3,274,476 Due from Hartford Life Insurance Company 1,406 6,571 12,177 Receivable from fund shares sold -- -- -- Other assets 1 -- -- ----------- ----------- ----------- Total Assets 5,115,959 1,955,889 3,286,653 ----------- ----------- ----------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 1,406 6,571 12,177 Other liabilities -- -- -- ----------- ----------- ----------- Total Liabilities 1,406 6,571 12,177 ----------- ----------- ----------- NET ASSETS: For Variable Annuity Contract Liabilities $5,114,553 $1,949,318 $3,274,476 =========== =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-14 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA NEW ECONOMY ROTATING INTERNATIONAL HUNTINGTON VA FUND MARKETS FUND EQUITY FUND MACRO 100 FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 193,090 82,841 170,628 179,477 =========== =========== =========== =========== Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $3,289,423 $1,206,023 $2,605,432 $2,078,446 =========== =========== =========== =========== Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $3,755,601 $1,246,749 $3,049,116 $1,819,896 Due from Hartford Life Insurance Company 5,223 6,027 8,653 7,243 Receivable from fund shares sold -- -- -- -- Other assets -- -- -- -- ----------- ----------- ----------- ----------- Total Assets 3,760,824 1,252,776 3,057,769 1,827,139 ----------- ----------- ----------- ----------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- -- Payable for fund shares purchased 5,223 6,027 8,653 7,243 Other liabilities -- -- -- -- ----------- ----------- ----------- ----------- Total Liabilities 5,223 6,027 8,653 7,243 ----------- ----------- ----------- ----------- NET ASSETS: For Variable Annuity Contract Liabilities $3,755,601 $1,246,749 $3,049,116 $1,819,896 =========== =========== =========== =========== HUNTINGTON VA HUNTINGTON VA MORTGAGE SITUS SMALL LORD ABBETT ALL SECURITIES FUND CAP FUND VALUE PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 115,281 382,742 559,110 ========== ========== ========== Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $1,265,026 $5,545,984 $9,019,392 ========== ========== ========== Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $1,304,983 $5,798,539 $9,415,414 Due from Hartford Life Insurance Company 820 6,321 291 Receivable from fund shares sold -- -- -- Other assets -- -- -- ---------- ---------- ---------- Total Assets 1,305,803 5,804,860 9,415,705 ---------- ---------- ---------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 820 6,321 291 Other liabilities -- -- -- ---------- ---------- ---------- Total Liabilities 820 6,321 291 ---------- ---------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $1,304,983 $5,798,539 $9,415,414 ========== ========== ==========
SA-15 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
LORD ABBETT LORD ABBETT AMERICA'S VALUE LORD ABBETT BOND GROWTH AND PORTFOLIO DEBENTURE FUND INCOME PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT (F) SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 439,638 2,674,040 5,435,856 ============ ============= ============== Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $6,541,732 $32,280,426 $158,255,469 ============ ============= ============== Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $6,502,251 $31,473,453 $151,714,747 Due from Hartford Life Insurance Company 37,442 97,375 313,298 Receivable from fund shares sold -- -- -- Other assets -- -- -- ------------ ------------- -------------- Total Assets 6,539,693 31,570,828 152,028,045 ------------ ------------- -------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 37,442 97,375 313,298 Other liabilities -- -- 1 ------------ ------------- -------------- Total Liabilities 37,442 97,375 313,299 ------------ ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $6,502,251 $31,473,453 $151,714,746 ============ ============= ==============
(f) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-16 -------------------------------------------------------------------------------
LORD ABBETT MFS INVESTORS LARGE CAP MFS CORE MFS EMERGING GROWTH STOCK CORE FUND EQUITY SERIES GROWTH SERIES SERIES SUB-ACCOUNT (G) SUB-ACCOUNT (H) SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 408,045 37,333 32,048 36,498 ============ ========== ========== ========== Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $4,938,716 $642,372 $833,439 $416,856 ============ ========== ========== ========== Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $5,259,703 $641,377 $801,536 $431,405 Due from Hartford Life Insurance Company 892 -- -- -- Receivable from fund shares sold -- 85 142 57 Other assets -- -- -- -- ------------ ---------- ---------- ---------- Total Assets 5,260,595 641,462 801,678 431,462 ------------ ---------- ---------- ---------- LIABILITIES: Due to Hartford Life Insurance Company -- 85 142 57 Payable for fund shares purchased 892 -- -- -- Other liabilities -- -- -- -- ------------ ---------- ---------- ---------- Total Liabilities 892 85 142 57 ------------ ---------- ---------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $5,259,703 $641,377 $801,536 $431,405 ============ ========== ========== ========== MFS INVESTORS MFS TOTAL EQUITY AND TRUST SERIES RETURN SERIES INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- 18,705 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 55,438 606,728 -- ============ ============= ========== Cost: Class I -- -- -- Class II -- -- $257,775 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $971,095 $11,439,984 -- ============ ============= ========== Market Value: Class I -- -- -- Class II -- -- $275,714 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $1,303,898 $13,153,858 -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 470 1,984 72 Other assets -- -- -- ------------ ------------- ---------- Total Assets 1,304,368 13,155,842 275,786 ------------ ------------- ---------- LIABILITIES: Due to Hartford Life Insurance Company 470 1,984 72 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------ ------------- ---------- Total Liabilities 470 1,984 72 ------------ ------------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $1,303,898 $13,153,858 $275,714 ============ ============= ==========
(g) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (h) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-17 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
CORE PLUS EMERGING EMERGING FIXED INCOME MARKETS DEBT MARKETS EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I 919,833 126,173 82,962 Class II -- -- 1,293,141 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============= ============ ============= Cost: Class I $10,299,012 $1,016,818 $1,121,995 Class II -- -- 24,341,910 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============= ============ ============= Market Value: Class I $10,651,667 $1,076,257 $2,013,497 Class II -- -- 31,358,660 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- Due from Hartford Life Insurance Company -- -- 419,827 Receivable from fund shares sold 1,387 52 -- Other assets -- -- -- ------------- ------------ ------------- Total Assets 10,653,054 1,076,309 33,791,984 ------------- ------------ ------------- LIABILITIES: Due to Hartford Life Insurance Company 1,387 52 -- Payable for fund shares purchased -- -- 419,827 Other liabilities -- -- -- ------------- ------------ ------------- Total Liabilities 1,387 52 419,827 ------------- ------------ ------------- NET ASSETS: For Variable Annuity Contract Liabilities $10,651,667 $1,076,257 $33,372,157 ============= ============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-18 -------------------------------------------------------------------------------
MID CAP U.S. MID HIGH YIELD GROWTH CAP VALUE FOCUS GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I 138,442 -- 278,999 -- Class II -- 852,645 580,139 -- Class X -- -- -- 527,639 Class Y -- -- -- 140,194 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============ ============= ============= ============= Cost: Class I $2,140,844 -- $4,084,386 -- Class II -- $11,073,343 11,176,372 -- Class X -- -- -- $7,193,115 Class Y -- -- -- 3,311,789 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============ ============= ============= ============= Market Value: Class I $1,783,128 -- $5,331,678 -- Class II -- $12,363,359 11,045,852 -- Class X -- -- -- $11,175,396 Class Y -- -- -- 2,939,880 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- Due from Hartford Life Insurance Company -- 24,080 9,909 -- Receivable from fund shares sold 93 -- -- 3,147 Other assets -- -- -- -- ------------ ------------- ------------- ------------- Total Assets 1,783,221 12,387,439 16,387,439 14,118,423 ------------ ------------- ------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company 93 -- -- 3,147 Payable for fund shares purchased -- 24,080 9,909 -- Other liabilities -- -- -- -- ------------ ------------- ------------- ------------- Total Liabilities 93 24,080 9,909 3,147 ------------ ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $1,783,128 $12,363,359 $16,377,530 $14,115,276 ============ ============= ============= ============= CAPITAL DEVELOPING BALANCED GROWTH OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X 382,695 145,604 106,339 Class Y 119,260 169,586 26,067 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============ ============ Cost: Class I -- -- -- Class II -- -- -- Class X $5,018,920 $1,560,686 $1,536,841 Class Y 1,784,348 2,631,929 587,571 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============ ============ Market Value: Class I -- -- -- Class II -- -- -- Class X $6,276,203 $2,194,253 $3,423,070 Class Y 1,949,900 2,508,182 825,552 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 1,222 2,711 707 Other assets -- -- -- ------------ ------------ ------------ Total Assets 8,227,325 4,705,146 4,249,329 ------------ ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company 1,222 2,711 707 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------ ------------ ------------ Total Liabilities 1,222 2,711 707 ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $8,226,103 $4,702,435 $4,248,622 ============ ============ ============
SA-19 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X 335,263 916,346 354,738 Class Y 267,865 140,831 46,854 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============= ============ Cost: Class I -- -- -- Class II -- -- -- Class X $3,312,716 $12,875,462 $3,999,924 Class Y 2,015,837 2,086,105 655,266 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ============ ============= ============ Market Value: Class I -- -- -- Class II -- -- -- Class X $2,387,070 $17,080,691 $6,647,785 Class Y 1,901,843 2,620,865 870,076 Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 1,034 2,971 1,140 Other assets -- -- -- ------------ ------------- ------------ Total Assets 4,289,947 19,704,527 7,519,001 ------------ ------------- ------------ LIABILITIES: Due to Hartford Life Insurance Company 1,034 2,971 1,140 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ------------ ------------- ------------ Total Liabilities 1,034 2,971 1,140 ------------ ------------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $4,288,913 $19,701,556 $7,517,861 ============ ============= ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-20 -------------------------------------------------------------------------------
EQUALLY-WEIGHTED GROWTH MONEY MARKET UTILITIES S&P 500 SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X 117,601 3,175,878 147,806 433,716 Class Y 42,767 4,644,355 50,916 343,513 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============ ============ ============ ============= Cost: Class I -- -- -- -- Class II -- -- -- -- Class X $1,480,363 $3,175,878 $1,931,580 $5,624,877 Class Y 768,723 4,644,355 1,188,013 6,912,735 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============ ============ ============ ============= Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X $2,609,567 $3,175,878 $4,400,184 $11,003,373 Class Y 934,903 4,644,355 1,514,737 8,615,312 Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- Due from Hartford Life Insurance Company -- -- -- -- Receivable from fund shares sold 3,659 4,794 1,140 5,341 Other assets -- -- -- -- ------------ ------------ ------------ ------------- Total Assets 3,548,129 7,825,027 5,916,061 19,624,026 ------------ ------------ ------------ ------------- LIABILITIES: Due to Hartford Life Insurance Company 3,659 4,794 1,140 5,341 Payable for fund shares purchased -- -- -- -- Other liabilities -- -- -- -- ------------ ------------ ------------ ------------- Total Liabilities 3,659 4,794 1,140 5,341 ------------ ------------ ------------ ------------- NET ASSETS: For Variable Annuity Contract Liabilities $3,544,470 $7,820,233 $5,914,921 $19,618,685 ============ ============ ============ ============= SMALL COMPANY MTB LARGE CAP GROWTH GLOBAL FRANCHISE GROWTH FUND II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- -------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II 38,484 64,006 -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- 116,273 ========== ============ ============ Cost: Class I -- -- -- Class II $634,283 $922,665 -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- $1,254,675 ========== ============ ============ Market Value: Class I -- -- -- Class II $651,536 $1,157,875 -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- $1,288,304 Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 436 194 50 Other assets -- -- -- ---------- ------------ ------------ Total Assets 651,972 1,158,069 1,288,354 ---------- ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company 436 194 50 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ---------- ------------ ------------ Total Liabilities 436 194 50 ---------- ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $651,536 $1,157,875 $1,288,304 ========== ============ ============
SA-21 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
MTB MANAGED MTB MANAGED ALLOCATION ALLOCATION FUND -- FUND -- MTB LARGE CAP MODERATE AGGRESSIVE VALUE FUND II GROWTH II GROWTH II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 286,486 311,430 52,575 ------------ ------------ ---------- Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $3,381,556 $3,313,803 $611,792 ------------ ------------ ---------- Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $3,317,507 $3,366,554 $628,795 Due from Hartford Life Insurance Company 1,118 -- -- Receivable from fund shares sold -- 125 26 Other assets -- -- -- ------------ ------------ ---------- Total Assets 3,318,625 3,366,679 628,821 ------------ ------------ ---------- LIABILITIES: Due to Hartford Life Insurance Company -- 125 26 Payable for fund shares purchased 1,118 -- -- Other liabilities 1 1 -- ------------ ------------ ---------- Total Liabilities 1,119 126 26 ------------ ------------ ---------- NET ASSETS: For Variable Annuity Contract Liabilities $3,317,506 $3,366,553 $628,795 ============ ============ ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-22 -------------------------------------------------------------------------------
MTB MANAGED ALLOCATION FUND -- OPPENHEIMER OPPENHEIMER CONSERVATIVE MIDCAP OPPENHEIMER CAPITAL GLOBAL SECURITIES GROWTH II FUND VA APPRECIATION FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------------ ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 56,942 56,130 1,162,416 5,870,401 ---------- ------------ ------------- -------------- Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $597,228 $2,809,532 $47,260,100 $203,693,773 ---------- ------------ ------------- -------------- Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $593,901 $2,987,242 $54,377,811 $212,919,426 Due from Hartford Life Insurance Company -- 4,670 282,772 410,401 Receivable from fund shares sold 22 -- -- -- Other assets -- -- 1 -- ---------- ------------ ------------- -------------- Total Assets 593,923 2,991,912 54,660,584 213,329,827 ---------- ------------ ------------- -------------- LIABILITIES: Due to Hartford Life Insurance Company 22 -- -- -- Payable for fund shares purchased -- 4,670 282,772 410,400 Other liabilities -- -- -- 2 ---------- ------------ ------------- -------------- Total Liabilities 22 4,670 282,772 410,402 ---------- ------------ ------------- -------------- NET ASSETS: For Variable Annuity Contract Liabilities $593,901 $2,987,242 $54,377,812 $212,919,425 ========== ============ ============= ============== OPPENHEIMER PUTNAM OPPENHEIMER MAIN STREET DIVERSIFIED MAIN STREET FUND SMALL CAP FUND INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 442,263 4,192,354 4,442,156 ------------- ------------- ------------- Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $10,314,121 $76,048,732 $38,231,007 ------------- ------------- ------------- Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $11,224,634 $75,588,148 $38,646,760 Due from Hartford Life Insurance Company 19,388 225,514 8,584 Receivable from fund shares sold -- -- -- Other assets -- 1 -- ------------- ------------- ------------- Total Assets 11,244,022 75,813,663 38,655,344 ------------- ------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 19,388 225,514 8,584 Other liabilities -- -- -- ------------- ------------- ------------- Total Liabilities 19,388 225,514 8,584 ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $11,224,634 $75,588,149 $38,646,760 ============= ============= =============
SA-23 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
PUTNAM INTERNATIONAL PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND ASSET ALLOCATION AND INCOME INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) --------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 448,986 308,066 3,174 ============ ============ ========= Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $7,047,510 $8,076,942 $51,983 ============ ============ ========= Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $7,605,827 $7,122,486 $52,300 Due from Hartford Life Insurance Company 7,590 668 4,470 Receivable from fund shares sold -- -- -- Other assets -- -- -- ------------ ------------ --------- Total Assets 7,613,417 7,123,154 56,770 ------------ ------------ --------- LIABILITIES: Due to Hartford Life Insurance Company -- -- -- Payable for fund shares purchased 7,590 668 4,470 Other liabilities -- -- -- ------------ ------------ --------- Total Liabilities 7,590 668 4,470 ------------ ------------ --------- NET ASSETS: For Variable Annuity Contract Liabilities $7,605,827 $7,122,486 $52,300 ============ ============ =========
(a) From inception November 12, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-24 -------------------------------------------------------------------------------
PUTNAM INTERNATIONAL PUTNAM PUTNAM PUTNAM SMALL EQUITY INVESTORS NEW VALUE CAP VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 4,298,946 1,909,748 657,023 3,063,701 ============= ============= ============= ============= Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $76,148,869 $22,527,289 $11,163,223 $69,837,884 ============= ============= ============= ============= Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $81,508,021 $22,038,487 $10,262,705 $57,444,394 Due from Hartford Life Insurance Company 80,293 441,084 -- 19,833 Receivable from fund shares sold -- -- 3,434 -- Other assets -- -- -- -- ------------- ------------- ------------- ------------- Total Assets 81,588,314 22,479,571 10,266,139 57,464,227 ------------- ------------- ------------- ------------- LIABILITIES: Due to Hartford Life Insurance Company -- -- 3,434 -- Payable for fund shares purchased 80,293 441,084 -- 19,833 Other liabilities 1 -- -- -- ------------- ------------- ------------- ------------- Total Liabilities 80,294 441,084 3,434 19,833 ------------- ------------- ------------- ------------- NET ASSETS: For Variable Annuity Contract Liabilities $81,508,020 $22,038,487 $10,262,705 $57,444,394 ============= ============= ============= ============= PUTNAM THE GEORGE PUTNAM PUTNAM FUND OF BOSTON PUTNAM VISTA VOYAGER SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 556,237 69,207 69,396 ============ ============ ============ Cost: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $6,412,649 $993,505 $1,963,973 ============ ============ ============ Market Value: Class I -- -- -- Class II -- -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other $6,113,044 $1,056,092 $2,201,923 Due from Hartford Life Insurance Company 11,639 -- -- Receivable from fund shares sold -- 139 463 Other assets -- -- -- ------------ ------------ ------------ Total Assets 6,124,683 1,056,231 2,202,386 ------------ ------------ ------------ LIABILITIES: Due to Hartford Life Insurance Company -- 139 463 Payable for fund shares purchased 11,639 -- -- Other liabilities -- -- -- ------------ ------------ ------------ Total Liabilities 11,639 139 463 ------------ ------------ ------------ NET ASSETS: For Variable Annuity Contract Liabilities $6,113,044 $1,056,092 $2,201,923 ============ ============ ============
SA-25 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
PIONEER OAK RIDGE LARGE PIONEER FUND CAP GROWTH VCT PORTFOLIO VCT PORTFOLIO ENTERPRISE SUB-ACCOUNT (I) SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- 28,351 Class II 30,080 40,529 48,085 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- -- -- ========== ========== ============ Cost: Class I -- -- $623,882 Class II $672,075 $479,967 846,339 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- 25 -- ========== ========== ============ Market Value: Class I -- -- $495,295 Class II $771,856 $528,499 840,048 Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other 1 35 -- Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 129 83 65 Other assets -- -- -- ---------- ---------- ------------ Total Assets 771,986 528,617 1,335,408 ---------- ---------- ------------ LIABILITIES: Due to Hartford Life Insurance Company 129 83 65 Payable for fund shares purchased -- -- -- Other liabilities -- 34 -- ---------- ---------- ------------ Total Liabilities 129 117 65 ---------- ---------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $771,857 $528,500 $1,335,343 ========== ========== ============
(i) Effective November 9, 2007, Pioneer Value VCT Portfolio merged with Pioneer Fund VCT Portfolio. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-26 -------------------------------------------------------------------------------
GROWTH AND STRATEGIC AGGRESSIVE INCOME COMSTOCK GROWTH GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I 84,454 -- -- -- Class II 2,250,168 5,902,662 10,545 32,019 Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============= ============= ========== ========== Cost: Class I $1,370,911 -- -- -- Class II 46,159,551 $80,776,621 $279,448 $159,901 Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- ============= ============= ========== ========== Market Value: Class I $1,803,942 -- -- -- Class II 47,951,076 $81,456,728 $351,046 $183,151 Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other -- -- -- -- Due from Hartford Life Insurance Company 51,470 119,589 -- -- Receivable from fund shares sold -- -- 18 41 Other assets -- -- -- -- ------------- ------------- ---------- ---------- Total Assets 49,806,488 81,576,317 351,064 183,192 ------------- ------------- ---------- ---------- LIABILITIES: Due to Hartford Life Insurance Company -- -- 18 41 Payable for fund shares purchased 51,470 119,589 -- -- Other liabilities -- -- -- -- ------------- ------------- ---------- ---------- Total Liabilities 51,470 119,589 18 41 ------------- ------------- ---------- ---------- NET ASSETS: For Variable Annuity Contract Liabilities $49,755,018 $81,456,728 $351,046 $183,151 ============= ============= ========== ========== WELLS FARGO WELLS FARGO ADVANTAGE VT ADVANTAGE VT GOVERNMENT LARGE COMPANY SMALL CAP PORTFOLIO GROWTH FUND GROWTH FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- Class II 63,876 -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- 2,354 1,580 ========== ========= ========= Cost: Class I -- -- -- Class II $596,344 -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- $22,291 $14,827 ========== ========= ========= Market Value: Class I -- -- -- Class II $607,461 -- -- Class X -- -- -- Class Y -- -- -- Class 1 -- -- -- Class 2 -- -- -- Other -- $24,297 $15,308 Due from Hartford Life Insurance Company -- -- -- Receivable from fund shares sold 970 1 1 Other assets -- -- -- ---------- --------- --------- Total Assets 608,431 24,298 15,309 ---------- --------- --------- LIABILITIES: Due to Hartford Life Insurance Company 970 1 1 Payable for fund shares purchased -- -- -- Other liabilities -- -- -- ---------- --------- --------- Total Liabilities 970 1 1 ---------- --------- --------- NET ASSETS: For Variable Annuity Contract Liabilities $607,461 $24,297 $15,308 ========== ========= =========
SA-27 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
STI CLASSIC VT LARGE CAP STI CLASSIC VT STI CLASSIC VT STI CLASSIC VT GROWTH LARGE CAP CORE MID-CAP CORE LARGE CAP VALUE STOCK FUND EQUITY FUND EQUITY FUND EQUITY FUND SUB-ACCOUNT (J) SUB-ACCOUNT (K) SUB-ACCOUNT (L) SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- ASSETS: Investments: Number of Shares: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other 1,406 11,286 7,125 129,439 ========= ========== ========= ============ Cost: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $25,010 $141,081 $94,154 $2,112,874 ========= ========== ========= ============ Market Value: Class I -- -- -- -- Class II -- -- -- -- Class X -- -- -- -- Class Y -- -- -- -- Class 1 -- -- -- -- Class 2 -- -- -- -- Other $25,693 $139,041 $86,710 $2,328,608 Due from Hartford Life Insurance Company -- -- -- 11,138 Receivable from fund shares sold 1 7 4 -- Other assets -- -- -- -- --------- ---------- --------- ------------ Total Assets 25,694 139,048 86,714 2,339,746 --------- ---------- --------- ------------ LIABILITIES: Due to Hartford Life Insurance Company 1 7 4 -- Payable for fund shares purchased -- -- -- 11,138 Other liabilities -- -- -- -- --------- ---------- --------- ------------ Total Liabilities 1 7 4 11,138 --------- ---------- --------- ------------ NET ASSETS: For Variable Annuity Contract Liabilities $25,693 $139,041 $86,710 $2,328,608 ========= ========== ========= ============
(j) Funded as of June 11, 2007. (k) Formerly STI Classic VT Large Cap Relative Value Fund. Change effective May 31, 2007. (l) Formerly STI Classic VT Mid-Cap Equity Fund. Change effective May 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-28 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-29 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 3,476,529 $12.043388 to $12.638593 $43,023,401 Strategy Portfolio -- Class B AllianceBernstein VP Global Research 183,410 10.843732 to 15.251626 2,727,525 Growth Portfolio -- Class B AllianceBernstein VP International Value 10,088,499 10.203042 to 15.623839 154,046,641 Portfolio -- Class B AllianceBernstein VP Small/Mid Cap Value 1,445,942 11.560375 to 12.131787 17,151,245 Portfolio -- Class B AllianceBernstein VP Value Portfolio -- 5,522,576 11.286935 to 11.844777 63,968,685 Class B AllianceBernstein VPS International 49,593 10.493320 to 10.529980 521,465 Growth Portfolio -- Class B American Funds Global Growth Fund -- 320,066 1.889019 to 17.985042 4,300,452 Class 2 American Funds Growth Fund -- Class 2 3,087,940 1.546007 to 16.007709 34,030,792 American Funds Growth-Income Fund -- 1,810,238 1.385135 to 14.739170 25,092,659 Class 2 American Funds International Fund -- 1,382,279 2.116001 to 19.459913 16,844,708 Class 2 American Funds Global Small 337,340 2.472943 to 25.430467 5,226,216 Capitalization Fund -- Class 2 BB&T Mid Cap Growth VIF 1,746,804 1.921515 to 2.247411 3,669,055 BB&T Capital Manager Equity VIF 1,333,165 1.151520 to 1.651028 1,729,776 BB&T Large Cap VIF 2,568,711 1.598577 to 1.713950 4,322,391 BB&T Special Opportunities Equity VIF 8,209,212 1.688134 to 1.756853 14,290,483 BB&T Total Return Bond VIF 2,658,741 1.069333 to 1.103453 2,910,144 Evergreen VA Balanced Fund -- Class I 577,235 1.039964 to 1.113690 621,494 Evergreen VA Growth Fund -- Class I 4,410,983 1.080915 to 1.585578 5,279,228 Evergreen VA International Equity Fund 1,338,331 1.339833 to 2.291471 2,010,131 -- Class I Evergreen VA Omega Fund -- Class I 60,936 0.697741 to 0.939459 44,335 Evergreen VA Special Values Fund -- 7,153,776 1.446461 to 1.968555 11,951,975 Class I Evergreen VA Fundamental Large Cap Fund 173,396 1.329012 to 1.468101 246,329 -- Class I Fidelity(R) VIP Equity-Income -- Class 6,056,636 11.916841 to 12.505825 74,051,461 SRV2 Fidelity(R) VIP Growth -- Class SRV2 1,838,492 13.580692 to 14.231633 25,628,953 Fidelity(R) VIP Contrafund(R) Class 28,559,428 13.989471 to 14.680736 410,770,352 SRV2 Fidelity(R) VIP Mid Cap -- Class SRV2 7,136,450 13.697774 to 14.374716 100,279,866 Fidelity(R) VIP Value Strategies -- 561,733 12.028191 to 12.622679 6,948,465 Class SRV2 Fidelity(R) VIP Dynamic Capital 2,266 9.539030 to 9.560421 21,639 Appreciation Portfolio -- Class 2 Franklin Small-Mid Cap Growth Securities 558,148 1.302551 to 14.871642 3,957,663 Fund -- Class 2 Franklin Strategic Income Securities 1,085,588 1.494425 to 16.301738 16,230,440 Fund -- Class 1 Mutual Shares Securities Fund -- Class 942,700 1.528406 to 17.873570 13,996,363 2 Templeton Developing Markets Securities 174,954 3.416340 to 29.724964 3,154,826 Fund -- Class 1 Templeton Growth Securities Fund -- 274,720 1.522683 to 16.124366 4,004,067 Class 2 Hartford Advisers HLS Fund -- Class IA 18,508,192 1.215681 to 5.442392 28,287,149 Hartford LargeCap Growth HLS Fund -- 10,280 9.794897 to 9.816844 100,909 Class IA Hartford Total Return Bond HLS Fund -- 226,689,930 1.436363 to 13.808135 386,195,329 Class IA Hartford Dividend and Growth HLS Fund -- 165,220,235 1.596005 to 4.179487 312,971,361 Class IA Hartford Fundamental Growth HLS Fund -- 1,293,227 1.252075 to 1.333943 1,692,496 Class IA Hartford Global Advisers HLS Fund -- 3,112,879 1.448549 to 2.341432 4,938,379 Class IA Hartford Global Growth HLS Fund -- Class 4,055,898 1.698782 to 14.203088 8,890,530 IA Hartford Disciplined Equity HLS Fund -- 192,979,347 1.221724 to 12.618494 262,380,253 Class IA Hartford Growth HLS Fund -- Class IA 8,275,635 1.464573 to 1.576049 12,542,884 Hartford Growth Opportunities HLS Fund 25,790,886 1.948859 to 20.434681 53,455,583 -- Class IA Hartford High Yield HLS Fund -- Class 18,499,091 1.352034 to 11.936834 26,083,391 IA
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 -------------------------------------------------------------------------------------------------------- Hartford Index HLS Fund -- Class IA 6,315,115 $1.143306 to $5.529186 $9,172,270 Hartford International Growth HLS Fund 20,030,390 1.907291 to 11.912146 39,632,228 -- Class IA Hartford International Small Company HLS 6,182,620 2.332801 to 10.151528 15,019,671 Fund -- Class IA Hartford International Opportunities HLS 41,441,160 1.710094 to 12.227564 78,718,154 Fund -- Class IA Hartford MidCap Growth HLS Fund -- Class 15,273 9.777219 to 9.797763 149,469 IA Hartford Money Market HLS Fund -- Class 46,249,295 1.038826 to 2.038627 59,920,984 IA Hartford Mortgage Securities HLS Fund -- 5,756,772 1.314311 to 3.034214 8,397,334 Class IA Hartford SmallCap Value HLS Fund -- 4,900 9.101084 to 9.120220 44,651 Class IA Hartford Small Company HLS Fund -- Class 7,977,937 1.546238 to 2.904548 16,076,826 IA Hartford SmallCap Growth HLS Fund -- 15,518,757 1.311438 to 13.540773 21,505,266 Class IA Hartford Stock HLS Fund -- Class IA 14,867,480 1.113667 to 7.036465 21,119,733 Hartford U.S. Government Securities HLS 140,250,881 1.098120 to 1.184437 159,909,627 Fund -- Class IA Hartford Value HLS Fund -- Class IA 18,131,259 1.386464 to 1.505403 26,170,486 Hartford Value Opportunities HLS Fund -- 12,840,708 1.447249 to 16.773721 19,607,554 Class IA Hartford Equity Income HLS Fund -- Class 7,856,023 1.450037 to 1.541964 11,789,255 IA Huntington VA Income Equity Fund 1,984,928 1.316182 to 14.572629 2,800,603 Huntington VA Dividend Capture Fund 2,922,607 1.423727 to 14.540797 5,114,553 Huntington VA Growth Fund 1,594,205 0.985212 to 14.232030 1,949,318 Huntington VA Mid Corp America Fund 1,728,552 1.716189 to 18.354130 3,274,476 Huntington VA New Economy Fund 1,861,661 1.835001 to 19.939233 3,755,601 Huntington VA Rotating Markets Fund 670,912 1.565621 to 18.687527 1,246,749 Huntington VA International Equity Fund 188,610 15.887446 to 16.282287 3,049,116 Huntington VA Macro 100 Fund 1,648,565 1.079664 to 1.116207 1,819,896 Huntington VA Mortgage Securities Fund 121,854 10.514016 to 10.775519 1,304,983 Huntington VA Situs Small Cap Fund 3,939,265 1.443681 to 1.492538 5,798,539 Lord Abbett All Value Portfolio -- Class 751,430 12.206180 to 12.791256 9,415,414 VC Lord Abbett America's Value Portfolio -- 556,088 11.424297 to 11.971920 6,502,251 Class VC Lord Abbett Bond Debenture Fund -- Class 2,810,592 10.916673 to 11.456197 31,473,453 VC Lord Abbett Growth and Income Portfolio 12,604,039 11.696028 to 12.274113 151,658,037 -- Class VC Lord Abbett Large Cap Core Fund -- Class 409,253 12.520156 to 13.100410 5,253,487 VC MFS Core Equity Series -- Class INIT 114,341 1.216627 to 10.433334 641,377 MFS Emerging Growth Series -- Class 110,954 6.435608 to 10.254739 801,536 INIT MFS Investors Growth Stock Series -- 54,720 6.847257 to 9.316867 431,405 Class INIT MFS Investors Trust Series -- Class 250,898 1.331219 to 10.748457 1,303,898 INIT MFS Total Return Series -- Class INIT 956,741 1.329842 to 14.851084 13,153,858 Equity and Income -- Class II 18,431 14.676995 to 15.230246 275,714 Core Plus Fixed Income -- Class I 931,778 1.239946 to 14.601703 10,651,667 Emerging Markets Debt -- Class I 51,716 18.378551 to 23.376960 1,076,257 Emerging Markets Equity -- Class I 72,555 3.579275 to 31.733290 1,894,021 Emerging Markets Equity -- Class II 1,396,155 13.517536 to 23.038258 31,358,660 High Yield -- Class I 180,087 1.391435 to 11.743825 1,783,128 Mid Cap Growth -- Class II 810,470 14.863779 to 15.576117 12,363,359 U.S. Mid Cap Value -- Class I 296,688 1.568311 to 21.228770 5,317,359 U.S. Mid Cap Value -- Class II 802,125 13.425485 to 14.068913 11,045,852 Focus Growth -- Class X 668,230 1.333634 to 34.400937 11,110,172 Focus Growth -- Class Y 347,432 8.111956 to 8.547613 2,939,880 Balanced Growth -- Class X 718,430 1.356218 to 26.142135 6,164,232 Balanced Growth -- Class Y 134,102 13.947661 to 14.637810 1,949,900
SA-31 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 -------------------------------------------------------------------------------------------------------- Capital Opportunities -- Class X 168,168 $1.508588 to $14.309407 $2,169,928 Capital Opportunities -- Class Y 466,242 5.111479 to 5.436497 2,508,183 Developing Growth -- Class X 108,758 1.942474 to 40.660810 3,398,458 Developing Growth -- Class Y 72,662 10.806114 to 11.493181 825,552 Flexible Income -- Class X 270,186 1.397865 to 14.845269 2,387,070 Flexible Income -- Class Y 161,993 11.282737 to 12.000085 1,901,843 Dividend Growth -- Class X 788,612 1.226769 to 30.498692 17,037,357 Dividend Growth -- Class Y 202,373 12.390268 to 13.055590 2,620,865 Global Equity -- Class X 336,594 1.696135 to 25.914544 6,565,864 Global Equity -- Class Y 70,212 11.805397 to 12.555943 870,076 Growth -- Class X 310,978 1.376764 to 24.554060 2,609,567 Growth -- Class Y 110,069 8.205665 to 8.727445 934,903 Money Market -- Class X 230,058 11.683329 to 13.835207 3,175,877 Money Market -- Class Y 434,558 10.215179 to 10.864720 4,644,356 Utilities -- Class X 305,469 1.895936 to 37.850885 4,400,184 Utilities -- Class Y 125,259 11.721275 to 12.177150 1,514,737 Equally-Weighted S&P 500 -- Class X 602,985 1.504079 to 36.694511 10,922,514 Equally-Weighted S&P 500 -- Class Y 542,051 15.263891 to 16.234315 8,615,312 Small Company Growth -- Class II 47,658 13.404473 to 13.969089 651,536 Global Franchise -- Class II 60,630 18.455152 to 19.407659 1,157,875 MTB Large Cap Growth Fund II 1,090,230 1.159425 to 1.194606 1,288,304 MTB Large Cap Value Fund II 2,507,981 1.296207 to 1.335509 3,317,506 MTB Managed Allocation Fund -- Moderate 2,797,118 1.177618 to 1.213306 3,366,553 Growth II MTB Managed Allocation Fund -- 49,489 12.530085 to 12.791953 628,795 Aggressive Growth II MTB Managed Allocation Fund -- 53,284 10.974704 to 11.204078 593,901 Conservative Growth II Oppenheimer Midcap Fund VA -- Class SRV 256,041 11.376060 to 11.803633 2,987,242 Oppenheimer Capital Appreciation Fund -- 4,340,689 12.205811 to 12.809096 54,377,812 Class SRV Oppenheimer Global Securities Fund -- 15,360,765 10.304583 to 14.137670 212,868,431 Class SRV Oppenheimer Main Street Fund -- Class 933,132 11.763316 to 12.344736 11,224,634 SRV Oppenheimer Main Street Small Cap Fund 6,324,700 11.644211 to 12.219796 75,588,149 -- Class SRV Putnam Diversified Income -- Class IB 2,268,908 13.809063 to 18.865269 38,641,064 Putnam Global Asset Allocation -- Class 437,668 9.944940 to 38.469378 7,605,827 IB Putnam Growth and Income -- Class IB 265,351 11.122224 to 55.693138 7,122,486 Putnam International Growth and Income 5,365 9.746889 to 9.760552 52,300 -- Class IB Putnam International Equity -- Class IB 4,478,672 10.270794 to 26.666709 81,508,020 Putnam Investors -- Class IB 2,405,721 6.842189 to 10.573923 22,038,487 Putnam New Value -- Class IB 529,239 14.754219 to 21.041934 10,262,705 Putnam Small Cap Value -- Class IB 2,607,444 19.242065 to 23.443202 57,444,394 Putnam The George Putnam Fund of Boston 449,733 12.282903 to 14.135785 6,113,044 -- Class IB Putnam Vista -- Class IB 126,280 5.731501 to 17.006719 1,056,092 Putnam Voyager -- Class IB 137,889 5.533992 to 57.361079 2,201,923 Pioneer Fund VCT Portfolio -- Class II 646,168 1.190416 to 1.216169 771,857 Pioneer Oak Ridge Large Cap Growth VCT 476,183 1.097818 to 1.129146 528,500 Portfolio -- Class II Enterprise -- Class I 51,033 9.697231 to 9.935661 495,296 Enterprise -- Class II 126,770 6.329218 to 6.731727 840,047 Growth and Income -- Class I 249,312 1.461243 to 16.726355 1,797,003 Growth and Income -- Class II 2,804,128 16.242615 to 17.327605 47,951,076 Comstock -- Class II 5,020,336 15.537611 to 16.457983 81,456,728
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-32 -------------------------------------------------------------------------------
UNITS MINIMUM MAXIMUM OWNED BY UNIT FAIR UNIT FAIR CONTRACT PARTICIPANTS VALUE # VALUE # LIABILITY -------------------------------------------------------------------------------------------------------- Strategic Growth -- Class II 23,408 $14.590661 to $15.344436 $351,046 Aggressive Growth Portfolio -- Class II 13,141 13.551542 to 14.122344 183,151 Government Portfolio -- Class II 56,841 10.536728 to 10.975127 607,461 Wells Fargo Advantage VT Large Company 21,695 1.088666 to 1.135208 24,297 Growth Fund Wells Fargo Advantage VT Small Cap 9,821 1.514837 to 1.579591 15,308 Growth Fund STI Classic VT Large Cap Growth Stock 1,750 14.684099 to 14.684099 25,693 Fund STI Classic VT Large Cap Core Equity 78,790 1.735837 to 1.810091 139,041 Fund STI Classic VT Mid-Cap Core Equity Fund 46,757 1.828175 to 1.875333 86,710 STI Classic VT Large Cap Value Equity 1,213,930 1.804350 to 18.218073 2,328,608 Fund ANNUITY CONTRACTS IN THE ANNUITY PERIOD (BY SUB-ACCOUNT): AllianceBernstein VP Balanced Wealth 482 12.495959 to 12.495959 6,022 Strategy Portfolio -- Class B American Funds Growth-Income Fund -- 546 14.739170 to 14.739170 8,052 Class 2 American Funds International Fund -- 456 13.433973 to 13.433973 6,130 Class 2 American Funds Global Small 1,995 18.359209 to 25.430467 44,545 Capitalization Fund -- Class 2 Fidelity(R) VIP Contrafund(R) -- Class 3,623 14.515095 to 14.515095 52,590 SRV2 Hartford Total Return Bond HLS Fund -- 44,741 1.564006 to 1.564006 69,975 Class IA Hartford Dividend and Growth HLS Fund -- 3,640 1.748028 to 1.748028 6,362 Class IA Hartford High Yield HLS Fund -- Class 37,369 1.390217 to 1.390217 51,951 IA Hartford Money Market HLS Fund -- Class 4,737 1.185768 to 1.185768 5,617 IA Hartford Equity Income HLS Fund -- Class 19,656 1.520541 to 1.520541 29,888 IA Lord Abbett Growth and Income Portfolio 4,673 12.135566 to 12.135566 56,709 -- Class VC Lord Abbett Large Cap Core Fund -- Class 480 12.961509 to 12.961509 6,216 VC Emerging Markets Equity -- Class I 3,959 24.240658 to 31.733290 119,476 U.S. Mid Cap Value -- Class I 937 15.289466 to 15.289466 14,319 Focus Growth -- Class X 1,896 34.400937 to 34.400937 65,224 Balanced Growth -- Class X 4,283 26.142135 to 26.142135 111,971 Capital Opportunities -- Class X 1,700 14.309407 to 14.309407 24,324 Developing Growth -- Class X 605 40.660810 to 40.660810 24,612 Dividend Growth -- Class X 1,421 30.498692 to 30.498692 43,334 Global Equity -- Class X 3,161 25.914544 to 25.914544 81,921 Equally-Weighted S&P 500 -- Class X 2,204 36.694511 to 36.694511 80,859 Oppenheimer Global Securities Fund -- 3,648 13.978128 to 13.978128 50,994 Class SRV Putnam Diversified Income -- Class IB 307 18.556344 to 18.556344 5,696 Growth and Income -- Class I 421 16.489414 to 16.489414 6,939
# Rounded unit values SA-33 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH VP INTERNATIONAL PORTFOLIO GROWTH PORTFOLIO VALUE PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $637,323 $2,900 $1,329,299 ----------- ---------- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (460,724) (31,866) (2,031,802) ----------- ---------- ------------- Net investment income (loss) 176,599 (28,966) (702,503) ----------- ---------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (3,831) 3,127 108,237 Net realized gain on distributions 469,380 72,356 4,982,409 Net unrealized appreciation (depreciation) of investments during the year 160,619 128,657 (774,874) ----------- ---------- ------------- Net gain (loss) on investments 626,168 204,140 4,315,772 ----------- ---------- ------------- Net increase (decrease) in net assets resulting from operations $802,767 $175,174 $3,613,269 =========== ========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-34 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN AMERICAN FUNDS VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL GLOBAL GROWTH VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $96,724 $650,692 $872 $111,669 ------------- ------------- --------- ---------- EXPENSE: Mortality and Expense Risk and Administrative Charges (225,883) (872,488) (561) (72,488) ------------- ------------- --------- ---------- Net investment income (loss) (129,159) (221,796) 311 39,181 ------------- ------------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 12,048 (2,473) 42 126,097 Net realized gain on distributions 904,650 1,486,281 31,643 169,993 Net unrealized appreciation (depreciation) of investments during the year (1,365,650) (5,325,146) (32,309) 164,514 ------------- ------------- --------- ---------- Net gain (loss) on investments (448,952) (3,841,338) (624) 460,604 ------------- ------------- --------- ---------- Net increase (decrease) in net assets resulting from operations $(578,111) $(4,063,134) $(313) $499,785 ============= ============= ========= ========== AMERICAN FUNDS AMERICAN FUNDS GROWTH-INCOME AMERICAN FUNDS GROWTH FUND FUND INTERNATIONAL FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- INVESTMENT INCOME: Dividends $263,787 $392,104 $236,919 ------------ ----------- ------------ EXPENSE: Mortality and Expense Risk and Administrative Charges (614,209) (476,542) (268,166) ------------ ----------- ------------ Net investment income (loss) (350,422) (84,438) (31,247) ------------ ----------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 1,253,945 703,631 302,334 Net realized gain on distributions 2,377,379 867,895 772,402 Net unrealized appreciation (depreciation) of investments during the year 166,692 (589,905) 1,595,212 ------------ ----------- ------------ Net gain (loss) on investments 3,798,016 981,621 2,669,948 ------------ ----------- ------------ Net increase (decrease) in net assets resulting from operations $3,447,594 $897,183 $2,638,701 ============ =========== ============
(a) From inception November 12, 2007 to December 31, 2007. SA-35 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL BB&T CAPITAL CAPITALIZATION BB&T MID CAP MANAGER FUND GROWTH VIF EQUITY VIF SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $155,402 $34 $47,614 ---------- ---------- ----------- EXPENSE: Mortality and expense risk and administrative charges (94,488) (39,903) (24,237) ---------- ---------- ----------- Net investment income (loss) 60,914 (39,869) 23,377 ---------- ---------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 170,765 14,023 9,433 Net realized gain on distributions 417,600 322,162 201,696 Net unrealized appreciation (depreciation) of investments during the year 296,676 484,172 (220,926) ---------- ---------- ----------- Net gain (loss) on investments 885,041 820,357 (9,797) ---------- ---------- ----------- Net increase (decrease) in net assets resulting from operations $945,955 $780,488 $13,580 ========== ========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-36 -------------------------------------------------------------------------------
BB&T SPECIAL BB&T LARGE OPPORTUNITIES BB&T TOTAL EVERGREEN VA CAP VIF EQUITY VIF RETURN BOND VIF BALANCED FUND SUB-ACCOUNT (B) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $83,422 $ -- $110,895 $22,901 ----------- ------------ ---------- --------- EXPENSE: Mortality and expense risk and administrative charges (55,715) (169,561) (34,965) (8,055) ----------- ------------ ---------- --------- Net investment income (loss) 27,707 (169,561) 75,930 14,846 ----------- ------------ ---------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (262,931) 25,975 1,521 233 Net realized gain on distributions 839,953 833,635 -- -- Net unrealized appreciation (depreciation) of investments during the year (950,542) 384,804 55,918 9,527 ----------- ------------ ---------- --------- Net gain (loss) on investments (373,520) 1,244,414 57,439 9,760 ----------- ------------ ---------- --------- Net increase (decrease) in net assets resulting from operations $(345,813) $1,074,853 $133,369 $24,606 =========== ============ ========== ========= EVERGREEN VA EVERGREEN VA INTERNATIONAL EVERGREEN VA GROWTH FUND EQUITY FUND OMEGA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $44,949 $238 ------------ ---------- ------- EXPENSE: Mortality and expense risk and administrative charges (84,959) (19,631) (832) ------------ ---------- ------- Net investment income (loss) (84,959) 25,318 (594) ------------ ---------- ------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 18,507 3,473 245 Net realized gain on distributions 1,004,688 131,855 -- Net unrealized appreciation (depreciation) of investments during the year (513,437) (32,352) 4,431 ------------ ---------- ------- Net gain (loss) on investments 509,758 102,976 4,676 ------------ ---------- ------- Net increase (decrease) in net assets resulting from operations $424,799 $128,294 $4,082 ============ ========== =======
(b) Effective February 9, 2007, BB&T Large Cap Growth VIF merged with BB&T Large Cap VIF. SA-37 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
EVERGREEN VA EVERGREEN VA SPECIAL VALUES FUNDAMENTAL FIDELITY(R) VIP FUND LARGE CAP FUND EQUITY-INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $188,071 $2,675 $1,228,299 ------------- --------- ------------- EXPENSE: Mortality and expense risk and administrative charges (195,539) (3,978) (1,007,403) ------------- --------- ------------- Net investment income (loss) (7,468) (1,303) 220,896 ------------- --------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (28,599) 1,679 19,268 Net realized gain on distributions 1,621,171 18,791 6,202,262 Net unrealized appreciation (depreciation) of investments during the year (2,800,554) (7,326) (7,619,547) ------------- --------- ------------- Net gain (loss) on investments (1,207,982) 13,144 (1,398,017) ------------- --------- ------------- Net increase (decrease) in net assets resulting from operations $(1,215,450) $11,841 $(1,177,121) ============= ========= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-38 -------------------------------------------------------------------------------
FIDELITY(R) FIDELITY(R) FIDELITY(R) VIP VIP VIP FIDELITY(R) VIP GROWTH CONTRAFUND(R) MID CAP VALUE STRATEGIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $71,816 $2,853,510 $418,437 $31,999 ------------ -------------- ------------- ----------- EXPENSE: Mortality and expense risk and administrative charges (321,285) (4,717,209) (1,329,411) (84,634) ------------ -------------- ------------- ----------- Net investment income (loss) (249,469) (1,863,699) (910,974) (52,635) ------------ -------------- ------------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 163,993 25,464 (11,594) (26,697) Net realized gain on distributions 16,257 97,316,223 6,585,325 414,932 Net unrealized appreciation (depreciation) of investments during the year 4,918,724 (50,500,431) 4,146,500 (445,350) ------------ -------------- ------------- ----------- Net gain (loss) on investments 5,098,974 46,841,256 10,720,231 (57,115) ------------ -------------- ------------- ----------- Net increase (decrease) in net assets resulting from operations $4,849,505 $44,977,557 $9,809,257 $(109,750) ============ ============== ============= =========== FIDELITY(R) VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FRANKLIN STRATEGIC APPRECIATION CAP GROWTH INCOME SECURITIES PORTFOLIO SECURITIES FUND FUND SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------ INVESTMENT INCOME: Dividends $18 $ -- $838,000 -------- ----------- ----------- EXPENSE: Mortality and expense risk and administrative charges (25) (74,159) (247,107) -------- ----------- ----------- Net investment income (loss) (7) (74,159) 590,893 -------- ----------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions -- 284,502 15,666 Net realized gain on distributions 1,534 302,417 46,009 Net unrealized appreciation (depreciation) of investments during the year (1,615) (118,689) 25,843 -------- ----------- ----------- Net gain (loss) on investments (81) 468,230 87,518 -------- ----------- ----------- Net increase (decrease) in net assets resulting from operations $(88) $394,071 $678,411 ======== =========== ===========
(a) From inception November 12, 2007 to December 31, 2007. SA-39 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
TEMPLETON MUTUAL SHARES DEVELOPING MARKETS TEMPLETON GROWTH SECURITIES FUND SECURITIES FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $216,359 $77,641 $56,604 ----------- ---------- ----------- EXPENSE: Mortality and Expense Risk and Administrative Charges (262,459) (54,835) (75,779) ----------- ---------- ----------- Net investment income (loss) (46,100) 22,806 (19,175) ----------- ---------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 357,586 310,814 97,843 Net realized gain on distributions 529,717 232,825 180,607 Net unrealized appreciation (depreciation) of investments during the year (555,194) 144,456 (228,895) ----------- ---------- ----------- Net gain (loss) on investments 332,109 688,095 49,555 ----------- ---------- ----------- Net increase (decrease) in net assets resulting from operations $286,009 $710,901 $30,380 =========== ========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-40 -------------------------------------------------------------------------------
FIFTH THIRD FIFTH THIRD FIFTH THIRD BALANCED DISCIPLINED VALUE FIFTH THIRD MID QUALITY GROWTH VIP FUND VIP FUND CAP VIP FUND VIP FUND SUB-ACCOUNT (C) SUB-ACCOUNT (C) SUB-ACCOUNT (C) SUB-ACCOUNT (C) ---------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,188 $63,950 $ -- $ -- --------- ------------ ----------- --------- EXPENSE: Mortality and Expense Risk and Administrative Charges (761) (56,308) (5,740) (510) --------- ------------ ----------- --------- Net investment income (loss) 427 7,642 (5,740) (510) --------- ------------ ----------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (8,051) (961,164) (150,488) (4,182) Net realized gain on distributions 17,717 1,692,716 229,653 13,308 Net unrealized appreciation (depreciation) of investments during the year (4,211) (397,027) (23,009) (2,835) --------- ------------ ----------- --------- Net gain (loss) on investments 5,455 334,525 56,156 6,291 --------- ------------ ----------- --------- Net increase (decrease) in net assets resulting from operations $5,882 $342,167 $50,416 $5,781 ========= ============ =========== ========= HARTFORD HARTFORD LARGECAP HARTFORD TOTAL ADVISERS GROWTH RETURN BOND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ---------------------------------------------------------------- INVESTMENT INCOME: Dividends $628,008 $337 $19,777,368 ------------- ----- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (388,194) (70) (4,815,344) ------------- ----- ------------- Net investment income (loss) 239,814 267 14,962,024 ------------- ----- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (5,336) -- 20,252 Net realized gain on distributions 2,983,643 -- -- Net unrealized appreciation (depreciation) of investments during the year (2,087,184) (69) (4,713,092) ------------- ----- ------------- Net gain (loss) on investments 891,123 (69) (4,692,840) ------------- ----- ------------- Net increase (decrease) in net assets resulting from operations $1,130,937 $198 $10,269,184 ============= ===== =============
(a) From inception November 12, 2007 to December 31, 2007. (c) This fund closed on October 12, 2007. SA-41 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD DIVIDEND AND FUNDAMENTAL HARTFORD GROWTH GROWTH GLOBAL ADVISERS HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT ----------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $5,127,067 $442 $40,076 -------------- ---------- ---------- EXPENSE: Mortality and Expense Risk and Administrative Charges (3,694,710) (14,862) (61,211) -------------- ---------- ---------- Net investment income (loss) 1,432,357 (14,420) (21,135) -------------- ---------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 33,116 692 5,956 Net realized gain on distributions 23,217,982 83,213 329,531 Net unrealized appreciation (depreciation) of investments during the year (12,000,418) 35,504 224,818 -------------- ---------- ---------- Net gain (loss) on investments 11,250,680 119,409 560,305 -------------- ---------- ---------- Net increase (decrease) in net assets resulting from operations $12,683,037 $104,989 $539,170 ============== ========== ==========
(d) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-42 -------------------------------------------------------------------------------
HARTFORD HARTFORD DISCIPLINED HARTFORD GROWTH GLOBAL GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT (E) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $3,333 $2,655,031 $2,224 $66,115 ------------ ------------- ------------ ------------ EXPENSE: Mortality and Expense Risk and Administrative Charges (105,105) (3,774,270) (159,986) (608,077) ------------ ------------- ------------ ------------ Net investment income (loss) (101,772) (1,119,239) (157,762) (541,962) ------------ ------------- ------------ ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (17,272) 15,793 22,279 17,076 Net realized gain on distributions 868,292 884,136 800,333 7,992,377 Net unrealized appreciation (depreciation) of investments during the year 606,494 14,496,300 791,372 1,372,663 ------------ ------------- ------------ ------------ Net gain (loss) on investments 1,457,514 15,396,229 1,613,984 9,382,116 ------------ ------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations $1,355,742 $14,276,990 $1,456,222 $8,840,154 ============ ============= ============ ============ HARTFORD INTERNATIONAL HARTFORD HIGH HARTFORD INDEX GROWTH YIELD HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (F) -------------------------- ---------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,995,456 $153,712 $254,969 ------------- ----------- ------------ EXPENSE: Mortality and Expense Risk and Administrative Charges (330,525) (122,068) (451,712) ------------- ----------- ------------ Net investment income (loss) 1,664,931 31,644 (196,743) ------------- ----------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 781 18,853 18,000 Net realized gain on distributions -- 510,045 6,276,433 Net unrealized appreciation (depreciation) of investments during the year (1,613,704) (347,813) (386,592) ------------- ----------- ------------ Net gain (loss) on investments (1,612,923) 181,085 5,907,841 ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations $52,008 $212,729 $5,711,098 ============= =========== ============
(e) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. (f) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-43 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL SMALL COMPANY OPPORTUNITIES HARTFORD MIDCAP HLS FUND HLS FUND GROWTH HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $250,629 $807,140 $552 ------------- ------------- --------- EXPENSE: Mortality and Expense Risk and Administrative Charges (183,290) (1,002,120) (131) ------------- ------------- --------- Net investment income (loss) 67,339 (194,980) 421 ------------- ------------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 30,951 423,303 (74) Net realized gain on distributions 2,215,935 13,908,571 10,963 Net unrealized appreciation (depreciation) of investments during the year (1,834,619) 1,096,212 (11,452) ------------- ------------- --------- Net gain (loss) on investments 412,267 15,428,086 (563) ------------- ------------- --------- Net increase (decrease) in net assets resulting from operations $479,606 $15,233,106 $(142) ============= ============= =========
(a) From inception November 12, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-44 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD HARTFORD SMALL MONEY MARKET SECURITIES SMALLCAP VALUE COMPANY HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $2,114,008 $451,663 $340 $33,405 ------------ ----------- -------- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (672,130) (111,103) (57) (86,677) ------------ ----------- -------- ------------- Net investment income (loss) 1,441,878 340,560 283 (53,272) ------------ ----------- -------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions -- 805 (103) 12,241 Net realized gain on distributions -- -- 2,538 1,681,246 Net unrealized appreciation (depreciation) of investments during the year (3) (201,418) (2,739) (1,199,853) ------------ ----------- -------- ------------- Net gain (loss) on investments (3) (200,613) (304) 493,634 ------------ ----------- -------- ------------- Net increase (decrease) in net assets resulting from operations $1,441,875 $139,947 $(21) $440,362 ============ =========== ======== ============= 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 $65,842 $219,794 $4,956,116 ------------- ------------- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (329,538) (314,556) (1,998,894) ------------- ------------- ------------- Net investment income (loss) (263,696) (94,762) 2,957,222 ------------- ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 19,675 (3,629) 4,009 Net realized gain on distributions 1,687,226 3,019,386 -- Net unrealized appreciation (depreciation) of investments during the year (2,316,580) (2,211,849) 782,419 ------------- ------------- ------------- Net gain (loss) on investments (609,679) 803,908 786,428 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations $(873,375) $709,146 $3,743,650 ============= ============= =============
(a) From inception November 12, 2007 to December 31, 2007. SA-45 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD VALUE HARTFORD HARTFORD VALUE OPPORTUNITIES EQUITY INCOME HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $297,000 $265,581 $243,876 ----------- ------------- ----------- EXPENSE: Mortality and expense risk and administrative charges (178,639) (279,039) (128,954) ----------- ------------- ----------- Net investment income (loss) 118,361 (13,458) 114,922 ----------- ------------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 2,495 (41,115) (8,006) Net realized gain on distributions 795,345 2,942,699 338,926 Net unrealized appreciation (depreciation) of investments during the year (469,736) (4,959,869) (108,066) ----------- ------------- ----------- Net gain (loss) on investments 328,104 (2,058,285) 222,854 ----------- ------------- ----------- Net increase (decrease) in net assets resulting from operations $446,465 $(2,071,743) $337,776 =========== ============= ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-46 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA INCOME EQUITY DIVIDEND HUNTINGTON VA MID CORP FUND CAPTURE FUND GROWTH FUND AMERICA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $46,080 $156,994 $5,357 $15,305 ----------- ----------- ---------- ---------- EXPENSE: Mortality and expense risk and administrative charges (38,124) (77,609) (19,934) (41,619) ----------- ----------- ---------- ---------- Net investment income (loss) 7,956 79,385 (14,577) (26,314) ----------- ----------- ---------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (554) (1,291) 2,620 1,536 Net realized gain on distributions 85,078 221,483 176 30,509 Net unrealized appreciation (depreciation) of investments during the year (133,204) (721,252) 185,970 159,674 ----------- ----------- ---------- ---------- Net gain (loss) on investments (48,680) (501,060) 188,766 191,719 ----------- ----------- ---------- ---------- Net increase (decrease) in net assets resulting from operations $(40,724) $(421,675) $174,189 $165,405 =========== =========== ========== ========== HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA NEW ECONOMY ROTATING INTERNATIONAL FUND MARKETS FUND EQUITY FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- INVESTMENT INCOME: Dividends $5,036 $6,566 $377 ---------- --------- ---------- EXPENSE: Mortality and expense risk and administrative charges (45,019) (12,571) (32,226) ---------- --------- ---------- Net investment income (loss) (39,983) (6,005) (31,849) ---------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 12,128 493 3,899 Net realized gain on distributions 60,750 36,564 4,225 Net unrealized appreciation (depreciation) of investments during the year 283,820 12,568 284,979 ---------- --------- ---------- Net gain (loss) on investments 356,698 49,625 293,103 ---------- --------- ---------- Net increase (decrease) in net assets resulting from operations $316,715 $43,620 $261,254 ========== ========= ==========
SA-47 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA MORTGAGE SITUS SMALL MACRO 100 FUND SECURITIES FUND CAP FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $7,345 $20,870 $18,323 ----------- --------- ---------- EXPENSE: Mortality and expense risk and administrative charges (26,412) (14,741) (77,938) ----------- --------- ---------- Net investment income (loss) (19,067) 6,129 (59,615) ----------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 3,444 325 8,840 Net realized gain on distributions 282,987 222 305,679 Net unrealized appreciation (depreciation) of investments during the year (348,261) 19,693 137,049 ----------- --------- ---------- Net gain (loss) on investments (61,830) 20,240 451,568 ----------- --------- ---------- Net increase (decrease) in net assets resulting from operations $(80,897) $26,369 $391,953 =========== ========= ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-48 -------------------------------------------------------------------------------
LORD ABBETT LORD ABBETT LORD ABBETT ALL AMERICA'S VALUE LORD ABBETT BOND GROWTH AND VALUE PORTFOLIO PORTFOLIO DEBENTURE FUND INCOME PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (G) SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $47,410 $193,702 $1,880,803 $1,867,343 ----------- ----------- ------------ ------------- EXPENSE: Mortality and expense risk and administrative charges (122,184) (87,018) (370,542) (1,769,334) ----------- ----------- ------------ ------------- Net investment income (loss) (74,774) 106,684 1,510,261 98,009 ----------- ----------- ------------ ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 5,354 2,321 311 12,018 Net realized gain on distributions 354,909 204,369 101,725 10,297,360 Net unrealized appreciation (depreciation) of investments during the year 53,725 (304,943) (674,147) (9,461,550) ----------- ----------- ------------ ------------- Net gain (loss) on investments 413,988 (98,253) (572,111) 847,828 ----------- ----------- ------------ ------------- Net increase (decrease) in net assets resulting from operations $339,214 $8,431 $938,150 $945,837 =========== =========== ============ ============= LORD ABBETT LARGE CAP MFS CORE MFS EMERGING CORE FUND EQUITY SERIES GROWTH SERIES SUB-ACCOUNT (H) SUB-ACCOUNT (I) SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- INVESTMENT INCOME: Dividends $32,270 $2,442 $ -- ---------- --------- ---------- EXPENSE: Mortality and expense risk and administrative charges (59,312) (10,619) (11,917) ---------- --------- ---------- Net investment income (loss) (27,042) (8,177) (11,917) ---------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 8,085 34,618 75,505 Net realized gain on distributions 181,877 -- -- Net unrealized appreciation (depreciation) of investments during the year 120,735 38,587 63,123 ---------- --------- ---------- Net gain (loss) on investments 310,697 73,205 138,628 ---------- --------- ---------- Net increase (decrease) in net assets resulting from operations $283,655 $65,028 $126,711 ========== ========= ==========
(g) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. (h) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (i) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-49 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MFS INVESTORS GROWTH STOCK MFS INVESTORS MFS TOTAL SERIES TRUST SERIES RETURN SERIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $1,451 $11,175 $368,449 --------- ---------- ----------- EXPENSE: Mortality and expense risk and administrative charges (6,839) (22,913) (252,008) --------- ---------- ----------- Net investment income (loss) (5,388) (11,738) 116,441 --------- ---------- ----------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 7,695 74,408 260,641 Net realized gain on distributions -- 11,334 352,281 Net unrealized appreciation (depreciation) of investments during the year 37,589 34,872 (376,977) --------- ---------- ----------- Net gain (loss) on investments 45,284 120,614 235,945 --------- ---------- ----------- Net increase (decrease) in net assets resulting from operations $39,896 $108,876 $352,386 ========= ========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-50 -------------------------------------------------------------------------------
EQUITY AND CORE PLUS EMERGING EMERGING INCOME FIXED INCOME MARKETS DEBT MARKETS EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $5,325 $411,325 $78,614 $91,737 -------- ----------- --------- ------------ EXPENSE: Mortality and expense risk and administrative charges (5,244) (192,062) (19,103) (358,659) -------- ----------- --------- ------------ Net investment income (loss) 81 219,263 59,511 (266,922) -------- ----------- --------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 5,910 51,753 1,859 36,206 Net realized gain on distributions 7,498 -- 33,590 2,472,707 Net unrealized appreciation (depreciation) of investments during the year (8,089) 130,660 (48,612) 4,952,869 -------- ----------- --------- ------------ Net gain (loss) on investments 5,319 182,413 (13,163) 7,461,782 -------- ----------- --------- ------------ Net increase (decrease) in net assets resulting from operations $5,400 $401,676 $46,348 $7,194,860 ======== =========== ========= ============ MID CAP U.S. MID HIGH YIELD GROWTH CAP VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- INVESTMENT INCOME: Dividends $164,110 $ -- $93,259 ---------- ------------ ------------ EXPENSE: Mortality and expense risk and administrative charges (32,859) (126,250) (236,971) ---------- ------------ ------------ Net investment income (loss) 131,251 (126,250) (143,712) ---------- ------------ ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (59,067) 30,690 172,684 Net realized gain on distributions -- 380,649 1,547,398 Net unrealized appreciation (depreciation) of investments during the year (28,539) 1,081,503 (848,661) ---------- ------------ ------------ Net gain (loss) on investments (87,606) 1,492,842 871,421 ---------- ------------ ------------ Net increase (decrease) in net assets resulting from operations $43,645 $1,366,592 $727,709 ========== ============ ============
SA-51 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
CAPITAL FOCUS GROWTH BALANCED GROWTH OPPORTUNITIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $229,597 $ -- ------------ ----------- ---------- EXPENSE: Mortality and expense risk and administrative charges (208,262) (133,505) (72,624) ------------ ----------- ---------- Net investment income (loss) (208,262) 96,092 (72,624) ------------ ----------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 385,048 227,172 165,914 Net realized gain on distributions -- 732,102 -- Net unrealized appreciation (depreciation) of investments during the year 2,542,029 (807,381) 670,221 ------------ ----------- ---------- Net gain (loss) on investments 2,927,077 151,893 836,135 ------------ ----------- ---------- Net increase (decrease) in net assets resulting from operations $2,718,815 $247,985 $763,511 ============ =========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-52 -------------------------------------------------------------------------------
DEVELOPING GROWTH FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $16,435 $277,260 $257,757 $51,503 ------------ ------------ ------------ -------------- EXPENSE: Mortality and expense risk and administrative charges (69,419) (72,449) (328,868) (116,418) ------------ ------------ ------------ -------------- Net investment income (loss) (52,984) 204,811 (71,111) (64,915) ------------ ------------ ------------ -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 578,280 (230,331) 721,284 329,184 Net realized gain on distributions -- -- -- 1,141,553 Net unrealized appreciation (depreciation) of investments during the year 373,665 123,409 91,089 (303,799) ------------ ------------ ------------ -------------- Net gain (loss) on investments 951,945 (106,922) 812,373 1,166,938 ------------ ------------ ------------ -------------- Net increase (decrease) in net assets resulting from operations $898,961 $97,889 $741,262 $1,102,023 ============ ============ ============ ============== GROWTH MONEY MARKET UTILITIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $ -- $348,480 $105,121 ------------ ------------ -------------- EXPENSE: Mortality and expense risk and administrative charges (54,962) (117,125) (87,685) ------------ ------------ -------------- Net investment income (loss) (54,962) 231,355 17,436 ------------ ------------ -------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 157,153 -- 569,959 Net realized gain on distributions -- -- -- Net unrealized appreciation (depreciation) of investments during the year 546,121 -- 439,418 ------------ ------------ -------------- Net gain (loss) on investments 703,274 -- 1,009,377 ------------ ------------ -------------- Net increase (decrease) in net assets resulting from operations $648,312 $231,355 $1,026,813 ============ ============ ==============
SA-53 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
EQUALLY-WEIGHTED SMALL COMPANY S&P 500 GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $322,703 $ -- $ -- ------------- --------- ---------- EXPENSE: Mortality and expense risk and administrative charges (370,829) (13,530) (22,730) ------------- --------- ---------- Net investment income (loss) (48,126) (13,530) (22,730) ------------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 1,868,955 4,808 21,567 Net realized gain on distributions 2,119,306 54,962 108,848 Net unrealized appreciation (depreciation) of investments during the year (3,773,902) (44,925) (15,512) ------------- --------- ---------- Net gain (loss) on investments 214,359 14,845 114,903 ------------- --------- ---------- Net increase (decrease) in net assets resulting from operations $166,233 $1,315 $92,173 ============= ========= ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-54 -------------------------------------------------------------------------------
MTB MANAGED MTB MANAGED ALLOCATION ALLOCATION FUND -- FUND -- MTB LARGE CAP MTB LARGE CAP MODERATE AGGRESSIVE GROWTH FUND II VALUE FUND II GROWTH II GROWTH II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $4,605 $31,206 $69,890 $7,647 --------- ----------- ---------- --------- EXPENSE: Mortality and expense risk and administrative charges (15,534) (40,721) (40,218) (7,435) --------- ----------- ---------- --------- Net investment income (loss) (10,929) (9,515) 29,672 212 --------- ----------- ---------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 1,654 (1,362) 6,556 (3,665) Net realized gain on distributions 86,394 116,206 103,894 28,398 Net unrealized appreciation (depreciation) of investments during the year (12,438) (146,845) 6,873 (123) --------- ----------- ---------- --------- Net gain (loss) on investments 75,610 (32,001) 117,323 24,610 --------- ----------- ---------- --------- Net increase (decrease) in net assets resulting from operations $64,681 $(41,516) $146,995 $24,822 ========= =========== ========== ========= MTB MANAGED ALLOCATION FUND -- OPPENHEIMER CONSERVATIVE MIDCAP OPPENHEIMER CAPITAL GROWTH II FUND VA APPRECIATION FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- INVESTMENT INCOME: Dividends $12,674 $ -- $3,380 --------- ---------- ------------ EXPENSE: Mortality and expense risk and administrative charges (5,517) (41,875) (655,804) --------- ---------- ------------ Net investment income (loss) 7,157 (41,875) (652,424) --------- ---------- ------------ NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 531 31,394 90,975 Net realized gain on distributions 11,563 -- -- Net unrealized appreciation (depreciation) of investments during the year (5,444) 101,825 5,023,281 --------- ---------- ------------ Net gain (loss) on investments 6,650 133,219 5,114,256 --------- ---------- ------------ Net increase (decrease) in net assets resulting from operations $13,807 $91,344 $4,461,832 ========= ========== ============
SA-55 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER GLOBAL SECURITIES OPPENHEIMER MAIN STREET FUND MAIN STREET FUND SMALL CAP FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,543,906 $70,625 $92,479 ------------- ----------- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (2,469,722) (163,560) (1,036,087) ------------- ----------- ------------- Net investment income (loss) (925,816) (92,935) (943,608) ------------- ----------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (1,404) 7,448 (17,204) Net realized gain on distributions 6,456,644 -- 2,000,089 Net unrealized appreciation (depreciation) of investments during the year (893,806) 219,030 (4,489,264) ------------- ----------- ------------- Net gain (loss) on investments 5,561,434 226,478 (2,506,379) ------------- ----------- ------------- Net increase (decrease) in net assets resulting from operations $4,635,618 $133,543 $(3,449,987) ============= =========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-56 -------------------------------------------------------------------------------
PUTNAM PUTNAM INTERNATIONAL DIVERSIFIED PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND INCOME ASSET ALLOCATION AND INCOME INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) -------------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,253,141 $29,641 $60,157 $ -- ------------ ----------- ------------- ----- EXPENSE: Mortality and Expense Risk and Administrative Charges (442,814) (105,574) (88,996) (60) ------------ ----------- ------------- ----- Net investment income (loss) 810,327 (75,933) (28,839) (60) ------------ ----------- ------------- ----- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (3,392) 7,545 7,103 -- Net realized gain on distributions -- -- 691,250 -- Net unrealized appreciation (depreciation) of investments during the year 970 115,381 (1,318,269) 317 ------------ ----------- ------------- ----- Net gain (loss) on investments (2,422) 122,926 (619,916) 317 ------------ ----------- ------------- ----- Net increase (decrease) in net assets resulting from operations $807,905 $46,993 $(648,755) $257 ============ =========== ============= ===== PUTNAM INTERNATIONAL PUTNAM PUTNAM EQUITY INVESTORS NEW VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------- INVESTMENT INCOME: Dividends $1,878,427 $13,909 $109,177 ------------- ------------- ------------- EXPENSE: Mortality and Expense Risk and Administrative Charges (1,138,501) (133,495) (165,361) ------------- ------------- ------------- Net investment income (loss) 739,926 (119,586) (56,184) ------------- ------------- ------------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 72,960 10,520 (24,727) Net realized gain on distributions 8,131,653 -- 913,501 Net unrealized appreciation (depreciation) of investments during the year (4,997,563) (898,792) (1,617,428) ------------- ------------- ------------- Net gain (loss) on investments 3,207,050 (888,272) (728,654) ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations $3,946,976 $(1,007,858) $(784,838) ============= ============= =============
(a) From inception November 12, 2007 to December 31, 2007. SA-57 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
PUTNAM THE PUTNAM SMALL GEORGE PUTNAM CAP VALUE FUND OF BOSTON PUTNAM VISTA SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $301,028 $119,563 $ -- -------------- ----------- --------- EXPENSE: Mortality and expense risk and administrative charges (897,835) (80,966) (16,136) -------------- ----------- --------- Net investment income (loss) (596,807) 38,597 (16,136) -------------- ----------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions (115,078) (6,189) 13,495 Net realized gain on distributions 6,020,565 414,994 -- Net unrealized appreciation (depreciation) of investments during the year (15,155,753) (542,312) 14,640 -------------- ----------- --------- Net gain (loss) on investments (9,250,266) (133,507) 28,135 -------------- ----------- --------- Net increase (decrease) in net assets resulting from operations $(9,847,073) $(94,910) $11,999 ============== =========== =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-58 -------------------------------------------------------------------------------
PIONEER OAK RIDGE LARGE PUTNAM PIONEER FUND CAP GROWTH VOYAGER VCT PORTFOLIO VCT PORTFOLIO ENTERPRISE SUB-ACCOUNT SUB-ACCOUNT (J) SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $12,287 $1,028 $3,860 ---------- --------- --------- ---------- EXPENSE: Mortality and expense risk and administrative charges (35,126) (16,403) (10,404) (23,582) ---------- --------- --------- ---------- Net investment income (loss) (35,126) (4,116) (9,376) (19,722) ---------- --------- --------- ---------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 29,484 12,141 5,593 9,511 Net realized gain on distributions -- 14,426 2,095 -- Net unrealized appreciation (depreciation) of investments during the year 79,377 (1,955) 34,651 165,453 ---------- --------- --------- ---------- Net gain (loss) on investments 108,861 24,612 42,339 174,964 ---------- --------- --------- ---------- Net increase (decrease) in net assets resulting from operations $73,735 $20,496 $32,963 $155,242 ========== ========= ========= ========== GROWTH AND STRATEGIC INCOME COMSTOCK GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------- INVESTMENT INCOME: Dividends $480,844 $1,102,817 $ -- ------------- ------------- --------- EXPENSE: Mortality and expense risk and administrative charges (643,835) (1,236,669) (6,015) ------------- ------------- --------- Net investment income (loss) (162,991) (133,852) (6,015) ------------- ------------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 278,636 19,580 5,411 Net realized gain on distributions 1,282,233 1,532,019 -- Net unrealized appreciation (depreciation) of investments during the year (1,653,818) (5,274,640) 36,533 ------------- ------------- --------- Net gain (loss) on investments (92,949) (3,723,041) 41,944 ------------- ------------- --------- Net increase (decrease) in net assets resulting from operations $(255,940) $(3,856,893) $35,929 ============= ============= =========
(j) Effective November 9, 2007, Pioneer Value VCT Portfolio merged with Pioneer Fund VCT Portfolio. SA-59 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AGGRESSIVE GOVERNMENT GROWTH PORTFOLIO PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------- INVESTMENT INCOME: Dividends $ -- $25,103 --------- --------- EXPENSE: Mortality and expense risk and administrative charges (4,931) (12,828) --------- --------- Net investment income (loss) (4,931) 12,275 --------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 11,195 305 Net realized gain on distributions 16,956 -- Net unrealized appreciation (depreciation) of investments during the year 9,514 14,414 --------- --------- Net gain (loss) on investments 37,665 14,719 --------- --------- Net increase (decrease) in net assets resulting from operations $32,734 $26,994 ========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-60 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO STI CLASSIC VT ADVANTAGE VT ADVANTAGE VT LARGE CAP LARGE COMPANY SMALL CAP GROWTH GROWTH FUND GROWTH FUND STOCK FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (K) ------------------------------------------------------------------------------------------ INVESTMENT INCOME: Dividends $ -- $ -- $82 ------- ------- ------- EXPENSE: Mortality and expense risk and administrative charges (367) (235) (270) ------- ------- ------- Net investment income (loss) (367) (235) (188) ------- ------- ------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 155 218 65 Net realized gain on distributions -- 2,373 1,460 Net unrealized appreciation (depreciation) of investments during the year 1,473 (785) 683 ------- ------- ------- Net gain (loss) on investments 1,628 1,806 2,208 ------- ------- ------- Net increase (decrease) in net assets resulting from operations $1,261 $1,571 $2,020 ======= ======= ======= STI CLASSIC VT STI CLASSIC VT STI CLASSIC VT LARGE CAP CORE MID-CAP CORE LARGE CAP VALUE EQUITY FUND EQUITY FUND EQUITY FUND SUB-ACCOUNT (L) SUB-ACCOUNT (M) SUB-ACCOUNT ----------------------------- -------------------------------------------------------------- INVESTMENT INCOME: Dividends $1,530 $190 $32,551 -------- --------- --------- EXPENSE: Mortality and expense risk and administrative charges (2,344) (1,408) (32,393) -------- --------- --------- Net investment income (loss) (814) (1,218) 158 -------- --------- --------- NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on security transactions 89 110 2,636 Net realized gain on distributions 7,645 11,282 -- Net unrealized appreciation (depreciation) of investments during the year (8,715) (8,722) 6,974 -------- --------- --------- Net gain (loss) on investments (981) 2,670 9,610 -------- --------- --------- Net increase (decrease) in net assets resulting from operations $(1,795) $1,452 $9,768 ======== ========= =========
(k) Funded as of June 11, 2007. (l) Formerly STI Classic VT Large Cap Relative Value Fund. Change effective May 31, 2007. (m) Formerly STI Classic VT Mid-Cap Equity Fund. Change effective May 31, 2007. SA-61 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH VP INTERNATIONAL PORTFOLIO GROWTH PORTFOLIO VALUE PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $176,599 $(28,966) $(702,503) Net realized gain (loss) on security transactions (3,831) 3,127 108,237 Net realized gain on distributions 469,380 72,356 4,982,409 Net unrealized appreciation (depreciation) of investments during the year 160,619 128,657 (774,874) ------------- ------------ -------------- Net increase (decrease) in net assets resulting from operations 802,767 175,174 3,613,269 ------------- ------------ -------------- UNIT TRANSACTIONS: Purchases 11,565,456 998,731 39,486,002 Net transfers 10,524,598 174,425 15,960,252 Surrenders for benefit payments and fees (1,270,777) (65,730) (6,531,808) Net annuity transactions (449) -- -- ------------- ------------ -------------- Net increase (decrease) in net assets resulting from unit transactions 20,818,828 1,107,426 48,914,446 ------------- ------------ -------------- Net increase (decrease) in net assets 21,621,595 1,282,600 52,527,715 NET ASSETS: Beginning of year 21,407,828 1,444,925 101,518,926 ------------- ------------ -------------- End of year $43,029,423 $2,727,525 $154,046,641 ============= ============ ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-62 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN AMERICAN VP SMALL/MID CAP ALLIANCEBERNSTEIN VPS INTERNATIONAL FUNDS GLOBAL VALUE PORTFOLIO VP VALUE PORTFOLIO GROWTH PORTFOLIO GROWTH FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(129,159) $(221,796) $311 $39,181 Net realized gain (loss) on security transactions 12,048 (2,473) 42 126,097 Net realized gain on distributions 904,650 1,486,281 31,643 169,993 Net unrealized appreciation (depreciation) of investments during the year (1,365,650) (5,325,146) (32,309) 164,514 ------------- ------------- ---------- ------------ Net increase (decrease) in net assets resulting from operations (578,111) (4,063,134) (313) 499,785 ------------- ------------- ---------- ------------ UNIT TRANSACTIONS: Purchases 4,882,516 15,698,684 111,357 25,782 Net transfers 2,875,662 10,246,628 416,854 214,155 Surrenders for benefit payments and fees (430,410) (2,659,996) (6,433) (424,251) Net annuity transactions -- -- -- -- ------------- ------------- ---------- ------------ Net increase (decrease) in net assets resulting from unit transactions 7,327,768 23,285,316 521,778 (184,314) ------------- ------------- ---------- ------------ Net increase (decrease) in net assets 6,749,657 19,222,182 521,465 315,471 NET ASSETS: Beginning of year 10,401,588 44,746,503 -- 3,984,981 ------------- ------------- ---------- ------------ End of year $17,151,245 $63,968,685 $521,465 $4,300,452 ============= ============= ========== ============ AMERICAN FUNDS AMERICAN FUNDS GROWTH-INCOME AMERICAN FUNDS GROWTH FUND FUND INTERNATIONAL FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(350,422) $(84,438) $(31,247) Net realized gain (loss) on security transactions 1,253,945 703,631 302,334 Net realized gain on distributions 2,377,379 867,895 772,402 Net unrealized appreciation (depreciation) of investments during the year 166,692 (589,905) 1,595,212 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 3,447,594 897,183 2,638,701 ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 217,235 198,065 173,007 Net transfers (517,456) (327,610) 385,673 Surrenders for benefit payments and fees (3,061,892) (2,051,878) (1,538,300) Net annuity transactions -- 8,052 6,130 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (3,362,113) (2,173,371) (973,490) ------------- ------------- ------------- Net increase (decrease) in net assets 85,481 (1,276,188) 1,665,211 NET ASSETS: Beginning of year 33,945,311 26,376,899 15,185,627 ------------- ------------- ------------- End of year $34,030,792 $25,100,711 $16,850,838 ============= ============= =============
(a) From inception November 12, 2007 to December 31, 2007. SA-63 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AMERICAN FUNDS GLOBAL SMALL BB&T CAPITAL CAPITALIZATION BB&T MID CAP MANAGER FUND GROWTH VIF EQUITY VIF SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $60,914 $(39,869) $23,377 Net realized gain (loss) on security transactions 170,765 14,023 9,433 Net realized gain on distributions 417,600 322,162 201,696 Net unrealized appreciation (depreciation) of investments during the year 296,676 484,172 (220,926) ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 945,955 780,488 13,580 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 3,953 724,476 532,989 Net transfers (214,591) 171,394 (94,234) Surrenders for benefit payments and fees (514,912) (96,545) (81,670) Net annuity transactions 12,703 -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions (712,847) 799,325 357,085 ------------ ------------ ------------ Net increase (decrease) in net assets 233,108 1,579,813 370,665 NET ASSETS: Beginning of year 5,037,653 2,089,242 1,359,111 ------------ ------------ ------------ End of year $5,270,761 $3,669,055 $1,729,776 ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-64 -------------------------------------------------------------------------------
BB&T SPECIAL BB&T LARGE OPPORTUNITIES BB&T TOTAL EVERGREEN VA CAP VIF EQUITY VIF RETURN BOND VIF BALANCED FUND SUB-ACCOUNT (B) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $27,707 $(169,561) $75,930 $14,846 Net realized gain (loss) on security transactions (262,931) 25,975 1,521 233 Net realized gain on distributions 839,953 833,635 -- -- Net unrealized appreciation (depreciation) of investments during the year (950,542) 384,804 55,918 9,527 ------------ ------------- ------------ ---------- Net increase (decrease) in net assets resulting from operations (345,813) 1,074,853 133,369 24,606 ------------ ------------- ------------ ---------- UNIT TRANSACTIONS: Purchases 1,412,413 4,371,000 776,571 164,155 Net transfers 351,601 1,560,810 266,651 157,013 Surrenders for benefit payments and fees (104,755) (623,068) (182,153) (7,081) Net annuity transactions -- -- -- -- ------------ ------------- ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 1,659,259 5,308,742 861,069 314,087 ------------ ------------- ------------ ---------- Net increase (decrease) in net assets 1,313,446 6,383,595 994,438 338,693 NET ASSETS: Beginning of year 3,008,945 7,906,888 1,915,706 282,801 ------------ ------------- ------------ ---------- End of year $4,322,391 $14,290,483 $2,910,144 $621,494 ============ ============= ============ ========== EVERGREEN VA EVERGREEN VA INTERNATIONAL EVERGREEN VA GROWTH FUND EQUITY FUND OMEGA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(84,959) $25,318 $(594) Net realized gain (loss) on security transactions 18,507 3,473 245 Net realized gain on distributions 1,004,688 131,855 -- Net unrealized appreciation (depreciation) of investments during the year (513,437) (32,352) 4,431 ------------ ------------ --------- Net increase (decrease) in net assets resulting from operations 424,799 128,294 4,082 ------------ ------------ --------- UNIT TRANSACTIONS: Purchases 607,731 895,981 -- Net transfers 131,203 313,616 (1,054) Surrenders for benefit payments and fees (206,278) (52,225) (271) Net annuity transactions -- -- -- ------------ ------------ --------- Net increase (decrease) in net assets resulting from unit transactions 532,656 1,157,372 (1,325) ------------ ------------ --------- Net increase (decrease) in net assets 957,455 1,285,666 2,757 NET ASSETS: Beginning of year 4,321,773 724,465 41,578 ------------ ------------ --------- End of year $5,279,228 $2,010,131 $44,335 ============ ============ =========
(b) Effective February 9, 2007, BB&T Large Cap Growth VIF merged with BB&T Large Cap VIF. SA-65 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
EVERGREEN VA EVERGREEN VA SPECIAL VALUES FUNDAMENTAL FIDELITY(R) VIP FUND LARGE CAP FUND EQUITY-INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(7,468) $(1,303) $220,896 Net realized gain (loss) on security transactions (28,599) 1,679 19,268 Net realized gain on distributions 1,621,171 18,791 6,202,262 Net unrealized appreciation (depreciation) of investments during the year (2,800,554) (7,326) (7,619,547) ------------- ---------- ------------- Net increase (decrease) in net assets resulting from operations (1,215,450) 11,841 (1,177,121) ------------- ---------- ------------- UNIT TRANSACTIONS: Purchases 3,110,917 52,727 17,363,435 Net transfers 867,424 (10,279) 10,050,141 Surrenders for benefit payments and fees (518,642) (543) (3,025,629) Net annuity transactions -- -- -- ------------- ---------- ------------- Net increase (decrease) in net assets resulting from unit transactions 3,459,699 41,905 24,387,947 ------------- ---------- ------------- Net increase (decrease) in net assets 2,244,249 53,746 23,210,826 NET ASSETS: Beginning of year 9,707,726 192,583 50,840,635 ------------- ---------- ------------- End of year $11,951,975 $246,329 $74,051,461 ============= ========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-66 -------------------------------------------------------------------------------
FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP GROWTH CONTRAFUND(R) MID CAP VALUE STRATEGIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(249,469) $(1,863,699) $(910,974) $(52,635) Net realized gain (loss) on security transactions 163,993 25,464 (11,594) (26,697) Net realized gain on distributions 16,257 97,316,223 6,585,325 414,932 Net unrealized appreciation (depreciation) of investments during the year 4,918,724 (50,500,431) 4,146,500 (445,350) ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from operations 4,849,505 44,977,557 9,809,257 (109,750) ------------- -------------- -------------- ------------ UNIT TRANSACTIONS: Purchases 5,213,644 102,394,403 19,620,820 2,874,349 Net transfers 1,577,115 57,048,611 7,842,909 1,295,694 Surrenders for benefit payments and fees (1,029,625) (14,201,851) (3,405,550) (302,140) Net annuity transactions -- (3,712) -- -- ------------- -------------- -------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 5,761,134 145,237,451 24,058,179 3,867,903 ------------- -------------- -------------- ------------ Net increase (decrease) in net assets 10,610,639 190,215,008 33,867,436 3,758,153 NET ASSETS: Beginning of year 15,018,314 220,607,934 66,412,430 3,190,312 ------------- -------------- -------------- ------------ End of year $25,628,953 $410,822,942 $100,279,866 $6,948,465 ============= ============== ============== ============ FIDELITY(R) VIP DYNAMIC CAPITAL FRANKLIN SMALL-MID FRANKLIN STRATEGIC APPRECIATION CAP GROWTH INCOME SECURITIES PORTFOLIO SECURITIES FUND FUND SUB-ACCOUNT (A) SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(7) $(74,159) $590,893 Net realized gain (loss) on security transactions -- 284,502 15,666 Net realized gain on distributions 1,534 302,417 46,009 Net unrealized appreciation (depreciation) of investments during the year (1,615) (118,689) 25,843 --------- ------------ ------------- Net increase (decrease) in net assets resulting from operations (88) 394,071 678,411 --------- ------------ ------------- UNIT TRANSACTIONS: Purchases 14,109 40,899 70,858 Net transfers 7,618 (307,849) 7,319,993 Surrenders for benefit payments and fees -- (493,744) (3,115,120) Net annuity transactions -- -- -- --------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 21,727 (760,694) 4,275,731 --------- ------------ ------------- Net increase (decrease) in net assets 21,639 (366,623) 4,954,142 NET ASSETS: Beginning of year -- 4,324,286 11,276,298 --------- ------------ ------------- End of year $21,639 $3,957,663 $16,230,440 ========= ============ =============
(a) From inception November 12, 2007 to December 31, 2007. SA-67 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
TEMPLETON MUTUAL SHARES DEVELOPING MARKETS TEMPLETON GROWTH SECURITIES FUND SECURITIES FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(46,100) $22,806 $(19,175) Net realized gain (loss) on security transactions 357,586 310,814 97,843 Net realized gain on distributions 529,717 232,825 180,607 Net unrealized appreciation (depreciation) of investments during the year (555,194) 144,456 (228,895) ------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations 286,009 710,901 30,380 ------------- ------------ ------------ UNIT TRANSACTIONS: Purchases 83,040 14,255 26,215 Net transfers (23,099) (465,134) (109,445) Surrenders for benefit payments and fees (1,377,313) (319,094) (243,145) Net annuity transactions -- -- -- ------------- ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions (1,317,372) (769,973) (326,375) ------------- ------------ ------------ Net increase (decrease) in net assets (1,031,363) (59,072) (295,995) NET ASSETS: Beginning of year 15,027,726 3,213,898 4,300,062 ------------- ------------ ------------ End of year $13,996,363 $3,154,826 $4,004,067 ============= ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-68 -------------------------------------------------------------------------------
FIFTH THIRD FIFTH THIRD FIFTH THIRD BALANCED DISCIPLINED VALUE FIFTH THIRD MID QUALITY GROWTH VIP FUND VIP FUND CAP VIP FUND VIP FUND SUB-ACCOUNT (C) SUB-ACCOUNT (C) SUB-ACCOUNT (C) SUB-ACCOUNT (C) --------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $427 $7,642 $(5,740) $(510) Net realized gain (loss) on security transactions (8,051) (961,164) (150,488) (4,182) Net realized gain on distributions 17,717 1,692,716 229,653 13,308 Net unrealized appreciation (depreciation) of investments during the year (4,211) (397,027) (23,009) (2,835) ----------- ------------- ----------- --------- Net increase (decrease) in net assets resulting from operations 5,882 342,167 50,416 5,781 ----------- ------------- ----------- --------- UNIT TRANSACTIONS: Purchases 9,607 668,770 44,780 -- Net transfers (100,384) (5,376,045) (474,569) (49,876) Surrenders for benefit payments and fees (8,467) (185,910) (18,360) (1,333) Net annuity transactions -- -- -- -- ----------- ------------- ----------- --------- Net increase (decrease) in net assets resulting from unit transactions (99,244) (4,893,185) (448,149) (51,209) ----------- ------------- ----------- --------- Net increase (decrease) in net assets (93,362) (4,551,018) (397,733) (45,428) NET ASSETS: Beginning of year 93,362 4,551,018 397,733 45,428 ----------- ------------- ----------- --------- End of year $ -- $ -- $ -- $ -- =========== ============= =========== ========= HARTFORD HARTFORD LARGECAP HARTFORD TOTAL ADVISERS GROWTH RETURN BOND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ----------------------------- ------------------------------------------------------------- OPERATIONS: Net investment income (loss) $239,814 $267 $14,962,024 Net realized gain (loss) on security transactions (5,336) -- 20,252 Net realized gain on distributions 2,983,643 -- -- Net unrealized appreciation (depreciation) of investments during the year (2,087,184) (69) (4,713,092) ------------- ---------- -------------- Net increase (decrease) in net assets resulting from operations 1,130,937 198 10,269,184 ------------- ---------- -------------- UNIT TRANSACTIONS: Purchases 5,078,617 41,689 80,719,370 Net transfers 2,956,511 59,024 69,385,327 Surrenders for benefit payments and fees (1,859,542) (2) (15,432,206) Net annuity transactions -- -- (5,161) ------------- ---------- -------------- Net increase (decrease) in net assets resulting from unit transactions 6,175,586 100,711 134,667,330 ------------- ---------- -------------- Net increase (decrease) in net assets 7,306,523 100,909 144,936,514 NET ASSETS: Beginning of year 20,980,626 -- 241,328,790 ------------- ---------- -------------- End of year $28,287,149 $100,909 $386,265,304 ============= ========== ==============
(a) From inception November 12, 2007 to December 31, 2007. (c) This fund closed on October 12, 2007. SA-69 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD DIVIDEND AND FUNDAMENTAL HARTFORD GROWTH GROWTH GLOBAL ADVISERS HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,432,357 $(14,420) $(21,135) Net realized gain (loss) on security transactions 33,116 692 5,956 Net realized gain on distributions 23,217,982 83,213 329,531 Net unrealized appreciation (depreciation) of investments during the year (12,000,418) 35,504 224,818 -------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations 12,683,037 104,989 539,170 -------------- ------------ ------------ UNIT TRANSACTIONS: Purchases 84,761,078 327,577 905,106 Net transfers 56,239,751 572,264 734,913 Surrenders for benefit payments and fees (11,346,136) (26,915) (155,174) Net annuity transactions (470) -- -- -------------- ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 129,654,223 872,926 1,484,845 -------------- ------------ ------------ Net increase (decrease) in net assets 142,337,260 977,915 2,024,015 NET ASSETS: Beginning of year 170,640,463 714,581 2,914,364 -------------- ------------ ------------ End of year $312,977,723 $1,692,496 $4,938,379 ============== ============ ============
(d) Formerly Hartford Focus HLS Fund. Change effective July 27, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-70 -------------------------------------------------------------------------------
HARTFORD HARTFORD DISCIPLINED HARTFORD GROWTH GLOBAL GROWTH EQUITY HARTFORD GROWTH OPPORTUNITIES HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT (E) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(101,772) $(1,119,239) $(157,762) $(541,962) Net realized gain (loss) on security transactions (17,272) 15,793 22,279 17,076 Net realized gain on distributions 868,292 884,136 800,333 7,992,377 Net unrealized appreciation (depreciation) of investments during the year 606,494 14,496,300 791,372 1,372,663 ------------ -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,355,742 14,276,990 1,456,222 8,840,154 ------------ -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 1,780,979 41,218,306 1,886,933 11,002,116 Net transfers 841,872 27,844,403 1,251,069 8,060,923 Surrenders for benefit payments and fees (192,970) (11,250,808) (513,987) (1,843,302) Net annuity transactions -- -- -- -- ------------ -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 2,429,881 57,811,901 2,624,015 17,219,737 ------------ -------------- ------------- ------------- Net increase (decrease) in net assets 3,785,623 72,088,891 4,080,237 26,059,891 NET ASSETS: Beginning of year 5,104,907 190,291,362 8,462,647 27,395,692 ------------ -------------- ------------- ------------- End of year $8,890,530 $262,380,253 $12,542,884 $53,455,583 ============ ============== ============= ============= HARTFORD INTERNATIONAL HARTFORD HIGH HARTFORD INDEX GROWTH YIELD HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (F) ----------------------------- ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $1,664,931 $31,644 $(196,743) Net realized gain (loss) on security transactions 781 18,853 18,000 Net realized gain on distributions -- 510,045 6,276,433 Net unrealized appreciation (depreciation) of investments during the year (1,613,704) (347,813) (386,592) ------------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 52,008 212,729 5,711,098 ------------- ------------ ------------- UNIT TRANSACTIONS: Purchases 6,475,447 1,922,232 8,510,161 Net transfers 6,684,476 1,228,699 7,189,116 Surrenders for benefit payments and fees (1,105,053) (351,737) (926,494) Net annuity transactions (3,924) -- -- ------------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 12,050,946 2,799,194 14,772,783 ------------- ------------ ------------- Net increase (decrease) in net assets 12,102,954 3,011,923 20,483,881 NET ASSETS: Beginning of year 14,032,388 6,160,347 19,148,347 ------------- ------------ ------------- End of year $26,135,342 $9,172,270 $39,632,228 ============= ============ =============
(e) Formerly Hartford Global Leaders HLS Fund. Change effective July 27, 2007. (f) Formerly Hartford International Capital Appreciation HLS Fund. Change effective July 27, 2007. SA-71 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL SMALL COMPANY OPPORTUNITIES HARTFORD MIDCAP HLS FUND HLS FUND GROWTH HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $67,339 $(194,980) $421 Net realized gain (loss) on security transactions 30,951 423,303 (74) Net realized gain on distributions 2,215,935 13,908,571 10,963 Net unrealized appreciation (depreciation) of investments during the year (1,834,619) 1,096,212 (11,452) ------------- ------------- ---------- Net increase (decrease) in net assets resulting from operations 479,606 15,233,106 (142) ------------- ------------- ---------- UNIT TRANSACTIONS: Purchases 6,336,205 14,156,682 138,905 Net transfers 858,578 2,436,428 12,278 Surrenders for benefit payments and fees (271,230) (2,882,857) (1,572) Net annuity transactions -- -- -- ------------- ------------- ---------- Net increase (decrease) in net assets resulting from unit transactions 6,923,553 13,710,253 149,611 ------------- ------------- ---------- Net increase (decrease) in net assets 7,403,159 28,943,359 149,469 NET ASSETS: Beginning of year 7,616,512 49,774,795 -- ------------- ------------- ---------- End of year $15,019,671 $78,718,154 $149,469 ============= ============= ==========
(a) From inception November 12, 2007 to December 31, 2007. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-72 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD HARTFORD SMALL MONEY MARKET SECURITIES SMALLCAP VALUE COMPANY HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $1,441,878 $340,560 $283 $(53,272) Net realized gain (loss) on security transactions -- 805 (103) 12,241 Net realized gain on distributions -- -- 2,538 1,681,246 Net unrealized appreciation (depreciation) of investments during the year (3) (201,418) (2,739) (1,199,853) -------------- ------------ --------- ------------- Net increase (decrease) in net assets resulting from operations 1,441,875 139,947 (21) 440,362 -------------- ------------ --------- ------------- UNIT TRANSACTIONS: Purchases 25,902,489 1,524,219 46,030 9,207,672 Net transfers 9,459,679 658,155 (1,371) 5,261,447 Surrenders for benefit payments and fees (10,194,183) (276,382) 13 (132,296) Net annuity transactions (412) -- -- -- -------------- ------------ --------- ------------- Net increase (decrease) in net assets resulting from unit transactions 25,167,573 1,905,992 44,672 14,336,823 -------------- ------------ --------- ------------- Net increase (decrease) in net assets 26,609,448 2,045,939 44,651 14,777,185 NET ASSETS: Beginning of year 33,317,153 6,351,395 -- 1,299,641 -------------- ------------ --------- ------------- End of year $59,926,601 $8,397,334 $44,651 $16,076,826 ============== ============ ========= ============= 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) $(263,696) $(94,762) $2,957,222 Net realized gain (loss) on security transactions 19,675 (3,629) 4,009 Net realized gain on distributions 1,687,226 3,019,386 -- Net unrealized appreciation (depreciation) of investments during the year (2,316,580) (2,211,849) 782,419 ------------- ------------- -------------- Net increase (decrease) in net assets resulting from operations (873,375) 709,146 3,743,650 ------------- ------------- -------------- UNIT TRANSACTIONS: Purchases 3,663,399 2,618,428 36,550,193 Net transfers 1,092,780 1,327,584 34,383,664 Surrenders for benefit payments and fees (1,118,772) (869,165) (6,392,792) Net annuity transactions -- -- -- ------------- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 3,637,407 3,076,847 64,541,065 ------------- ------------- -------------- Net increase (decrease) in net assets 2,764,032 3,785,993 68,284,715 NET ASSETS: Beginning of year 18,741,234 17,333,740 91,624,912 ------------- ------------- -------------- End of year $21,505,266 $21,119,733 $159,909,627 ============= ============= ==============
(a) From inception November 12, 2007 to December 31, 2007. SA-73 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HARTFORD VALUE HARTFORD HARTFORD VALUE OPPORTUNITIES EQUITY INCOME HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $118,361 $(13,458) $114,922 Net realized gain (loss) on security transactions 2,495 (41,115) (8,006) Net realized gain on distributions 795,345 2,942,699 338,926 Net unrealized appreciation (depreciation) of investments during the year (469,736) (4,959,869) (108,066) ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 446,465 (2,071,743) 337,776 ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 13,506,534 8,414,201 3,444,293 Net transfers 7,372,084 2,933,837 2,806,595 Surrenders for benefit payments and fees (481,897) (586,123) (349,645) Net annuity transactions -- -- (2,231) ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 20,396,721 10,761,915 5,899,012 ------------- ------------- ------------- Net increase (decrease) in net assets 20,843,186 8,690,172 6,236,788 NET ASSETS: Beginning of year 5,327,300 10,917,382 5,582,355 ------------- ------------- ------------- End of year $26,170,486 $19,607,554 $11,819,143 ============= ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-74 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA INCOME EQUITY DIVIDEND HUNTINGTON VA MID CORP FUND CAPTURE FUND GROWTH FUND AMERICA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $7,956 $79,385 $(14,577) $(26,314) Net realized gain (loss) on security transactions (554) (1,291) 2,620 1,536 Net realized gain on distributions 85,078 221,483 176 30,509 Net unrealized appreciation (depreciation) of investments during the year (133,204) (721,252) 185,970 159,674 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations (40,724) (421,675) 174,189 165,405 ------------ ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 800,291 952,835 744,690 645,742 Net transfers 161,382 523,153 234,697 266,178 Surrenders for benefit payments and fees (170,680) (179,912) (87,311) (121,301) Net annuity transactions -- -- -- -- ------------ ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 790,993 1,296,076 892,076 790,619 ------------ ------------ ------------ ------------ Net increase (decrease) in net assets 750,269 874,401 1,066,265 956,024 NET ASSETS: Beginning of year 2,050,334 4,240,152 883,053 2,318,452 ------------ ------------ ------------ ------------ End of year $2,800,603 $5,114,553 $1,949,318 $3,274,476 ============ ============ ============ ============ HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA NEW ECONOMY ROTATING INTERNATIONAL FUND MARKETS FUND EQUITY FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- ---------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(39,983) $(6,005) $(31,849) Net realized gain (loss) on security transactions 12,128 493 3,899 Net realized gain on distributions 60,750 36,564 4,225 Net unrealized appreciation (depreciation) of investments during the year 283,820 12,568 284,979 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 316,715 43,620 261,254 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 851,418 742,512 1,002,296 Net transfers 101,569 120,578 378,752 Surrenders for benefit payments and fees (146,993) (29,330) (114,510) Net annuity transactions -- -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 805,994 833,760 1,266,538 ------------ ------------ ------------ Net increase (decrease) in net assets 1,122,709 877,380 1,527,792 NET ASSETS: Beginning of year 2,632,892 369,369 1,521,324 ------------ ------------ ------------ End of year $3,755,601 $1,246,749 $3,049,116 ============ ============ ============
SA-75 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA MORTGAGE SITUS SMALL MACRO 100 FUND SECURITIES FUND CAP FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(19,067) $6,129 $(59,615) Net realized gain (loss) on security transactions 3,444 325 8,840 Net realized gain on distributions 282,987 222 305,679 Net unrealized appreciation (depreciation) of investments during the year (348,261) 19,693 137,049 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations (80,897) 26,369 391,953 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 220,117 460,098 1,291,694 Net transfers 109,217 182,038 262,373 Surrenders for benefit payments and fees (95,801) (58,819) (200,521) Net annuity transactions -- -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 233,533 583,317 1,353,546 ------------ ------------ ------------ Net increase (decrease) in net assets 152,636 609,686 1,745,499 NET ASSETS: Beginning of year 1,667,260 695,297 4,053,040 ------------ ------------ ------------ End of year $1,819,896 $1,304,983 $5,798,539 ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-76 -------------------------------------------------------------------------------
LORD ABBETT LORD ABBETT LORD ABBETT ALL AMERICA'S VALUE LORD ABBETT BOND GROWTH AND VALUE PORTFOLIO PORTFOLIO DEBENTURE FUND INCOME PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (G) SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(74,774) $106,684 $1,510,261 $98,009 Net realized gain (loss) on security transactions 5,354 2,321 311 12,018 Net realized gain on distributions 354,909 204,369 101,725 10,297,360 Net unrealized appreciation (depreciation) of investments during the year 53,725 (304,943) (674,147) (9,461,550) ---------- ---------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 339,214 8,431 938,150 945,837 ---------- ---------- ----------- ------------ UNIT TRANSACTIONS: Purchases 1,772,383 1,315,468 6,887,300 48,557,891 Net transfers 1,033,961 1,140,227 9,434,641 28,141,170 Surrenders for benefit payments and fees (258,985) (233,677) (1,136,478) (5,834,624) Net annuity transactions -- -- -- (4,310) ---------- ---------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions 2,547,359 2,222,018 15,185,463 70,860,127 ---------- ---------- ----------- ------------ Net increase (decrease) in net assets 2,886,573 2,230,449 16,123,613 71,805,964 NET ASSETS: Beginning of year 6,528,841 4,271,802 15,349,840 79,908,782 ---------- ---------- ----------- ------------ End of year $9,415,414 $6,502,251 $31,473,453 $151,714,746 ========== ========== =========== ============ LORD ABBETT LARGE CAP MFS CORE MFS EMERGING CORE FUND EQUITY SERIES GROWTH SERIES SUB-ACCOUNT (H) SUB-ACCOUNT (I) SUB-ACCOUNT ----------------------------- ---------------------------------------------------------- OPERATIONS: Net investment income (loss) $(27,042) $(8,177) $(11,917) Net realized gain (loss) on security transactions 8,085 34,618 75,505 Net realized gain on distributions 181,877 -- -- Net unrealized appreciation (depreciation) of investments during the year 120,735 38,587 63,123 ----------- ---------- --------- Net increase (decrease) in net assets resulting from operations 283,655 65,028 126,711 ----------- ---------- --------- UNIT TRANSACTIONS: Purchases 1,425,782 -- 2,067 Net transfers 1,270,107 (28,707) 2,157 Surrenders for benefit payments and fees (146,041) (75,686) (17,826) Net annuity transactions (452) -- -- ----------- ---------- --------- Net increase (decrease) in net assets resulting from unit transactions 2,549,396 (104,393) (13,602) ----------- ---------- --------- Net increase (decrease) in net assets 2,833,051 (39,365) 113,109 NET ASSETS: Beginning of year 2,426,652 680,742 688,427 ----------- ---------- --------- End of year $5,259,703 $641,377 $801,536 =========== ========== =========
(g) Formerly Lord Abbett Bond-Debenture Portfolio. Change effective August 15, 2007. (h) Formerly Lord Abbett Large-Cap Core Portfolio. Change effective August 15, 2007. (i) Formerly MFS Capital Opportunities Series. Change effective May 1, 2007. SA-77 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
MFS INVESTORS GROWTH STOCK MFS INVESTORS MFS TOTAL SERIES TRUST SERIES RETURN SERIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(5,388) $(11,738) $116,441 Net realized gain (loss) on security transactions 7,695 74,408 260,641 Net realized gain on distributions -- 11,334 352,281 Net unrealized appreciation (depreciation) of investments during the year 37,589 34,872 (376,977) ---------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 39,896 108,876 352,386 ---------- ------------ ------------- UNIT TRANSACTIONS: Purchases -- 8,916 206,946 Net transfers (21,957) 30,719 (134,537) Surrenders for benefit payments and fees (12,024) (95,111) (1,966,786) Net annuity transactions -- -- -- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions (33,981) (55,476) (1,894,377) ---------- ------------ ------------- Net increase (decrease) in net assets 5,915 53,400 (1,541,991) NET ASSETS: Beginning of year 425,490 1,250,498 14,695,849 ---------- ------------ ------------- End of year $431,405 $1,303,898 $13,153,858 ========== ============ =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-78 -------------------------------------------------------------------------------
EQUITY AND CORE PLUS EMERGING EMERGING INCOME FIXED INCOME MARKETS DEBT MARKETS EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $81 $219,263 $59,511 $(266,922) Net realized gain (loss) on security transactions 5,910 51,753 1,859 36,206 Net realized gain on distributions 7,498 -- 33,590 2,472,707 Net unrealized appreciation (depreciation) of investments during the year (8,089) 130,660 (48,612) 4,952,869 ------------ ---------------- -------------- ---------------- Net increase (decrease) in net assets resulting from operations 5,400 401,676 46,348 7,194,860 ------------ ---------------- -------------- ---------------- UNIT TRANSACTIONS: Purchases -- 54,450 18,000 6,921,587 Net transfers 101,257 (529,439) (25,161) 6,007,376 Surrenders for benefit payments and fees (18,513) (2,028,236) (79,568) (1,107,854) Net annuity transactions -- -- -- 8,788 ------------ ---------------- -------------- ---------------- Net increase (decrease) in net assets resulting from unit transactions 82,744 (2,503,225) (86,729) 11,829,897 ------------ ---------------- -------------- ---------------- Net increase (decrease) in net assets 88,144 (2,101,549) (40,381) 19,024,757 NET ASSETS: Beginning of year 187,570 12,753,216 1,116,638 14,347,400 ------------ ---------------- -------------- ---------------- End of year $275,714 $10,651,667 $1,076,257 $33,372,157 ============ ================ ============== ================ EMERGING MID CAP U.S. MID MARKETS EQUITY H YIELD GROWTH CAP VALUE SUB-ACCOUNT UB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $131,251 $(126,250) $(143,712) Net realized gain (loss) on security transactions (59,067) 30,690 172,684 Net realized gain on distributions -- 380,649 1,547,398 Net unrealized appreciation (depreciation) of investments during the year (28,539) 1,081,503 (848,661) -------------- ---------------- ---------------- Net increase (decrease) in net assets resulting from operations 43,645 1,366,592 727,709 -------------- ---------------- ---------------- UNIT TRANSACTIONS: Purchases -- 2,342,845 3,908,089 Net transfers (24,288) 3,141,786 428,174 Surrenders for benefit payments and fees (270,368) (499,089) (1,274,971) Net annuity transactions -- -- 14,319 -------------- ---------------- ---------------- Net increase (decrease) in net assets resulting from unit transactions (294,656) 4,985,542 3,075,611 -------------- ---------------- ---------------- Net increase (decrease) in net assets (251,011) 6,352,134 3,803,320 NET ASSETS: Beginning of year 2,034,139 6,011,225 12,574,210 -------------- ---------------- ---------------- End of year $1,783,128 $12,363,359 $16,377,530 ============== ================ ================
SA-79 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
CAPITAL FOCUS GROWTH BALANCED GROWTH OPPORTUNITIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(208,262) $96,092 $(72,624) Net realized gain (loss) on security transactions 385,048 227,172 165,914 Net realized gain on distributions -- 732,102 -- Net unrealized appreciation (depreciation) of investments during the year 2,542,029 (807,381) 670,221 ------------- ------------- ------------ Net increase (decrease) in net assets resulting from operations 2,718,815 247,985 763,511 ------------- ------------- ------------ UNIT TRANSACTIONS: Purchases 38,586 54,982 7,760 Net transfers (549,285) (162,006) (136,797) Surrenders for benefit payments and fees (2,877,666) (2,218,498) (784,770) Net annuity transactions (8,406) (14,860) (2,910) ------------- ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions (3,396,771) (2,340,382) (916,717) ------------- ------------- ------------ Net increase (decrease) in net assets (677,956) (2,092,397) (153,206) NET ASSETS: Beginning of year 14,793,232 10,318,500 4,855,641 ------------- ------------- ------------ End of year $14,115,276 $8,226,103 $4,702,435 ============= ============= ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-80 -------------------------------------------------------------------------------
DEVELOPING GROWTH FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(52,984) $204,811 $(71,111) $(64,915) Net realized gain (loss) on security transactions 578,280 (230,331) 721,284 329,184 Net realized gain on distributions -- -- -- 1,141,553 Net unrealized appreciation (depreciation) of investments during the year 373,665 123,409 91,089 (303,799) ------------- ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 898,961 97,889 741,262 1,102,023 ------------- ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 10,305 2,720 106,884 3,550 Net transfers (342,175) 52,330 (912,883) (56,851) Surrenders for benefit payments and fees (1,246,666) (716,613) (5,572,699) (1,858,361) Net annuity transactions (3,393) -- (7,370) (10,568) ------------- ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (1,581,929) (661,563) (6,386,068) (1,922,230) ------------- ------------ ------------- ------------- Net increase (decrease) in net assets (682,968) (563,674) (5,644,806) (820,207) NET ASSETS: Beginning of year 4,931,590 4,852,587 25,346,362 8,338,068 ------------- ------------ ------------- ------------- End of year $4,248,622 $4,288,913 $19,701,556 $7,517,861 ============= ============ ============= ============= GROWTH MONEY MARKET UTILITIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(54,962) $231,355 $17,436 Net realized gain (loss) on security transactions 157,153 -- 569,959 Net realized gain on distributions -- -- -- Net unrealized appreciation (depreciation) of investments during the year 546,121 -- 439,418 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 648,312 231,355 1,026,813 ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 450 34,134 1,268 Net transfers (126,988) 3,707,699 (8,294) Surrenders for benefit payments and fees (537,796) (3,134,534) (1,262,984) Net annuity transactions -- -- -- ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (664,334) 607,299 (1,270,010) ------------ ------------- ------------- Net increase (decrease) in net assets (16,022) 838,654 (243,197) NET ASSETS: Beginning of year 3,560,492 6,981,579 6,158,118 ------------ ------------- ------------- End of year $3,544,470 $7,820,233 $5,914,921 ============ ============= =============
SA-81 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
EQUALLY-WEIGHTED SMALL COMPANY S&P 500 GROWTH GLOBAL FRANCHISE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(48,126) $(13,530) $(22,730) Net realized gain (loss) on security transactions 1,868,955 4,808 21,567 Net realized gain on distributions 2,119,306 54,962 108,848 Net unrealized appreciation (depreciation) of investments during the year (3,773,902) (44,925) (15,512) ------------- ---------- ------------ Net increase (decrease) in net assets resulting from operations 166,233 1,315 92,173 ------------- ---------- ------------ UNIT TRANSACTIONS: Purchases 133,822 624 432 Net transfers (1,150,595) 76,144 4,183 Surrenders for benefit payments and fees (4,535,453) (52,852) (72,287) Net annuity transactions (11,139) -- -- ------------- ---------- ------------ Net increase (decrease) in net assets resulting from unit transactions (5,563,365) 23,916 (67,672) ------------- ---------- ------------ Net increase (decrease) in net assets (5,397,132) 25,231 24,501 NET ASSETS: Beginning of year 25,015,817 626,305 1,133,374 ------------- ---------- ------------ End of year $19,618,685 $651,536 $1,157,875 ============= ========== ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-82 -------------------------------------------------------------------------------
MTB MANAGED MTB MANAGED ALLOCATION ALLOCATION FUND -- FUND -- MTB LARGE CAP MTB LARGE CAP MODERATE AGGRESSIVE GROWTH FUND II VALUE FUND II GROWTH II GROWTH II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(10,929) $(9,515) $29,672 $212 Net realized gain (loss) on security transactions 1,654 (1,362) 6,556 (3,665) Net realized gain on distributions 86,394 116,206 103,894 28,398 Net unrealized appreciation (depreciation) of investments during the year (12,438) (146,845) 6,873 (123) ------------ ------------ ------------ ---------- Net increase (decrease) in net assets resulting from operations 64,681 (41,516) 146,995 24,822 ------------ ------------ ------------ ---------- UNIT TRANSACTIONS: Purchases 539,977 1,424,936 754,367 104,775 Net transfers 40,761 212,111 324,024 96,918 Surrenders for benefit payments and fees (57,829) (159,512) (266,773) 642 Net annuity transactions -- -- -- -- ------------ ------------ ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 522,909 1,477,535 811,618 202,335 ------------ ------------ ------------ ---------- Net increase (decrease) in net assets 587,590 1,436,019 958,613 227,157 NET ASSETS: Beginning of year 700,714 1,881,487 2,407,940 401,638 ------------ ------------ ------------ ---------- End of year $1,288,304 $3,317,506 $3,366,553 $628,795 ============ ============ ============ ========== MTB MANAGED ALLOCATION FUND -- OPPENHEIMER CONSERVATIVE MIDCAP OPPENHEIMER CAPITAL GROWTH II FUND VA APPRECIATION FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- --------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $7,157 $(41,875) $(652,424) Net realized gain (loss) on security transactions 531 31,394 90,975 Net realized gain on distributions 11,563 -- -- Net unrealized appreciation (depreciation) of investments during the year (5,444) 101,825 5,023,281 ---------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 13,807 91,344 4,461,832 ---------- ------------ ------------- UNIT TRANSACTIONS: Purchases 304,636 1,034,224 14,981,662 Net transfers 85,077 (14,486) 6,411,467 Surrenders for benefit payments and fees (13,205) (214,626) (1,985,486) Net annuity transactions -- -- -- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 376,508 805,112 19,407,643 ---------- ------------ ------------- Net increase (decrease) in net assets 390,315 896,456 23,869,475 NET ASSETS: Beginning of year 203,586 2,090,786 30,508,337 ---------- ------------ ------------- End of year $593,901 $2,987,242 $54,377,812 ========== ============ =============
SA-83 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
OPPENHEIMER OPPENHEIMER GLOBAL SECURITIES OPPENHEIMER MAIN STREET FUND MAIN STREET FUND SMALL CAP FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(925,816) $(92,935) $(943,608) Net realized gain (loss) on security transactions (1,404) 7,448 (17,204) Net realized gain on distributions 6,456,644 -- 2,000,089 Net unrealized appreciation (depreciation) of investments during the year (893,806) 219,030 (4,489,264) -------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 4,635,618 133,543 (3,449,987) -------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 66,381,370 2,444,668 18,578,414 Net transfers 38,507,520 1,745,157 12,548,565 Surrenders for benefit payments and fees (7,926,851) (491,394) (3,022,641) Net annuity transactions (3,854) -- -- -------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 96,958,185 3,698,431 28,104,338 -------------- ------------- ------------- Net increase (decrease) in net assets 101,593,803 3,831,974 24,654,351 NET ASSETS: Beginning of year 111,325,622 7,392,660 50,933,798 -------------- ------------- ------------- End of year $212,919,425 $11,224,634 $75,588,149 ============== ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-84 -------------------------------------------------------------------------------
PUTNAM PUTNAM INTERNATIONAL DIVERSIFIED PUTNAM GLOBAL PUTNAM GROWTH GROWTH AND INCOME ASSET ALLOCATION AND INCOME INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ----------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $810,327 $(75,933) $(28,839) $(60) Net realized gain (loss) on security transactions (3,392) 7,545 7,103 -- Net realized gain on distributions -- -- 691,250 -- Net unrealized appreciation (depreciation) of investments during the year 970 115,381 (1,318,269) 317 ------------- ------------ ------------- --------- Net increase (decrease) in net assets resulting from operations 807,905 46,993 (648,755) 257 ------------- ------------ ------------- --------- UNIT TRANSACTIONS: Purchases 14,064,432 1,562,014 2,961,146 34,133 Net transfers 5,261,631 925,227 1,243,922 17,910 Surrenders for benefit payments and fees (1,429,421) (257,983) (326,468) -- Net annuity transactions (418) -- -- -- ------------- ------------ ------------- --------- Net increase (decrease) in net assets resulting from unit transactions 17,896,224 2,229,258 3,878,600 52,043 ------------- ------------ ------------- --------- Net increase (decrease) in net assets 18,704,129 2,276,251 3,229,845 52,300 NET ASSETS: Beginning of year 19,942,631 5,329,576 3,892,641 -- ------------- ------------ ------------- --------- End of year $38,646,760 $7,605,827 $7,122,486 $52,300 ============= ============ ============= ========= PUTNAM INTERNATIONAL PUTNAM PUTNAM EQUITY INVESTORS NEW VALUE SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ---------------------------------------------------------- OPERATIONS: Net investment income (loss) $739,926 $(119,586) $(56,184) Net realized gain (loss) on security transactions 72,960 10,520 (24,727) Net realized gain on distributions 8,131,653 -- 913,501 Net unrealized appreciation (depreciation) of investments during the year (4,997,563) (898,792) (1,617,428) ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 3,946,976 (1,007,858) (784,838) ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 16,998,345 13,299,893 1,815,647 Net transfers 6,055,747 6,184,008 868,994 Surrenders for benefit payments and fees (3,264,071) (362,901) (339,501) Net annuity transactions -- -- -- ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 19,790,021 19,121,000 2,345,140 ------------- ------------- ------------- Net increase (decrease) in net assets 23,736,997 18,113,142 1,560,302 NET ASSETS: Beginning of year 57,771,023 3,925,345 8,702,403 ------------- ------------- ------------- End of year $81,508,020 $22,038,487 $10,262,705 ============= ============= =============
(a) From inception November 12, 2007 to December 31, 2007. SA-85 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 PUTNAM VISTA SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(596,807) $38,597 $(16,136) Net realized gain (loss) on security transactions (115,078) (6,189) 13,495 Net realized gain on distributions 6,020,565 414,994 -- Net unrealized appreciation (depreciation) of investments during the year (15,155,753) (542,312) 14,640 -------------- ------------ ------------ Net increase (decrease) in net assets resulting from operations (9,847,073) (94,910) 11,999 -------------- ------------ ------------ UNIT TRANSACTIONS: Purchases 13,183,272 3,195,074 352,633 Net transfers 8,729,907 (720,204) (5,441) Surrenders for benefit payments and fees (2,343,818) (178,560) (100,470) Net annuity transactions -- -- -- -------------- ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 19,569,361 2,296,310 246,722 -------------- ------------ ------------ Net increase (decrease) in net assets 9,722,288 2,201,400 258,721 NET ASSETS: Beginning of year 47,722,106 3,911,644 797,371 -------------- ------------ ------------ End of year $57,444,394 $6,113,044 $1,056,092 ============== ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-86 -------------------------------------------------------------------------------
PIONEER OAK RIDGE LARGE PUTNAM PIONEER FUND CAP GROWTH VOYAGER VCT PORTFOLIO VCT PORTFOLIO ENTERPRISE SUB-ACCOUNT SUB-ACCOUNT (J) SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(35,126) $(4,116) $(9,376) $(19,722) Net realized gain (loss) on security transactions 29,484 12,141 5,593 9,511 Net realized gain on distributions -- 14,426 2,095 -- Net unrealized appreciation (depreciation) of investments during the year 79,377 (1,955) 34,651 165,453 ------------ ---------- ---------- ------------ Net increase (decrease) in net assets resulting from operations 73,735 20,496 32,963 155,242 ------------ ---------- ---------- ------------ UNIT TRANSACTIONS: Purchases 434,725 22,356 10,555 1,830 Net transfers (217,744) (32,423) (14,347) (106,908) Surrenders for benefit payments and fees (143,836) (23,743) (28,406) (248,014) Net annuity transactions -- -- -- -- ------------ ---------- ---------- ------------ Net increase (decrease) in net assets resulting from unit transactions 73,145 (33,810) (32,198) (353,092) ------------ ---------- ---------- ------------ Net increase (decrease) in net assets 146,880 (13,314) 765 (197,850) NET ASSETS: Beginning of year 2,055,043 785,171 527,735 1,533,193 ------------ ---------- ---------- ------------ End of year $2,201,923 $771,857 $528,500 $1,335,343 ============ ========== ========== ============ GROWTH AND STRATEGIC INCOME COMSTOCK GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(162,991) $(133,852) $(6,015) Net realized gain (loss) on security transactions 278,636 19,580 5,411 Net realized gain on distributions 1,282,233 1,532,019 -- Net unrealized appreciation (depreciation) of investments during the year (1,653,818) (5,274,640) 36,533 ------------- ------------- ---------- Net increase (decrease) in net assets resulting from operations (255,940) (3,856,893) 35,929 ------------- ------------- ---------- UNIT TRANSACTIONS: Purchases 13,019,903 11,661,009 -- Net transfers 9,373,978 12,139,812 62,400 Surrenders for benefit payments and fees (2,683,564) (3,573,168) (7,259) Net annuity transactions (771) -- -- ------------- ------------- ---------- Net increase (decrease) in net assets resulting from unit transactions 19,709,546 20,227,653 55,141 ------------- ------------- ---------- Net increase (decrease) in net assets 19,453,606 16,370,760 91,070 NET ASSETS: Beginning of year 30,301,412 65,085,968 259,976 ------------- ------------- ---------- End of year $49,755,018 $81,456,728 $351,046 ============= ============= ==========
(j) Effective November 9, 2007, Pioneer Value VCT Portfolio merged with Pioneer Fund VCT Portfolio. SA-87 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2007 -------------------------------------------------------------------------------
AGGRESSIVE GOVERNMENT GROWTH PORTFOLIO PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(4,931) $12,275 Net realized gain (loss) on security transactions 11,195 305 Net realized gain on distributions 16,956 -- Net unrealized appreciation (depreciation) of investments during the year 9,514 14,414 ---------- ---------- Net increase (decrease) in net assets resulting from operations 32,734 26,994 ---------- ---------- UNIT TRANSACTIONS: Purchases 432 5,300 Net transfers (67,214) 87,985 Surrenders for benefit payments and fees (3,731) (20,328) Net annuity transactions -- -- ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions (70,513) 72,957 ---------- ---------- Net increase (decrease) in net assets (37,779) 99,951 NET ASSETS: Beginning of year 220,930 507,510 ---------- ---------- End of year $183,151 $607,461 ========== ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-88 -------------------------------------------------------------------------------
WELLS FARGO WELLS FARGO STI CLASSIC VT ADVANTAGE VT ADVANTAGE VT LARGE CAP LARGE COMPANY SMALL CAP GROWTH GROWTH FUND GROWTH FUND STOCK FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (K) -------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(367) $(235) $(188) Net realized gain (loss) on security transactions 155 218 65 Net realized gain on distributions -- 2,373 1,460 Net unrealized appreciation (depreciation) of investments during the year 1,473 (785) 683 --------- --------- --------- Net increase (decrease) in net assets resulting from operations 1,261 1,571 2,020 --------- --------- --------- UNIT TRANSACTIONS: Purchases 3,230 1,615 25,000 Net transfers (412) (1,769) (1,327) Surrenders for benefit payments and fees (3) (3) -- Net annuity transactions -- -- -- --------- --------- --------- Net increase (decrease) in net assets resulting from unit transactions 2,815 (157) 23,673 --------- --------- --------- Net increase (decrease) in net assets 4,076 1,414 25,693 NET ASSETS: Beginning of year 20,221 13,894 -- --------- --------- --------- End of year $24,297 $15,308 $25,693 ========= ========= ========= STI CLASSIC VT STI CLASSIC VT STI CLASSIC VT LARGE CAP CORE MID-CAP CORE LARGE CAP VALUE EQUITY FUND EQUITY FUND EQUITY FUND SUB-ACCOUNT (L) SUB-ACCOUNT (M) SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(814) $(1,218) $158 Net realized gain (loss) on security transactions 89 110 2,636 Net realized gain on distributions 7,645 11,282 -- Net unrealized appreciation (depreciation) of investments during the year (8,715) (8,722) 6,974 ---------- --------- ------------ Net increase (decrease) in net assets resulting from operations (1,795) 1,452 9,768 ---------- --------- ------------ UNIT TRANSACTIONS: Purchases 3,671 15,000 520,199 Net transfers 15,648 1,403 367,235 Surrenders for benefit payments and fees (306) (764) (96,598) Net annuity transactions -- -- -- ---------- --------- ------------ Net increase (decrease) in net assets resulting from unit transactions 19,013 15,639 790,836 ---------- --------- ------------ Net increase (decrease) in net assets 17,218 17,091 800,604 NET ASSETS: Beginning of year 121,823 69,619 1,528,004 ---------- --------- ------------ End of year $139,041 $86,710 $2,328,608 ========== ========= ============
(k) Funded as of June 11, 2007. (l) Formerly STI Classic VT Large Cap Relative Value Fund. Change effective May 31, 2007. (m) Formerly STI Classic VT Mid-Cap Equity Fund. Change effective May 31, 2007. SA-89 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN VP BALANCED ALLIANCEBERNSTEIN ALLIANCEBERNSTEIN WEALTH STRATEGY VP GLOBAL RESEARCH VP INTERNATIONAL PORTFOLIO GROWTH PORTFOLIO VALUE PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(122,264) $(13,351) $(248,322) Net realized gain (loss) on security transactions 4,552 1,171 60,353 Net realized gain on distributions -- 12,519 1,052,921 Net unrealized appreciation (depreciation) of investments during the year 1,825,410 98,360 16,910,575 ------------- ------------ -------------- Net increase (decrease) in net assets resulting from operations 1,707,698 98,699 17,775,527 ------------- ------------ -------------- UNIT TRANSACTIONS: Purchases 10,054,716 886,861 40,255,063 Net transfers 4,327,137 255,897 16,769,170 Surrenders for benefit payments and fees (423,760) (29,659) (2,401,900) Net annuity transactions 5,688 -- -- ------------- ------------ -------------- Net increase (decrease) in net assets resulting from unit transactions 13,963,781 1,113,099 54,622,333 ------------- ------------ -------------- Net increase (decrease) in net assets 15,671,479 1,211,798 72,397,860 NET ASSETS: Beginning of year 5,736,349 233,127 29,121,066 ------------- ------------ -------------- End of year $21,407,828 $1,444,925 $101,518,926 ============= ============ ==============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-90 -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN AMERICAN FUNDS VP SMALL/MID CAP ALLIANCEBERNSTEIN GLOBAL GROWTH AMERICAN FUNDS VALUE PORTFOLIO VP VALUE PORTFOLIO FUND GROWTH FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(89,435) $(204,975) $(30,038) $(316,557) Net realized gain (loss) on security transactions (853) 13,879 58,326 477,616 Net realized gain on distributions 437,123 821,637 -- 205,165 Net unrealized appreciation (depreciation) of investments during the year 446,207 5,076,059 568,963 2,268,855 ------------- ------------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 793,042 5,706,600 597,251 2,635,079 ------------- ------------- ------------ ------------- UNIT TRANSACTIONS: Purchases 4,450,511 15,964,349 247,148 1,033,241 Net transfers 1,801,508 8,219,944 252,971 455,359 Surrenders for benefit payments and fees (240,612) (1,400,088) (294,830) (2,365,819) Net annuity transactions -- -- -- -- ------------- ------------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 6,011,407 22,784,205 205,289 (877,219) ------------- ------------- ------------ ------------- Net increase (decrease) in net assets 6,804,449 28,490,805 802,540 1,757,860 NET ASSETS: Beginning of year 3,597,139 16,255,698 3,182,441 32,187,451 ------------- ------------- ------------ ------------- End of year $10,401,588 $44,746,503 $3,984,981 $33,945,311 ============= ============= ============ ============= AMERICAN FUNDS AMERICAN FUNDS GLOBAL SMALL GROWTH-INCOME AMERICAN FUNDS CAPITALIZATION FUND INTERNATIONAL FUND FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(53,915) $1,753 $(56,539) Net realized gain (loss) on security transactions 401,818 122,946 19,881 Net realized gain on distributions 592,963 126,237 230,457 Net unrealized appreciation (depreciation) of investments during the year 2,191,355 1,920,938 653,937 ------------- ------------- ------------ Net increase (decrease) in net assets resulting from operations 3,132,221 2,171,874 847,736 ------------- ------------- ------------ UNIT TRANSACTIONS: Purchases 999,135 463,292 61,114 Net transfers (556,019) 1,797,647 820,371 Surrenders for benefit payments and fees (1,825,984) (1,320,112) (338,167) Net annuity transactions -- -- 22,008 ------------- ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions (1,382,868) 940,827 565,326 ------------- ------------- ------------ Net increase (decrease) in net assets 1,749,353 3,112,701 1,413,062 NET ASSETS: Beginning of year 24,627,546 12,072,926 3,624,591 ------------- ------------- ------------ End of year $26,376,899 $15,185,627 $5,037,653 ============= ============= ============
SA-91 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
BB&T CAPITAL BB&T MID CAP MANAGER BB&T LARGE GROWTH VIF EQUITY VIF CAP VIF SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (A) ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(18,115) $(1,643) $(1,432) Net realized gain (loss) on security transactions 1,129 1,964 9,712 Net realized gain on distributions 109,721 33,714 -- Net unrealized appreciation (depreciation) of investments during the year (97,687) 96,057 166,757 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations (4,952) 130,092 175,037 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 1,359,777 655,511 503,364 Net transfers 292,396 120,670 219,063 Surrenders for benefit payments and fees (90,507) (27,217) (134,365) Net annuity transactions -- -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 1,561,666 748,964 588,062 ------------ ------------ ------------ Net increase (decrease) in net assets 1,556,714 879,056 763,099 NET ASSETS: Beginning of year 532,528 480,055 602,888 ------------ ------------ ------------ End of year $2,089,242 $1,359,111 $1,365,987 ============ ============ ============
(a) Formerly BB&T Large Cap Value VIF. Change effective March 13, 2006. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-92 -------------------------------------------------------------------------------
BB&T SPECIAL BB&T LARGE CAP OPPORTUNITIES BB&T TOTAL EVERGREEN VA GROWTH VIF EQUITY VIF RETURN BOND VIF BALANCED FUND SUB-ACCOUNT (B) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(9,367) $(77,378) $45,685 $1,857 Net realized gain (loss) on security transactions 466 2,491 1,466 267 Net realized gain on distributions 3,234 279,981 -- -- Net unrealized appreciation (depreciation) of investments during the year 47,775 970,157 (5,727) 15,013 ------------ ------------ ------------ ---------- Net increase (decrease) in net assets resulting from operations 42,108 1,175,251 41,424 17,137 ------------ ------------ ------------ ---------- UNIT TRANSACTIONS: Purchases 814,077 2,723,301 497,980 85,126 Net transfers 473,714 1,142,791 369,608 81,319 Surrenders for benefit payments and fees (81,740) (267,714) (24,686) (22,919) Net annuity transactions -- -- -- -- ------------ ------------ ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 1,206,051 3,598,378 842,902 143,526 ------------ ------------ ------------ ---------- Net increase (decrease) in net assets 1,248,159 4,773,629 884,326 160,663 NET ASSETS: Beginning of year 394,799 3,133,259 1,031,380 122,138 ------------ ------------ ------------ ---------- End of year $1,642,958 $7,906,888 $1,915,706 $282,801 ============ ============ ============ ========== EVERGREEN VA EVERGREEN VA INTERNATIONAL EVERGREEN VA GROWTH FUND EQUITY FUND OMEGA FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ----------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(48,949) $13,504 $(488) Net realized gain (loss) on security transactions 2,694 (6,343) 73 Net realized gain on distributions 93,439 32,488 -- Net unrealized appreciation (depreciation) of investments during the year 182,042 47,195 2,008 ------------ ---------- --------- Net increase (decrease) in net assets resulting from operations 229,226 86,844 1,593 ------------ ---------- --------- UNIT TRANSACTIONS: Purchases 1,627,570 253,201 15,935 Net transfers 1,023,834 174,426 4,803 Surrenders for benefit payments and fees (84,847) (11,977) (15) Net annuity transactions -- -- -- ------------ ---------- --------- Net increase (decrease) in net assets resulting from unit transactions 2,566,557 415,650 20,723 ------------ ---------- --------- Net increase (decrease) in net assets 2,795,783 502,494 22,316 NET ASSETS: Beginning of year 1,525,990 221,971 19,262 ------------ ---------- --------- End of year $4,321,773 $724,465 $41,578 ============ ========== =========
(b) Formerly BB&T Large Company Growth VIF. Change effective March 13, 2006. SA-93 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
EVERGREEN VA EVERGREEN VA SPECIAL VALUES FUNDAMENTAL FIDELITY(R) VIP FUND LARGE CAP FUND EQUITY-INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(44,073) $33 $473,368 Net realized gain (loss) on security transactions 4,487 215 12,412 Net realized gain on distributions 968,770 2,798 4,501,672 Net unrealized appreciation (depreciation) of investments during the year 180,205 10,114 1,131,990 ------------ ---------- ------------- Net increase (decrease) in net assets resulting from operations 1,109,389 13,160 6,119,442 ------------ ---------- ------------- UNIT TRANSACTIONS: Purchases 4,520,878 84,940 18,426,580 Net transfers 1,298,058 55,228 9,269,218 Surrenders for benefit payments and fees (226,235) (323) (1,371,024) Net annuity transactions -- -- -- ------------ ---------- ------------- Net increase (decrease) in net assets resulting from unit transactions 5,592,701 139,845 26,324,774 ------------ ---------- ------------- Net increase (decrease) in net assets 6,702,090 153,005 32,444,216 NET ASSETS: Beginning of year 3,005,636 39,578 18,396,419 ------------ ---------- ------------- End of year $9,707,726 $192,583 $50,840,635 ============ ========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-94 -------------------------------------------------------------------------------
FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP FIDELITY(R) VIP GROWTH CONTRAFUND(R) MID CAP VALUE STRATEGIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(130,683) $(486,654) $(666,583) $(28,632) Net realized gain (loss) on security transactions 1,690 5,264 3,434 3,334 Net realized gain on distributions -- 16,223,244 2,932,015 210,944 Net unrealized appreciation (depreciation) of investments during the year 671,802 (2,306,499) 1,364,134 117,714 ------------- -------------- ------------- ------------ Net increase (decrease) in net assets resulting from operations 542,809 13,435,355 3,633,000 303,360 ------------- -------------- ------------- ------------ UNIT TRANSACTIONS: Purchases 7,923,513 113,400,351 34,054,601 1,513,796 Net transfers 2,811,951 44,326,576 11,477,119 410,674 Surrenders for benefit payments and fees (311,663) (4,784,069) (1,418,707) (111,791) Net annuity transactions -- 46,530 -- -- ------------- -------------- ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 10,423,801 152,989,388 44,113,013 1,812,679 ------------- -------------- ------------- ------------ Net increase (decrease) in net assets 10,966,610 166,424,743 47,746,013 2,116,039 NET ASSETS: Beginning of year 4,051,704 54,183,191 18,666,417 1,074,273 ------------- -------------- ------------- ------------ End of year $15,018,314 $220,607,934 $66,412,430 $3,190,312 ============= ============== ============= ============ FRANKLIN SMALL-MID FRANKLIN STRATEGIC CAP GROWTH INCOME SECURITIES MUTUAL SHARES SECURITIES FUND FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- ------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(73,846) $182,835 $(62,176) Net realized gain (loss) on security transactions 58,856 5,114 319,740 Net realized gain on distributions -- 39,199 453,639 Net unrealized appreciation (depreciation) of investments during the year 293,746 229,435 1,417,467 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 278,756 456,583 2,128,670 ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 131,121 244,698 233,933 Net transfers 99,666 6,026,912 508,936 Surrenders for benefit payments and fees (288,565) (552,927) (1,311,050) Net annuity transactions -- -- -- ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (57,778) 5,718,683 (568,181) ------------ ------------- ------------- Net increase (decrease) in net assets 220,978 6,175,266 1,560,489 NET ASSETS: Beginning of year 4,103,308 5,101,032 13,467,237 ------------ ------------- ------------- End of year $4,324,286 $11,276,298 $15,027,726 ============ ============= =============
SA-95 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
TEMPLETON FIFTH THIRD DEVELOPING MARKETS TEMPLETON GROWTH BALANCED SECURITIES FUND SECURITIES FUND VIP FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(15,690) $(18,211) $1,028 Net realized gain (loss) on security transactions 40,519 81,016 56 Net realized gain on distributions -- 143,532 816 Net unrealized appreciation (depreciation) of investments during the year 634,509 514,465 5,129 ------------ ------------ --------- Net increase (decrease) in net assets resulting from operations 659,338 720,802 7,029 ------------ ------------ --------- UNIT TRANSACTIONS: Purchases 99,715 193,667 34,711 Net transfers 161,322 312,239 -- Surrenders for benefit payments and fees (134,692) (390,367) (1,300) Net annuity transactions (24,654) -- -- ------------ ------------ --------- Net increase (decrease) in net assets resulting from unit transactions 101,691 115,539 33,411 ------------ ------------ --------- Net increase (decrease) in net assets 761,029 836,341 40,440 NET ASSETS: Beginning of year 2,452,869 3,463,721 52,922 ------------ ------------ --------- End of year $3,213,898 $4,300,062 $93,362 ============ ============ =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-96 -------------------------------------------------------------------------------
FIFTH THIRD FIFTH THIRD DISCIPLINED VALUE FIFTH THIRD MID QUALITY GROWTH FIRST HORIZON CAPITAL VIP FUND CAP VIP FUND VIP FUND APPRECIATION PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (C) -------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $29,067 $(2,700) $(330) $(5) Net realized gain (loss) on security transactions 583 439 305 (584) Net realized gain on distributions 53,457 -- -- 674 Net unrealized appreciation (depreciation) of investments during the year 394,109 19,638 1,554 49 ------------ ---------- --------- -------- Net increase (decrease) in net assets resulting from operations 477,216 17,377 1,529 134 ------------ ---------- --------- -------- UNIT TRANSACTIONS: Purchases 2,343,179 321,638 -- 600 Net transfers 1,134,216 (4,763) (4,238) (2,226) Surrenders for benefit payments and fees (79,762) (2,925) (9) 1 Net annuity transactions -- -- -- -- ------------ ---------- --------- -------- Net increase (decrease) in net assets resulting from unit transactions 3,397,633 313,950 (4,247) (1,625) ------------ ---------- --------- -------- Net increase (decrease) in net assets 3,874,849 331,327 (2,718) (1,491) NET ASSETS: Beginning of year 676,169 66,406 48,146 1,491 ------------ ---------- --------- -------- End of year $4,551,018 $397,733 $45,428 $ -- ============ ========== ========= ======== HARTFORD HARTFORD TOTAL FIRST HORIZON CORE ADVISERS RETURN BOND EQUITY PORTFOLIO HLS FUND HLS FUND SUB-ACCOUNT (C) SUB-ACCOUNT SUB-ACCOUNT ----------------------------- --------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(11) $234,307 $8,513,644 Net realized gain (loss) on security transactions (1,114) 785 4,777 Net realized gain on distributions 862 1,469,028 23,424 Net unrealized appreciation (depreciation) of investments during the year 311 (205,088) (1,646,630) -------- ------------- -------------- Net increase (decrease) in net assets resulting from operations 48 1,499,032 6,895,215 -------- ------------- -------------- UNIT TRANSACTIONS: Purchases 800 6,348,496 100,873,132 Net transfers (8,132) 3,881,422 53,840,509 Surrenders for benefit payments and fees -- (692,305) (6,922,244) Net annuity transactions -- -- 70,004 -------- ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions (7,332) 9,537,613 147,861,401 -------- ------------- -------------- Net increase (decrease) in net assets (7,284) 11,036,645 154,756,616 NET ASSETS: Beginning of year 7,284 9,943,981 86,572,174 -------- ------------- -------------- End of year $ -- $20,980,626 $241,328,790 ======== ============= ==============
(c) Fund closed effective February 22, 2006. SA-97 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HARTFORD DIVIDEND AND HARTFORD GROWTH HARTFORD FOCUS GLOBAL ADVISERS HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,156,399 $(1,594) $42,474 Net realized gain (loss) on security transactions 11,524 (485) (17) Net realized gain on distributions 10,925,053 37,730 97,048 Net unrealized appreciation (depreciation) of investments during the year 6,540,417 12,475 5,783 -------------- ---------- ------------ Net increase (decrease) in net assets resulting from operations 18,633,393 48,126 145,288 -------------- ---------- ------------ UNIT TRANSACTIONS: Purchases 79,287,579 459,529 1,182,111 Net transfers 34,725,469 (3,309) 631,857 Surrenders for benefit payments and fees (3,862,093) (11,692) (77,150) Net annuity transactions 5,677 -- -- -------------- ---------- ------------ Net increase (decrease) in net assets resulting from unit transactions 110,156,632 444,528 1,736,818 -------------- ---------- ------------ Net increase (decrease) in net assets 128,790,025 492,654 1,882,106 NET ASSETS: Beginning of year 41,850,438 221,927 1,032,258 -------------- ---------- ------------ End of year $170,640,463 $714,581 $2,914,364 ============== ========== ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-98 -------------------------------------------------------------------------------
HARTFORD HARTFORD DISCIPLINED HARTFORD GROWTH GLOBAL LEADERS EQUITY HARTFORD GROWTH OPPORTUNITIES HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(20,686) $(85,809) $(92,959) $(110,516) Net realized gain (loss) on security transactions 12,183 17,570 848 48,962 Net realized gain on distributions 255,168 -- 486,277 2,488,960 Net unrealized appreciation (depreciation) of investments during the year 202,464 14,663,438 (133,968) (452,999) ------------ -------------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 449,129 14,595,199 260,198 1,974,407 ------------ -------------- ------------ ------------- UNIT TRANSACTIONS: Purchases 1,826,655 74,019,558 2,745,993 14,660,761 Net transfers 1,015,160 42,244,487 2,047,361 3,599,474 Surrenders for benefit payments and fees (183,052) (5,553,153) (242,143) (600,390) Net annuity transactions -- -- -- -- ------------ -------------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 2,658,763 110,710,892 4,551,211 17,659,845 ------------ -------------- ------------ ------------- Net increase (decrease) in net assets 3,107,892 125,306,091 4,811,409 19,634,252 NET ASSETS: Beginning of year 1,997,015 64,985,271 3,651,238 7,761,440 ------------ -------------- ------------ ------------- End of year $5,104,907 $190,291,362 $8,462,647 $27,395,692 ============ ============== ============ ============= HARTFORD INTERNATIONAL CAPITAL HARTFORD HIGH HARTFORD INDEX APPRECIATION YIELD HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,470,747 $33,138 $(62,336) Net realized gain (loss) on security transactions 1,748 (4,318) (3,538) Net realized gain on distributions -- 533,313 1,298,188 Net unrealized appreciation (depreciation) of investments during the year (594,047) 35,646 1,308,060 ------------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 878,448 597,779 2,540,374 ------------- ------------ ------------- UNIT TRANSACTIONS: Purchases 5,161,460 2,372,789 7,883,213 Net transfers 4,066,630 1,113,495 3,192,043 Surrenders for benefit payments and fees (446,331) (180,863) (340,950) Net annuity transactions 50,662 -- -- ------------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 8,832,421 3,305,421 10,734,306 ------------- ------------ ------------- Net increase (decrease) in net assets 9,710,869 3,903,200 13,274,680 NET ASSETS: Beginning of year 4,321,519 2,257,147 5,873,667 ------------- ------------ ------------- End of year $14,032,388 $6,160,347 $19,148,347 ============= ============ =============
SA-99 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HARTFORD HARTFORD INTERNATIONAL INTERNATIONAL HARTFORD SMALL COMPANY OPPORTUNITIES MONEY MARKET HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $40,434 $523,075 $676,903 Net realized gain (loss) on security transactions (29,877) 21,573 -- Net realized gain on distributions 741,464 3,584,233 -- Net unrealized appreciation (depreciation) of investments during the year 332,557 2,607,904 3 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 1,084,578 6,736,785 676,906 ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 3,735,420 18,719,051 28,216,200 Net transfers 807,814 9,820,055 (1,338,633) Surrenders for benefit payments and fees (150,416) (1,319,369) (2,439,175) Net annuity transactions -- -- 5,687 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 4,392,818 27,219,737 24,444,079 ------------ ------------- ------------- Net increase (decrease) in net assets 5,477,396 33,956,522 25,120,985 NET ASSETS: Beginning of year 2,139,116 15,818,273 8,196,168 ------------ ------------- ------------- End of year $7,616,512 $49,774,795 $33,317,153 ============ ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-100 -------------------------------------------------------------------------------
HARTFORD HARTFORD MORTGAGE HARTFORD SMALL SMALLCAP SECURITIES COMPANY GROWTH HARTFORD STOCK HLS FUND HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT (D) SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $475,172 $(1,625) $(170,225) $18,988 Net realized gain (loss) on security transactions 188 (8,669) (18,357) 8,037 Net realized gain on distributions -- 160,083 1,231,401 946,087 Net unrealized appreciation (depreciation) of investments during the year (306,719) (84,342) (316,893) 722,068 ------------ ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 168,641 65,447 725,926 1,695,180 ------------ ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 2,870,262 850,890 7,331,094 7,193,081 Net transfers 1,391,567 390,515 1,873,864 2,092,757 Surrenders for benefit payments and fees (208,098) (7,211) (582,693) (412,933) Net annuity transactions -- -- -- -- ------------ ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 4,053,731 1,234,194 8,622,265 8,872,905 ------------ ------------ ------------- ------------- Net increase (decrease) in net assets 4,222,372 1,299,641 9,348,191 10,568,085 NET ASSETS: Beginning of year 2,129,023 -- 9,393,043 6,765,655 ------------ ------------ ------------- ------------- End of year $6,351,395 $1,299,641 $18,741,234 $17,333,740 ============ ============ ============= ============= HARTFORD U.S. GOVERNMENT HARTFORD VALUE SECURITIES HARTFORD VALUE OPPORTUNITIES HLS FUND HLS FUND HLS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $1,099,703 $7,746 $8,372 Net realized gain (loss) on security transactions 8,376 10,609 3,185 Net realized gain on distributions -- 75,580 982,660 Net unrealized appreciation (depreciation) of investments during the year 731,774 466,064 232,505 ------------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 1,839,853 559,999 1,226,722 ------------- ------------ ------------- UNIT TRANSACTIONS: Purchases 39,131,345 2,115,409 4,510,528 Net transfers 22,920,405 1,165,409 1,817,138 Surrenders for benefit payments and fees (2,699,695) (156,158) (307,560) Net annuity transactions -- -- -- ------------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 59,352,055 3,124,660 6,020,106 ------------- ------------ ------------- Net increase (decrease) in net assets 61,191,908 3,684,659 7,246,828 NET ASSETS: Beginning of year 30,433,004 1,642,641 3,670,554 ------------- ------------ ------------- End of year $91,624,912 $5,327,300 $10,917,382 ============= ============ =============
(d) From inception, June 1, 2006 to December 31, 2006. SA-101 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HARTFORD HUNTINGTON VA HUNTINGTON VA EQUITY INCOME INCOME EQUITY DIVIDEND HLS FUND FUND CAPTURE FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $46,687 $2,632 $49,514 Net realized gain (loss) on security transactions 1,354 511 3,114 Net realized gain on distributions 6,018 34,346 66,183 Net unrealized appreciation (depreciation) of investments during the year 520,146 118,334 330,829 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 574,205 155,823 449,640 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 1,890,129 945,159 1,424,393 Net transfers 1,701,875 240,079 695,740 Surrenders for benefit payments and fees (179,750) (45,669) (94,244) Net annuity transactions 26,023 -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 3,438,277 1,139,569 2,025,889 ------------ ------------ ------------ Net increase (decrease) in net assets 4,012,482 1,295,392 2,475,529 NET ASSETS: Beginning of year 1,569,873 754,942 1,764,623 ------------ ------------ ------------ End of year $5,582,355 $2,050,334 $4,240,152 ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-102 -------------------------------------------------------------------------------
HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA HUNTINGTON VA MID CORP NEW ECONOMY ROTATING GROWTH FUND AMERICA FUND FUND MARKETS FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(6,323) $(20,355) $(22,440) $(1,545) Net realized gain (loss) on security transactions (64) 6,356 1,651 183 Net realized gain on distributions 4,476 19,063 19,273 2,748 Net unrealized appreciation (depreciation) of investments during the year 47,727 97,121 152,323 26,835 ---------- ------------ ------------ ---------- Net increase (decrease) in net assets resulting from operations 45,816 102,185 150,807 28,221 ---------- ------------ ------------ ---------- UNIT TRANSACTIONS: Purchases 492,864 1,056,474 1,569,224 270,963 Net transfers 78,284 220,996 279,196 51,058 Surrenders for benefit payments and fees (12,259) (58,479) (55,239) (4,644) Net annuity transactions -- -- -- -- ---------- ------------ ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 558,889 1,218,991 1,793,181 317,377 ---------- ------------ ------------ ---------- Net increase (decrease) in net assets 604,705 1,321,176 1,943,988 345,598 NET ASSETS: Beginning of year 278,348 997,276 688,904 23,771 ---------- ------------ ------------ ---------- End of year $883,053 $2,318,452 $2,632,892 $369,369 ========== ============ ============ ========== HUNTINGTON VA HUNTINGTON VA INTERNATIONAL HUNTINGTON VA MORTGAGE EQUITY FUND MACRO 100 FUND SECURITIES FUND SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $920 $(16,341) $(2,040) Net realized gain (loss) on security transactions 431 738 81 Net realized gain on distributions 6,919 13,607 -- Net unrealized appreciation (depreciation) of investments during the year 154,599 56,050 19,578 ------------ ------------ ---------- Net increase (decrease) in net assets resulting from operations 162,869 54,054 17,619 ------------ ------------ ---------- UNIT TRANSACTIONS: Purchases 1,051,046 695,366 470,849 Net transfers 258,726 290,888 118,126 Surrenders for benefit payments and fees (23,371) (47,510) (7,985) Net annuity transactions -- -- -- ------------ ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 1,286,401 938,744 580,990 ------------ ------------ ---------- Net increase (decrease) in net assets 1,449,270 992,798 598,609 NET ASSETS: Beginning of year 72,054 674,462 96,688 ------------ ------------ ---------- End of year $1,521,324 $1,667,260 $695,297 ============ ============ ==========
SA-103 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
HUNTINGTON VA LORD ABBETT SITUS SMALL LORD ABBETT ALL AMERICA'S VALUE CAP FUND VALUE PORTFOLIO PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(41,982) $(23,765) $49,701 Net realized gain (loss) on security transactions 2,610 2,426 1,481 Net realized gain on distributions 42,705 155,713 81,773 Net unrealized appreciation (depreciation) of investments during the year 80,665 279,070 287,193 ------------ ------------ ------------ Net increase (decrease) in net assets resulting from operations 83,998 413,444 420,148 ------------ ------------ ------------ UNIT TRANSACTIONS: Purchases 2,215,914 3,244,491 1,091,163 Net transfers 604,440 1,233,970 1,243,611 Surrenders for benefit payments and fees (98,928) (139,622) (184,222) Net annuity transactions -- -- -- ------------ ------------ ------------ Net increase (decrease) in net assets resulting from unit transactions 2,721,426 4,338,839 2,150,552 ------------ ------------ ------------ Net increase (decrease) in net assets 2,805,424 4,752,283 2,570,700 NET ASSETS: Beginning of year 1,247,616 1,776,558 1,701,102 ------------ ------------ ------------ End of year $4,053,040 $6,528,841 $4,271,802 ============ ============ ============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-104 -------------------------------------------------------------------------------
LORD ABBETT LORD ABBETT LORD ABBETT MFS CAPITAL BOND-DEBENTURE GROWTH AND LARGE-CAP OPPORTUNITIES PORTFOLIO INCOME PORTFOLIO CORE PORTFOLIO SERIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $708,817 $305,616 $(10,706) $(7,578) Net realized gain (loss) on security transactions 661 5,488 27 21,942 Net realized gain on distributions -- 2,460,062 9,463 -- Net unrealized appreciation (depreciation) of investments during the year 72,851 3,329,578 182,877 69,055 ------------- ------------- ------------ ----------- Net increase (decrease) in net assets resulting from operations 782,329 6,100,744 181,661 83,419 ------------- ------------- ------------ ----------- UNIT TRANSACTIONS: Purchases 6,554,544 43,842,911 1,311,845 5,000 Net transfers 3,997,363 19,040,066 258,302 (197,167) Surrenders for benefit payments and fees (423,730) (1,669,653) (55,720) (182,541) Net annuity transactions -- 53,186 5,689 -- ------------- ------------- ------------ ----------- Net increase (decrease) in net assets resulting from unit transactions 10,128,177 61,266,510 1,520,116 (374,708) ------------- ------------- ------------ ----------- Net increase (decrease) in net assets 10,910,506 67,367,254 1,701,777 (291,289) NET ASSETS: Beginning of year 4,439,334 12,541,528 724,875 972,031 ------------- ------------- ------------ ----------- End of year $15,349,840 $79,908,782 $2,426,652 $680,742 ============= ============= ============ =========== MFS INVESTORS MFS EMERGING GROWTH STOCK MFS INVESTORS GROWTH SERIES SERIES TRUST SERIES SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(11,709) $(7,703) $(15,219) Net realized gain (loss) on security transactions 8,628 1,992 30,038 Net realized gain on distributions -- -- -- Net unrealized appreciation (depreciation) of investments during the year 43,704 29,129 111,773 ---------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 40,623 23,418 126,592 ---------- ----------- ------------ UNIT TRANSACTIONS: Purchases 4,464 -- 18,113 Net transfers (12,065) (57,811) 19,017 Surrenders for benefit payments and fees (20,674) (74,392) (165,774) Net annuity transactions -- -- -- ---------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions (28,275) (132,203) (128,644) ---------- ----------- ------------ Net increase (decrease) in net assets 12,348 (108,785) (2,052) NET ASSETS: Beginning of year 676,079 534,275 1,252,550 ---------- ----------- ------------ End of year $688,427 $425,490 $1,250,498 ========== =========== ============
SA-105 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
MFS TOTAL EQUITY AND CORE PLUS RETURN SERIES INCOME FIXED INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $88,939 $(1,610) $315,469 Net realized gain (loss) on security transactions 155,541 4,251 40,578 Net realized gain on distributions 463,229 5,114 70,799 Net unrealized appreciation (depreciation) of investments during the year 668,893 13,155 (183,003) ------------- ---------- ------------- Net increase (decrease) in net assets resulting from operations 1,376,602 20,910 243,843 ------------- ---------- ------------- UNIT TRANSACTIONS: Purchases 262,731 12,000 102,713 Net transfers (143,449) (16,709) (169,228) Surrenders for benefit payments and fees (1,664,797) (40,802) (1,732,401) Net annuity transactions -- -- -- ------------- ---------- ------------- Net increase (decrease) in net assets resulting from unit transactions (1,545,515) (45,511) (1,798,916) ------------- ---------- ------------- Net increase (decrease) in net assets (168,913) (24,601) (1,555,073) NET ASSETS: Beginning of year 14,864,762 212,171 14,308,289 ------------- ---------- ------------- End of year $14,695,849 $187,570 $12,753,216 ============= ========== =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-106 -------------------------------------------------------------------------------
EMERGING EMERGING MARKETS DEBT MARKETS EQUITY TECHNOLOGY HIGH YIELD SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (E) SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $72,759 $(72,281) $(1,000) $126,412 Net realized gain (loss) on security transactions 2,517 (10,800) (38,464) (84,280) Net realized gain on distributions 19,808 203,888 -- -- Net unrealized appreciation (depreciation) of investments during the year (4,968) 2,402,576 50,150 89,336 ------------ ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 90,116 2,523,383 10,686 131,468 ------------ ------------- ----------- ------------ UNIT TRANSACTIONS: Purchases 7,902 6,742,135 440 6,020 Net transfers 38,798 2,163,557 (192,304) (31,249) Surrenders for benefit payments and fees (55,832) (544,357) (1,929) (193,819) Net annuity transactions -- 61,319 -- -- ------------ ------------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions (9,132) 8,422,654 (193,793) (219,048) ------------ ------------- ----------- ------------ Net increase (decrease) in net assets 80,984 10,946,037 (183,107) (87,580) NET ASSETS: Beginning of year 1,035,654 3,401,363 183,107 2,121,719 ------------ ------------- ----------- ------------ End of year $1,116,638 $14,347,400 $ -- $2,034,139 ============ ============= =========== ============ MID CAP U.S. MID GROWTH CAP VALUE FOCUS GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT (F) -------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(61,048) $(129,279) $(235,490) Net realized gain (loss) on security transactions 10,718 125,279 (276,003) Net realized gain on distributions 244,671 1,142,299 -- Net unrealized appreciation (depreciation) of investments during the year 96,084 584,024 209,885 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 290,425 1,722,323 (301,608) ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 3,015,696 3,196,214 38,259 Net transfers 1,079,614 1,505,705 (1,566,846) Surrenders for benefit payments and fees (125,310) (861,490) (2,823,792) Net annuity transactions -- -- 54,626 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 3,970,000 3,840,429 (4,297,753) ------------ ------------- ------------- Net increase (decrease) in net assets 4,260,425 5,562,752 (4,599,361) NET ASSETS: Beginning of year 1,750,800 7,011,458 19,392,593 ------------ ------------- ------------- End of year $6,011,225 $12,574,210 $14,793,232 ============ ============= =============
(e) Fund closed effective April 28, 2006. (f) Formerly American Opportunities. Change effective July 3, 2006. SA-107 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
CAPITAL DEVELOPING BALANCED GROWTH OPPORTUNITIES GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $111,289 $(79,035) $(76,620) Net realized gain (loss) on security transactions 110,295 (35,826) 473,675 Net realized gain on distributions 506,837 -- -- Net unrealized appreciation (depreciation) of investments during the year 333,451 380,896 72,109 ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations 1,061,872 266,035 469,164 ----------- ----------- ----------- UNIT TRANSACTIONS: Purchases 52,989 15,513 26,998 Net transfers (215,450) 22,620 (464,585) Surrenders for benefit payments and fees (1,525,822) (822,832) (769,339) Net annuity transactions 110,229 13,744 19,722 ----------- ----------- ----------- Net increase (decrease) in net assets resulting from unit transactions (1,578,054) (770,955) (1,187,204) ----------- ----------- ----------- Net increase (decrease) in net assets (516,182) (504,920) (718,040) NET ASSETS: Beginning of year 10,834,682 5,360,561 5,649,630 ----------- ----------- ----------- End of year $10,318,500 $4,855,641 $4,931,590 =========== =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-108 -------------------------------------------------------------------------------
FLEXIBLE INCOME DIVIDEND GROWTH GLOBAL EQUITY GROWTH SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $242,393 $(38,444) $(59,307) $(57,201) Net realized gain (loss) on security transactions (207,496) (235,568) 375,122 75,614 Net realized gain on distributions -- -- 591,556 -- Net unrealized appreciation (depreciation) of investments during the year 162,409 2,652,134 599,760 53,939 ------------ ------------- ----------- ------------ Net increase (decrease) in net assets resulting from operations 197,306 2,378,122 1,507,131 72,352 ------------ ------------- ----------- ------------ UNIT TRANSACTIONS: Purchases 22,023 91,217 30,753 25,819 Net transfers (164,718) (2,445,565) (258,739) (206,502) Surrenders for benefit payments and fees (679,313) (4,511,565) (1,380,361) (425,048) Net annuity transactions -- 40,291 66,152 -- ------------ ------------- ----------- ------------ Net increase (decrease) in net assets resulting from unit transactions (822,008) (6,825,622) (1,542,195) (605,731) ------------ ------------- ----------- ------------ Net increase (decrease) in net assets (624,702) (4,447,500) (35,064) (533,379) NET ASSETS: Beginning of year 5,477,289 29,793,862 8,373,132 4,093,871 ------------ ------------- ----------- ------------ End of year $4,852,587 $25,346,362 $8,338,068 $3,560,492 ============ ============= =========== ============ EQUALLY-WEIGHTED MONEY MARKET UTILITIES S&P 500 SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- -------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $204,102 $34,881 $(97,938) Net realized gain (loss) on security transactions -- 324,898 2,071,281 Net realized gain on distributions -- -- 1,360,903 Net unrealized appreciation (depreciation) of investments during the year -- 694,302 (11,819) ------------- ------------- ------------- Net increase (decrease) in net assets resulting from operations 204,102 1,054,081 3,322,427 ------------- ------------- ------------- UNIT TRANSACTIONS: Purchases 23,697 11,226 116,358 Net transfers 3,922,893 (172,018) (1,971,888) Surrenders for benefit payments and fees (3,976,982) (1,197,175) (3,952,438) Net annuity transactions -- -- 78,984 ------------- ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions (30,392) (1,357,967) (5,728,984) ------------- ------------- ------------- Net increase (decrease) in net assets 173,710 (303,886) (2,406,557) NET ASSETS: Beginning of year 6,807,869 6,462,004 27,422,374 ------------- ------------- ------------- End of year $6,981,579 $6,158,118 $25,015,817 ============= ============= =============
SA-109 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
SMALL COMPANY MTB LARGE CAP GROWTH GLOBAL FRANCHISE GROWTH FUND II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(12,452) $(4,771) $(4,506) Net realized gain (loss) on security transactions 8,510 23,237 540 Net realized gain on distributions 45,226 24,570 6,981 Net unrealized appreciation (depreciation) of investments during the year 12,160 145,700 42,487 ---------- ------------ ---------- Net increase (decrease) in net assets resulting from operations 53,444 188,736 45,502 ---------- ------------ ---------- UNIT TRANSACTIONS: Purchases 29,306 18,143 366,082 Net transfers 40,080 46,205 2,830 Surrenders for benefit payments and fees (29,493) (97,401) (9,454) Net annuity transactions -- -- -- ---------- ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 39,893 (33,053) 359,458 ---------- ------------ ---------- Net increase (decrease) in net assets 93,337 155,683 404,960 NET ASSETS: Beginning of year 532,968 977,691 295,754 ---------- ------------ ---------- End of year $626,305 $1,133,374 $700,714 ========== ============ ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-110 -------------------------------------------------------------------------------
MTB MANAGED MTB MANAGED MTB MANAGED ALLOCATION ALLOCATION ALLOCATION FUND -- FUND -- FUND -- MTB LARGE CAP MODERATE AGGRESSIVE CONSERVATIVE VALUE FUND II GROWTH II GROWTH II GROWTH II SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(4,125) $28,646 $5,441 $2,710 Net realized gain (loss) on security transactions 342 2,673 53 70 Net realized gain on distributions 119,068 114,647 10,422 2,974 Net unrealized appreciation (depreciation) of investments during the year 67,269 28,656 16,851 1,493 ------------ ------------ ---------- ---------- Net increase (decrease) in net assets resulting from operations 182,554 174,622 32,767 7,247 ------------ ------------ ---------- ---------- UNIT TRANSACTIONS: Purchases 1,113,707 763,314 301,430 108,944 Net transfers 139,539 12,281 2,546 3,628 Surrenders for benefit payments and fees (30,671) (73,857) (2,350) (8,942) Net annuity transactions -- -- -- -- ------------ ------------ ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions 1,222,575 701,738 301,626 103,630 ------------ ------------ ---------- ---------- Net increase (decrease) in net assets 1,405,129 876,360 334,393 110,877 NET ASSETS: Beginning of year 476,358 1,531,580 67,245 92,709 ------------ ------------ ---------- ---------- End of year $1,881,487 $2,407,940 $401,638 $203,586 ============ ============ ========== ========== OPPENHEIMER OPPENHEIMER MIDCAP OPPENHEIMER CAPITAL GLOBAL SECURITIES FUND VA APPRECIATION FUND FUND SUB-ACCOUNT (G) SUB-ACCOUNT SUB-ACCOUNT -------------------------- ------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(24,767) $(302,754) $(616,996) Net realized gain (loss) on security transactions 3,057 2,503 7,419 Net realized gain on distributions -- -- 1,533,842 Net unrealized appreciation (depreciation) of investments during the year 36,339 1,732,463 9,008,601 ------------ ------------- -------------- Net increase (decrease) in net assets resulting from operations 14,629 1,432,212 9,932,866 ------------ ------------- -------------- UNIT TRANSACTIONS: Purchases 1,497,240 12,608,412 60,753,785 Net transfers (174,676) 6,447,086 25,293,701 Surrenders for benefit payments and fees (28,871) (758,935) (1,951,010) Net annuity transactions -- -- 47,400 ------------ ------------- -------------- Net increase (decrease) in net assets resulting from unit transactions 1,293,693 18,296,563 84,143,876 ------------ ------------- -------------- Net increase (decrease) in net assets 1,308,322 19,728,775 94,076,742 NET ASSETS: Beginning of year 782,464 10,779,562 17,248,880 ------------ ------------- -------------- End of year $2,090,786 $30,508,337 $111,325,622 ============ ============= ==============
(g) Formerly Oppenheimer Aggressive Growth Fund. Change effective May 1, 2006. SA-111 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
OPPENHEIMER PUTNAM OPPENHEIMER MAIN STREET DIVERSIFIED MAIN STREET FUND SMALL CAP FUND INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT --------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(46,805) $(486,722) $280,576 Net realized gain (loss) on security transactions (9,032) 7,406 2,049 Net realized gain on distributions -- 575,870 -- Net unrealized appreciation (depreciation) of investments during the year 638,000 3,417,056 373,519 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from operations 582,163 3,513,610 656,144 ------------ ------------- ------------- UNIT TRANSACTIONS: Purchases 3,764,626 23,152,354 9,719,423 Net transfers 1,471,166 12,235,511 4,949,493 Surrenders for benefit payments and fees (238,846) (1,302,711) (466,134) Net annuity transactions -- -- 5,681 ------------ ------------- ------------- Net increase (decrease) in net assets resulting from unit transactions 4,996,946 34,085,154 14,208,463 ------------ ------------- ------------- Net increase (decrease) in net assets 5,579,109 37,598,764 14,864,607 NET ASSETS: Beginning of year 1,813,551 13,335,034 5,078,024 ------------ ------------- ------------- End of year $7,392,660 $50,933,798 $19,942,631 ============ ============= =============
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-112 -------------------------------------------------------------------------------
PUTNAM PUTNAM GLOBAL PUTNAM GROWTH INTERNATIONAL PUTNAM ASSET ALLOCATION AND INCOME EQUITY INVESTORS SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ------------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $20,317 $(12,460) $(418,207) $(28,238) Net realized gain (loss) on security transactions 734 (4,075) 18,086 3,434 Net realized gain on distributions -- 39,405 -- -- Net unrealized appreciation (depreciation) of investments during the year 374,590 331,677 9,091,711 373,193 ------------ ------------ ------------- ------------ Net increase (decrease) in net assets resulting from operations 395,641 354,547 8,691,590 348,389 ------------ ------------ ------------- ------------ UNIT TRANSACTIONS: Purchases 2,320,911 2,218,806 22,368,754 1,984,517 Net transfers 527,543 431,022 9,241,319 877,153 Surrenders for benefit payments and fees (91,458) (98,047) (1,563,597) (77,523) Net annuity transactions -- -- -- -- ------------ ------------ ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 2,756,996 2,551,781 30,046,476 2,784,147 ------------ ------------ ------------- ------------ Net increase (decrease) in net assets 3,152,637 2,906,328 38,738,066 3,132,536 NET ASSETS: Beginning of year 2,176,939 986,313 19,032,957 792,809 ------------ ------------ ------------- ------------ End of year $5,329,576 $3,892,641 $57,771,023 $3,925,345 ============ ============ ============= ============ PUTNAM THE PUTNAM PUTNAM SMALL GEORGE PUTNAM NEW VALUE CAP VALUE FUND OF BOSTON SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------ OPERATIONS: Net investment income (loss) $(43,497) $(395,805) $8,301 Net realized gain (loss) on security transactions 6,638 579 13,852 Net realized gain on distributions 249,911 2,009,778 77,258 Net unrealized appreciation (depreciation) of investments during the year 631,699 2,475,873 225,030 ------------ ------------- ------------ Net increase (decrease) in net assets resulting from operations 844,751 4,090,425 324,441 ------------ ------------- ------------ UNIT TRANSACTIONS: Purchases 4,540,720 22,300,319 2,987,267 Net transfers 953,779 10,348,720 (651,120) Surrenders for benefit payments and fees (172,039) (1,104,871) (114,877) Net annuity transactions -- -- -- ------------ ------------- ------------ Net increase (decrease) in net assets resulting from unit transactions 5,322,460 31,544,168 2,221,270 ------------ ------------- ------------ Net increase (decrease) in net assets 6,167,211 35,634,593 2,545,711 NET ASSETS: Beginning of year 2,535,192 12,087,513 1,365,933 ------------ ------------- ------------ End of year $8,702,403 $47,722,106 $3,911,644 ============ ============= ============
SA-113 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
PUTNAM PIONEER FUND PUTNAM VISTA VOYAGER VCT PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT -------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(10,278) $(31,052) $(4,180) Net realized gain (loss) on security transactions 1,948 1,318 1,611 Net realized gain on distributions -- -- -- Net unrealized appreciation (depreciation) of investments during the year 30,175 92,286 71,477 ---------- ------------ ---------- Net increase (decrease) in net assets resulting from operations 21,845 62,552 68,908 ---------- ------------ ---------- UNIT TRANSACTIONS: Purchases 227,316 1,159,174 36,093 Net transfers 253,538 (594,930) 16,714 Surrenders for benefit payments and fees (52,765) (88,571) (12,054) Net annuity transactions -- -- -- ---------- ------------ ---------- Net increase (decrease) in net assets resulting from unit transactions 428,089 475,673 40,753 ---------- ------------ ---------- Net increase (decrease) in net assets 449,934 538,225 109,661 NET ASSETS: Beginning of year 347,437 1,516,818 473,582 ---------- ------------ ---------- End of year $797,371 $2,055,043 $583,243 ========== ============ ==========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-114 -------------------------------------------------------------------------------
PIONEER OAK RIDGE LARGE CAP GROWTH PIONEER VALUE GROWTH AND VCT PORTFOLIO VCT PORTFOLIO ENTERPRISE INCOME SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(8,545) $(3,684) $(19,650) $(179,556) Net realized gain (loss) on security transactions 331 2,283 (52,587) 81,629 Net realized gain on distributions 6,547 10,511 -- 1,048,740 Net unrealized appreciation (depreciation) of investments during the year 8,858 14,921 148,347 2,089,184 ---------- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from operations 7,191 24,031 76,110 3,039,997 ---------- ---------- ------------ ------------- UNIT TRANSACTIONS: Purchases 90,387 11,851 4,182 11,228,616 Net transfers 149,807 (15,205) (24,865) 4,147,174 Surrenders for benefit payments and fees (34,296) (17,781) (92,414) (1,625,400) Net annuity transactions -- -- -- (822) ---------- ---------- ------------ ------------- Net increase (decrease) in net assets resulting from unit transactions 205,898 (21,135) (113,097) 13,749,568 ---------- ---------- ------------ ------------- Net increase (decrease) in net assets 213,089 2,896 (36,987) 16,789,565 NET ASSETS: Beginning of year 314,646 199,032 1,570,180 13,511,847 ---------- ---------- ------------ ------------- End of year $527,735 $201,928 $1,533,193 $30,301,412 ========== ========== ============ ============= STRATEGIC AGGRESSIVE COMSTOCK GROWTH GROWTH PORTFOLIO SUB-ACCOUNT SUB-ACCOUNT (H) SUB-ACCOUNT ----------------------------- ------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(296,090) $(5,083) $(4,447) Net realized gain (loss) on security transactions 10,227 2,820 (395) Net realized gain on distributions 2,163,222 -- 17,267 Net unrealized appreciation (depreciation) of investments during the year 4,807,286 2,278 (6,630) ------------- ---------- ---------- Net increase (decrease) in net assets resulting from operations 6,684,645 15 5,795 ------------- ---------- ---------- UNIT TRANSACTIONS: Purchases 20,533,485 41,178 10,018 Net transfers 11,618,008 (26,627) 919 Surrenders for benefit payments and fees (2,081,837) (10,017) (3,979) Net annuity transactions -- -- -- ------------- ---------- ---------- Net increase (decrease) in net assets resulting from unit transactions 30,069,656 4,534 6,958 ------------- ---------- ---------- Net increase (decrease) in net assets 36,754,301 4,549 12,753 NET ASSETS: Beginning of year 28,331,667 255,427 208,177 ------------- ---------- ---------- End of year $65,085,968 $259,976 $220,930 ============= ========== ==========
(h) Formerly Emerging Growth. Change effective August 15, 2006. SA-115 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEAR ENDED DECEMBER 31, 2006 -------------------------------------------------------------------------------
WELLS FARGO ADVANTAGE VT GOVERNMENT LARGE COMPANY PORTFOLIO GROWTH FUND SUB-ACCOUNT SUB-ACCOUNT (I) ------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $8,727 $(190) Net realized gain (loss) on security transactions 552 8 Net realized gain on distributions -- -- Net unrealized appreciation (depreciation) of investments during the year (4,296) 566 ---------- --------- Net increase (decrease) in net assets resulting from operations 4,983 384 ---------- --------- UNIT TRANSACTIONS: Purchases 61,858 11,106 Net transfers 82,609 1,180 Surrenders for benefit payments and fees (28,115) (1) Net annuity transactions -- -- ---------- --------- Net increase (decrease) in net assets resulting from unit transactions 116,352 12,285 ---------- --------- Net increase (decrease) in net assets 121,335 12,669 NET ASSETS: Beginning of year 386,175 7,552 ---------- --------- End of year $507,510 $20,221 ========== =========
(i) Formerly Wells Fargo Advantage Large Company Growth Fund. Change effective May 1, 2006. THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS. SA-116 -------------------------------------------------------------------------------
WELLS FARGO STI CLASSIC VT ADVANTAGE VT LARGE CAP STI CLASSIC VT STI CLASSIC VT SMALL CAP RELATIVE MID-CAP LARGE CAP VALUE GROWTH FUND VALUE FUND EQUITY FUND EQUITY FUND SUB-ACCOUNT (J) SUB-ACCOUNT SUB-ACCOUNT SUB-ACCOUNT ---------------------------------------------------------------------------------------------------------------------- OPERATIONS: Net investment income (loss) $(124) $(465) $(926) $(1,924) Net realized gain (loss) on security transactions 77 108 (115) 952 Net realized gain on distributions 210 6,184 5,170 -- Net unrealized appreciation (depreciation) of investments during the year 1,207 5,751 847 199,289 --------- ---------- --------- ------------ Net increase (decrease) in net assets resulting from operations 1,370 11,578 4,976 198,317 --------- ---------- --------- ------------ UNIT TRANSACTIONS: Purchases 7,404 6,646 8,675 434,400 Net transfers 306 46,091 3,765 320,862 Surrenders for benefit payments and fees (3) 150 (829) (40,806) Net annuity transactions -- -- -- -- --------- ---------- --------- ------------ Net increase (decrease) in net assets resulting from unit transactions 7,707 52,887 11,611 714,456 --------- ---------- --------- ------------ Net increase (decrease) in net assets 9,077 64,465 16,587 912,773 NET ASSETS: Beginning of year 4,817 57,358 53,032 615,231 --------- ---------- --------- ------------ End of year $13,894 $121,823 $69,619 $1,528,004 ========= ========== ========= ============
(j) Formerly Wells Fargo Advantage Small Cap Growth Fund. Change effective May 1, 2006. SA-117 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2007 ------------------------------------------------------------------------------- 1. ORGANIZATION: Separate Account Three (the "Account") is a separate investment account within Hartford Life 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, BB&T Mid Cap Growth VIF, BB&T Capital Manager Equity VIF, BB&T Large Cap VIF, BB&T Special Opportunities Equity VIF, BB&T Total Return Bond VIF, Evergreen VA Balanced Fund, Evergreen VA Growth Fund, Evergreen VA International Equity Fund, Evergreen VA Omega Fund, Evergreen VA Special Values Fund, Evergreen VA Fundamental Large Cap Fund, Fidelity(R) VIP Equity-Income, Fidelity(R) VIP Growth, Fidelity(R) VIP Contrafund(R), Fidelity(R) VIP Mid Cap, Fidelity(R) VIP Value Strategies, Fidelity(R) VIP Dynamic Capital Appreciation Portfolio, Franklin Small-Mid Cap Growth Securities Fund, Franklin Strategic Income Securities Fund, Mutual Shares Securities Fund, Templeton Developing Markets Securities Fund, Templeton Growth Securities Fund, Hartford Advisers HLS Fund, Hartford Large Cap 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 Small Cap 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, Huntington VA Income Equity Fund, Huntington VA Dividend Capture Fund, Huntington VA Growth Fund, Huntington VA Mid Corp America Fund, Huntington VA New Economy Fund, Huntington VA Rotating Markets Fund, Huntington VA International Equity Fund, Huntington VA Macro 100 Fund, Huntington VA Mortgage Securities Fund, Huntington VA Situs Small Cap 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, MTB Large Cap Growth Fund II, MTB Large Cap Value Fund II, MTB Managed Allocation Fund -- Moderate Growth II, MTB Managed Allocation Fund -- Aggressive Growth II, MTB Managed Allocation Fund -- Conservative Growth II, Oppenheimer Midcap Fund VA, 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 International Growth and Income, Putnam International Equity, Putnam Investors, Putnam New Value, Putnam Small Cap Value, Putnam The George Putnam Fund of Boston, Putnam Vista, Putnam Voyager, Pioneer Fund VCT Portfolio, Pioneer Oak Ridge Large Cap Growth VCT Portfolio, Enterprise, Growth and Income, Comstock, Strategic Growth, Aggressive Growth Portfolio, Government Portfolio, Wells Fargo Advantage VT Large Company Growth Fund, Wells Fargo Advantage VT Small Cap Growth Fund, STI Classic VT Large Cap Growth Stock Fund, STI Classic VT Large Cap Core Equity Fund, STI Classic VT Mid-Cap Core Equity Fund, and STI Classic VT Large Cap Value Equity Fund. 2. SIGNIFICANT ACCOUNTING POLICIES: The following is a summary of significant accounting policies of the Account, which are in accordance with SA-118 ------------------------------------------------------------------------------- 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 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 CHARGES AND ADMINISTRATIVE FEES -- The Company, as issuer of variable annuity contracts, provides the mortality and expense undertakings and, with respect to the Account, receives a maximum annual fee of up to 1.60% of the Account's average daily net assets. The Company also provides administrative services and receives an annual fee of up to 0.20% of the Account's average daily net assets. b) 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 charges are included in surrenders for benefit payments and fees on the accompanying statements of changes in net assets. SA-119 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 $24,112,943 $2,648,185 AllianceBernstein VP Global Research Growth Portfolio 1,552,452 401,636 AllianceBernstein VP International Value Portfolio 65,399,151 12,206,791 AllianceBernstein VP Small/Mid Cap Value Portfolio 10,175,089 2,071,862 AllianceBernstein VP Value Portfolio 26,690,852 2,142,002 AllianceBernstein VPS International Growth Portfolio 559,961 6,229 American Funds Global Growth Fund 925,979 901,117 American Funds Growth Fund 4,806,248 6,142,683 American Funds Growth-Income Fund 2,997,251 4,388,059 American Funds International Fund 2,542,092 2,774,634 American Funds Global Small Capitalization Fund 1,046,281 1,280,621 BB&T Mid Cap Growth VIF 1,450,325 368,708 BB&T Capital Manager Equity VIF 900,691 318,356 BB&T Large Cap VIF 4,650,782 2,123,835 BB&T Special Opportunities Equity VIF 6,917,261 944,477 BB&T Total Return Bond VIF 1,343,821 406,690 Evergreen VA Balanced Fund 342,958 14,026 Evergreen VA Growth Fund 2,151,177 698,777 Evergreen VA International Equity Fund 1,503,155 188,709 Evergreen VA Omega Fund 336 2,254 Evergreen VA Special Values Fund 6,484,530 1,411,110 Evergreen VA Fundamental Large Cap Fund 91,566 32,172 Fidelity(R) VIP Equity-Income 35,115,061 4,304,798 Fidelity(R) VIP Growth 9,331,284 3,803,528 Fidelity(R) VIP Contrafund(R) 249,586,067 8,897,766 Fidelity(R) VIP Mid Cap 35,101,569 5,369,408 Fidelity(R) VIP Value Strategies 5,934,348 1,704,157 Fidelity(R) VIP Dynamic Capital Appreciation Portfolio 23,278 24 Franklin Small-Mid Cap Growth Securities Fund 707,328 1,239,758 Franklin Strategic Income Securities Fund 8,471,983 3,559,348 Mutual Shares Securities Fund 1,706,813 2,540,583 Templeton Developing Markets Securities Fund 571,904 1,086,258 Templeton Growth Securities Fund 539,057 704,695 Fifth Third Balanced VIP Fund 28,430 109,528 Fifth Third Disciplined Value VIP Fund 2,609,117 5,801,952 Fifth Third Mid Cap VIP Fund 285,246 509,482 Fifth Third Quality Growth VIP Fund 13,308 51,719 Hartford Advisers HLS Fund 12,590,804 3,192,663 Hartford LargeCap Growth HLS Fund 101,037 59 Hartford Total Return Bond HLS Fund 161,832,671 12,202,983 Hartford Dividend and Growth HLS Fund 160,939,949 6,638,633 Hartford Fundamental Growth HLS Fund 1,036,408 94,691 Hartford Global Advisers HLS Fund 2,134,590 341,347 Hartford Global Growth HLS Fund 4,384,424 1,188,632 Hartford Disciplined Equity HLS Fund 72,473,993 14,900,803
SA-120 -------------------------------------------------------------------------------
PURCHASES PROCEEDS SUB-ACCOUNT AT COST FROM SALES -------------------------------------------------------------------------------- Hartford Growth HLS Fund $4,749,038 $1,482,535 Hartford Growth Opportunities HLS Fund 27,644,810 2,974,953 Hartford High Yield HLS Fund 15,628,272 1,912,501 Hartford Index HLS Fund 5,289,465 1,948,622 Hartford International Growth HLS Fund 22,508,524 1,656,389 Hartford International Small Company HLS Fund 11,903,764 2,696,942 Hartford International Opportunities HLS Fund 38,310,268 10,887,011 Hartford MidCap Growth HLS Fund 167,250 6,255 Hartford Money Market HLS Fund 79,870,075 53,258,934 Hartford Mortgage Securities HLS Fund 2,989,869 743,315 Hartford SmallCap Value HLS Fund 51,470 3,977 Hartford Small Company HLS Fund 16,513,481 548,682 Hartford SmallCap Growth HLS Fund 8,055,317 2,995,366 Hartford Stock HLS Fund 7,587,025 1,585,640 Hartford U.S. Government Securities HLS Fund 72,551,652 5,053,012 Hartford Value HLS Fund 22,375,728 1,065,626 Hartford Value Opportunities HLS Fund 15,309,155 1,618,042 Hartford Equity Income HLS Fund 7,132,735 780,213 Huntington VA Income Equity Fund 1,165,563 281,587 Huntington VA Dividend Capture Fund 1,913,139 316,291 Huntington VA Growth Fund 1,012,280 134,717 Huntington VA Mid Corp America Fund 953,059 158,455 Huntington VA New Economy Fund 1,259,650 432,944 Huntington VA Rotating Markets Fund 902,799 38,481 Huntington VA International Equity Fund 1,457,329 218,414 Huntington VA Macro 100 Fund 672,868 175,467 Huntington VA Mortgage Securities Fund 688,245 98,579 Huntington VA Situs Small Cap Fund 2,048,375 448,924 Lord Abbett All Value Portfolio 3,612,689 785,194 Lord Abbett America's Value Portfolio 3,209,113 676,126 Lord Abbett Bond Debenture Fund 18,762,003 1,964,563 Lord Abbett Growth and Income Portfolio 86,904,952 5,649,628 Lord Abbett Large Cap Core Fund 3,159,201 455,000 MFS Core Equity Series 32,171 144,741 MFS Emerging Growth Series 189,423 214,943 MFS Investors Growth Stock Series 11,745 51,113 MFS Investors Trust Series 250,874 306,759 MFS Total Return Series 1,511,888 2,938,179 Equity and Income 145,246 54,925 Core Plus Fixed Income 1,611,476 3,895,430 Emerging Markets Debt 254,691 248,317 Emerging Markets Equity 19,480,901 5,445,229 High Yield 281,546 444,949 Mid Cap Growth 6,809,711 1,569,793 U.S. Mid Cap Value 7,998,992 3,519,693 Focus Growth 206,202 3,811,136 Balanced Growth 1,140,814 2,652,995 Capital Opportunities 286,711 1,276,056
SA-121 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
PURCHASES PROCEEDS SUB-ACCOUNT AT COST FROM SALES -------------------------------------------------------------------------------- Developing Growth $66,721 $1,701,639 Flexible Income 578,606 1,035,357 Dividend Growth 412,638 6,869,709 Global Equity 1,301,457 2,146,916 Growth 28,159 747,451 Money Market 6,445,454 5,606,792 Utilities 426,050 1,678,654 Equally-Weighted S&P 500 3,815,948 7,307,696 Small Company Growth 157,016 91,666 Global Franchise 247,145 228,700 MTB Large Cap Growth Fund II 704,121 105,748 MTB Large Cap Value Fund II 1,805,287 221,077 MTB Managed Allocation Fund -- Moderate Growth II 1,271,157 325,963 MTB Managed Allocation Fund -- Aggressive Growth II 442,139 211,194 MTB Managed Allocation Fund -- Conservative Growth II 435,861 40,817 Oppenheimer Midcap Fund VA 1,539,296 776,080 Oppenheimer Capital Appreciation Fund 22,050,143 3,295,211 Oppenheimer Global Securities Fund 108,330,801 5,842,639 Oppenheimer Main Street Fund 5,046,932 1,441,544 Oppenheimer Main Street Small Cap Fund 33,014,895 3,855,293 Putnam Diversified Income 22,982,415 4,275,877 Putnam Global Asset Allocation 2,791,054 636,631 Putnam Growth and Income 5,217,711 676,710 Putnam International Growth and Income 52,041 58 Putnam International Equity 35,645,992 6,985,590 Putnam Investors 19,833,988 832,580 Putnam New Value 4,538,634 1,336,212 Putnam Small Cap Value 29,100,597 4,108,808 Putnam The George Putnam Fund of Boston 4,681,471 1,931,581 Putnam Vista 418,368 187,789 Putnam Voyager 716,562 678,557 Pioneer Fund VCT Portfolio 300,104 323,605 Pioneer Oak Ridge Large Cap Growth VCT Portfolio 58,448 97,928 Enterprise 110,577 483,392 Growth and Income 25,045,282 4,216,746 Comstock 26,282,069 4,656,774 Strategic Growth 97,240 48,119 Aggressive Growth Portfolio 33,740 92,229 Government Portfolio 117,195 31,963 Wells Fargo Advantage VT Large Company Growth Fund 4,072 1,628 Wells Fargo Advantage VT Small Cap Growth Fund 3,991 2,029 STI Classic VT Large Cap Growth Stock Fund 26,541 1,596 STI Classic VT Large Cap Core Equity Fund 28,488 2,644 STI Classic VT Mid-Cap Core Equity Fund 27,818 2,114 STI Classic VT Large Cap Value Equity Fund 939,506 148,545 ------------------ ---------------- $1,825,908,854 $324,632,242 ================== ================
SA-122 ------------------------------------------------------------------------------- 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 ISSUE REDEEMED (DECREASE) -------------------------------------------------------------------------------- AllianceBernstein VP 1,883,751 202,325 1,681,426 Balanced Wealth Strategy Portfolio AllianceBernstein VP Global 103,389 26,972 76,417 Research Growth Portfolio AllianceBernstein VP 3,938,197 762,074 3,176,123 International Value Portfolio AllianceBernstein VP 735,040 165,942 569,098 Small/Mid Cap Value Portfolio AllianceBernstein VP Value 2,033,465 159,412 1,874,053 Portfolio AllianceBernstein VPS 50,137 544 49,593 International Growth Portfolio American Funds Global Growth 46,174 58,061 (11,887) Fund American Funds Growth Fund 197,168 463,656 (266,488) American Funds Growth-Income 123,460 271,938 (148,478) Fund American Funds International 108,816 201,799 (92,983) Fund American Funds Global Small 25,705 56,621 (30,916) Capitalization Fund BB&T Mid Cap Growth VIF 632,488 191,799 440,689 BB&T Capital Manager Equity 487,973 206,947 281,026 VIF BB&T Large Cap VIF 2,077,884 1,813,937 263,947 BB&T Special Opportunities 3,641,463 517,398 3,124,065 Equity VIF BB&T Total Return Bond VIF 1,175,415 353,435 821,980 Evergreen VA Balanced Fund 306,034 5,894 300,140 Evergreen VA Growth Fund 1,018,622 542,125 476,497 Evergreen VA International 911,427 119,975 791,452 Equity Fund Evergreen VA Omega Fund 142 2,062 (1,920) Evergreen VA Special Values 2,556,792 756,155 1,800,637 Fund Evergreen VA Fundamental 50,013 22,421 27,592 Large Cap Fund Fidelity(R) VIP 2,216,963 309,287 1,907,676 Equity-Income Fidelity(R) VIP Growth 786,898 293,604 493,294 Fidelity(R) VIP 11,447,634 627,285 10,820,349 Contrafund(R) Fidelity(R) VIP Mid Cap 2,144,167 379,016 1,765,151 Fidelity(R) VIP Value 421,552 128,127 293,425 Strategies Fidelity(R) VIP Dynamic 2,266 -- 2,266 Capital Appreciation Portfolio Franklin Small-Mid Cap 48,938 138,893 (89,955) Growth Securities Fund Franklin Strategic Income 499,952 216,418 283,534 Securities Fund Mutual Shares Securities 55,643 129,095 (73,452) Fund Templeton Developing Markets 10,537 45,039 (34,502) Securities Fund Templeton Growth Securities 19,651 40,420 (20,769) Fund Hartford Advisers HLS Fund 5,653,968 1,619,838 4,034,130 Hartford LargeCap Growth HLS 10,280 -- 10,280 Fund Hartford Total Return Bond 86,374,523 7,935,268 78,439,255 HLS Fund Hartford Dividend and Growth 70,775,174 3,289,177 67,485,997 HLS Fund Hartford Fundamental Growth 739,469 66,574 672,895 HLS Fund Hartford Global Advisers HLS 1,148,342 185,894 962,448 Fund Hartford Global Growth HLS 1,856,745 625,897 1,230,848 Fund Hartford Disciplined Equity 52,801,022 9,657,183 43,143,839 HLS Fund Hartford Growth HLS Fund 2,874,896 1,027,642 1,847,254 Hartford Growth 10,313,540 1,436,444 8,877,096 Opportunities HLS Fund Hartford High Yield HLS Fund 9,707,541 1,311,583 8,395,958 Hartford Index HLS Fund 3,350,529 1,567,847 1,782,682
SA-123 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUE REDEEMED (DECREASE) -------------------------------------------------------------------------------- Hartford International 9,041,770 842,724 8,199,046 Growth HLS Fund Hartford International Small 3,866,415 1,065,878 2,800,537 Company HLS Fund Hartford International 14,583,917 6,184,138 8,399,779 Opportunities HLS Fund Hartford MidCap Growth HLS 15,918 645 15,273 Fund Hartford Money Market HLS 63,109,118 43,771,455 19,337,663 Fund Hartford Mortgage Securities 1,739,945 467,266 1,272,679 HLS Fund Hartford SmallCap Value HLS 5,332 432 4,900 Fund Hartford Small Company HLS 7,490,861 227,774 7,263,087 Fund Hartford SmallCap Growth HLS 4,354,974 1,833,288 2,521,686 Fund Hartford Stock HLS Fund 2,714,831 1,101,519 1,613,312 Hartford U.S. Government 61,785,789 4,286,933 57,498,856 Securities HLS Fund Hartford Value HLS Fund 14,893,305 742,495 14,150,810 Hartford Value Opportunities 7,072,621 912,381 6,160,240 HLS Fund Hartford Equity Income HLS 4,437,761 488,808 3,948,953 Fund Huntington VA Income Equity 723,926 178,981 544,945 Fund Huntington VA Dividend 900,817 145,572 755,245 Capture Fund Huntington VA Growth Fund 927,955 116,451 811,504 Huntington VA Mid Corp 498,656 71,386 427,270 America Fund Huntington VA New Economy 629,548 212,350 417,198 Fund Huntington VA Rotating 483,158 18,505 464,653 Markets Fund Huntington VA International 95,780 12,686 83,094 Equity Fund Huntington VA Macro 100 Fund 338,491 136,943 201,548 Huntington VA Mortgage 63,724 8,458 55,266 Securities Fund Huntington VA Situs Small 1,192,280 272,138 920,142 Cap Fund Lord Abbett All Value 258,895 55,611 203,284 Portfolio Lord Abbett America's Value 234,810 49,854 184,956 Portfolio Lord Abbett Bond Debenture 1,554,362 177,513 1,376,849 Fund Lord Abbett Growth and 6,284,023 452,007 5,832,016 Income Portfolio Lord Abbett Large Cap Core 236,629 32,876 203,753 Fund MFS Core Equity Series 3,741 15,513 (11,772) MFS Emerging Growth Series 24,944 33,374 (8,430) MFS Investors Growth Stock 1,404 5,453 (4,049) Series MFS Investors Trust Series 26,197 38,136 (11,939) MFS Total Return Series 56,006 186,778 (130,772) Equity and Income 8,967 3,322 5,645 Core Plus Fixed Income 112,790 286,922 (174,132) Emerging Markets Debt 7,097 11,181 (4,084) Emerging Markets Equity 872,501 272,401 600,100 High Yield 10,588 37,744 (27,156) Mid Cap Growth 449,137 115,093 334,044 U.S. Mid Cap Value 460,237 219,169 241,068 Focus Growth 34,789 191,929 (157,140) Balanced Growth 42,045 224,660 (182,615) Capital Opportunities 53,661 144,082 (90,421) Developing Growth 5,834 69,939 (64,105) Flexible Income 52,819 72,375 (19,556) Dividend Growth 10,377 252,431 (242,054) Global Equity 14,173 104,718 (90,545)
SA-124 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUE REDEEMED (DECREASE) -------------------------------------------------------------------------------- Growth 4,582 78,267 (73,685) Money Market 538,461 459,176 79,285 Utilities 33,227 70,159 (36,932) Equally-Weighted S&P 500 93,131 306,937 (213,806) Small Company Growth 7,062 5,641 1,421 Global Franchise 7,417 10,752 (3,335) MTB Large Cap Growth Fund II 516,235 65,339 450,896 MTB Large Cap Value Fund II 1,213,626 134,060 1,079,566 MTB Managed Allocation Fund 930,248 245,750 684,498 -- Moderate Growth II MTB Managed Allocation Fund 31,489 15,593 15,896 -- Aggressive Growth II MTB Managed Allocation Fund 37,825 3,528 34,297 -- Conservative Growth II Oppenheimer Midcap Fund VA 131,740 62,931 68,809 Oppenheimer Capital 1,861,733 253,854 1,607,879 Appreciation Fund Oppenheimer Global 7,361,940 403,811 6,958,129 Securities Fund Oppenheimer Main Street Fund 413,638 110,321 303,317 Oppenheimer Main Street 2,470,766 288,003 2,182,763 Small Cap Fund Putnam Diversified Income 1,311,637 252,364 1,059,273 Putnam Global Asset 125,021 31,815 93,206 Allocation Putnam Growth and Income 148,170 29,077 119,093 Putnam International Growth 5,365 -- 5,365 and Income Putnam International Equity 1,375,206 375,974 999,232 Putnam Investors 2,054,628 82,411 1,972,217 Putnam New Value 169,635 61,402 108,233 Putnam Small Cap Value 898,007 158,587 739,420 Putnam The George Putnam 296,391 132,630 163,761 Fund of Boston Putnam Vista 48,372 15,333 33,039 Putnam Voyager 52,992 42,394 10,598 Pioneer Fund VCT Portfolio 230,854 265,623 (34,769) Pioneer Oak Ridge Large Cap 50,343 78,549 (28,206) Growth VCT Portfolio Enterprise 16,095 59,373 (43,278) Growth and Income 1,347,109 235,420 1,111,689 Comstock 1,419,102 259,082 1,160,020 Strategic Growth 6,606 3,040 3,566 Aggressive Growth Portfolio 1,354 6,599 (5,245) Government Portfolio 8,987 1,874 7,113 Wells Fargo Advantage VT 3,656 1,076 2,580 Large Company Growth Fund Wells Fargo Advantage VT 1,003 1,166 (163) Small Cap Growth Fund STI Classic VT Large Cap 1,843 93 1,750 Growth Stock Fund STI Classic VT Large Cap 10,385 163 10,222 Core Equity Fund STI Classic VT Mid-Cap Core 8,288 377 7,911 Equity Fund STI Classic VT Large Cap 448,119 65,449 382,670 Value Equity Fund
SA-125 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 ------------------------------------------------------------------------------- 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 1,356,164 100,026 1,256,138 Balanced Wealth Strategy Portfolio AllianceBernstein VP Global 96,185 8,709 87,476 Research Growth Portfolio AllianceBernstein VP 4,651,071 378,076 4,272,995 International Value Portfolio AllianceBernstein VP 573,463 37,689 535,774 Small/Mid Cap Value Portfolio AllianceBernstein VP Value 2,221,806 153,388 2,068,418 Portfolio American Funds Global Growth 52,660 36,579 16,081 Fund American Funds Growth Fund 363,161 351,107 12,054 American Funds Growth-Income 162,856 243,115 (80,259) Fund American Funds International 410,768 220,948 189,820 Fund American Funds Global Small 73,044 37,071 35,973 Capitalization Fund BB&T Mid Cap Growth VIF 1,249,761 289,444 960,317 BB&T Capital Manager Equity 697,941 90,782 607,159 VIF BB&T Large Cap Value VIF 445,162 88,441 356,721 BB&T Large Company Growth 1,276,910 102,875 1,174,035 VIF BB&T Special Opportunities 2,887,810 279,754 2,608,056 Equity VIF BB&T Total Return Bond VIF 1,055,305 227,647 827,658 Evergreen VA Balanced Fund 176,749 30,299 146,450 Evergreen VA Growth Fund 2,622,021 250,760 2,371,261 Evergreen VA International 455,886 108,108 347,778 Equity Fund Evergreen VA Omega Fund 35,297 1,772 33,525 Evergreen VA Special Values 3,565,018 288,108 3,276,910 Fund Evergreen VA Fundamental 119,291 7,362 111,929 Large Cap Fund Fidelity(R) VIP 2,510,760 135,201 2,375,559 Equity-Income Fidelity(R) VIP Growth 1,005,697 41,710 963,987 Fidelity(R) VIP 13,214,716 259,026 12,955,690 Contrafund(R) Fidelity(R) VIP Mid Cap 3,881,471 181,359 3,700,112 Fidelity(R) VIP Value 184,729 19,647 165,082 Strategies Franklin Small-Mid Cap 121,883 71,502 50,381 Growth Securities Fund Franklin Strategic Income 478,569 54,154 424,415 Securities Fund Mutual Shares Securities 137,785 143,231 (5,446) Fund Templeton Developing Markets 31,827 20,298 11,529 Securities Fund Templeton Growth Securities 63,066 52,828 10,238 Fund Fifth Third Balanced VIP 28,470 1,044 27,426 Fund Fifth Third Disciplined 2,066,523 63,849 2,002,674 Value VIP Fund Fifth Third Mid Cap VIP Fund 195,408 8,078 187,330 Fifth Third Quality Growth 53 5,499 (5,446) VIP Fund Hartford Advisers HLS Fund 7,771,675 644,473 7,127,202 Hartford Total Return Bond 94,002,343 2,140,992 91,861,351 HLS Fund Hartford Dividend and Growth 70,276,828 1,528,617 68,748,211 HLS Fund Hartford Focus HLS Fund 485,171 75,334 409,837 Hartford Global Advisers HLS 1,401,229 95,154 1,306,075 Fund Hartford Global Leaders HLS 1,800,685 190,379 1,610,306 Fund Hartford Disciplined Equity 95,354,717 2,878,644 92,476,073 HLS Fund Hartford Growth HLS Fund 4,010,141 448,371 3,561,770 Hartford Growth 13,317,902 1,815,633 11,502,269 Opportunities HLS Fund Hartford High Yield HLS Fund 7,406,306 662,537 6,743,769
SA-126 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Hartford Index HLS Fund 2,909,252 202,094 2,707,158 Hartford International 8,014,480 619,886 7,394,594 Capital Appreciation HLS Fund Hartford International Small 2,831,276 658,699 2,172,577 Company HLS Fund Hartford International 21,121,419 1,276,115 19,845,304 Opportunities HLS Fund Hartford Money Market HLS 44,549,963 24,282,946 20,267,017 Fund Hartford Mortgage Securities 3,245,668 350,191 2,895,477 HLS Fund Hartford Small Company HLS 767,985 53,135 714,850 Fund Hartford SmallCap Growth HLS 9,124,225 3,148,184 5,976,041 Fund Hartford Stock HLS Fund 8,882,986 1,429,329 7,453,657 Hartford U.S. Government 56,983,188 2,458,964 54,524,224 Securities HLS Fund Hartford Value HLS Fund 3,009,179 509,279 2,499,900 Hartford Value Opportunities 4,407,363 367,643 4,039,720 HLS Fund Hartford Equity Income HLS 2,960,488 351,798 2,608,690 Fund Huntington VA Income Equity 889,487 35,687 853,800 Fund Huntington VA Dividend 1,227,898 99,978 1,127,920 Capture Fund Huntington VA Growth Fund 576,705 29,613 547,092 Huntington VA Mid Corp 801,203 99,499 701,704 America Fund Huntington VA New Economy 1,084,611 59,890 1,024,721 Fund Huntington VA Rotating 192,098 2,564 189,534 Markets Fund Huntington VA International 101,742 2,420 99,322 Equity Fund Huntington VA Macro 100 Fund 871,140 43,071 828,069 Huntington VA Mortgage 58,954 2,027 56,927 Securities Fund Huntington VA Situs Small 2,230,472 171,876 2,058,596 Cap Fund Lord Abbett All Value 419,008 39,488 379,520 Portfolio Lord Abbett America's Value 239,072 34,585 204,487 Portfolio Lord Abbett Bond-Debenture 1,021,628 34,341 987,287 Portfolio Lord Abbett Growth and 5,698,820 151,835 5,546,985 Income Portfolio Lord Abbett Large-Cap Core 156,615 19,119 137,496 Portfolio MFS Capital Opportunities 39,043 53,519 (14,476) Series MFS Emerging Growth Series 2,481 6,290 (3,809) MFS Investors Growth Stock 1,301 20,433 (19,132) Series MFS Investors Trust Series 77,229 39,637 37,592 MFS Total Return Series 66,869 178,269 (111,400) Equity and Income 2,587 5,725 (3,138) Core Plus Fixed Income 152,783 223,722 (70,939) Emerging Markets Debt 7,145 7,925 (780) Emerging Markets Equity 803,636 202,420 601,216 High Yield 35,304 39,254 (3,950) Mid Cap Growth 367,732 40,566 327,166 U.S. Mid Cap Value 440,357 100,114 340,243 Focus Growth 77,229 215,996 (138,767) Balanced Growth 109,025 105,165 3,860 Capital Opportunities 145,258 226,113 (80,855) Developing Growth 14,392 77,380 (62,988) Flexible Income 96,701 104,414 (7,713) Dividend Growth 67,763 313,903 (246,140) Global Equity 15,383 117,875 (102,492) Growth 147,627 82,183 65,444
SA-127 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNITS UNITS NET INCREASE SUB-ACCOUNT ISSUED REDEEMED (DECREASE) -------------------------------------------------------------------------------- Money Market 405,268 398,972 6,296 Utilities 36,716 64,828 (28,112) Equally-Weighted S&P 500 169,050 291,462 (122,412) Small Company Growth 12,063 8,886 3,177 Global Franchise 8,953 10,801 (1,848) MTB Large Cap Growth Fund II 390,798 44,715 346,083 MTB Large Cap Value Fund II 1,045,256 36,689 1,008,567 MTB Managed Allocation Fund 835,192 185,079 650,113 -- Moderate Growth II MTB Managed Allocation Fund 27,403 183 27,220 -- Aggressive Growth II MTB Managed Allocation Fund 10,715 848 9,867 -- Conservative Growth II Oppenheimer Midcap Fund VA 162,712 46,363 116,349 Oppenheimer Capital 1,776,980 68,262 1,708,718 Appreciation Fund Oppenheimer Global 7,052,880 153,693 6,899,187 Securities Fund Oppenheimer Main Street Fund 535,617 80,264 455,353 Oppenheimer Main Street 3,066,644 149,473 2,917,171 Small Cap Fund Putnam Diversified Income 945,224 71,093 874,131 Putnam Global Asset 192,084 6,545 185,539 Allocation Putnam Growth and Income 108,867 13,655 95,212 Putnam International Equity 2,100,434 159,467 1,940,967 Putnam Investors 340,586 8,689 331,897 Putnam New Value 317,718 39,622 278,096 Putnam Small Cap Value 1,376,607 58,963 1,317,644 Putnam The George Putnam 289,524 113,746 175,778 Fund of Boston Putnam Vista 59,636 9,492 50,144 Putnam Voyager 118,873 158,495 (39,622) Pioneer Fund VCT Portfolio 70,259 33,606 36,653 Pioneer Oak Ridge Large Cap 260,186 59,072 201,114 Growth Portfolio Pioneer Value VCT Portfolio 24,512 44,487 (19,975) Enterprise 1,889 16,601 (14,712) Growth and Income 1,100,620 176,531 924,089 Comstock 2,087,665 148,622 1,939,043 Strategic Growth 4,909 4,636 273 Aggressive Growth Portfolio 1,165 594 571 Government Portfolio 15,221 3,656 11,565 Wells Fargo Advantage VT 12,052 89 11,963 Large Company Growth Fund Wells Fargo Advantage VT 6,180 352 5,828 Small Cap Growth Fund STI Classic VT Large Cap 36,234 4,677 31,557 Relative Value Fund STI Classic VT Mid-Cap 10,322 3,578 6,744 Equity Fund STI Classic VT Large Cap 482,486 55,272 427,214 Value Equity Fund
SA-128 ------------------------------------------------------------------------------- 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 7,924 $12.638593 $100,147 Highest contract charges 62 12.043388 750 Remaining contract charges 3,469,025 -- 42,928,526 2006 Lowest contract charges 2,763 12.097214 33,419 Highest contract charges 42,131 11.735880 494,452 Remaining contract charges 1,750,691 -- 20,879,957 2005 Lowest contract charges 50,342 10.678542 537,579 Highest contract charges 7,224 10.567251 76,333 Remaining contract charges 481,881 -- 5,122,437 ALLIANCEBERNSTEIN VP GLOBAL RESEARCH GROWTH PORTFOLIO 2007 Lowest contract charges 1,088 15.251626 16,591 Highest contract charges 319 10.843732 3,460 Remaining contract charges 182,003 -- 2,707,474 2006 Lowest contract charges 142 13.699024 1,939 Highest contract charges 3,580 13.327881 47,723 Remaining contract charges 103,271 -- 1,395,263 2005 Lowest contract charges 3,486 11.997909 41,819 Highest contract charges 136 11.898589 1,622 Remaining contract charges 15,895 -- 189,686 ALLIANCEBERNSTEIN VP INTERNATIONAL VALUE PORTFOLIO 2007 Lowest contract charges 10,455 15.623839 163,340 Highest contract charges 904 10.203042 9,225 Remaining contract charges 10,077,140 -- 153,874,076 2006 Lowest contract charges 4,887 14.909092 72,868 Highest contract charges 116,807 14.464028 1,689,486 Remaining contract charges 6,790,682 -- 99,756,572 2005 Lowest contract charges 100 11.117122 1,110 Highest contract charges 81,587 10.964475 894,562 Remaining contract charges 2,557,694 -- 28,225,394 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- ALLIANCEBERNSTEIN VP BALANCED WEALTH STRATEGY PORTFOLIO 2007 Lowest contract charges 0.74% 2.22% 4.48% Highest contract charges 2.04% -- 2.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.79% 12.91% Highest contract charges 2.40% 0.50% 11.06% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.11% 9.59% Highest contract charges 2.37% 0.55% 8.68% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP GLOBAL RESEARCH GROWTH PORTFOLIO 2007 Lowest contract charges 0.74% 0.18% 11.33% Highest contract charges 1.76% -- 4.45% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.73% -- 13.88% Highest contract charges 2.38% -- 12.01% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% -- 19.98% Highest contract charges 2.38% -- 18.99% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP INTERNATIONAL VALUE PORTFOLIO 2007 Lowest contract charges 0.74% 1.04% 4.79% Highest contract charges 1.79% -- (1.66)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.71% 34.11% Highest contract charges 2.40% 1.23% 31.92% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.86% 0.74% 19.17% Highest contract charges 2.35% 0.17% 17.87% Remaining contract charges -- -- --
SA-129 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- ALLIANCEBERNSTEIN VP SMALL/MID CAP VALUE PORTFOLIO 2007 Lowest contract charges 1,863 $12.131787 $22,597 Highest contract charges 3,149 11.560375 36,404 Remaining contract charges 1,440,930 -- 17,092,244 2006 Lowest contract charges 708 12.039175 8,521 Highest contract charges 2,999 11.679520 35,040 Remaining contract charges 873,137 -- 10,358,027 2005 Lowest contract charges 396 10.621426 4,209 Highest contract charges 509 10.471156 5,327 Remaining contract charges 340,165 -- 3,587,603 ALLIANCEBERNSTEIN VP VALUE PORTFOLIO 2007 Lowest contract charges 4,505 11.844777 53,366 Highest contract charges 1,390 11.286935 15,691 Remaining contract charges 5,516,681 -- 63,899,628 2006 Lowest contract charges 4,314 12.452476 53,724 Highest contract charges 1,158 12.069459 13,980 Remaining contract charges 3,643,051 -- 44,678,799 2005 Lowest contract charges 257,334 10.331580 2,658,663 Highest contract charges 1,296 10.219611 13,249 Remaining contract charges 1,321,475 -- 13,583,786 ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO 2007 Lowest contract charges 8,567 10.529980 90,209 Highest contract charges 918 10.493320 9,632 Remaining contract charges 40,108 -- 421,624 AMERICAN FUNDS GLOBAL GROWTH FUND 2007 Lowest contract charges 13,039 1.889019 24,631 Highest contract charges 9,633 11.926853 114,893 Remaining contract charges 297,394 -- 4,160,928 2006 Lowest contract charges 13,039 1.666306 21,727 Highest contract charges 9,950 10.658295 106,049 Remaining contract charges 308,964 -- 3,857,205 2005 Lowest contract charges 13,039 1.401769 18,278 Highest contract charges 5,435 9.083466 49,369 Remaining contract charges 297,398 -- 3,114,794 2004 Lowest contract charges 13,037 1.244884 16,232 Highest contract charges 4,780 8.172367 39,066 Remaining contract charges 279,808 -- 2,587,495 2003 Lowest contract charges 13,039 1.111293 14,490 Highest contract charges 4,583 10.434278 47,823 Remaining contract charges 240,727 -- 1,941,944 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- ALLIANCEBERNSTEIN VP SMALL/MID CAP VALUE PORTFOLIO 2007 Lowest contract charges 0.74% 0.42% 0.77% Highest contract charges 2.42% -- (0.93)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.25% 13.35% Highest contract charges 2.40% 0.21% 11.49% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.75% 0.41% 12.68% Highest contract charges 2.41% 0.98% 11.41% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VP VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 1.49% (4.88)% Highest contract charges 2.44% 1.11% (6.48)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.93% 20.13% Highest contract charges 2.45% 0.77% 18.10% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.19% 7.24% Highest contract charges 2.43% 1.44% 6.32% Remaining contract charges -- -- -- ALLIANCEBERNSTEIN VPS INTERNATIONAL GROWTH PORTFOLIO 2007 Lowest contract charges 0.32% 1.14% 1.53% Highest contract charges 0.59% -- 1.36% Remaining contract charges -- -- -- AMERICAN FUNDS GLOBAL GROWTH FUND 2007 Lowest contract charges 1.30% 2.70% 13.37% Highest contract charges 2.59% 2.68% 11.90% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.87% 18.87% Highest contract charges 2.59% 0.61% 17.34% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.67% 12.60% Highest contract charges 2.59% 0.67% 11.15% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.44% 12.02% Highest contract charges 2.59% 0.56% 10.58% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.24% -- 33.53% Highest contract charges 1.43% -- 29.34% Remaining contract charges -- -- --
SA-130 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- AMERICAN FUNDS GROWTH FUND 2007 Lowest contract charges 345,147 $1.546007 $533,599 Highest contract charges 42,418 10.406277 441,409 Remaining contract charges 2,700,375 -- 33,055,784 2006 Lowest contract charges 348,660 1.394084 486,062 Highest contract charges 44,571 9.506472 423,712 Remaining contract charges 2,961,197 -- 33,035,537 2005 Lowest contract charges 252,224 1.281399 323,199 Highest contract charges 42,523 8.852411 376,435 Remaining contract charges 3,047,627 -- 31,487,817 2004 Lowest contract charges 178,363 1.117260 199,278 Highest contract charges 23,616 7.819403 184,664 Remaining contract charges 2,973,353 -- 27,028,232 2003 Lowest contract charges 103,201 1.006145 103,835 Highest contract charges 1,633 7.133854 11,653 Remaining contract charges 2,470,547 -- 19,719,704 AMERICAN FUNDS GROWTH-INCOME FUND 2007 Lowest contract charges 66,648 1.385135 92,316 Highest contract charges 8,767 13.858148 121,501 Remaining contract charges 1,735,369 -- 24,886,894 2006 Lowest contract charges 69,629 1.335895 93,017 Highest contract charges 10,626 13.540353 143,875 Remaining contract charges 1,879,007 -- 26,140,007 2005 Lowest contract charges 41,179 1.174773 48,376 Highest contract charges 10,307 12.063035 124,336 Remaining contract charges 1,988,035 -- 24,454,834 2004 Lowest contract charges 328,740 11.817193 3,884,782 Highest contract charges 5,094 11.698456 59,597 Remaining contract charges 1,658,622 -- 19,653,548 2003 Lowest contract charges 279,723 10.857374 3,037,059 Highest contract charges 1,086 10.878053 11,813 Remaining contract charges 1,283,434 -- 14,099,748 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- AMERICAN FUNDS GROWTH FUND 2007 Lowest contract charges 1.30% 0.78% 10.90% Highest contract charges 2.59% 0.77% 9.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.92% 8.79% Highest contract charges 2.60% 0.81% 7.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 0.73% 14.69% Highest contract charges 2.58% 0.84% 13.21% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 0.25% 11.04% Highest contract charges 2.57% 0.31% 9.61% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% 0.55% 35.04% Highest contract charges 1.58% 0.31% 24.34% Remaining contract charges -- -- -- AMERICAN FUNDS GROWTH-INCOME FUND 2007 Lowest contract charges 1.30% 1.51% 3.69% Highest contract charges 2.60% 1.43% 2.35% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.09% 13.72% Highest contract charges 2.60% 1.58% 12.25% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 2.32% 4.47% Highest contract charges 2.57% 1.86% 3.12% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 0.93% 8.84% Highest contract charges 2.59% 1.23% 7.54% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 1.21% 30.59% Highest contract charges 1.58% 2.50% 24.33% Remaining contract charges -- -- --
SA-131 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- AMERICAN FUNDS INTERNATIONAL FUND 2007 Lowest contract charges 330,619 $2.116001 $699,590 Highest contract charges 15,712 12.631102 198,459 Remaining contract charges 1,036,404 -- 15,952,789 2006 Lowest contract charges 367,792 1.786074 656,905 Highest contract charges 15,615 10.801046 168,652 Remaining contract charges 1,092,311 -- 14,360,070 2005 Lowest contract charges 248,186 1.520816 377,446 Highest contract charges 17,101 9.317239 159,332 Remaining contract charges 1,020,611 -- 11,536,148 2004 Lowest contract charges 39,749 1.268031 50,407 Highest contract charges 6,911 7.870167 54,392 Remaining contract charges 662,992 -- 6,034,159 2003 Lowest contract charges 25,692 9.940938 255,398 Highest contract charges 856 9.764532 8,358 Remaining contract charges 409,265 -- 2,871,640 AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION FUND 2007 Lowest contract charges 92,536 2.472943 228,836 Highest contract charges 1,861 17.261982 32,116 Remaining contract charges 244,938 -- 5,009,809 2006 Lowest contract charges 91,929 2.063188 189,667 Highest contract charges 1,866 14.590139 27,213 Remaining contract charges 276,456 -- 4,820,773 2005 Lowest contract charges 91,929 1.684898 154,892 Highest contract charges 1,597 12.070920 19,280 Remaining contract charges 240,752 -- 3,450,419 2004 Lowest contract charges 91,929 1.361722 125,182 Highest contract charges 1,285 9.883142 12,698 Remaining contract charges 188,207 -- 2,174,827 2003 Lowest contract charges 91,929 1.141236 104,913 Highest contract charges 7,682 11.602372 89,133 Remaining contract charges 87,496 -- 791,276 BB&T MID CAP GROWTH VIF 2007 Lowest contract charges 657,257 2.031000 1,334,888 Highest contract charges 3,041 1.921515 5,844 Remaining contract charges 1,086,506 -- 2,328,323 2006 Lowest contract charges 362,143 1.521650 551,054 Highest contract charges 3,258 1.457705 4,750 Remaining contract charges 940,714 -- 1,533,438 2005 Lowest contract charges 135,916 1.490627 202,600 Highest contract charges 5,756 1.643177 9,458 Remaining contract charges 204,126 -- 320,470 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- AMERICAN FUNDS INTERNATIONAL FUND 2007 Lowest contract charges 1.30% 1.44% 18.47% Highest contract charges 2.59% 1.49% 16.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.05% 17.44% Highest contract charges 2.60% 1.61% 15.93% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 2.20% 19.94% Highest contract charges 2.58% 1.93% 18.39% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.28% 2.64% 17.78% Highest contract charges 2.51% 5.67% 16.26% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.39% 2.43% 32.98% Highest contract charges 1.40% 4.98% 34.26% Remaining contract charges -- -- -- AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION FUND 2007 Lowest contract charges 1.30% 2.90% 19.86% Highest contract charges 2.59% 2.91% 18.31% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.46% 22.45% Highest contract charges 2.60% 0.49% 20.87% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.97% 23.73% Highest contract charges 2.59% 1.00% 22.14% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 19.32% Highest contract charges 2.56% -- 17.78% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 51.55% Highest contract charges 1.90% -- 50.57% Remaining contract charges -- -- -- BB&T MID CAP GROWTH VIF 2007 Lowest contract charges 1.14% -- 33.47% Highest contract charges 2.39% -- 31.82% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.23% 2.08% Highest contract charges 2.41% -- 0.81% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 23.22% Highest contract charges 2.05% -- 22.45% Remaining contract charges -- -- --
SA-132 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- BB&T CAPITAL MANAGER EQUITY VIF 2007 Lowest contract charges 835,576 $1.184223 $989,508 Highest contract charges 60,368 1.613733 97,418 Remaining contract charges 437,221 -- 642,850 2006 Lowest contract charges 612,937 1.173652 719,375 Highest contract charges 273,515 1.644496 449,795 Remaining contract charges 165,687 -- 189,941 2005 Lowest contract charges 385,299 1.025898 395,277 Highest contract charges 56,273 1.444668 81,296 Remaining contract charges 3,408 -- 3,482 BB&T LARGE CAP VIF 2007 Lowest contract charges 1,063,022 1.713950 1,821,966 Highest contract charges 3,032 1.613259 4,891 Remaining contract charges 1,502,657 -- 2,495,534 2006 Lowest contract charges 253,501 1.841882 466,920 Highest contract charges 4,818 1.734298 8,355 Remaining contract charges 497,943 -- 890,712 2005 Lowest contract charges 71,748 1.536222 110,221 Highest contract charges 6,302 1.460300 9,203 Remaining contract charges 321,491 -- 483,464 BB&T SPECIAL OPPORTUNITIES EQUITY VIF 2007 Lowest contract charges 3,516,606 1.756853 6,178,160 Highest contract charges 25,098 1.688134 42,369 Remaining contract charges 4,667,508 -- 8,069,954 2006 Lowest contract charges 1,597,994 1.567011 2,504,073 Highest contract charges 18,105 1.524647 27,606 Remaining contract charges 3,469,048 -- 5,375,209 2005 Lowest contract charges 618,270 1.271051 785,852 Highest contract charges 7,267 1.255389 9,123 Remaining contract charges 1,851,554 -- 2,338,284 BB&T TOTAL RETURN BOND VIF 2007 Lowest contract charges 1,239,170 1.103453 1,367,366 Highest contract charges 44,011 1.069333 47,063 Remaining contract charges 1,375,560 -- 1,495,715 2006 Lowest contract charges 932,454 1.048296 977,488 Highest contract charges 572,194 1.035633 592,584 Remaining contract charges 332,113 -- 345,634 2005 Lowest contract charges 525,006 1.024796 538,024 Highest contract charges 291,419 1.017495 296,500 Remaining contract charges 192,678 -- 196,856 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- BB&T CAPITAL MANAGER EQUITY VIF 2007 Lowest contract charges 1.15% 2.70% 0.90% Highest contract charges 2.08% 3.23% (0.05)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.13% 14.40% Highest contract charges 1.64% 1.19% 13.83% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% 3.18% 9.26% Highest contract charges 1.55% 10.72% 8.89% Remaining contract charges -- -- -- BB&T LARGE CAP VIF 2007 Lowest contract charges 1.14% 2.16% (6.95)% Highest contract charges 2.38% 2.19% (8.10)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.32% 19.90% Highest contract charges 2.10% 1.36% 18.76% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 2.85% 6.88% Highest contract charges 2.04% 2.75% 6.20% Remaining contract charges -- -- -- BB&T SPECIAL OPPORTUNITIES EQUITY VIF 2007 Lowest contract charges 1.14% -- 12.12% Highest contract charges 2.39% -- 10.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.06% 23.29% Highest contract charges 2.38% 0.05% 21.75% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 7.89% Highest contract charges 2.05% -- 7.21% Remaining contract charges -- -- -- BB&T TOTAL RETURN BOND VIF 2007 Lowest contract charges 1.15% 4.32% 5.26% Highest contract charges 2.08% 4.21% 4.27% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 4.33% 2.29% Highest contract charges 1.65% 4.33% 1.78% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 4.63% 0.44% Highest contract charges 1.61% 4.52% 0.11% Remaining contract charges -- -- --
SA-133 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- EVERGREEN VA BALANCED FUND 2007 Lowest contract charges 126,210 $1.113690 $140,559 Highest contract charges 53,534 1.039964 55,673 Remaining contract charges 397,491 -- 425,262 2006 Lowest contract charges 39,522 1.055993 41,735 Highest contract charges 53,021 0.995492 52,782 Remaining contract charges 184,552 -- 188,284 2005 Lowest contract charges 1,523 0.972446 1,481 Highest contract charges 28,809 0.925472 26,662 Remaining contract charges 100,313 -- 93,995 EVERGREEN VA GROWTH FUND 2007 Lowest contract charges 720,796 1.585578 1,142,878 Highest contract charges 90,128 1.080915 97,421 Remaining contract charges 3,600,059 -- 4,038,929 2006 Lowest contract charges 663,423 1.444366 958,226 Highest contract charges 102,923 0.997024 102,617 Remaining contract charges 3,168,140 -- 3,260,930 2005 Lowest contract charges 124,839 1.315864 164,272 Highest contract charges 79,855 0.919738 73,445 Remaining contract charges 1,358,531 -- 1,288,273 EVERGREEN VA INTERNATIONAL EQUITY FUND 2007 Lowest contract charges 157,813 2.291471 361,623 Highest contract charges 16,075 1.339833 21,538 Remaining contract charges 1,164,443 -- 1,626,970 2006 Lowest contract charges 46,785 2.015588 94,300 Highest contract charges 13,829 1.193327 16,502 Remaining contract charges 486,265 -- 613,663 2005 Lowest contract charges 10,168 1.655468 16,833 Highest contract charges 13,829 0.992443 13,724 Remaining contract charges 175,104 -- 191,414 EVERGREEN VA OMEGA FUND 2007 Lowest contract charges 6,324 0.939459 5,941 Highest contract charges 39,386 0.697741 27,481 Remaining contract charges 15,226 -- 10,913 2006 Lowest contract charges 6,324 0.850503 5,379 Highest contract charges 41,273 0.636425 26,266 Remaining contract charges 15,259 -- 9,933 2005 Lowest contract charges 6,324 0.813148 5,142 Highest contract charges 20,065 0.613061 12,301 Remaining contract charges 2,942 -- 1,819 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- EVERGREEN VA BALANCED FUND 2007 Lowest contract charges 1.14% 5.00% 5.46% Highest contract charges 2.09% 4.18% 4.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 2.46% 8.59% Highest contract charges 2.10% 2.66% 7.57% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.07% 10.62% 6.76% Highest contract charges 1.97% 6.72% 6.09% Remaining contract charges -- -- -- EVERGREEN VA GROWTH FUND 2007 Lowest contract charges 1.15% -- 9.78% Highest contract charges 2.39% -- 8.41% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 9.77% Highest contract charges 2.40% -- 8.40% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% -- 16.61% Highest contract charges 2.34% -- 15.65% Remaining contract charges -- -- -- EVERGREEN VA INTERNATIONAL EQUITY FUND 2007 Lowest contract charges 1.14% 4.32% 13.69% Highest contract charges 2.39% 2.82% 12.28% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 4.74% 21.75% Highest contract charges 2.40% 3.79% 20.24% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% 7.69% 16.73% Highest contract charges 2.23% 16.52% 15.76% Remaining contract charges -- -- -- EVERGREEN VA OMEGA FUND 2007 Lowest contract charges 1.34% 0.54% 10.46% Highest contract charges 2.09% 0.54% 9.63% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.36% -- 4.59% Highest contract charges 2.09% -- 3.81% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.35% -- 12.74% Highest contract charges 2.06% -- 12.18% Remaining contract charges -- -- --
SA-134 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- EVERGREEN VA SPECIAL VALUES FUND 2007 Lowest contract charges 1,171,832 $1.968555 $2,306,815 Highest contract charges 88,369 1.446461 127,822 Remaining contract charges 5,893,575 -- 9,517,338 2006 Lowest contract charges 738,406 2.153172 1,589,915 Highest contract charges 105,970 1.602021 169,767 Remaining contract charges 4,508,763 -- 7,948,044 2005 Lowest contract charges 153,677 1.791931 275,379 Highest contract charges 83,392 1.350018 112,581 Remaining contract charges 1,839,160 -- 2,617,676 EVERGREEN VA FUNDAMENTAL LARGE CAP FUND 2007 Lowest contract charges 14,712 1.468101 21,599 Highest contract charges 22,613 1.329012 30,053 Remaining contract charges 136,071 -- 194,677 2006 Lowest contract charges 9,801 1.371376 13,441 Highest contract charges 22,613 1.257064 28,426 Remaining contract charges 113,390 -- 150,716 2005 Lowest contract charges 5,540 1.223488 6,778 Highest contract charges 22,613 1.142774 25,841 Remaining contract charges 5,722 -- 6,959 FIDELITY(R) VIP EQUITY-INCOME 2007 Lowest contract charges 2,368 12.505825 29,618 Highest contract charges 1,471 11.916841 17,524 Remaining contract charges 6,052,797 -- 74,004,319 2006 Lowest contract charges 1,221 12.441638 15,189 Highest contract charges 1,313 12.058974 15,827 Remaining contract charges 4,146,426 -- 50,809,619 2005 Lowest contract charges 407 10.452282 4,257 Highest contract charges 1,148 10.304441 11,832 Remaining contract charges 1,771,846 -- 18,380,330 FIDELITY(R) VIP GROWTH 2007 Lowest contract charges 283 14.231633 4,030 Highest contract charges 23,554 13.580692 319,878 Remaining contract charges 1,814,655 -- 25,305,045 2006 Lowest contract charges 511,524 11.237773 5,748,387 Highest contract charges 18,012 10.982519 197,822 Remaining contract charges 815,662 -- 9,072,105 2005 Lowest contract charges 111,290 10.666705 1,187,093 Highest contract charges 6,590 10.555587 69,558 Remaining contract charges 263,331 -- 2,795,053 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- EVERGREEN VA SPECIAL VALUES FUND 2007 Lowest contract charges 1.14% 1.72% (8.57)% Highest contract charges 2.40% 1.28% (9.71)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.26% 20.16% Highest contract charges 2.40% 0.90% 18.67% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 3.89% 14.95% Highest contract charges 2.34% 2.81% 14.00% Remaining contract charges -- -- -- EVERGREEN VA FUNDAMENTAL LARGE CAP FUND 2007 Lowest contract charges 1.15% 1.26% 7.05% Highest contract charges 2.39% 1.13% 5.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.14% 2.42% 11.38% Highest contract charges 2.40% 1.28% 10.00% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.43% 2.56% 9.59% Highest contract charges 2.24% 7.33% 8.90% Remaining contract charges -- -- -- FIDELITY(R) VIP EQUITY-INCOME 2007 Lowest contract charges 0.75% 2.13% 0.52% Highest contract charges 2.44% 1.73% (1.18)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.58% 19.03% Highest contract charges 2.46% 3.23% 17.03% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.71% -- 9.37% Highest contract charges 2.43% -- 8.14% Remaining contract charges -- -- -- FIDELITY(R) VIP GROWTH 2007 Lowest contract charges 0.75% 0.04% 25.71% Highest contract charges 2.39% 0.36% 23.66% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.08% 5.35% Highest contract charges 2.39% 0.07% 4.05% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 11.57% Highest contract charges 2.36% -- 10.65% Remaining contract charges -- -- --
SA-135 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- FIDELITY(R) VIP CONTRAFUND(R) 2007 Lowest contract charges 54,366 $14.680736 $798,132 Highest contract charges 3,704 13.989471 51,819 Remaining contract charges 28,504,981 -- 409,972,991 2006 Lowest contract charges 29,305 12.609462 369,520 Highest contract charges 1,230 12.221659 15,026 Remaining contract charges 17,712,167 -- 220,223,388 2005 Lowest contract charges 3,538 11.401061 40,338 Highest contract charges 503 11.239872 5,659 Remaining contract charges 4,782,971 -- 54,137,194 FIDELITY(R) VIP MID CAP 2007 Lowest contract charges 9,991 14.374716 143,613 Highest contract charges 98 13.697774 1,341 Remaining contract charges 7,126,361 -- 100,134,912 2006 Lowest contract charges 10,260 12.556903 128,829 Highest contract charges 46,288 12.181858 563,871 Remaining contract charges 5,314,751 -- 65,719,730 2005 Lowest contract charges 35 11.255439 397 Highest contract charges 783 11.096304 8,683 Remaining contract charges 1,670,369 -- 18,657,337 FIDELITY(R) VIP VALUE STRATEGIES 2007 Lowest contract charges 1,104 12.622679 13,936 Highest contract charges 2,789 12.028191 33,549 Remaining contract charges 557,840 -- 6,900,980 2006 Lowest contract charges 391 12.017161 4,700 Highest contract charges 4,090 11.701169 47,850 Remaining contract charges 263,827 -- 3,137,762 2005 Lowest contract charges 34,370 10.440272 358,836 Highest contract charges 1,027 10.331500 10,613 Remaining contract charges 67,829 -- 704,824 FIDELITY(R) VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO 2007 Lowest contract charges 457 9.560421 4,365 Highest contract charges 188 9.539030 1,793 Remaining contract charges 1,621 -- 15,481 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- FIDELITY(R) VIP CONTRAFUND(R) 2007 Lowest contract charges 0.75% 0.91% 16.43% Highest contract charges 2.44% 1.08% 14.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.20% 10.60% Highest contract charges 2.43% 1.64% 8.74% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 19.05% Highest contract charges 2.40% -- 17.72% Remaining contract charges -- -- -- FIDELITY(R) VIP MID CAP 2007 Lowest contract charges 0.75% 0.46% 14.48% Highest contract charges 2.42% 1.43% 12.55% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.10% 11.56% Highest contract charges 2.40% 0.13% 9.74% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.90% -- 20.62% Highest contract charges 2.41% -- 19.27% Remaining contract charges -- -- -- FIDELITY(R) VIP VALUE STRATEGIES 2007 Lowest contract charges 0.75% 0.34% 4.65% Highest contract charges 2.43% 0.83% 2.89% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.94% 0.35% 14.91% Highest contract charges 2.40% 0.10% 13.26% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 16.53% Highest contract charges 2.36% -- 15.56% Remaining contract charges -- -- -- FIDELITY(R) VIP DYNAMIC CAPITAL APPRECIATION PORTFOLIO 2007 Lowest contract charges 0.30% 0.41% (0.91)% Highest contract charges 0.50% 0.34% (1.01)% Remaining contract charges -- -- --
SA-136 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- FRANKLIN SMALL-MID CAP GROWTH SECURITIES FUND 2007 Lowest contract charges 173,959 $1.302551 $226,591 Highest contract charges 9,673 7.980030 77,194 Remaining contract charges 374,516 -- 3,653,878 2006 Lowest contract charges 182,240 1.186237 216,179 Highest contract charges 9,840 7.362563 72,453 Remaining contract charges 456,023 -- 4,035,654 2005 Lowest contract charges 118,621 1.105640 131,152 Highest contract charges 7,732 6.952213 53,755 Remaining contract charges 471,369 -- 3,918,401 2004 Lowest contract charges 26,024 1.068933 27,818 Highest contract charges 6,267 6.809347 42,673 Remaining contract charges 432,054 -- 3,459,462 2003 Lowest contract charges 47,047 11.135937 523,912 Highest contract charges 744 6.269322 4,664 Remaining contract charges 341,209 -- 2,249,400 FRANKLIN STRATEGIC INCOME SECURITIES FUND 2007 Lowest contract charges 59,373 1.494425 88,728 Highest contract charges 17,301 14.647354 253,410 Remaining contract charges 1,008,914 -- 15,888,302 2006 Lowest contract charges 59,086 1.425577 84,232 Highest contract charges 14,521 14.155259 205,538 Remaining contract charges 728,447 -- 10,986,528 2005 Lowest contract charges 15,437 1.331024 20,547 Highest contract charges 12,073 13.389254 161,654 Remaining contract charges 350,129 -- 4,918,831 2004 Lowest contract charges 13,279 1.325500 17,602 Highest contract charges 159 13.508186 2,152 Remaining contract charges 281,958 -- 3,967,706 2003 Lowest contract charges 54,976 13.368091 734,920 Highest contract charges 726 12.618912 9,164 Remaining contract charges 144,849 -- 1,861,858 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 1.23% -- 10.04% Highest contract charges 2.58% -- 8.61% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 35.34% Highest contract charges 1.58% -- 30.99% Remaining contract charges -- -- -- FRANKLIN STRATEGIC INCOME SECURITIES FUND 2007 Lowest contract charges 1.30% 5.14% 4.83% Highest contract charges 2.59% 5.30% 3.48% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 3.80% 7.10% Highest contract charges 2.60% 4.71% 5.72% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 4.68% 0.42% Highest contract charges 2.57% 2.63% (0.88)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 3.67% 8.59% Highest contract charges 2.54% -- 7.19% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 2.39% 18.68% Highest contract charges 1.48% -- 8.80% Remaining contract charges -- -- --
SA-137 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- MUTUAL SHARES SECURITIES FUND 2007 Lowest contract charges 146,639 $1.528406 $224,125 Highest contract charges 7,321 16.564137 121,266 Remaining contract charges 788,740 -- 13,650,972 2006 Lowest contract charges 146,646 1.496340 219,432 Highest contract charges 7,407 16.428819 121,691 Remaining contract charges 862,099 -- 14,686,603 2005 Lowest contract charges 112,250 1.280557 143,743 Highest contract charges 4,274 14.243479 60,883 Remaining contract charges 905,074 -- 13,262,611 2004 Lowest contract charges 70,371 1.173480 82,579 Highest contract charges 971 13.223137 12,843 Remaining contract charges 904,104 -- 12,234,364 2003 Lowest contract charges 189,249 12.392633 2,345,296 Highest contract charges 1,862 12.065535 22,470 Remaining contract charges 543,049 -- 6,633,216 TEMPLETON DEVELOPING MARKETS SECURITIES FUND 2007 Lowest contract charges 64,890 3.416340 221,687 Highest contract charges 4,766 25.990444 123,860 Remaining contract charges 105,298 -- 2,809,279 2006 Lowest contract charges 64,890 2.681166 173,982 Highest contract charges 4,903 20.664228 101,294 Remaining contract charges 139,663 -- 2,938,622 2005 Lowest contract charges 57,958 2.114912 122,577 Highest contract charges 2,914 16.513159 48,113 Remaining contract charges 137,055 -- 2,282,179 2004 Lowest contract charges 57,958 1.677055 97,200 Highest contract charges 92 13.265566 1,223 Remaining contract charges 94,391 -- 1,255,893 2003 Lowest contract charges 40,770 1.360999 55,488 Highest contract charges 302 10.920992 3,301 Remaining contract charges 49,099 -- 530,017 TEMPLETON GROWTH SECURITIES FUND 2007 Lowest contract charges 14,201 1.522683 21,623 Highest contract charges 6,261 14.466570 90,570 Remaining contract charges 254,258 -- 3,891,874 2006 Lowest contract charges 14,201 1.507218 21,403 Highest contract charges 6,249 14.507161 90,667 Remaining contract charges 275,039 -- 4,187,992 2005 Lowest contract charges 14,201 1.253557 17,801 Highest contract charges 2,469 12.223467 30,176 Remaining contract charges 268,581 -- 3,415,744 2004 Lowest contract charges 14,200 1.166563 16,566 Highest contract charges 1,379 11.523966 15,886 Remaining contract charges 247,336 -- 2,937,936 2003 Lowest contract charges 14,201 1.018575 14,464 Highest contract charges 1,665 10.207451 16,995 Remaining contract charges 208,346 -- 2,166,856 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- MUTUAL SHARES SECURITIES FUND 2007 Lowest contract charges 1.30% 1.42% 2.14% Highest contract charges 2.59% 1.43% 0.82% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.27% 16.85% Highest contract charges 2.60% 1.22% 15.34% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.05% 9.13% Highest contract charges 2.56% 0.61% 7.72% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.23% -- 11.18% Highest contract charges 2.58% -- 9.74% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 1.05% 23.41% Highest contract charges 1.49% -- 19.40% Remaining contract charges -- -- -- TEMPLETON DEVELOPING MARKETS SECURITIES FUND 2007 Lowest contract charges 1.30% 2.51% 27.42% Highest contract charges 2.59% 2.51% 25.78% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.21% 26.77% Highest contract charges 2.60% 0.94% 25.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 1.41% 26.11% Highest contract charges 2.57% 0.45% 24.48% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 1.79% 23.22% Highest contract charges 2.58% -- 21.63% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 51.76% Highest contract charges 1.50% -- 44.39% Remaining contract charges -- -- -- TEMPLETON GROWTH SECURITIES FUND 2007 Lowest contract charges 1.30% 1.32% 1.03% Highest contract charges 2.59% 1.31% (0.28)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.32% 20.24% Highest contract charges 2.59% 0.99% 18.68% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 1.10% 7.46% Highest contract charges 2.59% 1.23% 6.07% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.17% 14.53% Highest contract charges 2.58% -- 13.05% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.24% -- 30.43% Highest contract charges 1.49% -- 30.31% Remaining contract charges -- -- --
SA-138 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HARTFORD ADVISERS HLS FUND 2007 Lowest contract charges 80 $1.282397 $103 Highest contract charges 10,879 1.215681 13,226 Remaining contract charges 18,497,233 -- 28,273,820 2006 Lowest contract charges 5,012,687 1.192989 5,980,081 Highest contract charges 29,829 1.168295 34,849 Remaining contract charges 9,431,546 -- 14,965,696 2005 Lowest contract charges 2,477,999 1.090110 2,701,291 Highest contract charges 20,735 1.081514 22,425 Remaining contract charges 4,848,126 -- 7,220,265 HARTFORD LARGECAP GROWTH HLS FUND 2007 Lowest contract charges 9,538 9.816844 93,633 Highest contract charges 187 9.794897 1,828 Remaining contract charges 555 -- 5,448 HARTFORD TOTAL RETURN BOND HLS FUND 2007 Lowest contract charges 423,040 1.594851 674,686 Highest contract charges 38,751 1.519717 58,890 Remaining contract charges 226,272,880 -- 385,531,728 2006 Lowest contract charges 209,162 1.535168 321,099 Highest contract charges 36,028 1.487922 53,607 Remaining contract charges 148,050,226 -- 240,954,084 2005 Lowest contract charges 16,935 1.475829 24,993 Highest contract charges 36,096 1.454940 52,518 Remaining contract charges 56,381,034 -- 86,494,663 HARTFORD DIVIDEND AND GROWTH HLS FUND 2007 Lowest contract charges 374,714 1.782505 667,929 Highest contract charges 42,952 1.596005 68,551 Remaining contract charges 164,806,209 -- 312,241,243 2006 Lowest contract charges 198,226 1.658967 328,851 Highest contract charges 49,964 1.510859 75,489 Remaining contract charges 97,489,688 -- 170,236,123 2005 Lowest contract charges 21,114 1.388704 29,322 Highest contract charges 44,104 1.286401 56,735 Remaining contract charges 28,924,449 -- 41,764,381 HARTFORD FUNDAMENTAL GROWTH HLS FUND 2007 Lowest contract charges 514,835 1.333943 686,760 Highest contract charges 3,798 1.252075 4,755 Remaining contract charges 774,594 -- 1,000,981 2006 Lowest contract charges 232,649 1.172110 272,691 Highest contract charges 4,137 1.111231 4,597 Remaining contract charges 383,546 -- 437,293 2005 Lowest contract charges 20,942 1.080585 22,629 Highest contract charges 4,669 1.034759 4,831 Remaining contract charges 184,884 -- 194,467 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HARTFORD ADVISERS HLS FUND 2007 Lowest contract charges 0.03% 3.08% 5.84% Highest contract charges 2.45% 1.32% 4.06% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 3.09% 9.44% Highest contract charges 2.45% 3.11% 8.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 6.17% 8.23% Highest contract charges 2.36% 11.61% 7.29% Remaining contract charges -- -- -- HARTFORD LARGECAP GROWTH HLS FUND 2007 Lowest contract charges 0.31% 1.48% 2.99% Highest contract charges 0.48% 1.33% 2.88% Remaining contract charges -- -- -- HARTFORD TOTAL RETURN BOND HLS FUND 2007 Lowest contract charges 0.75% 6.95% 3.89% Highest contract charges 2.44% 5.47% 2.14% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 7.85% 4.02% Highest contract charges 2.45% 5.20% 2.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 19.51% 0.94% Highest contract charges 2.41% 11.78% (0.20)% Remaining contract charges -- -- -- HARTFORD DIVIDEND AND GROWTH HLS FUND 2007 Lowest contract charges 0.75% 2.36% 7.45% Highest contract charges 2.44% 1.56% 5.64% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.25% 19.46% Highest contract charges 2.45% 2.01% 17.45% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 3.54% 8.05% Highest contract charges 2.40% 3.34% 6.84% Remaining contract charges -- -- -- HARTFORD FUNDAMENTAL GROWTH HLS FUND 2007 Lowest contract charges 1.14% 0.04% 13.81% Highest contract charges 2.16% 0.05% 12.68% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.24% 8.47% Highest contract charges 2.15% 0.81% 7.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.14% 9.90% 13.25% Highest contract charges 1.91% 12.51% 12.50% Remaining contract charges -- -- --
SA-139 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HARTFORD GLOBAL ADVISERS HLS FUND 2007 Lowest contract charges 226 $1.506901 $340 Highest contract charges 624,913 1.448549 905,217 Remaining contract charges 2,487,740 -- 4,032,822 2006 Lowest contract charges 518,371 1.282188 664,649 Highest contract charges 477,719 1.268796 606,128 Remaining contract charges 1,154,341 -- 1,643,587 2005 Lowest contract charges 73,962 1.191716 88,141 Highest contract charges 150,385 1.190538 179,039 Remaining contract charges 620,009 -- 765,078 HARTFORD GLOBAL GROWTH HLS FUND 2007 Lowest contract charges 3,814 1.780206 6,789 Highest contract charges 116,924 1.698782 198,628 Remaining contract charges 3,935,160 -- 8,685,113 2006 Lowest contract charges 3,095 1.434316 4,440 Highest contract charges 108,623 1.391475 151,144 Remaining contract charges 2,713,332 -- 4,949,323 2005 Lowest contract charges 222,607 1.251555 278,604 Highest contract charges 57,197 1.248662 71,420 Remaining contract charges 934,940 -- 1,646,991 HARTFORD DISCIPLINED EQUITY HLS FUND 2007 Lowest contract charges 90,995 1.280301 116,501 Highest contract charges 27,543 1.436846 39,576 Remaining contract charges 192,860,809 -- 262,224,176 2006 Lowest contract charges 61,121 1.190599 72,770 Highest contract charges 11,134 1.359078 15,133 Remaining contract charges 149,763,253 -- 190,203,459 2005 Lowest contract charges 10,140,732 1.054512 10,693,523 Highest contract charges 15,982 1.238558 19,795 Remaining contract charges 47,202,721 -- 54,271,953 HARTFORD GROWTH HLS FUND 2007 Lowest contract charges 75,468 1.576049 118,941 Highest contract charges 35,346 1.465205 51,789 Remaining contract charges 8,164,821 -- 12,372,154 2006 Lowest contract charges 72,541 1.359730 98,637 Highest contract charges 28,070 1.285135 36,073 Remaining contract charges 6,327,770 -- 8,327,937 2005 Lowest contract charges 19,902 1.309557 26,063 Highest contract charges 19,434 1.258313 24,454 Remaining contract charges 2,827,275 -- 3,600,721 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HARTFORD GLOBAL ADVISERS HLS FUND 2007 Lowest contract charges 0.58% 1.18% 15.72% Highest contract charges 2.09% 0.96% 14.17% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 4.28% 7.59% Highest contract charges 2.10% 3.87% 6.57% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 6.00% 7.95% Highest contract charges 2.06% 6.26% 7.27% Remaining contract charges -- -- -- HARTFORD GLOBAL GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.05% 24.12% Highest contract charges 2.39% 0.05% 22.09% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.72% 1.91% 13.29% Highest contract charges 2.40% 0.95% 11.44% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 1.77% 13.15% Highest contract charges 2.36% 1.44% 12.21% Remaining contract charges -- -- -- HARTFORD DISCIPLINED EQUITY HLS FUND 2007 Lowest contract charges 0.75% 1.17% 7.53% Highest contract charges 2.44% 1.32% 5.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.98% 11.61% Highest contract charges 2.46% 0.98% 9.73% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 3.23% 9.11% Highest contract charges 2.43% 1.85% 8.17% Remaining contract charges -- -- -- HARTFORD GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.02% 15.91% Highest contract charges 2.40% 0.02% 14.01% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.07% 3.83% Highest contract charges 2.40% 0.06% 2.13% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 13.12% Highest contract charges 2.34% -- 11.88% Remaining contract charges -- -- --
SA-140 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HARTFORD GROWTH OPPORTUNITIES HLS FUND 2007 Lowest contract charges 53,177 $2.102007 $111,777 Highest contract charges 123,441 1.948859 240,570 Remaining contract charges 25,614,268 -- 53,103,236 2006 Lowest contract charges 26,657 1.633478 43,544 Highest contract charges 394,603 1.584678 625,319 Remaining contract charges 16,492,530 -- 26,726,829 2005 Lowest contract charges 887,815 1.455585 1,292,290 Highest contract charges 2,089 1.408825 2,944 Remaining contract charges 4,521,617 -- 6,466,206 HARTFORD HIGH YIELD HLS FUND 2007 Lowest contract charges 26,014 1.417630 36,878 Highest contract charges 1,094 1.360119 1,488 Remaining contract charges 18,509,352 -- 26,096,976 2006 Lowest contract charges 28,682 1.389570 39,855 Highest contract charges 2,380 1.356048 3,228 Remaining contract charges 10,109,440 -- 13,989,305 2005 Lowest contract charges 635,946 1.244947 791,719 Highest contract charges 3,526 1.250060 4,408 Remaining contract charges 2,757,261 -- 3,525,392 HARTFORD INDEX HLS FUND 2007 Lowest contract charges 54,673 1.178530 64,434 Highest contract charges 96,120 1.165052 111,985 Remaining contract charges 6,164,322 -- 8,995,851 2006 Lowest contract charges 33,344 1.128688 37,635 Highest contract charges 103,408 1.134339 117,301 Remaining contract charges 4,395,681 -- 6,005,411 2005 Lowest contract charges 17,214 0.984953 16,955 Highest contract charges 78,579 1.006357 79,079 Remaining contract charges 1,729,482 -- 2,161,113 HARTFORD INTERNATIONAL GROWTH HLS FUND 2007 Lowest contract charges 104,300 2.069968 215,897 Highest contract charges 352 11.885065 4,179 Remaining contract charges 19,925,738 -- 39,412,152 2006 Lowest contract charges 61,985 1.683127 104,329 Highest contract charges 271,330 1.576637 427,787 Remaining contract charges 11,498,029 -- 18,616,231 2005 Lowest contract charges 17,868 1.366664 24,419 Highest contract charges 67,922 1.301496 88,400 Remaining contract charges 4,350,960 -- 5,760,848 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HARTFORD GROWTH OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.75% 0.20% 28.68% Highest contract charges 2.42% 0.30% 26.52% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.45% 11.22% Highest contract charges 2.39% 1.05% 9.40% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 0.62% 25.05% Highest contract charges 2.42% 0.36% 23.98% Remaining contract charges -- -- -- HARTFORD HIGH YIELD HLS FUND 2007 Lowest contract charges 0.75% 7.32% 2.02% Highest contract charges 2.46% 6.72% 0.30% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 18.77% 10.34% Highest contract charges 2.44% 12.84% 8.48% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 1.97% 4.42% Highest contract charges 2.36% -- 3.53% Remaining contract charges -- -- -- HARTFORD INDEX HLS FUND 2007 Lowest contract charges 0.75% 2.18% 4.42% Highest contract charges 2.40% 1.64% 2.71% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.60% 14.59% Highest contract charges 2.40% 1.85% 12.72% Remaining contract charges -- -- -- 2005 Lowest contract charges -- -- 7.98% Highest contract charges 2.33% 5.60% 6.80% Remaining contract charges -- -- -- HARTFORD INTERNATIONAL GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.91% 22.98% Highest contract charges 1.83% 4.43% 15.35% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.11% 23.16% Highest contract charges 2.40% 0.95% 21.14% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 2.72% 15.40% Highest contract charges 2.33% 2.87% 14.14% Remaining contract charges -- -- --
SA-141 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND 2007 Lowest contract charges 10,731 $2.531786 $27,169 Highest contract charges 2,083 10.128436 21,093 Remaining contract charges 6,169,806 -- 14,971,409 2006 Lowest contract charges 3,943 2.340119 9,226 Highest contract charges 30,430 2.192075 66,708 Remaining contract charges 3,347,710 -- 7,540,578 2005 Lowest contract charges 553 1.822914 1,008 Highest contract charges 12,370 1.735984 21,474 Remaining contract charges 1,196,583 -- 2,116,634 HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND 2007 Lowest contract charges 66,471 1.766656 117,431 Highest contract charges 111 12.199778 1,356 Remaining contract charges 41,374,578 -- 78,599,367 2006 Lowest contract charges 7,539 1.396856 10,531 Highest contract charges 596,472 1.374614 819,919 Remaining contract charges 32,437,370 -- 48,944,345 2005 Lowest contract charges 348 1.130783 394 Highest contract charges 463,040 1.131293 523,833 Remaining contract charges 12,732,689 -- 15,294,046 HARTFORD MIDCAP GROWTH HLS FUND 2007 Lowest contract charges 2,112 9.797763 20,695 Highest contract charges 118 9.777219 1,151 Remaining contract charges 13,043 -- 127,623 HARTFORD MONEY MARKET HLS FUND 2007 Lowest contract charges 87,011 1.209133 105,208 Highest contract charges 142,702 1.038826 148,242 Remaining contract charges 46,024,319 -- 59,673,151 2006 Lowest contract charges 80,942 1.160839 93,960 Highest contract charges 17,435 1.014418 17,692 Remaining contract charges 26,817,992 -- 33,205,501 2005 Lowest contract charges 1,575,373 1.104241 1,739,591 Highest contract charges 17,436 0.992855 17,311 Remaining contract charges 5,056,543 -- 6,439,266 HARTFORD MORTGAGE SECURITIES HLS FUND 2007 Lowest contract charges 6,613 1.419566 9,387 Highest contract charges 28,194 1.314873 37,071 Remaining contract charges 5,721,965 -- 8,350,876 2006 Lowest contract charges 1,428 1.383332 1,976 Highest contract charges 28,194 1.302625 36,726 Remaining contract charges 4,454,471 -- 6,312,693 2005 Lowest contract charges 1,430 1.331509 1,905 Highest contract charges 1,880 1.274155 2,396 Remaining contract charges 1,585,306 -- 2,124,722 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HARTFORD INTERNATIONAL SMALL COMPANY HLS FUND 2007 Lowest contract charges 0.75% 2.80% 8.19% Highest contract charges 1.83% 3.17% (2.90)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.47% 28.37% Highest contract charges 2.40% 2.67% 26.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.64% 8.05% 18.53% Highest contract charges 2.37% 4.45% 17.24% Remaining contract charges -- -- -- HARTFORD INTERNATIONAL OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.74% 2.00% 26.47% Highest contract charges 1.84% 5.50% 17.19% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.41% 23.53% Highest contract charges 2.40% 2.86% 21.51% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.90% -- 17.26% Highest contract charges 2.35% -- 15.98% Remaining contract charges -- -- -- HARTFORD MIDCAP GROWTH HLS FUND 2007 Lowest contract charges 0.28% 0.31% 2.96% Highest contract charges 0.40% -- 2.86% Remaining contract charges -- -- -- HARTFORD MONEY MARKET HLS FUND 2007 Lowest contract charges 0.75% 4.80% 4.16% Highest contract charges 2.40% 4.61% 2.41% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.74% 4.86% 3.92% Highest contract charges 2.45% 4.59% 2.17% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 3.42% 1.34% Highest contract charges 2.40% 3.14% 0.47% Remaining contract charges -- -- -- HARTFORD MORTGAGE SECURITIES HLS FUND 2007 Lowest contract charges 0.74% 6.89% 2.62% Highest contract charges 2.39% 5.48% 0.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.76% 10.46% 3.89% Highest contract charges 2.40% 10.24% 2.19% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.75% -- 0.84% Highest contract charges 2.37% 7.15% (0.29)% Remaining contract charges -- -- --
SA-142 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HARTFORD SMALLCAP VALUE HLS FUND 2007 Lowest contract charges 2,003 $9.120220 $18,272 Highest contract charges 172 9.101084 1,569 Remaining contract charges 2,725 -- 24,810 HARTFORD SMALL COMPANY HLS FUND 2007 Lowest contract charges 32,283 1.827464 58,996 Highest contract charges 17,781 1.546238 27,494 Remaining contract charges 7,927,873 -- 15,990,336 2006 Lowest contract charges 397,547 1.575297 626,255 Highest contract charges 2,708 1.387226 3,757 Remaining contract charges 314,595 -- 669,629 HARTFORD SMALLCAP GROWTH HLS FUND 2007 Lowest contract charges 68,395 1.414586 96,750 Highest contract charges 7,464 1.311438 9,788 Remaining contract charges 15,442,898 -- 21,398,728 2006 Lowest contract charges 40,383 1.451976 58,635 Highest contract charges 7,510 1.369188 10,282 Remaining contract charges 12,949,178 -- 18,672,317 2005 Lowest contract charges 2,654 1.369036 3,633 Highest contract charges 7,994 1.313122 10,497 Remaining contract charges 7,010,382 -- 9,378,913 HARTFORD STOCK HLS FUND 2007 Lowest contract charges 18,539 1.148022 21,283 Highest contract charges 130,175 1.127052 146,714 Remaining contract charges 14,718,766 -- 20,951,736 2006 Lowest contract charges 16,145 1.092190 17,633 Highest contract charges 102,478 1.090081 111,709 Remaining contract charges 13,135,545 -- 17,204,398 2005 Lowest contract charges 2,006 0.959768 1,926 Highest contract charges 46,829 0.973852 45,604 Remaining contract charges 5,751,676 -- 6,718,125 HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND 2007 Lowest contract charges 96,025 1.184437 113,736 Highest contract charges 30,312 1.098120 33,286 Remaining contract charges 140,124,544 -- 159,762,605 2006 Lowest contract charges 56,712 1.143295 64,838 Highest contract charges 27,367 1.078142 29,506 Remaining contract charges 82,667,946 -- 91,530,568 2005 Lowest contract charges 3,267 1.107461 3,618 Highest contract charges 30,199 1.062245 32,079 Remaining contract charges 28,194,335 -- 30,397,307 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HARTFORD SMALLCAP VALUE HLS FUND 2007 Lowest contract charges 0.27% -- (2.25)% Highest contract charges 0.47% 3.98% (2.35)% Remaining contract charges -- -- -- HARTFORD SMALL COMPANY HLS FUND 2007 Lowest contract charges 0.74% 0.65% 13.37% Highest contract charges 2.42% 0.45% 11.46% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.73% 0.51% 2.42% Highest contract charges 1.57% 0.50% 1.64% Remaining contract charges -- -- -- HARTFORD SMALLCAP GROWTH HLS FUND 2007 Lowest contract charges 0.75% 0.40% (2.58)% Highest contract charges 2.45% 0.29% (4.22)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.52% 6.06% Highest contract charges 2.45% 0.36% 4.27% Remaining contract charges -- -- -- 2005 Lowest contract charges -- -- 17.77% Highest contract charges 2.42% 0.63% 16.45% Remaining contract charges -- -- -- HARTFORD STOCK HLS FUND 2007 Lowest contract charges 0.75% 1.09% 5.11% Highest contract charges 2.39% 1.17% 3.39% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.92% 13.80% Highest contract charges 2.40% 1.60% 11.94% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.75% 3.19% 12.41% Highest contract charges 2.36% 3.03% 11.18% Remaining contract charges -- -- -- HARTFORD U.S. GOVERNMENT SECURITIES HLS FUND 2007 Lowest contract charges 0.75% 3.92% 3.60% Highest contract charges 2.44% 3.80% 1.85% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.74% 2.50% 3.24% Highest contract charges 2.45% 2.66% 1.50% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 0.46% Highest contract charges 2.41% 4.28% (0.67)% Remaining contract charges -- -- --
SA-143 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HARTFORD VALUE HLS FUND 2007 Lowest contract charges 5,887 $1.505403 $8,862 Highest contract charges 3,889 1.386664 5,392 Remaining contract charges 18,121,483 -- 26,156,232 2006 Lowest contract charges 1,314,841 1.371064 1,802,732 Highest contract charges 125,637 1.303700 163,792 Remaining contract charges 2,539,971 -- 3,360,776 2005 Lowest contract charges 174,257 1.138452 198,383 Highest contract charges 3,168 1.096127 3,473 Remaining contract charges 1,303,124 -- 1,440,785 HARTFORD VALUE OPPORTUNITIES HLS FUND 2007 Lowest contract charges 10,727 1.561011 16,745 Highest contract charges 40,122 1.447249 58,066 Remaining contract charges 12,789,859 -- 19,532,743 2006 Lowest contract charges 5,805 1.678386 9,743 Highest contract charges 289,353 1.628257 471,142 Remaining contract charges 6,385,310 -- 10,436,497 2005 Lowest contract charges 3,050 1.420752 4,333 Highest contract charges 3,913 1.362775 5,332 Remaining contract charges 2,633,785 -- 3,660,889 HARTFORD EQUITY INCOME HLS FUND 2007 Lowest contract charges 49,828 1.541964 76,833 Highest contract charges 2,379 1.450037 3,449 Remaining contract charges 7,823,472 -- 11,738,861 2006 Lowest contract charges 48,318 1.452696 70,192 Highest contract charges 2,621 1.389511 3,643 Remaining contract charges 3,875,787 -- 5,508,520 2005 Lowest contract charges 446 1.211673 540 Highest contract charges 23,556 1.180208 27,801 Remaining contract charges 1,294,034 -- 1,541,532 HUNTINGTON VA INCOME EQUITY FUND 2007 Lowest contract charges 885,364 1.383280 1,224,707 Highest contract charges 80,313 1.443302 115,915 Remaining contract charges 1,019,251 -- 1,459,981 2006 Lowest contract charges 626,849 1.386243 868,965 Highest contract charges 71,473 1.460214 104,366 Remaining contract charges 741,661 -- 1,077,003 2005 Lowest contract charges 197,546 1.245491 246,042 Highest contract charges 37,068 1.324465 49,096 Remaining contract charges 351,569 -- 459,804 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HARTFORD VALUE HLS FUND 2007 Lowest contract charges 0.75% 2.29% 8.17% Highest contract charges 2.44% 3.28% 6.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 2.48% 20.43% Highest contract charges 2.39% 2.30% 18.94% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 4.26% 7.86% Highest contract charges 2.37% 3.82% 6.96% Remaining contract charges -- -- -- HARTFORD VALUE OPPORTUNITIES HLS FUND 2007 Lowest contract charges 0.75% 2.57% (6.99)% Highest contract charges 2.42% 7.32% (8.56)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 1.54% 18.13% Highest contract charges 2.39% 1.79% 16.20% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% 2.31% 12.64% Highest contract charges 2.41% 2.44% 11.37% Remaining contract charges -- -- -- HARTFORD EQUITY INCOME HLS FUND 2007 Lowest contract charges 0.75% 2.18% 6.15% Highest contract charges 2.45% 2.04% 4.36% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 4.07% 19.89% Highest contract charges 2.47% 7.47% 17.87% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.80% 1.72% 4.59% Highest contract charges 2.37% 2.88% 3.45% Remaining contract charges -- -- -- HUNTINGTON VA INCOME EQUITY FUND 2007 Lowest contract charges 1.14% 1.68% (0.21)% Highest contract charges 2.09% 1.75% (1.16)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.60% 11.30% Highest contract charges 2.10% 1.88% 10.25% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 1.92% 3.53% Highest contract charges 2.07% 0.59% 2.88% Remaining contract charges -- -- --
SA-144 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HUNTINGTON VA DIVIDEND CAPTURE FUND 2007 Lowest contract charges 974,854 $1.489438 $1,451,985 Highest contract charges 61 14.164468 870 Remaining contract charges 1,947,692 -- 3,661,698 2006 Lowest contract charges 590,720 1.605086 948,157 Highest contract charges 62 15.456286 955 Remaining contract charges 1,576,580 -- 3,291,040 2005 Lowest contract charges 174,359 1.392666 242,824 Highest contract charges 62 13.579374 844 Remaining contract charges 865,021 -- 1,520,955 HUNTINGTON VA GROWTH FUND 2007 Lowest contract charges 915,554 1.032542 945,348 Highest contract charges 9,308 14.091540 131,162 Remaining contract charges 669,343 -- 872,808 2006 Lowest contract charges 388,384 0.910619 353,670 Highest contract charges 4,863 12.546009 61,011 Remaining contract charges 389,454 -- 468,372 2005 Lowest contract charges 86,491 0.854848 73,936 Highest contract charges 3,352 11.890056 39,852 Remaining contract charges 145,766 -- 164,560 HUNTINGTON VA MID CORP AMERICA FUND 2007 Lowest contract charges 836,675 1.795830 1,502,527 Highest contract charges 8,720 18.172960 158,467 Remaining contract charges 883,157 -- 1,613,482 2006 Lowest contract charges 556,198 1.670403 929,075 Highest contract charges 7,260 17.064993 123,898 Remaining contract charges 737,824 -- 1,265,479 2005 Lowest contract charges 156,171 1.575703 246,079 Highest contract charges 2,230 16.251286 36,248 Remaining contract charges 441,177 -- 714,949 HUNTINGTON VA NEW ECONOMY FUND 2007 Lowest contract charges 897,527 1.920209 1,723,439 Highest contract charges 7,441 19.742399 146,901 Remaining contract charges 956,693 -- 1,885,261 2006 Lowest contract charges 644,733 1.726573 1,113,179 Highest contract charges 5,647 17.920935 101,188 Remaining contract charges 794,083 -- 1,418,525 2005 Lowest contract charges 103,423 1.583729 163,794 Highest contract charges 300 16.595263 4,983 Remaining contract charges 316,019 -- 520,127 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HUNTINGTON VA DIVIDEND CAPTURE FUND 2007 Lowest contract charges 1.14% 3.04% (7.21)% Highest contract charges 2.51% 3.38% (8.36)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 2.97% 15.25% Highest contract charges 2.31% 3.47% 13.82% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 1.21% 4.32% Highest contract charges 2.22% -- 3.48% Remaining contract charges -- -- -- HUNTINGTON VA GROWTH FUND 2007 Lowest contract charges 1.14% 0.37% 13.39% Highest contract charges 2.08% 0.39% 12.32% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.26% 6.52% Highest contract charges 2.10% 0.45% 5.52% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% 0.37% 3.78% Highest contract charges 2.07% 0.16% 3.12% Remaining contract charges -- -- -- HUNTINGTON VA MID CORP AMERICA FUND 2007 Lowest contract charges 1.14% 0.52% 7.51% Highest contract charges 2.09% 0.53% 6.49% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.32% 6.01% Highest contract charges 2.09% 0.36% 5.01% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.04% 14.39% Highest contract charges 2.06% 0.09% 13.67% Remaining contract charges -- -- -- HUNTINGTON VA NEW ECONOMY FUND 2007 Lowest contract charges 1.14% 0.15% 11.22% Highest contract charges 2.09% 0.16% 10.16% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.08% 9.02% Highest contract charges 2.09% 0.07% 7.99% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% -- 16.09% Highest contract charges 2.06% -- 15.36% Remaining contract charges -- -- --
SA-145 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- HUNTINGTON VA ROTATING MARKETS FUND 2007 Lowest contract charges 295,139 $1.638282 $483,520 Highest contract charges 6,944 18.503060 128,486 Remaining contract charges 368,829 -- 634,743 2006 Lowest contract charges 101,095 1.518895 153,553 Highest contract charges 1,545 17.318252 26,764 Remaining contract charges 103,619 -- 189,052 2005 Lowest contract charges 14,850 1.284542 19,076 Highest contract charges 172 14.873813 2,561 Remaining contract charges 1,703 -- 2,134 HUNTINGTON VA INTERNATIONAL EQUITY FUND 2007 Lowest contract charges 82,314 16.282287 1,340,267 Highest contract charges 12,088 15.887446 192,054 Remaining contract charges 94,208 -- 1,516,795 2006 Lowest contract charges 45,120 14.476142 653,162 Highest contract charges 3,291 14.259822 46,939 Remaining contract charges 57,105 -- 821,223 2005 Lowest contract charges 3,592 11.643997 41,827 Highest contract charges 187 11.599757 2,169 Remaining contract charges 2,415 -- 28,058 HUNTINGTON VA MACRO 100 FUND 2007 Lowest contract charges 584,244 1.116207 652,137 Highest contract charges 48,339 1.079664 52,189 Remaining contract charges 1,015,982 -- 1,115,570 2006 Lowest contract charges 464,924 1.161549 540,032 Highest contract charges 42,268 1.134249 47,942 Remaining contract charges 939,825 -- 1,079,286 2005 Lowest contract charges 189,185 1.095413 207,236 Highest contract charges 21,559 1.079887 23,281 Remaining contract charges 408,204 -- 443,945 HUNTINGTON VA MORTGAGE SECURITIES FUND 2007 Lowest contract charges 63,069 10.775519 679,602 Highest contract charges 2,500 10.514016 26,286 Remaining contract charges 56,285 -- 599,095 2006 Lowest contract charges 28,601 10.488149 299,976 Highest contract charges 1,700 10.331301 17,560 Remaining contract charges 36,287 -- 377,761 2005 Lowest contract charges 5,930 10.019191 59,413 Highest contract charges 409 9.963537 4,079 Remaining contract charges 3,322 -- 33,196 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ HUNTINGTON VA ROTATING MARKETS FUND 2007 Lowest contract charges 1.14% 0.71% 7.86% Highest contract charges 2.07% 0.79% 6.84% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.45% 18.24% Highest contract charges 2.08% -- 17.13% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.14% 1.31% 13.51% Highest contract charges 1.51% -- 12.94% Remaining contract charges -- -- -- HUNTINGTON VA INTERNATIONAL EQUITY FUND 2007 Lowest contract charges 1.14% 0.02% 12.48% Highest contract charges 2.07% 0.01% 11.41% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.63% 24.32% Highest contract charges 2.10% 2.68% 23.15% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.11% 1.82% 15.30% Highest contract charges 1.78% 2.64% 14.93% Remaining contract charges -- -- -- HUNTINGTON VA MACRO 100 FUND 2007 Lowest contract charges 1.15% 0.41% (3.90)% Highest contract charges 2.09% 0.40% (4.81)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.15% 6.04% Highest contract charges 2.10% 0.14% 5.03% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.09% 14.19% Highest contract charges 2.06% 0.17% 13.47% Remaining contract charges -- -- -- HUNTINGTON VA MORTGAGE SECURITIES FUND 2007 Lowest contract charges 1.14% 1.96% 2.74% Highest contract charges 2.09% 1.86% 1.77% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.89% 4.68% Highest contract charges 2.09% 1.39% 3.69% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- (0.17)% Highest contract charges 2.05% -- (0.63)% Remaining contract charges -- -- --
SA-146 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HUNTINGTON VA SITUS SMALL CAP FUND 2007 Lowest contract charges 1,167,877 $1.492538 $1,743,101 Highest contract charges 690,618 1.443681 997,033 Remaining contract charges 2,080,770 -- 3,058,405 2006 Lowest contract charges 965,257 1.355598 1,308,501 Highest contract charges 554,681 1.323739 734,251 Remaining contract charges 1,499,185 -- 2,010,288 2005 Lowest contract charges 233,861 1.307997 305,889 Highest contract charges 217,268 1.289462 280,158 Remaining contract charges 509,398 -- 661,569 LORD ABBETT ALL VALUE PORTFOLIO 2007 Lowest contract charges 15,609 12.791256 199,658 Highest contract charges 12,937 12.206180 157,907 Remaining contract charges 722,884 -- 9,057,849 2006 Lowest contract charges 17,797 12.075767 214,913 Highest contract charges 13,246 11.715068 155,179 Remaining contract charges 517,103 -- 6,158,749 2005 Lowest contract charges 7,823 10.612875 83,025 Highest contract charges 4,448 10.467117 46,553 Remaining contract charges 156,355 -- 1,646,980 LORD ABBETT AMERICA'S VALUE PORTFOLIO 2007 Lowest contract charges 13,973 11.971920 167,285 Highest contract charges 902 11.424297 10,309 Remaining contract charges 541,213 -- 6,324,657 2006 Lowest contract charges 14,051 11.692294 164,291 Highest contract charges 1,228 11.343054 13,935 Remaining contract charges 355,853 -- 4,093,576 2005 Lowest contract charges 9,033 10.283680 92,890 Highest contract charges 521 10.142435 5,281 Remaining contract charges 157,091 -- 1,602,931 LORD ABBETT BOND DEBENTURE FUND 2007 Lowest contract charges 26,182 11.456197 299,944 Highest contract charges 750 10.916673 8,186 Remaining contract charges 2,783,660 -- 31,165,323 2006 Lowest contract charges 14,575 10.870047 158,432 Highest contract charges 676 10.535676 7,120 Remaining contract charges 1,418,492 -- 15,184,288 2005 Lowest contract charges 3,529 10.017399 35,352 Highest contract charges 16,403 9.879781 162,055 Remaining contract charges 426,524 -- 4,241,927 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HUNTINGTON VA SITUS SMALL CAP FUND 2007 Lowest contract charges 1.15% 0.35% 10.10% Highest contract charges 2.09% 0.37% 9.06% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.09% 3.64% Highest contract charges 2.09% 0.08% 2.66% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 20.20% Highest contract charges 2.04% -- 19.45% Remaining contract charges -- -- -- LORD ABBETT ALL VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 0.46% 5.93% Highest contract charges 2.39% 0.50% 4.19% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.72% 13.78% Highest contract charges 2.41% 0.84% 11.92% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 1.53% 11.45% Highest contract charges 2.33% 1.06% 10.24% Remaining contract charges -- -- -- LORD ABBETT AMERICA'S VALUE PORTFOLIO 2007 Lowest contract charges 0.75% 2.72% 2.39% Highest contract charges 2.40% 2.64% 0.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 3.02% 13.70% Highest contract charges 2.40% 3.31% 11.84% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% 10.00% 6.50% Highest contract charges 2.33% 6.58% 5.34% Remaining contract charges -- -- -- LORD ABBETT BOND DEBENTURE FUND 2007 Lowest contract charges 0.75% 7.50% 5.39% Highest contract charges 2.45% 7.03% 3.62% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 7.57% 8.51% Highest contract charges 2.42% 24.56% 6.68% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% 24.21% 4.62% Highest contract charges 2.35% 14.14% 3.48% Remaining contract charges -- -- --
SA-147 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 49,568 $12.274113 $608,409 Highest contract charges 3,943 11.696028 46,120 Remaining contract charges 12,555,201 -- 151,060,217 2006 Lowest contract charges 22,792 11.955476 272,495 Highest contract charges 2,782 11.587688 32,240 Remaining contract charges 6,751,122 -- 79,604,047 2005 Lowest contract charges 5,421 10.271292 55,685 Highest contract charges 1,699 10.125948 17,206 Remaining contract charges 1,222,591 -- 12,468,637 LORD ABBETT LARGE CAP CORE FUND 2007 Lowest contract charges 9,890 13.100410 129,569 Highest contract charges 14,024 12.520156 175,581 Remaining contract charges 385,819 -- 4,954,553 2006 Lowest contract charges 4,673 11.925730 55,727 Highest contract charges 1,303 11.650909 15,181 Remaining contract charges 200,004 -- 2,355,744 2005 Lowest contract charges 3,164 10.641404 33,671 Highest contract charges 226 10.542723 2,384 Remaining contract charges 65,094 -- 688,820 MFS CORE EQUITY SERIES 2007 Lowest contract charges 38,409 1.216627 46,730 Highest contract charges 3,553 7.519618 26,715 Remaining contract charges 72,379 -- 567,932 2006 Lowest contract charges 38,409 1.108918 42,593 Highest contract charges 18,297 6.947882 127,126 Remaining contract charges 69,407 -- 511,023 2005 Lowest contract charges 33,750 8.482700 286,289 Highest contract charges 5,817 8.275443 48,137 Remaining contract charges 101,022 -- 637,605 2004 Lowest contract charges 49,553 8.459697 419,205 Highest contract charges 18,589 6.230456 115,817 Remaining contract charges 82,266 -- 520,049 2003 Lowest contract charges 4,488 7.628186 34,236 Highest contract charges 18,591 5.643391 104,918 Remaining contract charges 81,703 -- 466,190 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- LORD ABBETT GROWTH AND INCOME PORTFOLIO 2007 Lowest contract charges 0.74% 1.66% 2.67% Highest contract charges 2.44% 1.44% 0.94% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.28% 16.40% Highest contract charges 2.44% 1.89% 14.44% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% 4.39% 7.03% Highest contract charges 2.40% 1.60% 5.82% Remaining contract charges -- -- -- LORD ABBETT LARGE CAP CORE FUND 2007 Lowest contract charges 0.74% 0.99% 9.85% Highest contract charges 2.42% 1.12% 8.00% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.70% 12.07% Highest contract charges 2.13% 1.03% 10.51% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% 1.35% 6.41% Highest contract charges 2.09% 0.40% 5.43% Remaining contract charges -- -- -- MFS CORE EQUITY SERIES 2007 Lowest contract charges 1.30% 0.34% 9.71% Highest contract charges 1.98% -- 8.95% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.38% -- 12.33% Highest contract charges 1.85% 0.44% 11.71% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% 0.79% 0.27% Highest contract charges 1.88% -- (0.23)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.39% 0.11% 10.90% Highest contract charges 1.85% 0.36% 10.40% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 0.23% 25.62% Highest contract charges 1.85% 0.23% 25.06% Remaining contract charges -- -- --
SA-148 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- MFS EMERGING GROWTH SERIES 2007 Lowest contract charges 10,981 $10.254739 $112,607 Highest contract charges 11,996 6.435608 77,200 Remaining contract charges 87,977 -- 611,729 2006 Lowest contract charges 490 8.582192 4,202 Highest contract charges 8,923 5.408651 48,267 Remaining contract charges 109,971 -- 635,958 2005 Lowest contract charges 3,249 8.066515 26,206 Highest contract charges 8,924 5.134777 45,823 Remaining contract charges 111,020 -- 604,050 2004 Lowest contract charges 3,249 7.491736 24,345 Highest contract charges 8,924 4.816813 42,986 Remaining contract charges 105,806 -- 537,235 2003 Lowest contract charges 2,362 6.725746 15,884 Highest contract charges 1,995 6.622651 13,213 Remaining contract charges 111,634 -- 499,548 MFS INVESTORS GROWTH STOCK SERIES 2007 Lowest contract charges 11,009 9.316867 102,566 Highest contract charges 1,514 6.847257 10,365 Remaining contract charges 42,197 -- 318,474 2006 Lowest contract charges 13,246 8.484512 112,389 Highest contract charges 1,521 6.298182 9,582 Remaining contract charges 44,002 -- 303,519 2005 Lowest contract charges 19,612 7.998221 156,862 Highest contract charges 1,592 5.996884 9,545 Remaining contract charges 56,697 -- 367,868 2004 Lowest contract charges 27,268 7.762533 211,663 Highest contract charges 1,600 5.878665 9,405 Remaining contract charges 103,992 -- 650,706 2003 Lowest contract charges 58,552 7.209750 422,146 Highest contract charges 150 7.081801 1,059 Remaining contract charges 98,920 -- 275,300 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- MFS EMERGING GROWTH SERIES 2007 Lowest contract charges 1.38% -- 19.49% Highest contract charges 2.29% -- 18.42% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.40% -- 6.39% Highest contract charges 2.40% -- 5.33% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% -- 7.67% Highest contract charges 2.39% -- 6.60% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% -- 11.39% Highest contract charges 2.39% -- 10.28% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 28.42% Highest contract charges 1.87% -- 27.72% Remaining contract charges -- -- -- MFS INVESTORS GROWTH STOCK SERIES 2007 Lowest contract charges 1.40% 0.36% 9.81% Highest contract charges 2.39% 0.32% 8.72% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.40% -- 6.08% Highest contract charges 2.40% -- 5.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% 0.32% 3.04% Highest contract charges 2.39% 0.35% 2.01% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% -- 7.67% Highest contract charges 2.37% -- 6.60% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 21.31% Highest contract charges 1.42% -- 14.47% Remaining contract charges -- -- --
SA-149 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- MFS INVESTORS TRUST SERIES 2007 Lowest contract charges 144,681 $1.331219 $192,602 Highest contract charges 4,355 10.091082 43,951 Remaining contract charges 101,862 -- 1,067,345 2006 Lowest contract charges 152,922 1.222627 186,967 Highest contract charges 4,229 9.389215 39,706 Remaining contract charges 105,686 -- 1,023,825 2005 Lowest contract charges 93,862 1.096187 102,890 Highest contract charges 4,201 8.528364 35,826 Remaining contract charges 127,182 -- 1,113,834 2004 Lowest contract charges 9,566 8.380645 80,172 Highest contract charges 1,453 8.156435 11,852 Remaining contract charges 103,690 -- 860,826 2003 Lowest contract charges 13,504 7.632109 103,065 Highest contract charges 144 7.496658 1,082 Remaining contract charges 100,841 -- 765,925 MFS TOTAL RETURN SERIES 2007 Lowest contract charges 48,459 1.329842 64,443 Highest contract charges 5,108 13.927118 71,140 Remaining contract charges 903,174 -- 13,018,275 2006 Lowest contract charges 48,463 1.292758 62,651 Highest contract charges 5,994 13.715825 82,214 Remaining contract charges 1,033,056 -- 14,550,984 2005 Lowest contract charges 44,912 1.170452 52,567 Highest contract charges 6,643 12.580684 83,577 Remaining contract charges 1,147,358 -- 14,728,618 2004 Lowest contract charges 238,908 12.917678 3,086,138 Highest contract charges 4,079 12.557976 51,226 Remaining contract charges 893,207 -- 11,376,568 2003 Lowest contract charges 230,841 11.767538 2,716,435 Highest contract charges 1,000 11.577974 11,576 Remaining contract charges 751,811 -- 8,818,843 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- MFS INVESTORS TRUST SERIES 2007 Lowest contract charges 1.30% 0.83% 8.88% Highest contract charges 2.59% 0.81% 7.48% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.36% 11.54% Highest contract charges 2.60% 0.49% 10.09% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% -- 5.93% Highest contract charges 2.58% 0.60% 4.56% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 0.68% 9.81% Highest contract charges 2.58% -- 8.50% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.39% 0.57% 20.45% Highest contract charges 1.42% -- 16.37% Remaining contract charges -- -- -- MFS TOTAL RETURN SERIES 2007 Lowest contract charges 1.30% 2.52% 2.87% Highest contract charges 2.59% 2.41% 1.54% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.20% 10.45% Highest contract charges 2.60% 2.48% 9.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% -- 1.49% Highest contract charges 2.58% 1.74% 0.18% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 1.73% 9.77% Highest contract charges 2.57% 1.29% 8.47% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 1.63% 14.71% Highest contract charges 1.58% -- 11.85% Remaining contract charges -- -- --
SA-150 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- EQUITY AND INCOME 2007 Lowest contract charges 2,639 $15.230246 $40,187 Highest contract charges 2,978 14.676995 43,707 Remaining contract charges 12,814 -- 191,820 2006 Lowest contract charges 1,481 14.957667 22,158 Highest contract charges 6,300 14.530066 91,528 Remaining contract charges 5,005 -- 73,884 2005 Lowest contract charges 3,764 13.487418 50,761 Highest contract charges 6,733 13.207063 88,924 Remaining contract charges 5,427 -- 72,486 2004 Lowest contract charges 1,481 12.750251 18,888 Highest contract charges 122 12.644405 1,544 Remaining contract charges 2,364 -- 29,980 2003 Lowest contract charges 30 11.571353 343 Highest contract charges -- -- -- Remaining contract charges -- -- -- CORE PLUS FIXED INCOME 2007 Lowest contract charges 196,369 1.239946 243,487 Highest contract charges 15,046 13.527056 203,522 Remaining contract charges 720,363 -- 10,204,658 2006 Lowest contract charges 190,270 1.191205 226,650 Highest contract charges 15,164 13.165406 199,643 Remaining contract charges 900,476 -- 12,326,923 2005 Lowest contract charges 121,983 1.163384 141,913 Highest contract charges 13,600 13.026094 177,149 Remaining contract charges 1,041,266 -- 13,989,227 2004 Lowest contract charges 18,644 1.130940 21,084 Highest contract charges 13,210 12.828577 169,470 Remaining contract charges 1,169,257 -- 15,321,412 2003 Lowest contract charges 2,838 1.097784 3,115 Highest contract charges 1,247 12.698069 15,839 Remaining contract charges 1,243,626 -- 15,890,128 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- EQUITY AND INCOME 2007 Lowest contract charges 1.49% 1.71% 1.82% Highest contract charges 2.30% 1.98% 1.01% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% 1.22% 10.90% Highest contract charges 2.30% 1.30% 10.02% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.49% 0.44% 5.78% Highest contract charges 2.28% 0.94% 4.94% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.48% -- 9.86% Highest contract charges 1.95% -- 9.31% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.34% 1.76% 15.71% Highest contract charges -- -- -- Remaining contract charges -- -- -- CORE PLUS FIXED INCOME 2007 Lowest contract charges 1.30% 3.81% 4.09% Highest contract charges 2.59% 3.64% 2.75% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 3.25% 2.39% Highest contract charges 2.60% 4.17% 1.07% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 5.28% 2.87% Highest contract charges 2.59% 3.41% 1.54% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 4.26% 3.02% Highest contract charges 2.55% 2.41% 1.69% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 3.29% Highest contract charges 1.49% -- 0.89% Remaining contract charges -- -- --
SA-151 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- EMERGING MARKETS DEBT 2007 Lowest contract charges 18,052 $19.239520 $347,310 Highest contract charges 537 22.107798 11,866 Remaining contract charges 33,127 -- 717,081 2006 Lowest contract charges 17,642 18.314375 323,111 Highest contract charges 544 21.298708 11,572 Remaining contract charges 37,614 -- 781,955 2005 Lowest contract charges 18,877 16.761055 316,402 Highest contract charges 852 19.819846 16,896 Remaining contract charges 36,851 -- 702,356 2004 Lowest contract charges 22,170 15.142234 335,696 Highest contract charges 649 18.085485 11,742 Remaining contract charges 31,725 -- 535,933 2003 Lowest contract charges 26,169 13.951766 365,104 Highest contract charges 218 16.932756 3,683 Remaining contract charges 22,646 -- 356,997 EMERGING MARKETS EQUITY 2007 Lowest contract charges 742 23.038258 17,100 Highest contract charges 2,009 29.399461 59,063 Remaining contract charges 1,469,918 -- 33,295,994 2006 Lowest contract charges 1,175 16.525505 19,411 Highest contract charges 2,046 21.482782 43,957 Remaining contract charges 869,348 -- 14,284,032 2005 Lowest contract charges 531 12.138274 6,441 Highest contract charges 1,230 16.076611 19,777 Remaining contract charges 269,592 -- 3,375,145 2004 Lowest contract charges 4,818 1.443391 6,955 Highest contract charges 141 12.326618 1,742 Remaining contract charges 62,142 -- 751,277 2003 Lowest contract charges 4,818 1.187725 5,722 Highest contract charges 2,460 10.311851 25,367 Remaining contract charges 43,417 -- 423,599 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- EMERGING MARKETS DEBT 2007 Lowest contract charges 1.40% 7.21% 5.05% Highest contract charges 2.59% 7.15% 3.80% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.40% 8.79% 9.27% Highest contract charges 2.60% 14.71% 7.97% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% 7.34% 10.69% Highest contract charges 2.38% 8.56% 9.59% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 6.88% 8.53% Highest contract charges 2.38% 8.25% 7.45% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 26.09% Highest contract charges 1.47% -- 12.72% Remaining contract charges -- -- -- EMERGING MARKETS EQUITY 2007 Lowest contract charges 0.75% 0.52% 39.41% Highest contract charges 2.59% 0.44% 36.85% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.94% 36.14% Highest contract charges 2.60% 0.94% 33.63% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% 0.04% 34.19% Highest contract charges 2.57% 0.21% 30.42% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.66% 21.53% Highest contract charges 2.58% 1.07% 19.96% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 47.74% Highest contract charges 2.09% -- 45.90% Remaining contract charges -- -- --
SA-152 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- HIGH YIELD 2007 Lowest contract charges 26,511 $1.391435 $36,888 Highest contract charges 3,724 10.862917 40,459 Remaining contract charges 149,852 -- 1,705,781 2006 Lowest contract charges 28,253 1.355279 38,291 Highest contract charges 3,853 10.719109 41,307 Remaining contract charges 175,137 -- 1,954,541 2005 Lowest contract charges 9,408 1.264029 11,892 Highest contract charges 4,041 10.128146 40,930 Remaining contract charges 197,744 -- 2,068,897 2004 Lowest contract charges 84,772 10.727163 909,364 Highest contract charges 1,769 10.286162 18,193 Remaining contract charges 139,399 -- 1,454,327 2003 Lowest contract charges 98,201 9.935899 975,717 Highest contract charges 377 9.707303 3,663 Remaining contract charges 127,351 -- 1,232,501 MID CAP GROWTH 2007 Lowest contract charges 3,373 15.576117 52,545 Highest contract charges 3,985 14.863779 59,236 Remaining contract charges 803,112 -- 12,251,578 2006 Lowest contract charges 2,984 12.799102 38,197 Highest contract charges 2,092 12.416818 25,967 Remaining contract charges 471,350 -- 5,947,061 2005 Lowest contract charges 324 11.815831 3,826 Highest contract charges 499 11.653645 5,815 Remaining contract charges 148,437 -- 1,741,159 U.S. MID CAP VALUE 2007 Lowest contract charges 4,061 14.068913 57,130 Highest contract charges 4,473 20.076072 89,793 Remaining contract charges 1,091,216 -- 16,230,607 2006 Lowest contract charges 2,926 13.156067 38,498 Highest contract charges 4,623 19.105897 88,324 Remaining contract charges 851,133 -- 12,447,388 2005 Lowest contract charges 597 10.988986 6,557 Highest contract charges 3,755 16.246380 61,013 Remaining contract charges 514,087 -- 6,943,888 2004 Lowest contract charges 136,454 13.981589 1,907,850 Highest contract charges 2,888 14.846750 42,874 Remaining contract charges 260,350 -- 3,278,228 2003 Lowest contract charges 161,815 12.373105 2,002,156 Highest contract charges 488 13.386714 6,539 Remaining contract charges 225,789 -- 2,474,261 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- HIGH YIELD 2007 Lowest contract charges 1.30% 8.51% 2.67% Highest contract charges 2.59% 8.66% 1.34% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 5.07% 7.22% Highest contract charges 2.60% 8.08% 5.84% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% -- (0.25)% Highest contract charges 2.58% 6.50% (1.54)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 6.00% 7.96% Highest contract charges 2.58% 7.70% 6.68% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 23.96% Highest contract charges 1.48% -- 10.68% Remaining contract charges -- -- -- MID CAP GROWTH 2007 Lowest contract charges 0.75% -- 21.70% Highest contract charges 2.38% -- 19.71% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 8.32% Highest contract charges 2.38% -- 6.55% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 24.28% Highest contract charges 2.37% -- 22.92% Remaining contract charges -- -- -- U.S. MID CAP VALUE 2007 Lowest contract charges 0.75% 0.60% 6.94% Highest contract charges 2.59% 0.65% 5.08% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.24% 19.72% Highest contract charges 2.60% 0.31% 17.60% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 13.94% Highest contract charges 2.59% 0.28% 9.43% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 0.02% 13.00% Highest contract charges 2.58% 0.03% 11.65% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 39.54% Highest contract charges 1.48% -- 33.41% Remaining contract charges -- -- --
SA-153 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY --------------------------------------------------------------------------- FOCUS GROWTH 2007 Lowest contract charges 356,325 $1.333634 $475,207 Highest contract charges 1,431 8.111956 11,605 Remaining contract charges 659,802 -- 13,628,464 2006 Lowest contract charges 355,168 1.100382 390,820 Highest contract charges 1,437 6.783478 9,752 Remaining contract charges 818,093 -- 14,392,660 2005 Lowest contract charges 301,232 1.110661 334,567 Highest contract charges 2,590 6.940242 17,977 Remaining contract charges 1,009,643 -- 19,040,049 2004 Lowest contract charges 306,404 0.983629 301,389 Highest contract charges 2,599 6.227146 16,185 Remaining contract charges 1,212,281 -- 21,047,470 2003 Lowest contract charges 298,056 0.920177 274,264 Highest contract charges 8,240 5.911953 48,715 Remaining contract charges 1,565,664 -- 26,926,215 BALANCED GROWTH 2007 Lowest contract charges 508,592 1.356218 689,762 Highest contract charges 43 13.947661 600 Remaining contract charges 348,180 -- 7,535,741 2006 Lowest contract charges 605,059 1.322920 800,445 Highest contract charges 60 13.776356 821 Remaining contract charges 434,311 -- 9,517,234 2005 Lowest contract charges 526,064 1.189469 625,737 Highest contract charges 60 12.545496 748 Remaining contract charges 509,446 -- 10,208,197 2004 Lowest contract charges 104,168 1.113625 16,002 Highest contract charges 1,232 11.924222 14,691 Remaining contract charges 671,814 -- 13,017,016 2003 Lowest contract charges 104,166 1.017026 105,939 Highest contract charges 1,259 11.007388 13,856 Remaining contract charges 756,760 -- 13,374,030 CAPITAL OPPORTUNITIES 2007 Lowest contract charges 18,070 1.508588 27,260 Highest contract charges 755 5.111479 3,862 Remaining contract charges 617,285 -- 4,671,313 2006 Lowest contract charges 18,070 1.280881 23,146 Highest contract charges 650 4.405475 2,868 Remaining contract charges 707,811 -- 4,829,627 2005 Lowest contract charges 4,327 1.203121 5,205 Highest contract charges 651 4.204831 2,739 Remaining contract charges 802,408 -- 5,352,617 2004 Lowest contract charges 5,696 0.994021 5,664 Highest contract charges 521 3.530842 1,841 Remaining contract charges 949,695 -- 5,366,990 2003 Lowest contract charges 376,405 7.822737 2,944,514 Highest contract charges 12,610 2.979113 37,568 Remaining contract charges 499,056 -- 1,552,683 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** ------------------------------ ---------------------------------------------------- FOCUS GROWTH 2007 Lowest contract charges 1.30% -- 21.20% Highest contract charges 2.39% -- 19.58% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.02% (0.93)% Highest contract charges 2.41% -- (2.26)% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.72% 12.92% Highest contract charges 2.39% 0.45% 11.45% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.36% 6.90% Highest contract charges 2.39% 0.11% 5.40% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 19.01% Highest contract charges 1.44% -- 17.02% Remaining contract charges -- -- -- BALANCED GROWTH 2007 Lowest contract charges 1.30% 2.54% 2.52% Highest contract charges 2.26% 2.26% 1.24% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.67% 11.22% Highest contract charges 2.33% 2.36% 9.81% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 2.51% 6.81% Highest contract charges 2.34% 2.19% 5.44% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 2.31% 9.50% Highest contract charges 2.15% 2.06% 8.33% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 3.14% 18.29% Highest contract charges 1.44% 1.92% 15.79% 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 1.26% -- 6.46% Highest contract charges 2.61% -- 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 1.27% -- 21.01% Highest contract charges 2.59% -- 19.27% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% -- 39.67% Highest contract charges 1.17% -- 28.54% Remaining contract charges -- -- --
SA-154 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- DEVELOPING GROWTH 2007 Lowest contract charges 25,036 $1.942474 $48,631 Highest contract charges 2,609 10.806114 28,192 Remaining contract charges 154,380 -- 4,171,799 2006 Lowest contract charges 30,593 1.600730 48,971 Highest contract charges 2,705 9.042643 24,458 Remaining contract charges 212,832 -- 4,858,161 2005 Lowest contract charges 37,737 1.465011 55,285 Highest contract charges 2,846 8.405217 23,923 Remaining contract charges 268,535 -- 5,570,422 2004 Lowest contract charges 30,705 1.250444 38,397 Highest contract charges 152 7.285686 1,109 Remaining contract charges 318,391 -- 5,916,226 2003 Lowest contract charges 13,786 1.035726 14,279 Highest contract charges 4,535 6.144071 27,866 Remaining contract charges 344,050 -- 5,765,780 FLEXIBLE INCOME 2007 Lowest contract charges 119,067 1.397865 166,440 Highest contract charges 1,798 11.282737 20,286 Remaining contract charges 311,314 -- 4,102,187 2006 Lowest contract charges 90,335 1.363163 123,141 Highest contract charges 1,886 11.173114 21,089 Remaining contract charges 359,514 -- 4,708,357 2005 Lowest contract charges 28,620 1.305789 37,371 Highest contract charges 1,987 10.851070 21,562 Remaining contract charges 428,841 -- 5,418,356 2004 Lowest contract charges 16,611 1.285868 21,359 Highest contract charges 1,814 10.852128 19,683 Remaining contract charges 599,234 -- 7,396,898 2003 Lowest contract charges 2,324 1.217480 2,829 Highest contract charges 652 10.446908 6,807 Remaining contract charges 445,340 -- 5,545,946 DIVIDEND GROWTH 2007 Lowest contract charges 238,842 1.226769 293,004 Highest contract charges 787 12.390268 9,753 Remaining contract charges 752,777 -- 19,398,799 2006 Lowest contract charges 256,585 1.191924 305,830 Highest contract charges 792 12.208537 9,658 Remaining contract charges 977,083 -- 25,030,874 2005 Lowest contract charges 233,502 1.085444 253,454 Highest contract charges 828 11.267672 9,326 Remaining contract charges 1,246,270 -- 29,531,082 2004 Lowest contract charges 127,169 1.041591 132,458 Highest contract charges 832 10.958814 9,117 Remaining contract charges 1,596,811 -- 36,647,893 2003 Lowest contract charges 125,937 0.974474 122,723 Highest contract charges 7,937 10.426884 82,759 Remaining contract charges 1,975,665 -- 42,825,348 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ DEVELOPING GROWTH 2007 Lowest contract charges 1.30% 0.46% 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 1.29% -- 17.16% Highest contract charges 2.57% -- 15.37% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% -- 20.73% Highest contract charges 2.61% -- 18.82% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% -- 39.58% Highest contract charges 1.44% -- 28.73% Remaining contract charges -- -- -- FLEXIBLE INCOME 2007 Lowest contract charges 1.29% 6.18% 2.55% Highest contract charges 2.59% 5.91% 0.98% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 6.22% 4.39% Highest contract charges 2.60% 6.20% 2.97% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 6.91% 1.55% Highest contract charges 2.59% 6.89% (0.01)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 8.96% 5.62% Highest contract charges 2.59% 9.44% 3.88% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% 5.84% 12.08% Highest contract charges 1.59% 3.85% 6.24% Remaining contract charges -- -- -- DIVIDEND GROWTH 2007 Lowest contract charges 1.30% 1.18% 2.92% Highest contract charges 2.39% 0.93% 1.49% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.36% 9.81% Highest contract charges 2.40% 1.08% 8.35% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.37% 4.21% Highest contract charges 2.39% 1.02% 2.82% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 1.60% 6.89% Highest contract charges 2.37% 3.13% 5.47% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 2.18% 26.09% Highest contract charges 1.29% 1.24% 21.61% Remaining contract charges -- -- --
SA-155 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- GLOBAL EQUITY 2007 Lowest contract charges 87,872 $1.696135 $149,043 Highest contract charges 1,132 11.805397 13,364 Remaining contract charges 320,963 -- 7,355,454 2006 Lowest contract charges 91,504 1.475550 135,018 Highest contract charges 1,132 10.431601 11,809 Remaining contract charges 407,876 -- 8,191,241 2005 Lowest contract charges 118,077 1.229415 145,165 Highest contract charges 962 8.822506 8,487 Remaining contract charges 483,965 -- 8,219,480 2004 Lowest contract charges 94,315 1.125673 106,169 Highest contract charges 362 8.243688 2,982 Remaining contract charges 569,788 -- 8,978,583 2003 Lowest contract charges 105,930 1.054284 111,680 Highest contract charges 3,521 7.845732 27,627 Remaining contract charges 657,150 -- 10,000,357 GROWTH 2007 Lowest contract charges 216,266 1.376764 297,747 Highest contract charges 9,768 8.205665 80,154 Remaining contract charges 195,013 -- 3,166,569 2006 Lowest contract charges 249,157 1.143977 285,029 Highest contract charges 10,841 6.926968 75,102 Remaining contract charges 234,734 -- 3,200,361 2005 Lowest contract charges 148,101 1.115013 165,135 Highest contract charges 10,483 6.852504 71,835 Remaining contract charges 270,704 -- 3,856,901 2004 Lowest contract charges 9,176 0.977539 8,970 Highest contract charges 4,574 6.104294 27,920 Remaining contract charges 326,924 -- 4,081,409 2003 Lowest contract charges 9,176 0.920058 8,443 Highest contract charges 218 5.860878 1,278 Remaining contract charges 387,025 -- 4,746,465 MONEY MARKET 2007 Lowest contract charges 226,793 13.835207 3,137,724 Highest contract charges 1,551 10.215179 15,841 Remaining contract charges 436,272 -- 4,666,668 2006 Lowest contract charges 298,634 13.370650 3,992,927 Highest contract charges 1,511 10.017061 15,139 Remaining contract charges 285,186 -- 2,973,513 2005 Lowest contract charges 328,687 12.963657 4,260,982 Highest contract charges 1,381 9.853007 13,605 Remaining contract charges 248,967 -- 2,533,282 2004 Lowest contract charges 23,538 0.988854 23,275 Highest contract charges 1,419 9.867901 13,999 Remaining contract charges 761,387 -- 8,829,364 2003 Lowest contract charges 678,970 12.866023 8,735,641 Highest contract charges 1,326 10.080023 13,365 Remaining contract charges 400,218 -- 4,094,566 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ GLOBAL EQUITY 2007 Lowest contract charges 1.30% 0.66% 14.95% Highest contract charges 2.59% 0.43% 13.17% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 0.78% 20.02% Highest contract charges 2.60% 0.54% 18.24% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.30% 0.62% 9.22% Highest contract charges 2.52% -- 7.49% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.24% 6.77% Highest contract charges 2.18% -- 5.44% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 0.38% 32.98% Highest contract charges 1.29% -- 27.38% Remaining contract charges -- -- -- GROWTH 2007 Lowest contract charges 1.30% -- 20.35% Highest contract charges 2.60% -- 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% 0.49% 14.06% Highest contract charges 2.58% 0.29% 12.26% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.21% 6.25% Highest contract charges 1.95% -- 4.63% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.28% -- 25.27% Highest contract charges 1.91% -- 24.07% Remaining contract charges -- -- -- MONEY MARKET 2007 Lowest contract charges 1.40% 4.82% 3.47% Highest contract charges 2.59% 4.54% 1.98% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.40% 4.50% 3.14% Highest contract charges 2.60% 4.26% 1.67% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% 2.67% 1.31% Highest contract charges 2.59% 2.44% (0.15)% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.29% 1.45% (0.44)% Highest contract charges 2.54% 1.07% (1.97)% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 0.66% (0.75)% Highest contract charges 1.49% 0.18% (1.28)% Remaining contract charges -- -- --
SA-156 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- UTILITIES 2007 Lowest contract charges 198,781 $1.895936 $376,876 Highest contract charges 2,925 11.721275 34,284 Remaining contract charges 229,022 -- 5,503,761 2006 Lowest contract charges 194,271 1.602471 311,314 Highest contract charges 973 9.979562 9,714 Remaining contract charges 272,416 -- 5,837,090 2005 Lowest contract charges 166,305 1.347218 224,049 Highest contract charges 973 8.485148 8,259 Remaining contract charges 328,494 -- 6,229,696 2004 Lowest contract charges 27,527 1.173772 32,310 Highest contract charges 1,766 7.473436 13,196 Remaining contract charges 381,649 -- 6,589,087 2003 Lowest contract charges 3,754 0.955583 3,588 Highest contract charges 1,804 6.150422 11,096 Remaining contract charges 446,982 -- 6,437,087 EQUALLY-WEIGHTED S&P 500 2007 Lowest contract charges 317,919 1.504079 478,175 Highest contract charges 10,652 15.263891 162,594 Remaining contract charges 818,669 -- 18,977,916 2006 Lowest contract charges 334,184 1.501713 501,848 Highest contract charges 10,471 15.474905 162,060 Remaining contract charges 1,016,391 -- 24,351,909 2005 Lowest contract charges 244,008 1.315013 320,873 Highest contract charges 9,116 13.770088 125,521 Remaining contract charges 1,230,334 -- 26,975,980 2004 Lowest contract charges 104,751 1.235637 129,433 Highest contract charges 4,282 13.138524 56,256 Remaining contract charges 1,551,252 -- 33,099,080 2003 Lowest contract charges 76,728 1.073160 82,342 Highest contract charges 6,898 11.606791 80,066 Remaining contract charges 1,486,823 -- 30,163,701 SMALL COMPANY GROWTH 2007 Lowest contract charges 9,092 13.969089 127,000 Highest contract charges 5,965 13.404473 79,958 Remaining contract charges 32,601 -- 444,578 2006 Lowest contract charges 8,782 13.772179 120,951 Highest contract charges 6,109 13.361686 81,622 Remaining contract charges 31,346 -- 423,732 2005 Lowest contract charges 10,015 12.500760 125,194 Highest contract charges 5,691 12.262332 69,779 Remaining contract charges 27,354 -- 337,995 2004 Lowest contract charges 2,381 11.241435 26,774 Highest contract charges 723 11.148935 8,065 Remaining contract charges 4,346 -- 48,619 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ UTILITIES 2007 Lowest contract charges 1.30% 1.82% 18.31% Highest contract charges 2.09% 1.58% 17.11% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 2.16% 18.95% Highest contract charges 2.16% 1.85% 17.61% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 2.40% 14.78% Highest contract charges 2.15% 1.82% 13.54% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.27% 2.92% 22.83% Highest contract charges 2.15% 1.99% 21.51% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.26% 2.61% 18.92% Highest contract charges 1.44% 2.00% 14.46% Remaining contract charges -- -- -- EQUALLY-WEIGHTED S&P 500 2007 Lowest contract charges 1.30% 1.46% 0.16% Highest contract charges 2.59% 1.21% (1.36)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.30% 1.04% 14.20% Highest contract charges 2.60% 1.13% 12.38% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.29% 1.03% 6.42% Highest contract charges 2.58% 0.79% 4.81% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.30% 0.82% 15.14% Highest contract charges 2.55% -- 13.35% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.29% 1.25% 35.38% Highest contract charges 1.48% -- 29.88% Remaining contract charges -- -- -- SMALL COMPANY GROWTH 2007 Lowest contract charges 1.50% -- 1.43% Highest contract charges 2.59% -- 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 1.48% -- 11.20% Highest contract charges 2.57% -- 9.99% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.11% -- 12.41% Highest contract charges 1.90% -- 11.49% Remaining contract charges -- -- --
SA-157 SEPARATE ACCOUNT THREE HARTFORD LIFE 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 15,779 $19.407659 $306,231 Highest contract charges 162 18.455152 2,989 Remaining contract charges 44,689 -- 848,655 2006 Lowest contract charges 17,712 17.945559 317,850 Highest contract charges 427 17.253444 7,374 Remaining contract charges 45,826 -- 808,150 2005 Lowest contract charges 17,933 14.991994 268,855 Highest contract charges 383 14.573126 5,585 Remaining contract charges 47,497 -- 703,251 2004 Lowest contract charges 3,027 13.590845 41,156 Highest contract charges 103 13.357186 1,382 Remaining contract charges 25,682 -- 346,338 2003 Lowest contract charges 613 12.234140 7,505 Highest contract charges 8,056 12.181166 98,126 Remaining contract charges 15,548 -- 189,744 MTB LARGE CAP GROWTH FUND II 2007 Lowest contract charges 375,398 1.194606 448,453 Highest contract charges 29,188 1.159425 33,841 Remaining contract charges 685,644 -- 806,010 2006 Lowest contract charges 145,521 1.107052 161,099 Highest contract charges 20,256 1.083082 21,939 Remaining contract charges 473,557 -- 517,676 2005 Lowest contract charges 63,248 1.014895 64,190 Highest contract charges 7,579 1.000907 7,586 Remaining contract charges 222,424 -- 223,978 MTB LARGE CAP VALUE FUND II 2007 Lowest contract charges 1,127,372 1.335509 1,505,616 Highest contract charges 17,100 1.296207 22,165 Remaining contract charges 1,363,509 -- 1,789,725 2006 Lowest contract charges 370,926 1.330094 493,367 Highest contract charges 13,085 1.301319 17,026 Remaining contract charges 1,044,404 -- 1,371,094 2005 Lowest contract charges 12,241 1.144063 14,005 Highest contract charges 3,318 1.128300 3,744 Remaining contract charges 404,289 -- 458,609 MTB MANAGED ALLOCATION FUND -- MODERATE GROWTH II 2007 Lowest contract charges 1,246,543 1.213306 1,512,439 Highest contract charges 68,363 1.177618 80,506 Remaining contract charges 1,482,212 -- 1,773,608 2006 Lowest contract charges 721,243 1.148226 828,150 Highest contract charges 50,226 1.123383 56,422 Remaining contract charges 1,341,151 -- 1,523,368 2005 Lowest contract charges 596,925 1.052312 628,151 Highest contract charges 50,225 1.037808 52,124 Remaining contract charges 815,357 -- 851,305 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% 1.41% 19.70% Highest contract charges 2.60% 1.41% 18.39% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.47% -- 10.31% Highest contract charges 2.57% -- 9.10% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.49% 0.18% 11.09% Highest contract charges 2.59% 0.20% 9.88% Remaining contract charges -- -- -- 2003 Lowest contract charges 0.95% -- 22.34% Highest contract charges 1.39% -- 21.81% Remaining contract charges -- -- -- MTB LARGE CAP GROWTH FUND II 2007 Lowest contract charges 1.14% 0.52% 7.91% Highest contract charges 1.94% 0.42% 7.05% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.75% 9.08% Highest contract charges 1.94% 0.69% 8.21% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 0.68% 5.71% Highest contract charges 1.69% 4.71% 5.15% Remaining contract charges -- -- -- MTB LARGE CAP VALUE FUND II 2007 Lowest contract charges 1.14% 1.14% 0.41% Highest contract charges 1.94% 1.04% (0.39)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.27% 16.26% Highest contract charges 1.95% 1.51% 15.33% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 1.12% 12.93% Highest contract charges 1.91% 1.32% 12.33% Remaining contract charges -- -- -- MTB MANAGED ALLOCATION FUND -- MODERATE GROWTH II 2007 Lowest contract charges 1.14% 2.55% 5.67% Highest contract charges 1.94% 2.23% 4.83% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 2.98% 9.12% Highest contract charges 1.95% 2.57% 8.25% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 3.02% 6.53% Highest contract charges 1.91% 2.70% 5.97% Remaining contract charges -- -- --
SA-158 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- MTB MANAGED ALLOCATION FUND -- AGGRESSIVE GROWTH II 2007 Lowest contract charges 17,253 $12.791953 $220,696 Highest contract charges 1,553 12.530085 19,455 Remaining contract charges 30,683 -- 388,644 2006 Lowest contract charges 10,559 12.013898 126,849 Highest contract charges 1,552 11.862441 18,418 Remaining contract charges 21,482 -- 256,371 2005 Lowest contract charges 5,217 10.555525 55,068 Highest contract charges 1,156 10.536982 12,177 Remaining contract charges -- -- -- MTB MANAGED ALLOCATION FUND -- CONSERVATIVE GROWTH II 2007 Lowest contract charges 28,972 11.204078 324,604 Highest contract charges 963 10.974704 10,571 Remaining contract charges 23,349 -- 258,726 2006 Lowest contract charges 6,164 10.778088 66,431 Highest contract charges 11,938 10.692953 127,657 Remaining contract charges 885 -- 9,498 2005 Lowest contract charges 683 10.193799 6,959 Highest contract charges 8,437 10.163961 85,750 Remaining contract charges -- -- -- OPPENHEIMER MIDCAP FUND VA 2007 Lowest contract charges 70,205 11.803633 828,669 Highest contract charges 119 11.376060 1,358 Remaining contract charges 185,717 -- 2,157,215 2006 Lowest contract charges 49,690 11.260326 559,525 Highest contract charges 712 11.004514 7,840 Remaining contract charges 136,830 -- 1,523,421 2005 Lowest contract charges 9,331 11.091041 103,485 Highest contract charges 1,549 10.975468 16,996 Remaining contract charges 60,003 -- 661,983 OPPENHEIMER CAPITAL APPRECIATION FUND 2007 Lowest contract charges 6,655 12.809096 85,239 Highest contract charges 595 12.205811 7,268 Remaining contract charges 4,333,439 -- 54,285,305 2006 Lowest contract charges 1,770 11.334601 20,066 Highest contract charges 171 10.985837 1,879 Remaining contract charges 2,730,869 -- 30,486,392 2005 Lowest contract charges 168,848 10.569767 1,784,688 Highest contract charges 486 10.455204 5,079 Remaining contract charges 854,758 -- 8,989,795 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ MTB MANAGED ALLOCATION FUND -- AGGRESSIVE GROWTH II 2007 Lowest contract charges 1.15% 1.50% 6.48% Highest contract charges 1.94% 1.22% 5.63% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 5.11% 13.48% Highest contract charges 1.95% 2.74% 12.58% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.84% -- 9.84% Highest contract charges 1.86% 2.29% 9.67% Remaining contract charges -- -- -- MTB MANAGED ALLOCATION FUND -- CONSERVATIVE GROWTH II 2007 Lowest contract charges 1.14% 3.16% 3.95% Highest contract charges 1.94% 2.64% 3.12% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 5.40% 5.73% Highest contract charges 1.65% 3.06% 5.21% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% 10.26% 1.55% Highest contract charges 1.59% 7.38% 1.30% Remaining contract charges -- -- -- OPPENHEIMER MIDCAP FUND VA 2007 Lowest contract charges 1.15% -- 4.83% Highest contract charges 2.34% -- 3.47% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% -- 1.53% Highest contract charges 2.40% -- 0.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 16.86% Highest contract charges 2.24% -- 15.89% Remaining contract charges -- -- -- OPPENHEIMER CAPITAL APPRECIATION FUND 2007 Lowest contract charges 0.74% -- 13.01% Highest contract charges 2.40% 0.01% 11.11% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 6.88% Highest contract charges 2.48% 0.33% 5.08% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 8.93% Highest contract charges 2.43% -- 7.99% Remaining contract charges -- -- --
SA-159 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- OPPENHEIMER GLOBAL SECURITIES FUND 2007 Lowest contract charges 39,729 $14.137670 $561,682 Highest contract charges 275 10.304583 2,838 Remaining contract charges 15,324,409 -- 212,354,905 2006 Lowest contract charges 20,123 13.427502 270,208 Highest contract charges 90,175 13.026465 1,174,656 Remaining contract charges 8,295,986 -- 109,880,758 2005 Lowest contract charges 441 11.527071 5,085 Highest contract charges 17,923 11.368801 203,763 Remaining contract charges 1,488,733 -- 17,040,032 OPPENHEIMER MAIN STREET FUND 2007 Lowest contract charges 1,210 12.344736 14,937 Highest contract charges 366 11.763316 4,309 Remaining contract charges 931,556 -- 11,205,388 2006 Lowest contract charges 1,082 11.941867 12,919 Highest contract charges 32,407 11.585138 375,442 Remaining contract charges 596,326 -- 7,004,299 2005 Lowest contract charges 24,595 10.449383 257,000 Highest contract charges 11,654 10.340458 120,506 Remaining contract charges 138,213 -- 1,436,045 OPPENHEIMER MAIN STREET SMALL CAP FUND 2007 Lowest contract charges 1,457 12.219796 17,809 Highest contract charges 1,956 11.644211 22,781 Remaining contract charges 6,321,287 -- 75,547,559 2006 Lowest contract charges 454 12.485517 5,664 Highest contract charges 214 12.101367 2,593 Remaining contract charges 4,141,269 -- 50,925,541 2005 Lowest contract charges 196,865 10.934626 2,152,647 Highest contract charges 308 10.816124 3,330 Remaining contract charges 1,027,593 -- 11,179,057 PUTNAM DIVERSIFIED INCOME 2007 Lowest contract charges 5,348 18.865269 100,892 Highest contract charges 58,882 13.944160 821,067 Remaining contract charges 2,204,985 -- 37,724,801 2006 Lowest contract charges 970 18.253223 17,711 Highest contract charges 13,592 13.716189 186,414 Remaining contract charges 1,195,380 -- 19,738,506 2005 Lowest contract charges 367 17.301813 6,346 Highest contract charges 8,554 13.217511 113,064 Remaining contract charges 326,890 -- 4,958,614 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ OPPENHEIMER GLOBAL SECURITIES FUND 2007 Lowest contract charges 0.75% 0.80% 5.29% Highest contract charges 1.72% -- (1.60)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.32% 16.49% Highest contract charges 2.39% 0.36% 14.58% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.75% -- 19.81% Highest contract charges 2.33% -- 18.50% Remaining contract charges -- -- -- OPPENHEIMER MAIN STREET FUND 2007 Lowest contract charges 0.75% 0.74% 3.37% Highest contract charges 2.35% -- 1.63% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.74% -- 13.90% Highest contract charges 2.40% 0.59% 12.04% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 8.85% Highest contract charges 2.32% -- 7.95% Remaining contract charges -- -- -- OPPENHEIMER MAIN STREET SMALL CAP FUND 2007 Lowest contract charges 0.75% 0.04% (2.13)% Highest contract charges 2.41% 0.04% (3.78)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% -- 13.80% Highest contract charges 2.45% 0.03% 11.88% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% -- 17.49% Highest contract charges 2.43% -- 16.48% Remaining contract charges -- -- -- PUTNAM DIVERSIFIED INCOME 2007 Lowest contract charges 0.74% 4.24% 3.35% Highest contract charges 2.38% 4.34% 1.66% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.76% 3.63% 5.50% Highest contract charges 2.40% 6.11% 3.77% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.70% -- 2.19% Highest contract charges 2.37% -- 1.07% Remaining contract charges -- -- --
SA-160 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM GLOBAL ASSET ALLOCATION 2007 Lowest contract charges 1,927 $38.469378 $74,121 Highest contract charges 136 9.944940 1,352 Remaining contract charges 435,605 -- 7,530,354 2006 Lowest contract charges 1,892 37.652345 71,246 Highest contract charges 10,360 11.181051 115,842 Remaining contract charges 332,210 -- 5,142,488 2005 Lowest contract charges 285 33.613874 9,575 Highest contract charges 4,787 10.147839 48,581 Remaining contract charges 153,851 -- 2,118,783 PUTNAM GROWTH AND INCOME 2007 Lowest contract charges 5 55.693138 276 Highest contract charges 561 11.122224 6,244 Remaining contract charges 264,785 -- 7,115,966 2006 Lowest contract charges 139 59.390313 8,267 Highest contract charges 562 12.130723 6,811 Remaining contract charges 145,557 -- 3,877,563 2005 Lowest contract charges 3,365 51.469113 173,195 Highest contract charges 561 10.725103 6,021 Remaining contract charges 47,120 -- 807,097 PUTNAM INTERNATIONAL GROWTH AND INCOME 2007 Lowest contract charges 459 9.760552 4,477 Highest contract charges 4,906 9.746889 47,823 Remaining contract charges -- -- -- PUTNAM INTERNATIONAL EQUITY 2007 Lowest contract charges 2,460 26.666709 65,587 Highest contract charges 12,229 10.270794 125,599 Remaining contract charges 4,463,983 -- 81,316,834 2006 Lowest contract charges 2,426 24.793041 60,141 Highest contract charges 75,170 12.560151 944,159 Remaining contract charges 3,401,844 -- 56,766,723 2005 Lowest contract charges 501 19.558296 9,799 Highest contract charges 50,940 10.073002 513,120 Remaining contract charges 1,487,032 -- 18,510,038 PUTNAM INVESTORS 2007 Lowest contract charges 11,096 10.573923 117,332 Highest contract charges 809 7.289828 5,896 Remaining contract charges 2,393,816 -- 21,915,259 2006 Lowest contract charges 11,276 11.233877 126,668 Highest contract charges 21,453 7.889516 169,261 Remaining contract charges 400,775 -- 3,629,416 2005 Lowest contract charges 477 9.934290 4,742 Highest contract charges 9,771 7.092883 69,306 Remaining contract charges 91,359 -- 718,761 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM GLOBAL ASSET ALLOCATION 2007 Lowest contract charges 0.75% 0.50% 2.17% Highest contract charges 1.83% -- (2.89)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 2.08% 12.01% Highest contract charges 2.41% 2.52% 10.18% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.66% -- 7.04% Highest contract charges 2.37% -- 5.87% Remaining contract charges -- -- -- PUTNAM GROWTH AND INCOME 2007 Lowest contract charges 0.27% -- (6.74)% Highest contract charges 2.45% 1.29% (8.31)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.04% -- 14.70% Highest contract charges 2.45% 1.51% 13.11% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 7.83% Highest contract charges 2.42% -- 6.90% Remaining contract charges -- -- -- PUTNAM INTERNATIONAL GROWTH AND INCOME 2007 Lowest contract charges -- -- (1.12)% Highest contract charges 0.45% -- (1.18)% Remaining contract charges -- -- -- PUTNAM INTERNATIONAL EQUITY 2007 Lowest contract charges 0.75% 2.20% 7.56% Highest contract charges 1.85% -- (1.78)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.45% 26.77% Highest contract charges 2.40% 0.54% 24.69% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.72% -- 14.66% Highest contract charges 2.36% -- 13.41% Remaining contract charges -- -- -- PUTNAM INVESTORS 2007 Lowest contract charges 0.75% 0.36% (5.88)% Highest contract charges 2.44% -- (7.46)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.30% 13.08% Highest contract charges 2.39% 0.29% 11.23% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.67% -- 13.42% Highest contract charges 2.37% -- 12.18% Remaining contract charges -- -- --
SA-161 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM NEW VALUE 2007 Lowest contract charges 10,391 $21.041934 $218,652 Highest contract charges 4,782 14.754219 70,552 Remaining contract charges 514,066 -- 9,973,501 2006 Lowest contract charges 8,051 22.290074 179,448 Highest contract charges 403 15.897471 6,415 Remaining contract charges 412,552 -- 8,516,540 2005 Lowest contract charges 1,639 19.357998 31,730 Highest contract charges 322 14.042955 4,518 Remaining contract charges 140,949 -- 2,498,944 PUTNAM SMALL CAP VALUE 2007 Lowest contract charges 4,054 23.443202 95,047 Highest contract charges 1,594 19.242065 30,680 Remaining contract charges 2,601,796 -- 57,318,667 2006 Lowest contract charges 3,804 27.061733 102,943 Highest contract charges 308 22.593352 6,938 Remaining contract charges 1,863,912 -- 47,612,225 2005 Lowest contract charges 1,198 23.245262 27,851 Highest contract charges 351 19.739785 6,933 Remaining contract charges 548,831 -- 12,052,729 PUTNAM THE GEORGE PUTNAM FUND OF BOSTON 2007 Lowest contract charges 4,043 13.832698 55,931 Highest contract charges 121 12.282903 1,488 Remaining contract charges 445,569 -- 6,055,625 2006 Lowest contract charges 3,647 13.805165 50,352 Highest contract charges 8,607 12.487367 107,476 Remaining contract charges 273,718 -- 3,753,816 2005 Lowest contract charges 3,865 12.396378 47,916 Highest contract charges 1,549 11.428257 17,706 Remaining contract charges 104,780 -- 1,300,311 PUTNAM VISTA 2007 Lowest contract charges 1,154 17.006719 19,632 Highest contract charges 22,856 6.525817 149,153 Remaining contract charges 102,270 -- 887,307 2006 Lowest contract charges 1,154 16.505957 19,054 Highest contract charges 23,550 6.439048 151,636 Remaining contract charges 68,537 -- 626,681 2005 Lowest contract charges 201 15.770447 3,165 Highest contract charges 16,747 6.254512 104,745 Remaining contract charges 26,149 -- 239,527 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM NEW VALUE 2007 Lowest contract charges 0.75% 1.02% (5.60)% Highest contract charges 2.42% 0.28% (7.19)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.88% 15.15% Highest contract charges 2.47% 1.04% 13.21% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 9.05% Highest contract charges 2.36% -- 7.82% Remaining contract charges -- -- -- PUTNAM SMALL CAP VALUE 2007 Lowest contract charges 0.75% 0.55% (13.37)% Highest contract charges 2.42% 0.25% (14.83)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.22% 16.42% Highest contract charges 2.45% 0.35% 14.46% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.74% -- 14.65% Highest contract charges 2.40% -- 13.36% Remaining contract charges -- -- -- PUTNAM THE GEORGE PUTNAM FUND OF BOSTON 2007 Lowest contract charges 0.75% 2.58% 0.20% Highest contract charges 2.33% -- (1.49)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.05% 11.09% Highest contract charges 2.39% 0.99% 9.27% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.03% -- 4.64% Highest contract charges 2.31% -- 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 0.68% -- 17.35% Highest contract charges 2.34% -- 16.07% Remaining contract charges -- -- --
SA-162 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- PUTNAM VOYAGER 2007 Lowest contract charges 12,446 $57.361079 $713,888 Highest contract charges 15,515 6.793891 105,407 Remaining contract charges 109,928 -- 1,382,628 2006 Lowest contract charges 9,719 54.988920 534,449 Highest contract charges 20,466 6.594853 134,974 Remaining contract charges 97,106 -- 1,385,620 2005 Lowest contract charges 2,926 52.757362 154,348 Highest contract charges 8,792 6.406829 56,326 Remaining contract charges 155,195 -- 1,306,144 PIONEER FUND VCT PORTFOLIO 2007 Lowest contract charges 56,562 1.216169 68,789 Highest contract charges 494,858 1.190416 589,087 Remaining contract charges 94,748 -- 113,981 2006 Lowest contract charges 57,063 1.174047 66,995 Highest contract charges 360,589 1.160156 418,342 Remaining contract charges 83,927 -- 97,906 2005 Lowest contract charges 46,189 1.020694 47,145 Highest contract charges 368,849 1.018250 375,581 Remaining contract charges 49,888 -- 50,857 PIONEER OAK RIDGE LARGE CAP GROWTH VCT PORTFOLIO 2007 Lowest contract charges 15,530 1.129146 17,536 Highest contract charges 4,255 1.097818 4,671 Remaining contract charges 456,398 -- 506,293 2006 Lowest contract charges 16,360 1.056411 17,282 Highest contract charges 4,327 1.040018 4,502 Remaining contract charges 483,702 -- 505,951 2005 Lowest contract charges 11,074 1.039627 11,513 Highest contract charges 12,691 1.036360 13,152 Remaining contract charges 279,510 -- 289,981 ENTERPRISE 2007 Lowest contract charges 49,295 9.697231 478,020 Highest contract charges 3,327 6.329218 21,057 Remaining contract charges 125,181 -- 836,266 2006 Lowest contract charges 73,844 8.727171 644,445 Highest contract charges 3,326 5.776113 19,216 Remaining contract charges 143,911 -- 869,532 2005 Lowest contract charges 85,125 8.265196 703,577 Highest contract charges 3,327 5.552645 18,473 Remaining contract charges 147,341 -- 848,130 2004 Lowest contract charges 124,710 7.750029 966,502 Highest contract charges 3,327 5.282739 17,575 Remaining contract charges 172,624 -- 936,701 2003 Lowest contract charges 124,465 7.553252 940,117 Highest contract charges 5,192 5.249094 27,253 Remaining contract charges 181,384 -- 966,132 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ PUTNAM VOYAGER 2007 Lowest contract charges 1.15% -- 4.31% Highest contract charges 2.40% -- 3.02% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.09% 4.23% Highest contract charges 2.40% 0.07% 2.94% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 13.06% Highest contract charges 2.37% -- 12.12% Remaining contract charges -- -- -- PIONEER FUND VCT PORTFOLIO 2007 Lowest contract charges 1.15% 0.98% 3.59% Highest contract charges 2.09% 1.03% 2.61% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.14% 15.02% Highest contract charges 2.10% 1.11% 13.94% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.14% 1.38% 2.57% Highest contract charges 2.07% 1.91% 2.42% Remaining contract charges -- -- -- PIONEER OAK RIDGE LARGE CAP GROWTH VCT PORTFOLIO 2007 Lowest contract charges 1.15% 0.20% 6.89% Highest contract charges 2.39% 0.19% 5.56% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 0.04% 1.61% Highest contract charges 2.44% 0.01% 0.35% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.13% -- 2.04% Highest contract charges 2.35% -- 1.84% Remaining contract charges -- -- -- ENTERPRISE 2007 Lowest contract charges 1.40% 0.41% 11.12% Highest contract charges 2.59% 0.15% 9.58% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.40% 0.44% 5.59% Highest contract charges 2.60% 0.19% 4.03% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.40% 0.73% 6.65% Highest contract charges 2.59% 0.47% 5.11% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.40% 0.37% 2.61% Highest contract charges 2.58% -- 1.13% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 0.52% 24.13% Highest contract charges 1.27% -- 18.48% Remaining contract charges -- -- --
SA-163 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- GROWTH AND INCOME 2007 Lowest contract charges 17,636 $17.180850 $303,005 Highest contract charges 8,160 16.242615 132,539 Remaining contract charges 3,028,065 -- 49,319,474 2006 Lowest contract charges 8,460 16.884100 142,841 Highest contract charges 8,116 16.260056 131,982 Remaining contract charges 1,925,596 -- 30,026,589 2005 Lowest contract charges 2,399 14.668103 35,183 Highest contract charges 5,254 14.389633 75,600 Remaining contract charges 1,010,430 -- 13,401,064 2004 Lowest contract charges 3,002 1.156077 3,469 Highest contract charges 890 13.460455 11,982 Remaining contract charges 461,726 -- 6,213,655 2003 Lowest contract charges 149,577 11.601336 1,735,287 Highest contract charges 6,838 12.121904 82,887 Remaining contract charges 188,166 -- 2,297,160 COMSTOCK 2007 Lowest contract charges 21,012 16.435250 345,337 Highest contract charges 10,723 15.537611 166,608 Remaining contract charges 4,988,601 -- 80,944,783 2006 Lowest contract charges 10,555 16.953685 178,941 Highest contract charges 11,212 16.327017 183,059 Remaining contract charges 3,838,549 -- 64,723,968 2005 Lowest contract charges 2,148 14.719590 31,619 Highest contract charges 10,062 14.440094 145,293 Remaining contract charges 1,909,063 -- 28,154,755 2004 Lowest contract charges 9,229 14.484780 133,677 Highest contract charges 942 14.235396 13,413 Remaining contract charges 140,222 -- 2,013,581 2003 Lowest contract charges 626 12.521462 7,844 Highest contract charges 5,744 12.458666 71,559 Remaining contract charges 47,422 -- 592,021 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ GROWTH AND INCOME 2007 Lowest contract charges 0.75% 0.95% 1.76% Highest contract charges 2.59% 1.35% (0.11)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.47% 15.11% Highest contract charges 2.60% 0.86% 13.00% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 9.99% Highest contract charges 2.57% 0.36% 6.90% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.28% -- 12.90% Highest contract charges 2.37% -- 11.19% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.40% 0.96% 26.25% Highest contract charges 1.46% -- 23.62% Remaining contract charges -- -- -- COMSTOCK 2007 Lowest contract charges 0.74% 1.07% (3.06)% Highest contract charges 2.59% 1.59% (4.84)% Remaining contract charges -- -- -- 2006 Lowest contract charges 0.75% 0.69% 15.18% Highest contract charges 2.60% 1.28% 13.07% Remaining contract charges -- -- -- 2005 Lowest contract charges 0.73% -- 5.94% Highest contract charges 2.57% 0.46% 1.44% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.48% 0.32% 15.68% Highest contract charges 2.57% -- 14.42% Remaining contract charges -- -- -- 2003 Lowest contract charges 0.99% -- 25.22% Highest contract charges 1.40% -- 24.59% Remaining contract charges -- -- --
SA-164 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- STRATEGIC GROWTH 2007 Lowest contract charges 2,176 $15.344436 $33,387 Highest contract charges 2,728 14.590661 39,810 Remaining contract charges 18,504 -- 277,849 2006 Lowest contract charges 1,465 13.353671 19,566 Highest contract charges 2,729 12.838045 35,028 Remaining contract charges 15,648 -- 205,382 2005 Lowest contract charges 1,648 13.208819 21,771 Highest contract charges 97 12.908054 1,249 Remaining contract charges 17,824 -- 232,407 2004 Lowest contract charges 1,711 12.456970 21,318 Highest contract charges 26 12.295684 318 Remaining contract charges 14,860 -- 183,692 2003 Lowest contract charges 1,375 11.842633 16,284 Highest contract charges 1,723 11.806929 20,340 Remaining contract charges 2,882 -- 34,056 AGGRESSIVE GROWTH PORTFOLIO 2007 Lowest contract charges 4,517 14.122344 63,795 Highest contract charges 162 13.551542 2,197 Remaining contract charges 8,462 -- 117,159 2006 Lowest contract charges 4,734 12.190083 57,702 Highest contract charges 131 11.826680 1,547 Remaining contract charges 13,521 -- 161,681 2005 Lowest contract charges 4,878 11.793783 57,529 Highest contract charges 131 11.568800 1,515 Remaining contract charges 12,806 -- 149,133 2004 Lowest contract charges 569 10.774757 6,131 Highest contract charges 131 10.686077 1,400 Remaining contract charges 6,632 -- 71,049 GOVERNMENT PORTFOLIO 2007 Lowest contract charges 738 10.975127 8,104 Highest contract charges 6,935 10.536728 73,075 Remaining contract charges 49,168 -- 526,282 2006 Lowest contract charges 739 10.410536 7,695 Highest contract charges 6,333 10.105234 63,997 Remaining contract charges 42,656 -- 435,818 2005 Lowest contract charges 740 10.249360 7,584 Highest contract charges 6,149 10.058815 61,851 Remaining contract charges 31,274 -- 316,740 2004 Lowest contract charges 1,954 10.071757 19,677 Highest contract charges 3,515 9.996370 35,141 Remaining contract charges 9,025 -- 90,415 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ STRATEGIC GROWTH 2007 Lowest contract charges 1.49% -- 14.91% Highest contract charges 2.59% -- 13.65% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% -- 1.10% Highest contract charges 2.56% -- (0.01)% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.50% 0.01% 6.04% Highest contract charges 2.20% -- 5.09% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.50% -- 5.19% Highest contract charges 2.28% -- 4.35% Remaining contract charges -- -- -- 2003 Lowest contract charges 1.00% -- 18.43% Highest contract charges 1.28% -- 18.07% 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 1.50% -- 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 1.12% -- 7.75% Highest contract charges 1.96% -- 6.86% Remaining contract charges -- -- -- GOVERNMENT PORTFOLIO 2007 Lowest contract charges 1.50% 4.41% 5.42% Highest contract charges 2.59% 4.30% 4.27% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.50% 4.23% 1.57% Highest contract charges 2.60% 4.26% 0.46% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.48% 4.02% 1.74% Highest contract charges 2.59% 3.42% 0.63% Remaining contract charges -- -- -- 2004 Lowest contract charges 1.17% -- 0.72% Highest contract charges 1.47% -- (0.04)% Remaining contract charges -- -- --
SA-165 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- WELLS FARGO ADVANTAGE VT LARGE COMPANY GROWTH FUND 2007 Lowest contract charges 11,975 $1.135208 $13,594 Highest contract charges 5,214 1.088666 5,677 Remaining contract charges 4,506 -- 5,026 2006 Lowest contract charges 12,043 1.069239 12,877 Highest contract charges 5,256 1.033116 5,430 Remaining contract charges 1,816 -- 1,914 2005 Lowest contract charges 5,477 1.058917 5,799 Highest contract charges 1,675 1.046872 1,753 Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL CAP GROWTH FUND 2007 Lowest contract charges 5,718 1.579591 9,032 Highest contract charges 2,490 1.514837 3,772 Remaining contract charges 1,613 -- 2,504 2006 Lowest contract charges 6,390 1.406759 8,989 Highest contract charges 2,854 1.359239 3,879 Remaining contract charges 740 -- 1,026 2005 Lowest contract charges 3,410 1.161578 3,961 Highest contract charges 746 1.148379 856 Remaining contract charges -- -- -- STI CLASSIC VT LARGE CAP GROWTH STOCK FUND 2007 Lowest contract charges 1,750 14.684099 25,693 Highest contract charges -- -- -- Remaining contract charges -- -- -- STI CLASSIC VT LARGE CAP CORE EQUITY FUND 2007 Lowest contract charges 13,956 1.810091 25,262 Highest contract charges 33,936 1.735837 58,907 Remaining contract charges 30,898 -- 54,872 2006 Lowest contract charges 3,733 1.816743 6,782 Highest contract charges 33,937 1.758858 59,692 Remaining contract charges 30,898 -- 55,349 2005 Lowest contract charges 6,740 1.567353 10,563 Highest contract charges 30,271 1.545839 46,795 Remaining contract charges -- -- -- INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ WELLS FARGO ADVANTAGE VT LARGE COMPANY GROWTH FUND 2007 Lowest contract charges 1.35% -- 6.17% Highest contract charges 2.09% -- 5.38% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.34% -- 0.98% Highest contract charges 2.09% -- 0.22% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.26% -- 16.28% Highest contract charges 1.64% 0.33% 16.05% Remaining contract charges -- -- -- WELLS FARGO ADVANTAGE VT SMALL CAP GROWTH FUND 2007 Lowest contract charges 1.35% -- 12.29% Highest contract charges 2.09% -- 11.45% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.34% -- 21.11% Highest contract charges 2.08% -- 20.20% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.26% -- 19.79% Highest contract charges 1.41% -- 19.55% Remaining contract charges -- -- -- STI CLASSIC VT LARGE CAP GROWTH STOCK FUND 2007 Lowest contract charges 1.87% 0.57% 13.11% Highest contract charges -- -- -- Remaining contract charges -- -- -- STI CLASSIC VT LARGE CAP CORE EQUITY FUND 2007 Lowest contract charges 1.13% 1.38% (0.37)% Highest contract charges 2.09% 1.18% (1.31)% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.79% 14.87% Highest contract charges 2.10% 1.28% 13.78% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.60% 1.70% 7.64% Highest contract charges 2.03% 1.25% 7.32% Remaining contract charges -- -- --
SA-166 -------------------------------------------------------------------------------
UNIT CONTRACT SUB-ACCOUNT UNITS FAIR VALUE # OWNERS' EQUITY ----------------------------------------------------------------------------------------- STI CLASSIC VT MID-CAP CORE EQUITY FUND 2007 Lowest contract charges 9,370 $1.875333 $17,572 Highest contract charges 17,733 1.828175 32,419 Remaining contract charges 19,654 -- 36,719 2006 Lowest contract charges 1,760 1.811680 3,189 Highest contract charges 17,620 1.774985 31,275 Remaining contract charges 19,466 -- 35,155 2005 Lowest contract charges 3,087 1.675109 5,171 Highest contract charges 12,857 1.637179 21,049 Remaining contract charges 16,158 -- 26,812 STI CLASSIC VT LARGE CAP VALUE EQUITY FUND 2007 Lowest contract charges 388,876 1.881544 731,686 Highest contract charges 25,496 1.815961 46,300 Remaining contract charges 799,558 -- 1,550,622 2006 Lowest contract charges 198,807 1.837953 365,398 Highest contract charges 19,614 1.796199 35,230 Remaining contract charges 612,839 -- 1,127,376 2005 Lowest contract charges 64,472 1.518186 97,879 Highest contract charges 5,293 1.502355 7,953 Remaining contract charges 334,281 -- 509,399 INVESTMENT EXPENSE INCOME TOTAL SUB-ACCOUNT RATIO* RATIO** RETURN*** -------------------------------------- ------------------------------------------------------ STI CLASSIC VT MID-CAP CORE EQUITY FUND 2007 Lowest contract charges 1.59% 0.45% 3.51% Highest contract charges 2.09% 0.23% 3.00% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.61% 0.40% 8.96% Highest contract charges 2.10% 0.40% 8.42% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.09% 0.97% 14.69% Highest contract charges 1.93% 0.17% 13.97% Remaining contract charges -- -- -- STI CLASSIC VT LARGE CAP VALUE EQUITY FUND 2007 Lowest contract charges 1.14% 1.67% 2.37% Highest contract charges 2.39% 1.61% 1.10% Remaining contract charges -- -- -- 2006 Lowest contract charges 1.15% 1.58% 21.06% Highest contract charges 2.39% 1.56% 19.56% Remaining contract charges -- -- -- 2005 Lowest contract charges 1.12% 2.36% 5.11% Highest contract charges 2.34% 2.19% 4.24% Remaining contract charges -- -- --
* This represents the annualized contract expenses of the Account for the period 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 Fund, net of management fees assessed by the Funds' 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 period 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 Sub-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 SA-167 SEPARATE ACCOUNT THREE HARTFORD LIFE INSURANCE COMPANY NOTES TO FINANCIAL STATEMENTS -- (CONTINUED) DECEMBER 31, 2007 ------------------------------------------------------------------------------- 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 contracts 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 Optional Death Benefit Charge, Earnings Protection Benefit Charge, Principal First Charge, Principal First Preferred, MAV Plus, and MAV/EPB Death Benefit Charge. These deductions range from 0.15% to .75%. These charges are a reduction in unit values. The Company will charge an expense 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 a redemption of units. 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 charges are included in surrenders for benefit payments and fees in the accompanying statements of changes in net assets. These charges are a redemption of units. SA-168 ------------------------------------------------------------------------------- [This page intentionally left blank] SA-169 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholder of Hartford Life Insurance Company Hartford, Connecticut We have audited the accompanying consolidated balance sheets of Hartford Life Insurance Company and its subsidiaries (the "Company") as of December 31, 2007 and 2006, and the related consolidated statements of income, changes in stockholder's equity, and cash flows for each of the three years in the period ended December 31, 2007. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the 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 consolidated 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 controls 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 consolidated 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. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Hartford Life Insurance Company and its subsidiaries as of December 31, 2007 and 2006, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2007, in conformity with accounting principles generally accepted in the United States of America. /s/ Deloitte & Touche LLP Hartford, Connecticut February 20, 2008 F-1 HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 (IN MILLIONS) -------------------------------------------------------------------------------- REVENUES Fee income and other $3,509 $3,113 $2,811 Earned premiums 983 547 449 Net investment income 3,048 2,728 2,569 Net realized capital gains (losses) (934) (299) 75 -------- -------- -------- TOTAL REVENUES 6,606 6,089 5,904 -------- -------- -------- BENEFITS, CLAIMS AND EXPENSES Benefits, loss and loss adjustment expenses 3,980 3,205 3,008 Insurance expenses and other 1,192 853 798 Amortization of deferred policy acquisition costs and present value of future profits 515 1,175 945 Dividends to policyholders 11 22 37 -------- -------- -------- TOTAL BENEFITS, LOSSES AND EXPENSES 5,698 5,255 4,788 -------- -------- -------- Income before income tax expense 908 834 1,116 Income tax expense 168 103 207 -------- -------- -------- NET INCOME $740 $731 $909 -------- -------- --------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. F-2 HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2007 2006 (IN MILLIONS, EXCEPT FOR SHARE DATA) -------------------------------------------------------------------------------- ASSETS Investments Fixed maturities, available for sale, at fair value (amortized cost of $46,208 and $43,846) $45,611 $44,646 Equity securities, available for sale, at fair value (cost of $763 and $267) 722 275 Equity securities, held for trading, at fair value -- 1 Policy loans, at outstanding balance 2,016 2,009 Mortgage loans on real estate 4,166 2,631 Short-term investments 752 694 Other investments 1,726 1,023 ----------- ----------- TOTAL INVESTMENTS 54,993 51,279 ----------- ----------- Cash 281 186 Premiums receivable and agents' balances 28 29 Reinsurance recoverables 1,730 1,393 Deferred policy acquisition costs and present value of future profits 8,393 7,334 Goodwill 186 186 Other assets 1,348 1,120 Separate account assets 199,253 179,943 ----------- ----------- TOTAL ASSETS $266,212 $241,470 ----------- ----------- LIABILITIES Reserve for future policy benefits $9,396 $8,209 Other policyholder funds 42,377 40,191 Consumer Notes 809 258 Deferred income taxes 124 491 Other liabilities 6,621 4,718 Separate account liabilities 199,253 179,943 ----------- ----------- TOTAL LIABILITIES 258,580 233,810 ----------- ----------- COMMITMENTS AND CONTINGENT LIABILITIES, NOTE 10 -- -- STOCKHOLDER'S EQUITY Common stock -- 1,000 shares authorized, issued and outstanding, par value $5,690 6 6 Capital surplus 2,888 2,586 Accumulated other comprehensive income Net unrealized capital gains on securities, net of tax (469) 290 Foreign currency translation adjustments -- 1 ----------- ----------- TOTAL ACCUMULATED OTHER COMPREHENSIVE INCOME (469) 291 ----------- ----------- Retained earnings 5,207 4,777 ----------- ----------- TOTAL STOCKHOLDER'S EQUITY 7,632 7,660 ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $266,212 $241,470 ----------- -----------
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. F-3 HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) NET NET (LOSS) UNREALIZED GAIN ON CAPITAL GAINS CASH FLOW FOREIGN COMMON (LOSSES) ON HEDGING CURRENCY STOCK CAPITAL SECURITIES, INSTRUMENTS, TRANSLATION SURPLUS NET OF TAX NET OF TAX ADJUSTMENTS (IN MILLIONS) -------------------------------------------------------------------------------------------------------------------------------- 2007 Balance, December 31, 2006 $6 $2,586 $500 $(210) $1 Comprehensive income Net income Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (832) Net gains on cash flow hedging instruments 73 Cumulative translation adjustments (1) Total other comprehensive income Total comprehensive income Capital contribution from parent 302 Dividends declared Cumulative effect of Accounting Changes, net of tax --- ------ ------ ------ ----- BALANCE, DECEMBER 31, 2007 $6 $2,888 $(332) $(137) $ -- --- ------ ------ ------ ----- 2006 Balance, December 31, 2005 $6 $2,405 $577 $(113) $(1) Comprehensive income Net income Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (77) Net loss on cash flow hedging instruments (97) Cumulative translation adjustments 2 Total other comprehensive income Total comprehensive income Capital contribution from parent 181 Dividends declared --- ------ ------ ------ ----- BALANCE, DECEMBER 31, 2006 $6 $2,586 $500 $(210) $1 --- ------ ------ ------ ----- 2005 Balance, December 31, 2004 $6 $2,240 $1,124 $(184) $(1) Comprehensive income Net income Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (547) Net gains on cash flow hedging instruments 71 Total other comprehensive income Total comprehensive income Capital contribution from parent 165 Dividends declared --- ------ ------ ------ ----- BALANCE, DECEMBER 31, 2005 $6 $2,405 $577 $(113) $(1) --- ------ ------ ------ ----- TOTAL RETAINED STOCKHOLDER'S EARNINGS EQUITY (IN MILLIONS) ---------------------------------- --------------------------------------- 2007 Balance, December 31, 2006 $4,777 $7,660 ------ Comprehensive income Net income 740 740 ------ Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (832) Net gains on cash flow hedging instruments 73 Cumulative translation adjustments (1) ------ Total other comprehensive income (760) ------ Total comprehensive income (20) Capital contribution from parent 302 Dividends declared (307) (307) Cumulative effect of Accounting Changes, net of tax (3) (3) ------ ------ BALANCE, DECEMBER 31, 2007 $5,207 $7,632 ------ ------ 2006 Balance, December 31, 2005 $4,463 $7,337 ------ Comprehensive income Net income 731 731 ------ Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (77) Net loss on cash flow hedging instruments (97) Cumulative translation adjustments 2 ------ Total other comprehensive income (172) ------ Total comprehensive income 559 Capital contribution from parent 181 Dividends declared (417) (417) ------ ------ BALANCE, DECEMBER 31, 2006 $4,777 $7,660 ------ ------ 2005 Balance, December 31, 2004 $4,064 $7,249 ------ Comprehensive income Net income 909 909 ------ Other comprehensive income, net of tax (1) Net change in unrealized capital gains (losses) on securities (2) (547) Net gains on cash flow hedging instruments 71 ------ Total other comprehensive income (476) ------ Total comprehensive income 433 Capital contribution from parent 165 Dividends declared (510) (510) ------ ------ BALANCE, DECEMBER 31, 2005 $4,463 $7,337 ------ ------
(1) Net change in unrealized capital gain on securities is reflected net of tax provision (benefit) and other items of $448, $(42) and $(295) for the years ended December 31, 2007, 2006 and 2005, respectively. Net (loss) gain on cash flow hedging instruments is net of tax provision (benefit) of $(39), $(52) and $38 for the years ended December 31, 2007, 2006 and 2005, respectively. There is no tax effect on cumulative translation adjustments. (2) There were reclassification adjustments for after-tax gains (losses) realized in net income of $(140), $(75), and $26 for the years ended December 31, 2007, 2006 and 2005, respectively. SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. F-4 HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 (IN MILLIONS) -------------------------------------------------------------------------------- OPERATING ACTIVITIES Net income $740 $731 $909 Adjustments to reconcile net income to net cash provided by operating activities Amortization of deferred policy acquisition costs and present value of future profits 515 1,175 945 Additions to deferred policy acquisition costs and present value of future profits (1,400) (1,351) (1,226) Change in: Reserve for future policy benefits, unpaid losses and loss adjustment expenses 1,187 836 129 Reinsurance recoverables (236) (47) 177 Receivables 190 11 (3) Payables and accruals 560 210 385 Accrued and deferred income taxes (102) 340 36 Net realized capital losses (gains) 934 299 (75) Depreciation and amortization 438 404 239 Other, net (267) 157 (228) --------- --------- --------- NET CASH PROVIDED BY OPERATING ACTIVITIES $2,559 $2,765 $1,288 --------- --------- --------- INVESTING ACTIVITIES Proceeds from the sale/maturity/prepayment of: Fixed Maturities and Short-term Investments, available for sale $15,892 $19,517 $19,727 Equity securities, available-for-sale 296 249 38 Mortgage loans 958 301 354 Partnerships 175 91 169 Payments for the purchase of: Fixed Maturities and Short-term Investments, available for sale (18,780) (22,017) (21,511) Equity securities, available-for-sale (484) (455) (60) Mortgage loans (2,492) (1,574) (915) Partnerships (607) (496) (337) Change in policy loans, net (6) (39) 647 Change in payables for collateral under securities lending, net 1,306 788 (276) Change in all other, net (587) (713) (193) --------- --------- --------- NET CASH USED FOR INVESTING ACTIVITIES $(4,329) $(4,348) $(2,357) --------- --------- --------- FINANCING ACTIVITIES Deposits and other additions to investment and universal life-type contracts 32,396 26,991 25,383 Withdrawals and other deductions from investment and universal life-type contracts (30,433) (26,687) (24,888) Net transfers (to)/from separate accounts related to investment and universal life-type contracts (606) 1,382 852 Capital contributions 270 -- 129 Dividends paid $(305) $(300) $(498) Proceeds from issuance of consumer notes 551 258 -- --------- --------- --------- NET CASH PROVIDED BY FINANCING ACTIVITIES $1,873 $1,644 $978 --------- --------- --------- Impact of foreign exchange (8) 1 (1) Net (decrease) increase in cash 95 62 (92) Cash -- beginning of year 186 124 216 --------- --------- --------- Cash -- end of year $281 $186 $124 --------- --------- --------- Supplemental Disclosure of Cash Flow Information: Net Cash Paid During the Year for: Income taxes $125 $(163) $149
F-5 SUPPLEMENTAL SCHEDULE OF NONCASH OPERATING AND FINANCING ACTIVITIES: THE COMPANY RECAPTURED AN INDEMNITY REINSURANCE ARRANGEMENT WITH HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY IN 2005. IN CONJUNCTION WITH THIS TRANSACTION, THE COMPANY RECORDED A NONCASH CAPITAL CONTRIBUTION OF $36 AND A RELATED EXTINGUISHMENT OF THE REINSURANCE RECOVERABLE LIABILITY. THE COMPANY MADE NONCASH DIVIDENDS OF $2 AND RECEIVED A NONCASH CAPITAL CONTRIBUTIONS OF $20 FROM ITS PARENT COMPANY DURING 2007 RELATED TO THE GUARANTEED MINIMUM INCOME AND ACCUMULATION BENEFIT REINSURANCE AGREEMENTS WITH HARTFORD LIFE INSURANCE K.K. THE COMPANY MADE NONCASH DIVIDENDS OF $117 AND RECEIVED A NONCASH CAPITAL CONTRIBUTIONS OF $154 FROM ITS PARENT COMPANY DURING 2006 RELATED TO THE GUARANTEED MINIMUM INCOME BENEFIT REINSURANCE AGREEMENT WITH HARTFORD LIFE INSURANCE K.K. SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS. F-6 HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (DOLLAR AMOUNTS IN MILLIONS, UNLESS OTHERWISE STATED) -------------------------------------------------------------------------------- 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES BASIS OF PRESENTATION These consolidated financial statements include Hartford Life Insurance Company and its wholly-owned subsidiaries (collectively, "Hartford Life Insurance Company" or the "Company"), Hartford Life and Annuity Insurance Company ("HLAI") and Hartford International Life Reassurance Corporation ("HLRe"). The Company is a wholly-owned subsidiary of Hartford Life and Accident Insurance Company ("HLA"), which is a wholly-owned subsidiary of Hartford Life, Inc. ("Hartford Life"). Hartford Life is a direct wholly-owned subsidiary of Hartford Holdings, Inc., a direct wholly-owned subsidiary of The Hartford Financial Services Group, Inc. ("The Hartford"), the Company's ultimate parent company. Along with its parent, HLA, the Company is a financial services and insurance group which provides (a) investment products, such as individual variable annuities and fixed market value adjusted annuities and retirement plan services; (b) individual life insurance; (c) group benefits products such as group life and group disability insurance that is directly written by the Company and is substantially ceded to its parent, HLA, (d) private placement life insurance and (e) assumes fixed market value adjusted annuities, guaranteed minimum income benefits ("GMIB"), guaranteed minimum accumulation benefits ("GMAB") and guaranteed minimum death benefits ("GMDB") from Hartford Life's international operations. The consolidated financial statements have been prepared on the basis of accounting principles generally accepted in the United States of America ("U.S. GAAP"), which differ materially from the accounting practices prescribed by various insurance regulatory authorities. CONSOLIDATION The consolidated financial statements include the accounts of Hartford Life Insurance Company in which the Company directly or indirectly has a controlling financial interest and those variable interest entities ("VIE") in which the Company is the primary beneficiary. The Company determines if it is the primary beneficiary using both qualitative and quantitative analyses. Entities in which Hartford Life Insurance Company does not have a controlling financial interest but in which the Company has significant influence over the operating and financing decisions are reported using the equity method. All material intercompany transactions and balances between Hartford Life Insurance Company and its subsidiaries and affiliates have been eliminated. For further discussions on variable interest entities see Note 3. USE OF ESTIMATES The preparation of financial statements, in conformity with U.S. GAAP 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 reporting period. Actual results could differ from those estimates. The most significant estimates include those used in determining estimated gross profits used in the valuation and amortization of assets and liabilities associated with variable annuity and other universal life-type contracts; the evaluation of other-than-temporary impairments on investments in available-for-sale securities; living benefits required to be fair valued; and contingencies relating to corporate litigation and regulatory matters. RECLASSIFICATIONS Certain reclassifications have been made to prior year financial information to conform to the current year presentation. ADOPTION OF NEW ACCOUNTING STANDARDS ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES, AN INTERPRETATION OF FASB STATEMENT NO. 109 The Financial Accounting Standards Board ("FASB") issued Interpretation No. 48, "Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109" ("FIN 48"), dated June 2006. FIN 48 requires companies to recognize the tax benefit of an uncertain tax position only when the position is "more likely than not" to be sustained assuming examination by tax authorities. The amount recognized represents the largest amount of tax benefit that is greater than 50% likely of being realized. A liability is recognized for any benefit claimed, or expected to be claimed, in a tax return in excess of the benefit recorded in the financial statements, along with any interest and penalty (if applicable) on the excess. The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the adoption, the Company recognized an $11 decrease in the liability for unrecognized tax benefits and a corresponding increase in the January 1, 2007 balance of retained earnings. The Company had no unrecognized tax benefits as of January 1, 2007. The Company does not believe it would be subject to any penalties in any open tax years and, therefore, has not booked any such amounts. The Company classifies interest and penalties (if applicable) as income tax expense in the financial statements. F-7 AMENDMENT OF FASB INTERPRETATION NO. 39 In April 2007, the FASB issued FASB Staff Position No. FIN 39-1, "Amendment of FASB Interpretation No. 39" ("FSP FIN 39-1"). FSP FIN 39-1 amends FIN 39, "Offsetting of Amounts Related to Certain Contacts", by permitting a reporting entity to offset fair value amounts recognized for the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a payable) against fair value amounts recognized for derivative instruments executed with the same counterparty under the same master netting arrangement that have been offset in the statement of financial position in accordance with FIN 39. FSP FIN 39-1 also amends FIN 39 by modifying certain terms. FSP FIN 39-1 is effective for reporting periods beginning after November 15, 2007, with early application permitted. The Company early adopted FSP FIN 39-1 on December 31, 2007, by electing to offset cash collateral against amounts recognized for derivative instruments under master netting arrangements. The effect of applying FSP FIN 39-1 is recorded as a change in accounting principle through retrospective application. The effect on the consolidated balance sheet as of December 31, 2006 was a decrease of $171 in the derivative payable included in other liabilities, and corresponding decrease of $1 and $170, respectively, in other investments and derivative receivable included in other assets. See Note 4 for further discussions on the adoption of FSP FIN 39-1. ACCOUNTING FOR CERTAIN HYBRID FINANCIAL INSTRUMENTS -- AN AMENDMENT OF FASB STATEMENTS NO. 133 AND 140 In February 2006, the FASB issued Statement of Financial Accounting Standard ("SFAS") No. 155, "Accounting for Certain Hybrid Financial Instruments -- an amendment of FASB Statements No. 133 and 140" ("SFAS 155"). This statement amends SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"), and SFAS No. 140, "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities" and resolves issues addressed in SFAS 133 Implementation Issue No. D1, "Application of Statement 133 to Beneficial Interests in Securitized Financial Assets". SFAS 155: (a) permits fair value remeasurement for any hybrid financial instrument (asset or liability) that contains an embedded derivative that otherwise would require bifurcation; (b) clarifies which interest-only strips and principal-only strips are not subject to the requirements of SFAS 133; (c) establishes a requirement to evaluate beneficial interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation; (d) clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives; and, (e) eliminates restrictions on a qualifying special-purpose entity's ability to hold passive derivative financial instruments that pertain to beneficial interests that are or contain a derivative financial instrument. SFAS 155 also requires presentation within the financial statements that identifies those hybrid financial instruments for which the fair value election has been applied and information on the income statement impact of the changes in fair value of those instruments. The Company began applying SFAS 155 to all financial instruments acquired, issued or subject to a remeasurement event beginning January 1, 2007. SFAS 155 did not have an effect on the Company's consolidated financial condition and results of operations upon adoption on January 1, 2007. ACCOUNTING BY INSURANCE ENTERPRISES FOR DEFERRED ACQUISITION COSTS ("DAC") IN CONNECTION WITH MODIFICATIONS OR EXCHANGES OF INSURANCE CONTRACTS In September 2005, the American Institute of Certified Public Accountants ("AICPA") issued Statement of Position 05-1, "Accounting by Insurance Enterprises for Deferred Acquisition Costs ("DAC") in Connection with Modifications or Exchanges of Insurance Contracts", ("SOP 05-1"). SOP 05-1 provides guidance on accounting by insurance enterprises for DAC on internal replacements of insurance and investment contracts. An internal replacement is a modification in product benefits, features, rights or coverages that occurs by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract. Modifications that result in a replacement contract that is substantially changed from the replaced contract should be accounted for as an extinguishment of the replaced contract. Unamortized DAC, unearned revenue liabilities and deferred sales inducements from the replaced contract must be written-off. Modifications that result in a contract that is substantially unchanged from the replaced contract should be accounted for as a continuation of the replaced contract. The Company adopted SOP 05-1 on January 1, 2007 and recognized the cumulative effect of the adoption of SOP 05-1 as a reduction in retained earnings of $14, after-tax. THE MEANING OF OTHER-THAN-TEMPORARY IMPAIRMENT AND ITS APPLICATION TO CERTAIN INVESTMENTS In November 2005, the FASB released FASB Staff Position Nos. FAS 115-1 and FAS 124-1, "The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments" ("FSP 115-1"), which effectively replaces Emerging Issues Task Force No. 03-1, "The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments" ("EITF 03-1"). FSP 115-1 contains a three-step model for evaluating impairments and carries forward the disclosure requirements in EITF 03-1 pertaining to securities in an unrealized loss position. Under the model, any security in an unrealized loss position is considered impaired; an evaluation is made to determine whether the impairment is other-than-temporary; and, if an impairment is considered other-than-temporary, a realized loss is recognized to write the security's cost or amortized cost basis down to fair value. FSP 115-1 references existing other-than-temporary impairment guidance for determining when an impairment is other-than-temporary and clarifies that subsequent to the recognition of an other- F-8 than-temporary impairment loss for debt securities, an investor shall account for the security using the constant effective yield method. FSP 115-1 is effective for reporting periods beginning after December 15, 2005, with earlier application permitted. The Company adopted FSP 115-1 upon issuance. The adoption did not have a material effect on the Company's consolidated financial condition or results of operations. FUTURE ADOPTION OF NEW ACCOUNTING STANDARDS BUSINESS COMBINATIONS In December 2007, the FASB issued SFAS No. 141 (revised 2007), "Business Combinations" ("SFAS 141(R)"). This statement replaces SFAS No. 141, "Business Combinations" ("SFAS 141") and establishes the principles and requirements for how the acquirer in a business combination: (a) measures and recognizes the identifiable assets acquired, liabilities assumed, and any noncontrolling interests in the acquired entity, (b) measures and recognizes positive goodwill acquired or a gain from bargain purchase (negative goodwill), and (c) determines the disclosure information that is decision-useful to users of financial statements in evaluating the nature and financial effects of the business combination. Some of the significant changes to the existing accounting guidance on business combinations made by SFAS 141(R) include the following: - Most of the identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree shall be measured at their acquisition-date fair values rather than SFAS 141's requirement to allocate the cost of an acquisition to individual assets acquired and liabilities assumed based on their estimated fair values; - Acquisition-related costs incurred by the acquirer shall be expensed in the periods in which the costs are incurred rather than included in the cost of the acquired entity; - Goodwill shall be measured as the excess of the consideration transferred, including the fair value of any contingent consideration, plus the fair value of any noncontrolling interest in the acquiree, over the fair values of the acquired identifiable net assets, rather than measured as the excess of the cost of the acquired entity over the estimated fair values of the acquired identifiable net assets; - Contractual pre-acquisition contingencies are to be recognized at their acquisition date fair values and noncontractual pre-acquisition contingencies are to be recognized at their acquisition date fair values only if it is more likely than not that the contingency gives rise to an asset or liability, whereas SFAS 141 generally permits the deferred recognition of pre-acquisition contingencies until the recognition criteria of SFAS No. 5, "Accounting for Contingencies" are met; and - Contingent consideration shall be recognized at the acquisition date rather than when the contingency is resolved and consideration is issued or becomes issuable. SFAS 141(R) is effective for and shall be applied prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008, with earlier adoption prohibited. Assets and liabilities that arose from business combinations with acquisition dates prior to the SFAS 141(R) effective date shall not be adjusted upon adoption of SFAS 141(R) with certain exceptions for acquired deferred tax assets and acquired income tax positions. The Company expects to adopt SFAS 141(R) on January 1, 2009, and has not yet determined the effect of SFAS 141(R) on its consolidated financial statements. NONCONTROLLING INTERESTS IN CONSOLIDATED FINANCIAL STATEMENTS, AN AMENDMENT OF ARB NO. 51 In December 2007, the FASB issued SFAS No. 160, "Noncontrolling Interests in Consolidated Financial Statements" ("SFAS 160"). This statement amends Accounting Research Bulletin No. 51, "Consolidated Financial Statements" ("ARB 51"). Noncontrolling interest refers to the minority interest portion of the equity of a subsidiary that is not attributable directly or indirectly to a parent. SFAS 160 establishes accounting and reporting standards that require for-profit entities that prepare consolidated financial statements to: (a) present noncontrolling interests as a component of equity, separate from the parent's equity, (b) separately present the amount of consolidated net income attributable to noncontrolling interests in the income statement, (c) consistently account for changes in a parent's ownership interests in a subsidiary in which the parent entity has a controlling financial interest as equity transactions, (d) require an entity to measure at fair value its remaining interest in a subsidiary that is deconsolidated, (e) require an entity to provide sufficient disclosures that identify and clearly distinguish between interests of the parent and interests of noncontrolling owners. SFAS 160 applies to all for-profit entities that prepare consolidated financial statements, and affects those for-profit entities that have outstanding noncontrolling interests in one or more subsidiaries or that deconsolidate a subsidiary. SFAS 160 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008 with earlier adoption prohibited. The Company expects to adopt SFAS 160 on January 1, 2009 and has not yet determined the effect of SFAS 160 on its consolidated financial statements. F-9 CLARIFICATION OF THE SCOPE OF THE AUDIT AND ACCOUNTING GUIDE "INVESTMENT COMPANIES" AND ACCOUNTING BY PARENT COMPANIES AND EQUITY METHOD INVESTORS FOR INVESTMENTS IN INVESTMENT COMPANIES In June 2007, the AICPA issued Statement of Position 07-1, "Clarification of the Scope of the Audit and Accounting Guide Investment Companies and Accounting by Parent Companies and Equity Method Investors for Investments in Investment Companies" ("SOP 07-1"). SOP 07-1 provides guidance for determining whether an entity is within the scope of the AICPA Audit and Accounting Guide Investment Companies ("the Guide"). This statement also addresses whether the specialized industry accounting principles of the Guide should be retained by a parent company in consolidation or by an investor that has the ability to exercise significant influence over the investment company and applies the equity method of accounting to its investment in the entity. In addition, SOP 07-1 includes certain disclosure requirements for parent companies and equity method investors in investment companies that retain investment company accounting in the parent company's consolidated financial statements or the financial statements of an equity method investor. SOP 07-1 is effective for fiscal years beginning on or after December 15, 2007, with earlier application encouraged; however, in November 2007, the FASB decided to (1) delay indefinitely the effective date of the SOP and (2) prohibit adoption of the SOP for an entity that has not early adopted the SOP. The Company did not early adopt SOP 07-1. SOP 07-1 as currently issued is not expected to have an impact on the Company's consolidated financial condition or results of operations. FAIR VALUE OPTION FOR FINANCIAL ASSETS AND FINANCIAL LIABILITIES In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for Financial Assets and Financial Liabilities, Including an amendment of FASB Statement No. 115" ("SFAS 159"). The objective of SFAS 159 is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported net income caused by measuring related assets and liabilities differently. This statement permits entities to choose, at specified election dates, to measure eligible items at fair value (i.e., the fair value option). Items eligible for the fair value option include certain recognized financial assets and liabilities, rights and obligations under certain insurance contracts that are not financial instruments, host financial instruments resulting from the separation of an embedded nonfinancial derivative instrument from a nonfinancial hybrid instrument, and certain commitments. Business entities shall report unrealized gains and losses on items for which the fair value option has been elected in net income. The fair value option: (a) may be applied instrument by instrument, with certain exceptions; (b) is irrevocable (unless a new election date occurs); and (c) is applied only to entire instruments and not to portions of instruments. SFAS 159 is effective as of the beginning of an entity's first fiscal year that begins after November 15, 2007, although early adoption is permitted under certain conditions. Companies shall report the effect of the first remeasurement to fair value as a cumulative-effect adjustment to the opening balance of retained earnings. On January 1, 2008, the Company did not elect to apply the provisions of SFAS 159 to financial assets and liabilities. FAIR VALUE MEASUREMENTS FAIR VALUE UNDER SFAS NO. 157 On January 1, 2008, the Company adopted SFAS 157, which was issued by the Financial Accounting Standards Board in September 2006. For financial statement elements currently required to be measured at fair value, SFAS 157 redefines 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 new definition of fair value focuses on the price that would be received to sell the asset or paid to transfer the liability regardless of whether an observable liquid market price existed (an exit price). An exit price valuation will include margins for risk even if they are not observable. As the Company is released from risk, the margins for risk will also be released through net realized capital gains (losses) in net income. SFAS 157 provides guidance on how to measure fair value, when required, under existing accounting standards. SFAS 157 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels ("Level 1, 2, and 3"). Level 1 Observable inputs that reflect quoted prices for identical assets or liabilities in active markets that the Company has the ability to access at the measurement date. Level 2 Observable inputs, other than quoted prices included in Level 1, for the asset or liability or prices for similar assets and liabilities. Level 3 Unobservable inputs reflecting the reporting entity's estimates of the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). ACCOUNTING FOR GUARANTEED BENEFITS OFFERED WITH VARIABLE ANNUITIES Many of the variable annuity contracts issued or reinsured by the Company offer various guaranteed minimum death, withdrawal, income and accumulation benefits. Those benefits are accounted for under Statement of Financial Accounting Standard No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133") or AICPA Statement of Position No. 03-1 "Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts ("SOP 03-1"). Guaranteed minimum benefits often meet the definition of an embedded derivative F-10 under SFAS 133 as they have notional amounts (the guaranteed balance) and underlyings (the investment fund options), they require no initial net investment and they may have terms that require or permit net settlement. However, certain guaranteed minimum benefits settle only upon a single insurable event, such as death (guaranteed minimum death benefits "GMDB") or living (life contingent portion of guaranteed minimum withdrawal benefits "GMWB"), and as such are scoped out of SFAS 133 under the "insurance contract exception". Guaranteed minimum benefits that do not meet the requirements of SFAS 133 are accounted for as insurance benefits under SOP 03-1. GUARANTEED BENEFITS ACCOUNTED FOR UNDER SOP 03-1 The GMDBs issued by the Company and certain GMDBs reinsured by the Company are accounted for under SOP 03-1. In addition, the Company's GMWB "for life" allows policyholders to receive the guaranteed annual withdrawal amount for as long as they are alive even if the guaranteed remaining balance ("GRB") is exhausted. Payments beyond the GRB are considered life contingent insurance benefits and are accounted for under SOP 03-1. Benefit guarantee liabilities accounted for under SOP 03-1, absent an unlocking event as described in the "Critical Accounting Estimates" within Management's Discussion and Analysis, do not result in a change in value that is immediately reflected in net income. Under SOP 03-1, the income statement reflects the current period increase in the liability due to the deferral of a percentage of current period revenues. The percentage is determined by dividing the present value of expected claims by the present value of expected revenues using best estimate assumptions over a range of market scenarios discounted at a rate consistent with that used in the Company's DAC models. Current period revenues are impacted by the actual increase or decrease in account value. Claims recorded against the liability have no immediate impact on the income statement unless those claims exceed the liability. Periodically, the Company unlocks its benefit assumptions, including the benefit deferral rate. The impact of this change is reflected in benefits, losses and loss adjustment expenses, in net income. In the U.S., the Company sells variable annuity contracts that, in addition to the living benefits described above, offer various guaranteed death benefits. Declines in the equity market may increase the Company's net exposure to death benefits under these contracts. The Company's total gross exposure (i.e., before reinsurance) to these U.S. guaranteed death benefits is often referred to as the net amount at risk. However, the Company will incur these guaranteed death benefit payments in the future only if the policyholder has an in-the-money guaranteed death benefit at their time of death. Effective July 31, 2006, an existing reinsurance agreement between a subsidiary of the Company, Hartford Life and Annuity Insurance Company ("HLAI") and Hartford Life, Insurance. KK ("HLIKK"), a wholly owned Japanese subsidiary of Hartford Life, Inc. ("Hartford Life"), was modified to include the GMDB on covered contracts that have an associated GMIB rider. The modified reinsurance agreement applies to all contracts, GMIB product and GMDB riders in-force and issued as of July 31, 2006 and prospectively, except for policies and GMIB product issued prior to April 1, 2005, which were recaptured. Declines in equity markets as well as a strengthening of Japanese Yen in comparison to the U.S. dollar may increase the Company's exposure to these guaranteed benefits. For the guaranteed death benefits, the Company pays the greater of account value at death or a guaranteed death benefit which, depending on the contract, may be based upon the premium paid and/or the maximum anniversary value established no later than age 80, as adjusted for withdrawals under the terms of the contract. The following table provides the account value, net amount at risk and reserve amount, at December 31, 2007, for each type of guaranteed death and living benefit sold by the Company that is accounted for under SOP 03-1:
ACCOUNT NET AMOUNT SOP 03-1 VALUE (1) AT RISK RESERVE (2) -------------------------------------------------------------------------------- U.S. Guaranteed Minimum Death Benefits $126,834 $5,106 $527 Guaranteed Minimum Death Benefits Assumed 30,724 380 4 Life Contingent Portion of "for Life" GMWBs 10,272 (*) (*) ----------- -------- ------ TOTAL $ 167,830 $ 5,486 $ 531 ----------- -------- ------
(1) Policies with "for Life" GMWB riders include both benefits accounted for under SFAS 133 and SOP 03-1 and thus are included this table and the SFAS 133 table below. However, benefits payable are generally mutually exclusive (e.g., for a given contract, only the death or living benefits, but not both are payable at one time) (See Note 8). (2) Before reinsurance. The Company uses reinsurance to manage its exposure to the mortality and equity risk associated with GMDB. Reinsurance of GMDB is accounted for under SOP 03-1. After reinsurance, the net amount at risk for U.S. GMDB is $976. After reinsurance, the net SOP 03-1 reserve for U.S. GMDB is $202. (*) Amounts are insignificant at December 31, 2007. GUARANTEED BENEFITS ACCOUNTED AT FAIR VALUE UNDER SFAS 133 The non-life contingent portion of GMWBs issued by the Company meet the definition of an embedded derivative under SFAS 133, and as such are recorded at fair value with changes in fair value recorded in net realized capital gains (losses) in net income. In bifurcating the embedded derivative, the Company attributes to the derivative a portion of total fees collected F-11 from the contract holder. Those fees attributed are set equal to the present value of future claims expected to be paid for the guaranteed living benefit embedded derivative at the inception of the contract (the "Attributed Fees"). The excess of total fees collected from the contract holder over the Attributed Fees are associated with the host variable annuity contract recorded in fee income. In subsequent valuations, both the present value of future claims expected to be paid and the present value of attributed fees expected to be collected are revalued based on current market conditions and policyholder behavior assumptions. The difference between each of the two components represents the fair value of the embedded derivative. GMWBs provide the policyholder with a guaranteed remaining balance ("GRB") if the account value is reduced to zero through a combination of market declines and withdrawals. The GRB is generally equal to premiums less withdrawals. For most of the Company's GMWB for life riders, the GRB is reset on an annual basis to the maximum anniversary account value subject to a cap. If the GRB exceeds the account value for any policy, the contract is "in-the-money" by the difference between the GRB and the account value. The sum of the in-the-money and out-of-the-money contracts is comparable to net amount at risk. Certain GMIBs and guaranteed minimum accumulation benefits ("GMAB") reinsured by the Company meet the definition a freestanding derivative, even though in-form they are reinsurance. Accordingly, the following GMIB and GMAB reinsurance agreements are recorded at fair value on the Company's balance sheet, with prospective changes in fair value recorded in net realized capital gains (losses) in net income: - REINSURED GMIB: Effective August 31, 2005, HLAI entered into a reinsurance agreement with HLIKK where HLIKK agreed to cede and HLAI agreed to reinsure 100% of the risks associated with the in-force and prospective GMIB product issued by HLIKK on its variable annuity business. Effective July 31, 2006, the agreement was modified to include a tiered reinsurance premium structure. The modified reinsurance agreement applies to all contracts, GMIBs in-force and issued as of July 31, 2006 and prospectively, except for policies and GMIB product issued prior to April 1, 2005, which were recaptured. - REINSURED GMAB: Effective September 30, 2007, HLAI entered into another reinsurance agreement where HLIKK agreed to cede and HLAI agreed to reinsure 100% of the risks associated with the in-force and prospective GMAB riders issued by HLIKK on certain of its variable annuity business. Due to the significance of the non-observable inputs associated with pricing the reinsurance of the GMIB and GMAB products that are free standing derivatives, the initial difference between the transaction price and the modeled value was recorded in additional paid-in capital because the reinsurance arrangements are between entities that are commonly controlled by The Hartford Financial Services Group, Inc. ("The Hartford"). The following table provides the account value, SFAS 133 fair value and GRB, at December 31, 2007, for each type of guaranteed living benefit liability sold or reinsured by the Company that is accounted for under SFAS 133, by rider fee:
(ASSET) GUARANTEED ACCOUNT LIABILITY REMAINING VALUE (1) FAIR VALUE BALANCE ------------------------------------------------------------------------------------------ U.S. GUARANTEED MINIMUM WITHDRAWAL BENEFITS 46,088 553 34,622 NON-LIFE CONTINGENT PORTION OF "FOR LIFE" GUARANTEED MINIMUM WITHDRAWAL BENEFITS 10,272 154 10,230 REINSURED GUARANTEED LIVING BENEFITS Guaranteed Minimum Income Benefits 16,289 72 15,297 Guaranteed Minimum Accumulation Benefits 2,734 (2) 2,768 --------- ------ --------- Subtotal 19,023 70 18,065 --------- ------ --------- TOTAL $ 75,383 $ 777 $ 62,917 --------- ------ ---------
(1) "For life" GMWB policies, and their related account values, include both benefits accounted for under SFAS 133 and SOP 03-1 and thus are included in this SFAS 133 table and the SOP 03-1 table above. However, benefits payable are generally mutually exclusive (e.g., for a given contract, only the death or living benefits, but not both are payable at one time). (2) The magnitude of the SFAS 133 fair value, at December 31, 2007, was highly dependent upon the size of the block of business for guaranteed living benefits that are required to be fair valued, and the market conditions at the date of valuation, in particular high implied volatilities and low risk-free interest rates. If implied volatilities were lower and risk-free interest rates were higher at December 31, 2007, the SFAS 133 fair value would have been lower and vice versa. F-12 DERIVATIVES THAT HEDGE CAPITAL MARKETS RISK FOR GUARANTEED MINIMUM BENEFITS ACCOUNTED FOR AS DERIVATIVES Changes in capital markets or policyholder behavior may increase or decrease the Company's exposure to benefits under the guarantees. The Company uses derivative transactions, including GMWB reinsurance (described below) which meets the definition of a derivative under SFAS 133 and customized derivative transactions, to mitigate some of that exposure. Derivatives are recorded at fair value with changes in fair value recorded in net realized capital gains (losses) in net income. GMWB REINSURANCE For all U.S. GMWB contracts in effect through July 2003, the Company entered into a reinsurance arrangement to offset its exposure to the GMWB for the remaining lives of those contracts. Substantially all of the Company's reinsurance capacity was utilized as of the third quarter of 2003. Substantially all U.S. GMWB riders sold since July 2003, are not covered by reinsurance. CUSTOMIZED DERIVATIVES In June and July of 2007, the Company entered into two customized swap contracts to hedge certain risk components for the remaining term of certain blocks of non-reinsured GMWB riders. These customized derivative contracts provide protection from capital markets risks based on policyholder behavior assumptions as specified by the Company at the inception of the derivative transactions. Due to the significance of the non-observable inputs associated with pricing these derivatives, the initial difference between the transaction price and modeled value was deferred in accordance with EITF No. 02-3 "Issues Involved in Accounting for Derivative Contracts Held for Trading Purposes and Contracts Involved in Energy Trading and Risk Management Activities" ("EITF 02-3") and included in Other Assets in the Condensed Consolidated Balance Sheets. OTHER DERIVATIVE INSTRUMENTS The Company uses other hedging instruments to hedge its unreinsured GMWB exposure. These instruments include interest rate futures and swaps, variance swaps, S&P 500 and NASDAQ index put options and futures contracts. The Company also uses EAFE Index swaps to hedge GMWB exposure to international equity markets. The following table provides the notional amount and SFAS 133 fair value at December 31, 2007, for each type of derivative asset held by the Company to hedge capital markets risk for guaranteed living benefit sold by the Company:
NOTIONAL FAIR AMOUNT VALUE (IN MILLIONS) -------------------------------------------------------------------------- Reinsurance $6,579 $128 Customized Derivatives 12,784 50 --------- ------ Other Derivative Instruments 8,573 592 --------- ------ TOTAL $ 27,936 $ 770 --------- ------
ADOPTION OF STATEMENT OF FINANCIAL ACCOUNTING STANDARD NO. 157, "FAIR VALUE MEASUREMENTS" ("SFAS 157") Fair values for GMWB embedded derivatives, reinsured GMIB and GMAB freestanding derivatives and customized derivatives that hedge certain equity markets exposure for GMWB contracts are calculated based upon internally developed models because active, observable markets do not exist for those items. Below is a description of the Company's fair value methodologies for guaranteed benefit liabilities, the related reinsurance and customized derivatives, all accounted for under SFAS 133, prior to the adoption of SFAS 157 and subsequent to adoption of SFAS 157. PRE-SFAS 157 FAIR VALUE Prior to January 1, 2008, the Company used the guidance prescribed in SFAS 133 and other related accounting literature on fair value which represented the amount for which a financial instrument could be exchanged in a current transaction between knowledgeable, unrelated willing parties. However, under that accounting literature, when an estimate of fair value is made for liabilities where no market observable transactions exist for that liability or similar liabilities, market risk margins are only included in the valuation if the margin is identifiable, measurable and significant. If a reliable estimate of market risk margins is not obtainable, the present value of expected future cash flows, discounted at the risk free rate of interest, may be the best available estimate of fair value in the circumstances ("Pre-SFAS 157 Fair Value"). The Pre-SFAS 157 Fair Value is calculated based on actuarial and capital market assumptions related to projected cashflows, including benefits and related contract charges, over the lives of the contracts, incorporating expectations concerning policyholder behavior such as lapses, fund selection, resets and withdrawal utilization (for the customized derivatives, policyholder behavior is prescribed in the derivative contract). Because of the dynamic and complex nature of these cashflows, best estimate assumptions and a Monte Carlo stochastic process involving the generation of thousands of scenarios that assume risk neutral returns consistent with swap rates and a blend of observable implied index volatility levels are used. Estimating these cashflows involves numerous estimates and subjective judgments including those regarding F-13 expected markets rates of return, market volatility, correlations of market index returns to funds, fund performance, discount rates and policyholder behavior. At each valuation date, the Company assumes expected returns based on risk-free rates as represented by the current LIBOR forward curve rates; forward market volatility assumptions for each underlying index based primarily on a blend of observed market "implied volatility" data; correlations of market returns across underlying indices based on actual observed market returns and relationships over the ten years preceding the valuation date; three years of history for fund regression; and current risk-free spot rates as represented by the current LIBOR spot curve to determine the present value of expected future cash flows produced in the stochastic projection process. As GMWB obligations are relatively new in the marketplace, actual policyholder behavior experience is limited. As a result, estimates of future policyholder behavior are subjective and based on analogous internal and external data. As markets change, mature and evolve and actual policyholder behavior emerges, management continually evaluates the appropriateness of its assumptions for this component of the fair value model. The Company's SFAS 157 fair value is calculated as an aggregation of the following components: Pre-SFAS 157 Fair Value, Actively-Managed Volatility Adjustment, Credit Standing Adjustment, Market Illiquidity Premium and Behavior Risk Margin. The resulting aggregation is reconciled or calibrated, if necessary, to market information that is, or may be, available to the Company, but may not be observable by other market participants, including reinsurance discussions and transactions. The Company believes the aggregation of each of these components, as necessary and as reconciled or calibrated to the market information available to the Company, results in an amount that the Company would be required to transfer for a liability, or receive for an asset, to market participants in an active liquid market, if one existed, for those market participants to assume the risks associated with the guaranteed minimum benefits, the related reinsurance and customized derivatives, required to be fair valued. Each of the components described below are unobservable in the market place and require subjectivity by the Company in determining their value. - ACTIVELY-MANAGED VOLATILITY ADJUSTMENT. This component incorporates the basis differential between the observable index implied index volatilities used to calculate the Pre-SFAS 157 component and the actively-managed funds underlying the variable annuity product. The Actively-Managed Volatility Adjustment is calculated using historical fund and weighted index volatilities. - CREDIT STANDING ADJUSTMENT. This component makes an adjustment that market participants would make to reflect the risk that GMWB obligations or the GMWB reinsurance recoverables will not be fulfilled ("nonperformance risk"). SFAS 157 explicitly requires nonperformance risk to be reflected in fair value. The Company calculates the Credit Standing Adjustment by using default rates provided by rating agencies, adjusted for market recoverability. - MARKET ILLIQUIDITY PREMIUM. This component makes an adjustment that market participants would require to reflect that GMWB obligations are illiquid and have no market observable exit prices in the capital markets. The Market Illiquidity Premium was determined using inputs that are identified in customized derivative transactions that the Company has entered into to hedge GMWB related risks. - BEHAVIOR RISK MARGIN. This component adds a margin that market participants would require for the risk that the Company's assumptions about policyholder behavior used in the Pre-SFAS 157 model could differ from actual experience. The Behavior Risk Margin is calculated by taking the difference between adverse policyholder behavior assumptions and the best estimate assumptions used in the Pre-SFAS 157 model using the Company's long-term view on interest rates and volatility. The adverse assumptions incorporate adverse dynamic lapse behavior, greater utilization of the withdrawal features, and the potential for contract holders to shift their investment funds into more aggressive investments when allowed. SFAS 157 TRANSITION Pending the release and potential impact of adopting the proposed FASB Staff Position, "Measuring Liabilities under FASB Statement No. 157", if any, the Company expects the impact of adopting SFAS 157 for guaranteed benefits accounted for under SFAS 133 and the related reinsurance, to be recorded in the first quarter of 2008, will be a reduction to net income of $250-$350, after the effects of DAC amortization and income taxes. In addition, net realized capital gains and losses that will be recorded in 2008 and future years are also likely to be more volatile than amounts recorded in prior years. Furthermore, adoption of SFAS 157 will result in lower variable annuity fee income for new business issued in 2008 as fees attributed to the embedded derivative will increase consistent with incorporating additional risk margins and other indicia of "exit value" in the valuation of the embedded derivative. The Company is still evaluating potential changes to its hedging program as a result of the adoption of SFAS 157. However, based on analysis to date, the Company does not expect significant changes in any of its hedging targets. The loss deferred in accordance with EITF 02-3 of $51 for the customized derivatives used to hedge a portion of the GMWB risk will be recognized in retained earnings upon the adoption of SFAS 157. In addition, the change in value of the customized derivatives due to the initial adoption of SFAS 157 of $35 will also be recorded in retained earnings with subsequent changes in fair value recorded in net realized capital gains (losses) in net income. The Company's adoption of SFAS 157 will not materially impact the fair values of other derivative instruments used to hedge guaranteed minimum benefits, as those instruments are F-14 composed primarily of Level 1 and Level 2 inputs and as a result, the Company was already using market observable transactions to value those hedging instruments. Additionally, the adoption of SFAS 157 will not have a significant impact on the fair values of the Company's other financial instruments. INVESTMENTS The Company's investments in fixed maturities, which include bonds, redeemable preferred stock and commercial paper; and certain equity securities, which include common and non-redeemable preferred stocks, are classified as "available-for-sale" and accordingly, are carried at fair value with the after-tax difference from cost or amortized cost, as adjusted for the effect of deducting the life and pension policyholders' share of the immediate participation guaranteed contracts and certain life and annuity deferred policy acquisition costs and reserve adjustments, reflected in stockholder's equity as a component of accumulated other comprehensive income ("AOCI"). Policy loans are carried at outstanding balance, which approximates fair value. Mortgage loans on real estate are recorded at the outstanding principal balance adjusted for amortization of premiums or discounts and net of valuation allowances, if any. Short-term investments are carried at amortized cost, which approximates fair value. Other investments primarily consist of limited partnership interests and other alternative investments and derivatives instruments. Limited partnerships are accounted for under the equity method and accordingly the Company's share of earnings are included in net investment income. Derivatives instruments are carried at fair value. VALUATION OF FIXED MATURITIES The fair value for fixed maturity securities is largely determined by one of three primary pricing methods: third party pricing service market prices, independent broker quotations or pricing matrices. Security pricing is applied using a hierarchy or "waterfall" approach whereby prices are first sought from third party pricing services with the remaining unpriced securities submitted to independent brokers for prices or lastly priced via a pricing matrix. Typical inputs used by these three pricing methods include, but are not limited to, reported trades, benchmark yields, issuer spreads, bids, offers, and/or estimated cash flows and prepayments speeds. Based on the typical trading volumes and the lack of quoted market prices for fixed maturities, third party pricing services will normally derive the security prices through recent reported trades for identical or similar securities making adjustments through the reporting date based upon available market observable information as outlined above. If there are no recent reported trades, the third party pricing services and brokers may use matrix or model processes to develop a security price where future cash flow expectations are developed based upon collateral performance and discounted at an estimated market rate. Included in the asset-backed securities ("ABS"), collaterized mortgage obligations ("CMOs"), and mortgage-backed securities ("MBS") pricing are estimates of the rate of future prepayments of principal over the remaining life of the securities. Such estimates are derived based on the characteristics of the underlying structure and prepayment speeds previously experienced at the interest rate levels projected for the underlying collateral. Actual prepayment experience may vary from these estimates Prices from third party pricing services are often unavailable for securities that are rarely traded or are traded only in privately negotiated transactions. As a result, certain of the Company's securities are priced via independent broker quotations which utilize inputs that may be difficult to corroborate with observable market based data. A pricing matrix is used to price securities for which the Company is unable to obtain either a price from a third party pricing service or an independent broker quotation. The pricing matrix begins with current spread levels to determine the market price for the security. The credit spreads, as assigned by a nationally recognized rating agency, incorporate the issuer's credit rating and a risk premium, if warranted, due to the issuer's industry and the security's time to maturity. The issuer-specific yield adjustments, which can be positive or negative, are updated twice annually, as of June 30 and December 31, by an independent third party source and are intended to adjust security prices for issuer-specific factors. The matrix-priced securities at December 31, 2007 and 2006 primarily consisted of non-144A private placements and have an average duration of 4.7 and 5.0 years, respectively. The Company assigns a credit rating to these securities based upon an internal analysis of the issuer's financial strength. The Company performs a monthly analysis on the prices received from third parties to assess if the prices represent a reasonable estimate of the fair value. This process involves quantitative and qualitative analysis and is overseen by investment and accounting professionals. Examples of procedures performed include, but are not limited to, initial and on-going review of third party pricing services methodologies, review of pricing statistics and trends, back testing recent trades, and monitoring of trading volumes. As a result of this analysis, if the Company determines there is a more appropriate fair value based upon available market data, the price received from the third party is adjusted accordingly. F-15 The following table presents the fair value of fixed maturity securities by pricing source as of December 31, 2007 and 2006.
PERCENTAGE PERCENTAGE 2007 OF TOTAL 2006 OF TOTAL FAIR VALUE FAIR VALUE FAIR VALUE FAIR VALUE --------------------------------------------------------------------------------------------------------------------------------- Priced via third party pricing services $35,892 78.7% $37,190 83.3% Priced via independent broker quotations 5,931 13.0% 3,567 8.0% Priced via matrices 3,526 7.7% 3,810 8.5% Priced via other methods 262 0.6% 79 0.2% --------- ------- --------- ------- TOTAL $45,611 100.0% $44,646 100.0% --------- ------- --------- -------
The fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between knowledgeable, unrelated willing parties using inputs, including assumptions and estimates, a market participant would utilize. As such, the estimated fair value of a financial instrument may differ significantly from the amount that could be realized if the security was sold immediately. OTHER-THAN-TEMPORARY IMPAIRMENTS ON AVAILABLE-FOR-SALE SECURITIES One of the significant estimates inherent in the valuation of investments is the evaluation of investments for other-than-temporary impairments. The evaluation of impairments is a quantitative and qualitative process, which is subject to risks and uncertainties and is intended to determine whether declines in the fair value of investments should be recognized in current period earnings. The risks and uncertainties include changes in general economic conditions, the issuer's financial condition or near term recovery prospects, the effects of changes in interest rates or credit spreads and the recovery period. The Company's accounting policy requires that a decline in the value of a security below its cost or amortized cost basis be assessed to determine if the decline is other-than-temporary. If the security is deemed to be other-than-temporarily impaired, 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 cost or amortized cost 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 ("the committee") that identifies securities that, due to certain characteristics, as described below, are subjected to an enhanced analysis on a quarterly basis. Securities not subject to EITF Issue No. 99-20, "Recognition of Interest Income and Impairment on Purchased Beneficial Interests and Beneficial Interests That Continued to Be Held by a Transferor in Securitized Financial Assets" ("non-EITF Issue No. 99-20 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 non-EITF Issue No. 99-20 securities is other-than-temporary include: (a) the length of time and the extent to which the fair value has been or is expected to be 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. For certain securitized financial assets with contractual cash flows including ABS, EITF Issue No. 99-20 requires the Company to periodically update its best estimate of cash flows over the life of the security. If the fair value of a securitized financial asset is less than its cost or amortized cost and there has been a decrease in the present value of the estimated cash flows since the last revised estimate, considering both timing and amount, an other-than-temporary impairment charge is recognized. The Company also considers its intent and ability to retain a temporarily impaired security until recovery. 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. In addition, projections of expected future cash flows may change based upon new information regarding the performance of the underlying collateral. Each quarter, during this analysis, the Company asserts its intent and ability to retain until recovery those securities judged to be temporarily impaired. Once identified, these securities are systematically restricted from trading unless approved by the committee. The committee will only authorize the sale of these securities based on predefined criteria that relate to events that could not have been foreseen. Examples of the criteria include, but are not limited to, the deterioration in the issuer's creditworthiness, a change in regulatory requirements or a major business combination or major disposition. MORTGAGE LOAN IMPAIRMENTS 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 amounts due according to the contractual F-16 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 either (a) the present value of the expected future cash flows discounted at the loan's original effective interest rate, (b) the loan's observable market price or (c) the fair value of the collateral. Changes in valuation allowances are recorded in net realized capital gains and losses. NET REALIZED CAPITAL GAINS AND LOSSES Net realized capital gains and losses from investment sales, after deducting the life and pension policyholders' share for certain products, are reported as a component of revenues and are determined on a specific identification basis. Net realized capital gains and losses also result from fair value changes in derivatives contracts (both free-standing and embedded) that do not qualify, or are not designated, as a hedge for accounting purposes, and the change in value of derivatives in certain fair-value hedge relationships. Impairments are recognized as net realized capital losses when investment losses in value are deemed other-than-temporary. Recoveries of principle received by the Company in excess of expected realizable value from securities previously recorded as other-than-temporarily impaired are included in net realized capital gains. Foreign currency transaction remeasurements are also included in net realized capital gains and losses. NET INVESTMENT INCOME Interest income from fixed maturities and mortgage loans on real estate is recognized when earned on the constant effective yield method based on estimated timing of cash flows. The amortization of premium and accretion of discount for fixed maturities also takes into consideration call and maturity dates that produce the lowest yield. For high credit quality securitized financial assets subject to prepayment risk, yields are recalculated and adjusted periodically to reflect historical and/or estimated future principal repayments using the retrospective method. For non-highly rated securitized financial assets any yield adjustments are made using the prospective method. Prepayment fees on fixed maturities and mortgage loans are recorded in net investment income when earned. For limited partnerships, the equity method of accounting is used to recognize the Company's share of earnings. For fixed maturities that have had an other-than-temporary impairment loss, the Company amortizes the new cost basis to par or to the estimated future value over the expected remaining life of the security by adjusting the security's yield. DERIVATIVE INSTRUMENTS Overview The Company utilizes a variety of derivative instruments, including swaps, caps, floors, forwards, futures and options through one of four Company-approved objectives: to hedge risk arising from interest rate, equity market, credit spread including issuer default, price or currency exchange rate risk or volatility; to manage liquidity; to control transaction costs; or to enter into replication transactions. For a further discussion of derivative instruments, see the Derivative Instruments section of Note 3. The Company's derivative transactions are used in strategies permitted under the derivative use plans required by the State of Connecticut and the State of New York insurance departments. Accounting and Financial Statement Presentation of Derivative Instruments and Hedging Activities Derivative instruments are recognized on the consolidated balance sheets at fair value. As of December 31, 2007 and 2006, approximately 89% and 82% of derivatives, respectively, based upon notional values, were priced by valuation models, which utilize independent market data, while the remaining 11% and 18%, respectively, were priced by broker quotations. The derivatives are valued using mid-market level inputs that are predominantly observable in the market place. Inputs used to value derivatives include, but are not limited to, interest swap rates, foreign currency forward and spot rates, credit spreads, interest and equity volatility and equity index levels. The Company performs a monthly analysis on the derivative valuation which includes both quantitative and qualitative analysis. Examples of procedures performed include, but are not limited to, review of pricing statistics and trends, back testing recent trades, analyzing changes in the market environment and monitoring trading volume. This discussion on derivative pricing excludes the GMWB rider and associated reinsurance contracts as well as the reinsurance contracts associated with the GMIB and GMAB products, which are discussed in the preceding paragraphs under "Accounting for Guaranteed Benefits Offered with Variable Annuities" section. On the date the derivative contract is entered into, the Company designates the derivative as (1) a hedge of the fair value of a recognized asset or liability ("fair-value" hedge), (2) a hedge of the variability in cash flows of a forecasted transaction or of amounts to be received or paid related to a recognized asset or liability ("cash-flow" hedge), (3) a foreign-currency fair value or cash-flow hedge ("foreign-currency" hedge), (4) a hedge of a net investment in a foreign operation ("net investment" hedge) or (5) held for other investment and/or risk management purposes, which primarily involve managing asset or liability related risks which do not qualify for hedge accounting. Fair-Value Hedges Changes in the fair value of a derivative that is designated and qualifies as a fair-value hedge, along with the changes in the fair value of the hedged asset or liability that is attributable to the hedged risk, are recorded in current period earnings with any F-17 differences between the net change in fair value of the derivative and the hedged item representing the hedge ineffectiveness. Periodic cash flows and accruals of income/expense ("periodic derivative net coupon settlements") are recorded in the line item of the consolidated statements of income in which the cash flows of the hedged item are recorded. Cash-Flow Hedges Changes in the fair value of a derivative that is designated and qualifies as a cash-flow hedge are recorded in AOCI and are reclassified into earnings when the variability of the cash flow of the hedged item impacts earnings. Gains and losses on derivative contracts that are reclassified from AOCI to current period earnings are included in the line item in the consolidated statements of income in which the cash flows of the hedged item are recorded. Any hedge ineffectiveness is recorded immediately in current period earnings as net realized capital gains and losses. Periodic derivative net coupon settlements are recorded in the line item of the consolidated statements of income in which the cash flows of the hedged item are recorded. Foreign-Currency Hedges Changes in the fair value of derivatives that are designated and qualify as foreign-currency hedges are recorded in either current period earnings or AOCI, depending on whether the hedged transaction is a fair-value hedge or a cash-flow hedge, respectively. Any hedge ineffectiveness is recorded immediately in current period earnings as net realized capital gains and losses. Periodic derivative net coupon settlements are recorded in the line item of the consolidated statements of income in which the cash flows of the hedged item are recorded. Net Investment in a Foreign Operation Hedges Changes in fair value of a derivative used as a hedge of a net investment in a foreign operation, to the extent effective as a hedge, are recorded in the foreign currency translation adjustments account within AOCI. Cumulative changes in fair value recorded in AOCI are reclassified into earnings upon the sale or complete, or substantially complete, liquidation of the foreign entity. Any hedge ineffectiveness is recorded immediately in current period earnings as net realized capital gains and losses. Periodic derivative net coupon settlements are recorded in the line item of the consolidated statements of income in which the cash flows of the hedged item are recorded. Other Investment and/or Risk Management Activities The Company's other investment and/or risk management activities primarily relate to strategies used to reduce economic risk or replicate permitted investments and do not receive hedge accounting treatment. Changes in the fair value, including periodic derivative net coupon settlements, of derivative instruments held for other investment and/or risk management purposes are reported in current period earnings as net realized capital gains and losses. Hedge Documentation and Effectiveness Testing To qualify for hedge accounting treatment, a derivative must be highly effective in mitigating the designated changes in value or cash flow of the hedged item. At hedge inception, the Company formally documents all relationships between hedging instruments and hedged items, as well as its risk-management objective and strategy for undertaking each hedge transaction. The documentation process includes linking derivatives that are designated as fair-value, cash-flow, foreign-currency or net investment hedges to specific assets or liabilities on the balance sheet or to specific forecasted transactions and defining the effectiveness and ineffectiveness testing methods to be used. The Company also formally assesses, both at the hedge's inception and ongoing on a quarterly basis, whether the derivatives that are used in hedging transactions have been and are expected to continue to be highly effective in offsetting changes in fair values or cash flows of hedged items. Hedge effectiveness is assessed using qualitative and quantitative methods. Qualitative methods may include comparison of critical terms of the derivative to the hedged item. Quantitative methods include regression or other statistical analysis of changes in fair value or cash flows associated with the hedge relationship. Hedge ineffectiveness of the hedge relationships are measured each reporting period using the "Change in Variable Cash Flows Method", the "Change in Fair Value Method", the "Hypothetical Derivative Method", or the "Dollar Offset Method". Discontinuance of Hedge Accounting The Company discontinues hedge accounting prospectively when (1) it is determined that the derivative is no longer highly effective in offsetting changes in the fair value or cash flows of a hedged item; (2) the derivative is dedesignated as a hedging instrument; or (3) the derivative expires or is sold, terminated or exercised. When hedge accounting is discontinued because it is determined that the derivative no longer qualifies as an effective fair-value hedge, the derivative continues to be carried at fair value on the balance sheet with changes in its fair value recognized in current period earnings. F-18 When hedge accounting is discontinued because the Company becomes aware that it is not probable that the forecasted transaction will occur, the derivative continues to be carried on the balance sheet at its fair value, and gains and losses that were accumulated in AOCI are recognized immediately in earnings. In other situations in which hedge accounting is discontinued on a cash-flow hedge, including those where the derivative is sold, terminated or exercised, amounts previously deferred in AOCI are reclassified into earnings when earnings are impacted by the variability of the cash flow of the hedged item. Embedded Derivatives The Company purchases and issues financial instruments and products that contain embedded derivative instruments. When it is determined that (1) the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, and (2) a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host for measurement purposes. The embedded derivative, which is reported with the host instrument in the consolidated balance sheets, is carried at fair value with changes in fair value reported in net realized capital gains and losses. Credit Risk The Company's derivative 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. 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, currency forward contracts, and certain embedded derivatives, 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. Product Derivatives and Risk Management The Company offers certain variable annuity products with a guaranteed minimum withdrawal benefit ("GMWB") rider. The Company has also assumed, through reinsurance, from HLIKK GMIB and GMAB. The fair value of the GMWB, GMIB and GMAB is calculated based on actuarial and capital market assumptions related to the projected cash flows, including benefits and related contract charges, over the lives of the contracts, incorporating expectations concerning policyholder behavior. Because of the dynamic and complex nature of these cash flows, best estimate assumptions and stochastic techniques under a variety of market return scenarios are used. Estimating these cash flows involves numerous estimates and subjective judgments including those regarding expected market rates of return, market volatility, correlations of market returns and discount rates. At each valuation date, the Company assumes expected returns based on risk-free rates; market volatility assumptions for each underlying index based on a blend of observed market "implied volatility" data and annualized standard deviations of monthly returns using the most recent 20 years of observed market performance correlations of market returns across underlying indices based on actual observed market returns and relationships over the ten years preceding the valuation date; and current risk-free spot rates, to determine the present value of expected future cash flows produced in the stochastic projection process. Changes in capital market assumptions can significantly change the value of the GMWB, GMIB, and GMAB. In valuing the embedded derivative, the Company attributes to the derivative a portion of the fees collected from the contract holder equal to the present value of future GMWB claims (the "Attributed Fees"). All changes in the fair value of the embedded GMWB derivative are recorded in net realized capital gains and losses. The excess of fees collected from the contract holder over the Attributed Fees are associated with the host variable annuity contract recorded in fee income. Upon adoption of SFAS 157, the Company will revise many of the assumptions used to value GMWB, GMIB and GMAB. For contracts issued prior to July 2003, the Company has a reinsurance arrangement in place to transfer its risk of loss due to GMWB. This arrangement is recognized as a derivative and carried at fair value in reinsurance recoverables. Changes in the fair value of the reinsurance agreement is recorded in net realized capital gains and losses. As of July 2003, the Company had substantially exhausted all of its reinsurance capacity, with respect to contracts issued after July 2003, and began hedging its exposure to the GMWB rider using a sophisticated program involving interest rate futures, Standard and Poor's ("S&P") 500 and NASDAQ index put options and futures contracts and Europe, Australasia and Far East ("EAFE") Index swaps to hedge GMWB exposure to international equity markets. During 2007, the Company also purchased customized derivative instruments to hedge capital market risks associated with GMWB. For the years ended December 31, 2007, 2006 and 2005, net realized capital gains and losses included the change in market value of the embedded derivative related to the GMWB F-19 and GMAB liability, the derivative reinsurance arrangement and the related derivative contracts that were purchased as economic hedges, the net effect of which was a $283 loss, $26 loss and $46 loss, before deferred policy acquisition costs and tax effects, respectively. A contract is 'in the money' if the contract holder's GRB is greater than the account value. For contracts that were 'in the money', the Company's exposure, after reinsurance, as of December 31, 2007, was $139. However, the only ways the contract holder can monetize the excess of the GRB over the account value of the contract is upon death or if their account value is reduced to zero through a combination of a series of withdrawals that do not exceed a specific percentage of the premiums paid per year and market declines. If the account value is reduced to zero, the contract holder will receive a period certain annuity equal to the remaining GRB. As the amount of the excess of the GRB over the account value can fluctuate with equity market returns on a daily basis the ultimate amount to be paid by the Company, if any, is uncertain and could be significantly more or less than $139. SEPARATE ACCOUNTS The Company maintains separate account assets and liabilities, which are reported at fair value. Separate accounts include contracts, wherein the policyholder assumes the investment risk. Separate account assets are segregated from other investments and investment income and gains and losses accrue directly to the policyholder. DEFERRED POLICY ACQUISITION COSTS AND PRESENT VALUE OF FUTURE PROFITS The deferred policy acquisition costs asset and present value of future profits ("PVFP") intangible asset (hereafter, referred to collectively as "DAC") related to investment contracts and universal life-type contracts (including variable annuities) are amortized in the same way, over the estimated life of the contracts acquired using the retrospective deposit method. Under the retrospective deposit method, acquisition costs are amortized in proportion to the present value of estimated gross profits ("EGPs"). EGPs are also used to amortize other assets and liabilities on the Company's balance sheet, such as sales inducement assets and unearned revenue reserves ("URR"). Components of EGPs are used to determine reserves for guaranteed minimum death, income and universal life secondary guarantee benefits accounted for and collectively referred to as "SOP 03-1 reserves". At December 31, 2007 and 2006, the carrying value of the Company's DAC asset was $8.4 billion and $7.3 billion, respectively. At December 31, 2007, the sales inducement, unearned revenue reserves, and SOP 03-1 balances were $445, $1.0 billion and $550, respectively. At December 31, 2006, the sales inducement, unearned revenue reserves and SOP 03-1 reserves were $397, $769 and $483, respectively. For most contracts, the Company estimates gross profits over a 20 year horizon as estimated profits emerging subsequent to year 20 are immaterial. The Company uses other amortization bases for amortizing DAC, such as gross costs (net of reinsurance), as a replacement for EGPs when EGPs are expected to be negative for multiple years of the contract's life. Actual gross profits, in a given reporting period, that vary from management's initial estimates result in increases or decreases in the rate of amortization, commonly referred to as a "true-up", which are recorded in the current period. The true-up recorded for the years ended December 31, 2007, 2006 and 2005 was an increase to amortization of $0, $45 and $27, respectively. Products sold in a particular year are aggregated into cohorts. Future gross profits for each cohort are projected over the estimated lives of the underlying contracts, and are, to a large extent, a function of future account value projections for individual variable annuity products and to a lesser extent for variable universal life products. The projection of future account values requires the use of certain assumptions. The assumptions considered to be important in the projection of future account value, and hence the EGPs, include separate account fund performance, which is impacted by separate account fund mix, less fees assessed against the contract holder's account balance, surrender and lapse rates, interest margin, mortality and hedging costs. The assumptions are developed as part of an annual process and are dependent upon the Company's current best estimates of future events. The Company's current separate account return assumption is approximately 8% (after fund fees, but before mortality and expense charges). Beginning in 2007, the Company estimated gross profits using the mean of EGPs derived from a set of stochastic scenarios that have been calibrated to our estimated separate account return as compared to prior years where we used a single deterministic estimation. Estimating future gross profits is a complex process requiring considerable judgment and the forecasting of events well into the future. The estimation process, the underlying assumptions and the resulting EGPs, are evaluated regularly. During the third quarter of 2007 and the fourth quarter of 2006, the Company refined its estimation process for DAC amortization and completed a comprehensive study of assumptions. The Company plans to complete a comprehensive assumption study and refine its estimate of future gross profits during the third quarter of each successive year. Upon completion of an assumption study, the Company revises its assumptions to reflect its current best estimate, thereby changing its estimate of projected account values and the related EGPs in the DAC, sales inducement and unearned revenue reserve amortization models as well as the SOP 03-1 reserving models. The DAC asset, as well as the sales inducement asset, unearned revenue reserves and SOP 03-1 reserves are adjusted with an offsetting benefit or charge to income to reflect such changes in the period of the revision, a process known as "unlocking". An unlock that results in an after-tax benefit generally occurs as a result of actual experience or future expectations of product profitability being favorable F-20 compared to previous estimates. An unlock that results in an after-tax charge generally occurs as a result of actual experience or future expectations of product profitability being unfavorable compared to previous estimates. In addition to when a comprehensive assumption study is completed, revisions to best estimate assumptions used to estimate future gross profits are necessary when the EGPs in the Company's models fall outside of an independently determined reasonable range of EGPs. The Company performs a quantitative process each quarter to determine the reasonable range of EGPs. This process involves the use of internally developed models, which run a large number of stochastically determined scenarios of separate account fund performance. Incorporated in each scenario are assumptions with respect to lapse rates, mortality, and expenses, based on the Company's most recent assumption study. These scenarios are run for the Company's individual variable annuity businesses, the Company's Retirement Plans businesses and for the Company's individual variable universal life business and are used to calculate statistically significant ranges of reasonable EGPs. The statistical ranges produced from the stochastic scenarios are compared to the present value of EGPs used in the Company's models. If EGPs used in the Company's models fall outside of the statistical ranges of reasonable EGPs, an "unlock" would be necessary. If EGPs used in the Company's models fall inside of the statistical ranges of reasonable EGPs, the Company will not solely rely on the results of the quantitative analysis to determine the necessity of an unlock. In addition, the Company considers, on a quarterly basis, other qualitative factors such as market, product, regulatory and policyholder behavior trends and may also revise EGPs if those trends are expected to be significant and were not or could not be included in the statistically significant ranges of reasonable EGPs. UNLOCK RESULTS During the third quarter of 2007 and the fourth quarter of 2006, the Company completed an annual, comprehensive study of assumptions underlying EGPs, resulting in an "unlock". The study covered all assumptions, including mortality, lapses, expenses, hedging costs, and separate account returns, in substantially all product lines. The new best estimate assumptions were applied to the current in-force to project future gross profits. The after-tax impact on the Company's assets and liabilities as a result of the unlock during the third quarter of 2007 was as follows:
Unearned Death Sales DAC and Revenue Benefit Inducement PVFP Reserves Reserves (1) Assets Total (2) --------------------------------------------------------------------------------------------------------------------------------- SEGMENT AFTER-TAX (CHARGE) BENEFIT Retail $181 $(5) $(4) $9 $181 Retirement Plans (9) -- -- -- (9) Institutional 1 -- -- -- 1 Individual Life 24 (8) -- -- 16 ------ ----- ---- ---- ------ TOTAL $197 $(13) $(4) $9 $189 ------ ----- ---- ---- ------
(1) As a result of the unlock, death benefit reserves, in Retail, decreased $4, pre-tax, offset by a decrease of $10,pre-tax, in reinsurance recoverables. (2) The following were the most significant contributors to the unlock amounts recorded during the third quarter of 2007: - Actual separate account returns were above our aggregated estimated return. - During the third quarter of 2007, the Company estimated gross profits using the mean of EGPs derived from a set of stochastic scenarios that have been calibrated to our estimated separate account return as compared to prior year where we used a single deterministic estimation. The impact of this change in estimation was a benefit of $20, after-tax, for variable annuities. - As part of its continual enhancement to its assumption setting processes and in connection with its assumption study, the Company included dynamic lapse behavior assumptions. Dynamic lapses reflect that lapse behavior will be different depending upon market movements. The impact of this assumption change along with other base lapse rate changes was an approximate benefit of $40, after-tax, for variable annuities. As a result of the unlock in the third quarter of 2007, the Company expects an immaterial change to total Company DAC amortization in 2008. F-21 The after-tax impact on the Company's assets and liabilities as a result of the unlock during the fourth quarter of 2006 was as follows:
Unearned Death Sales DAC and Revenue Benefit Inducement PVFP Reserves Reserves (1) Assets Total --------------------------------------------------------------------------------------------------------------------------------- SEGMENT AFTER-TAX (CHARGE) BENEFIT Retail $(116) $5 $(10) $3 $(118) Retirement Plans 20 -- -- -- 20 Individual Life (46) 30 -- -- (16) ------- ---- ----- ---- ------- TOTAL $(142) $35 $(10) $3 $(114) ------- ---- ----- ---- -------
(1) As a result of the unlock, death benefit reserves, in the Retail, increased $294, offset by an increase of $279 in reinsurance recoverables. An "unlock" only revises EGPs to reflect current best estimate assumptions. The Company must also test the aggregate recoverability of the DAC and sales inducement assets by comparing the amounts deferred to the present value of total EGPs. In addition, the Company routinely stress tests its DAC and sales inducement assets for recoverability against severe declines in its separate account assets, which could occur if the equity markets experienced a significant sell-off, as the majority of policyholders' funds in the separate accounts is invested in the equity market. As of December 31, 2007, the Company believed individual variable annuity separate account assets could fall, through a combination of negative market returns, lapses and mortality, by at least 54%, before portions of its DAC and sales inducement assets would be unrecoverable. RESERVE FOR FUTURE POLICY BENEFITS AND UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSES Liabilities for the Company's group life and disability contracts as well its individual term life insurance policies include amounts for unpaid losses and future policy benefits. Liabilities for unpaid losses include estimates of amounts to fully settle known reported claims as well as claims related to insured events that the Company estimates have been incurred but have not yet been reported. Liabilities for future policy benefits are calculated by the net level premium method using interest, withdrawal and mortality assumptions appropriate at the time the policies were issued. The methods used in determining the liability for unpaid losses and future policy benefits are standard actuarial methods recognized by the American Academy of Actuaries. For the tabular reserves, discount rates are based on the Company's earned investment yield and the morbidity/mortality tables used are standard industry tables modified to reflect the Company's actual experience when appropriate. In particular, for the Company's group disability known claim reserves, the morbidity table for the early durations of claim is based exclusively on the Company's experience, incorporating factors such as gender, elimination period and diagnosis. These reserves are computed such that they are expected to meet the Company's future policy obligations. Future policy benefits are computed at amounts that, with additions from estimated premiums to be received and with interest on such reserves compounded annually at certain assumed rates, are expected to be sufficient to meet the Company's policy obligations at their maturities or in the event of an insured's death. Changes in or deviations from the assumptions used for mortality, morbidity, expected future premiums and interest can significantly affect the Company's reserve levels and related future operations and, as such, provisions for adverse deviation are built into the long-tailed liability assumptions. Certain contracts classified as universal life-type may also include additional death or other insurance benefit features, such as guaranteed minimum death benefits offered with variable annuity contracts or no lapse guarantees offered with universal life insurance contracts. An additional liability is established for these benefits by estimating the expected present value of the benefits in excess of the projected account value in proportion to the present value of total expected assessments. Excess benefits are accrued as a liability as actual assessments are recorded. Determination of the expected value of excess benefits and assessments are based on a range of scenarios and assumptions including those related to market rates of return and volatility, contract surrender rates and mortality experience. Revisions to assumptions are made consistent with the Company's process for an unlock. See Life Deferred Policy Acquisition Costs and Present value of Future Benefits in this Note. OTHER POLICYHOLDER FUNDS AND BENEFITS PAYABLE The Company has classified its fixed and variable annuities, 401(k), certain governmental annuities, private placement life insurance ("PPLI"), variable universal life insurance, universal life insurance and interest sensitive whole life insurance as universal life-type contracts. The liability for universal life-type contracts is equal to the balance that accrues to the benefit of the policyholders as of the financial statement date (commonly referred to as the account value), including credited interest, amounts that have been assessed to compensate the Company for services to be performed over future periods, and any amounts previously assessed against policyholders that are refundable on termination of the contract. F-22 The Company has classified its institutional and governmental products, without life contingencies, including funding agreements, certain structured settlements and guaranteed investment contracts, as investment contracts. The liability for investment contracts is equal to the balance that accrues to the benefit of the contract holder as of the financial statement date, which includes the accumulation of deposits plus credited interest, less withdrawals and amounts assessed through the financial statement date. Contract holder funds include funding agreements held by VIE issuing medium-term notes. REVENUE RECOGNITION For investment and universal life-type contracts, the amounts collected from policyholders are considered deposits and are not included in revenue. Fee income for universal life-type contracts consists of policy charges for policy administration, cost of insurance charges and surrender charges assessed against policyholders' account balances and are recognized in the period in which services are provided. For the Company's traditional life and group disability products premiums are recognized as revenue when due from policyholders. FOREIGN CURRENCY TRANSLATION Foreign currency translation gains and losses are reflected in stockholder's equity as a component of accumulated other comprehensive income. The Company's assumed foreign balance sheet accounts are translated at the exchange rates in effect at each year end and income statement accounts are translated at the average rates of exchange prevailing during the year. The national currencies of the international operations are generally their functional currencies. DIVIDENDS TO POLICYHOLDERS Policyholder dividends are paid to certain policies, which are referred to as participating policies. Such dividends are accrued using an estimate of the amount to be paid based on underlying contractual obligations under policies and applicable state laws. Participating life insurance in-force accounted for 7%, 3% and 3% as of December 31, 2007, 2006 and 2005, respectively, of total life insurance in-force. Dividends to policyholders were $11, $22 and $37 for the years ended December 31, 2007, 2006 and 2005, respectively. There were no additional amounts of income allocated to participating policyholders. If limitations exist on the amount of net income from participating life insurance contracts that may be distributed to stockholder's, the policyholder's share of net income on those contracts that cannot be distributed is excluded from stockholder's equity by a charge to operations and a credit to a liability. REINSURANCE Through both facultative and treaty reinsurance agreements, the Company cedes a share of the risks it has underwritten to other insurance companies. Assumed reinsurance refers to the Company's acceptance of certain insurance risks that other insurance companies have underwritten. Reinsurance accounting is followed for ceded and assumed transactions when the risk transfer provisions of SFAS 113, "Accounting and Reporting for Reinsurance of Short-Duration and Long-Duration Contracts," have been met. To meet risk transfer requirements, a reinsurance contract must include insurance risk, consisting of both underwriting and timing risk, and a reasonable possibility of a significant loss to the reinsurer. Earned premiums and incurred losses and loss adjustment expenses reflect the net effects of ceded and assumed reinsurance transactions. Included in other assets are prepaid reinsurance premiums, which represent the portion of premiums ceded to reinsurers applicable to the unexpired terms of the reinsurance contracts. Reinsurance recoverables include balances due from reinsurance companies for paid and unpaid losses and loss adjustment expenses and are presented net of an allowance for uncollectible reinsurance. INCOME TAXES The Company recognizes taxes payable or refundable for the current year and deferred taxes for the tax consequences of differences between the financial reporting and tax basis of assets and liabilities. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years the temporary differences are expected to reverse. 2. SEGMENT INFORMATION The Company has four reporting segments: Retail Products Group ("Retail"), Retirement Plans ("Retirement"), Institutional Solutions Group ("Institutional") and Individual Life. In 2007, the Company changed its reporting for realized gains and losses, as well as credit risk charges previously allocated between Other and each of the reporting segments. All segment data for prior reporting periods have been adjusted to reflect the current segment reporting. Retail offers individual variable and fixed market value adjusted ("MVA") annuities. Retirement Plans provides products and services to corporations pursuant to Section 401(k) and products and services to municipalities and not-for-profit organizations under Section 457 and 403(b) of the IRS code. F-23 Institutional primarily offers institutional liability products, including stable value products, structured settlements and institutional annuities (primarily terminal funding cases), as well as variable Private Placement Life Insurance ("PPLI") owned by corporations and high net worth individuals. Furthermore, Institutional offers additional individual products including structured settlements, single premium immediate annuities and longevity assurance. Individual Life sells a variety of life insurance products, including variable universal life, universal life, interest sensitive whole life and term life. The Company includes in an Other category its leveraged PPLI product line of business; corporate items not directly allocated to any of its reporting segments; intersegment eliminations, guaranteed minimum income benefit ("GMIB'), guaranteed minimum death benefit ("GMDB") and guaranteed minimum accumulation benefit ("GMAB") reinsurance assumed from Hartford Life Insurance KK ("HLIKK"), a related party and subsidiary of Hartford Life, as well as certain group benefit products, including group life and group disability insurance that is directly written by the Company and for which nearly half is ceded to its parent, HLA. The accounting policies of the reportable operating segments are the same as those described in the summary of significant accounting policies in Note 1. The Company evaluates performance of its segments based on revenues, net income and the segment's return on allocated capital. Each operating segment is allocated corporate surplus as needed to support its business. The following tables represent summarized financial information concerning the Company's segments.
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- REVENUES BY PRODUCT LINE REVENUES LIFE Earned premiums, fees, and other considerations RETAIL Individual annuity: Individual variable annuity $2,103 $1,835 $1,629 Fixed / MVA Annuity 1 3 (2) Other -- -- -- -------- -------- -------- Total Retail 2,104 1,838 1,627 RETIREMENT PLANS 401(k) 179 154 106 403(b)/457 50 45 43 -------- -------- -------- Total Retirement Plans 229 199 149 INSTITUTIONAL IIP 1,012 623 516 PPLI 224 103 105 -------- -------- -------- Total Institutional 1,236 726 621 INDIVIDUAL LIFE Total Individual Life 760 780 716 OTHER 163 117 147 -------- -------- -------- Total Life premiums, fees, and other considerations 4,492 3,660 3,260 Net investment income 3,048 2,728 2,569 Net realized capital losses (934) (299) 75 -------- -------- -------- TOTAL LIFE 6,606 6,089 5,904 -------- -------- --------
NET INCOME (LOSS) 2007 2006 2005 --------------------------------------------------------------------------------- Retail $663 $397 $480 Retirement Plans 53 94 73 Institutional 7 69 107 Individual Life 169 137 157 Other (152) 34 92 ------- ------- --- TOTAL NET INCOME $740 $731 $909 ------- ------- ---
F-24
2007 2006 2005 -------------------------------------------------------------------------------- NET INVESTMENT INCOME Retail $815 $835 $934 Retirement Plans 355 326 311 Institutional 1,226 987 784 Individual Life 331 293 272 Other 321 287 268 ------- ------- ------- TOTAL NET INVESTMENT INCOME $3,048 $2,728 $2,569 ------- ------- ------- AMORTIZATION OF DEFERRED POLICY ACQUISITION AND PRESENT VALUE OF FUTURE PROFITS Retail $316 $913 $685 Retirement Plans 58 (4) 31 Institutional 23 32 32 Individual Life 117 235 198 Other 1 (1) (1) ------- ------- ------- TOTAL AMORTIZATION OF DAC $515 $1,175 $945 ------- ------- ------- INCOME TAX EXPENSE (BENEFIT) Retail $137 $(40) $11 Retirement Plans 14 35 22 Institutional (5) 26 49 Individual Life 81 60 73 Other (1) (59) 22 52 ------- ------- ------- TOTAL INCOME TAX EXPENSE $168 $103 $207 ------- ------- -------
DECEMBER 31, 2007 2006 -------------------------------------------------------------------------------- ASSETS Retail $135,244 $129,158 Retirement Plans 28,157 24,596 Institutional 77,990 65,897 Individual Life 15,151 13,810 Other 9,670 8,009 ----------- ----------- TOTAL ASSETS $266,212 $241,470 ----------- ----------- DAC Retail $5,182 $4,561 Retirement Plans 658 543 Institutional 143 111 Individual Life 2,411 2,119 Other (1) -- ----------- ----------- TOTAL DAC $8,393 $7,334 ----------- ----------- RESERVE FOR FUTURE POLICY BENEFITS Retail $944 $845 Retirement Plans 333 357 Institutional 6,657 5,711 Individual Life 685 575 Other 777 721 ----------- ----------- TOTAL RESERVE FOR FUTURE POLICY BENEFITS $9,396 $8,209 ----------- ----------- OTHER POLICYHOLDER FUNDS Retail $15,391 $15,008 Retirement Plans 5,591 5,544 Institutional 12,455 11,401 Individual Life 5,210 4,845 Other 3,730 3,393 ----------- ----------- TOTAL OTHER POLICYHOLDER FUNDS $42,377 $40,191 ----------- -----------
F-25 3. INVESTMENTS AND DERIVATIVE INSTRUMENTS
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- COMPONENTS OF NET INVESTMENT INCOME Fixed maturities (1) $2,710 $2,459 $2,275 Policy loans 132 140 142 Mortgage loans on real estate 227 126 64 Other investments 35 53 125 Gross investment income 3,104 2,778 2,606 Less: Investment expenses 56 50 37 ------- ------- ------- NET INVESTMENT INCOME $3,048 $2,728 $2,569 ------- ------- ------- COMPONENTS OF NET REALIZED CAPITAL GAINS (LOSSES) Fixed maturities $(248) $(105) $57 Equity securities (46) (3) 8 Foreign currency transaction remeasurements 102 18 157 Derivatives and other (2) (742) (209) (147) ------- ------- ------- NET REALIZED CAPITAL GAINS (LOSSES) $(934) $(299) $75 ------- ------- -------
(1) Includes income on short-term bonds. (2) Primarily consists of changes in fair value on non-qualifying derivatives, changes in fair value of certain derivatives in fair value hedge relationships and hedge ineffectiveness on qualifying derivative instruments.
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- COMPONENTS OF NET UNREALIZED GAINS (LOSSES) ON AVAILABLE-FOR-SALE SECURITIES Fixed maturities $(597) $800 $986 Equity securities (42) 8 7 Net unrealized gains credited to policyholders 3 (4) (9) ------- ------- ------- Net unrealized gains (636) 804 984 Deferred income taxes and other items (304) 304 407 ------- ------- ------- Net unrealized gains (losses), net of tax -- end of year (332) 500 577 Net unrealized gains, net of tax -- beginning of year 500 577 1,124 ------- ------- ------- CHANGE IN UNREALIZED LOSSES ON AVAILABLE-FOR-SALE SECURITIES $(832) $(77) $(547) ------- ------- -------
F-26 COMPONENTS OF FIXED MATURITY INVESTMENTS
AS OF DECEMBER 31, 2007 GROSS GROSS AMORTIZED UNREALIZED UNREALIZED FAIR COST GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- BONDS AND NOTES ABS $7,602 $24 $(519) $7,107 CMOs Agency backed 793 18 (3) 808 Non-agency backed 411 4 (2) 413 Commercial mortgage-backed securities ("CMBS") 11,515 159 (572) 11,102 Corporate 21,928 807 (571) 22,164 Government/Government agencies Foreign 465 35 (2) 498 United States 516 14 (1) 529 MBS 1,750 15 (15) 1,750 States, municipalities and political subdivisions 1,226 32 (20) 1,238 Redeemable preferred stock 2 2 (2) 2 --------- -------- --------- --------- TOTAL FIXED MATURITIES $46,208 $1,110 $(1,707) $45,611 --------- -------- --------- ---------
AS OF DECEMBER 31, 2006 GROSS GROSS AMORTIZED UNREALIZED UNREALIZED FAIR COST GAINS LOSSES VALUE --------------------------------------------------------------------------------------------------------------------------------- BONDS AND NOTES ABS $6,170 $38 $(41) $6,167 CMOs Agency backed 778 8 (5) 781 Non-agency backed 76 -- -- 76 Commercial mortgage-backed securities ("CMBS") 10,806 146 (71) 10,881 Corporate 21,982 911 (206) 22,687 Government/Government agencies Foreign 568 44 (4) 608 United States 542 2 (5) 539 MBS 1,808 6 (31) 1,783 States, municipalities and political subdivisions 1,114 23 (15) 1,122 Redeemable preferred stock 2 -- -- 2 --------- -------- ------- --------- TOTAL FIXED MATURITIES $43,846 $1,178 $(378) $44,646 --------- -------- ------- ---------
The amortized cost and estimated fair value of fixed maturity investments at December 31, 2007 by contractual maturity year are shown below.
AMORTIZED COST FAIR VALUE -------------------------------------------------------------------------------- MATURITY One year or less $767 $805 Over one year through five years 7,389 7,675 Over five years through ten years 6,041 5,994 Over ten years 21,455 21,059 Subtotal 35,652 35,533 ABS, MBS, and CMOs 10,556 10,078 --------- --------- TOTAL $46,208 $45,611 --------- ---------
Estimated maturities may differ from contractual maturities due to security call or prepayment provisions because of the potential for prepayment on certain mortgage- and asset-backed securities which is why ABS, MBS, and CMOs are not categorized by contractual maturity. The CMBS are categorized by contractual maturity because they generally are not subject to prepayment risk as these securities are generally structured to include forms of call protections such as yield maintenance charges, prepayment penalties or lockouts, and defeasance. F-27 SALES OF FIXED MATURITY AND AVAILABLE-FOR-SALE EQUITY SECURITY INVESTMENTS
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- SALE OF FIXED MATURITIES Sale proceeds $12,415 $16,159 $15,784 Gross gains 246 210 302 Gross losses (135) (230) (218) SALE OF AVAILABLE-FOR-SALE EQUITY SECURITIES Sale proceeds $296 $249 $38 Gross gains 12 5 8 Gross losses (7) (5) -- --------- --------- ---------
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 stockholder's equity other than U.S. government and certain U.S. government agencies. Other than U.S. government and U.S. government agencies, the Company's largest three exposures by issuer including multiple investment grade tranches of the same security as of December 31, 2007 were Wachovia Bank Commercial Mortgage Trust, Goldman Equity Office Properties and PARCS-R and as of December 31, 2006 were Wachovia Bank Commercial Mortgage Trust, General Electric Company, and Citigroup, Inc., which each comprise less than 1.0%, of total invested assets. Wachovia Bank Commercial Mortgage Trust, Goldman Equity Office Properties, and PARCS-R include multiple investment grade tranches. The Company's largest three exposures by sector, as of December 31, 2007 and 2006, were commercial mortgage and real estate, financial services and residential mortgages which comprised approximately 28%, 14% and 10%, respectively, for 2007 and 26%, 13% and 8%, respectively, for 2006, of total invested assets. The Company's investments in states, municipalities and political subdivisions are geographically dispersed throughout the United States. As of December 31, 2007 and 2006, the largest concentrations were in California, Oregon, and Illinois which each comprised less than 1% of total invested assets, respectively. 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 the Investments section of Note 2. 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. F-28 The following tables present amortized cost, fair value and unrealized losses for the Company's fixed maturity and available-for-sale 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.
2007 LESS THAN 12 MONTHS 12 MONTHS OR MORE AMORTIZED FAIR UNREALIZED AMORTIZED FAIR UNREALIZED COST VALUE LOSSES COST VALUE LOSSES ----------------------------------------------------------------------------------------------------------------------------------- ABS $6,271 $5,789 $(482) $497 460 $(37) CMOs Agency backed 270 268 (2) 60 59 (1) Non-agency backed 97 96 (1) 33 32 (1) CMBS 5,493 5,010 (483) 1,808 1,719 (89) Corporate 8,354 7,920 (434) 2,554 2,417 (137) Government/Government agencies Foreign 86 84 (2) 43 43 -- United States 136 135 (1) 7 7 -- MBS 49 48 (1) 760 746 (14) States, municipalities and political subdivisions 383 373 (10) 189 179 (10) Redeemable preferred stock 4 2 (2) -- -- -- -------- -------- -------- ------- -------- ------- TOTAL FIXED MATURITIES 21,143 19,725 (1,418) 5,951 5,662 (289) Common stock 106 102 (4) -- -- -- Non-redeemable preferred stock 509 463 (46) 20 19 (1) -------- -------- -------- ------- -------- ------- TOTAL EQUITY 615 565 (50) 20 19 (1) -------- -------- -------- ------- -------- ------- TOTAL TEMPORARILY IMPAIRED SECURITIES $21,758 $20,290 $(1,468) $5,971 $5,681 $(290) -------- -------- -------- ------- -------- -------
2007 TOTAL AMORTIZED FAIR UNREALIZED COST VALUE LOSSES ----------------------------------------------------------------------------------- ABS $6,768 $6,249 $(519) CMOs Agency backed 330 327 (3) Non-agency backed 130 128 (2) CMBS 7,301 6,729 (572) Corporate 10,908 10,337 (571) Government/Government agencies Foreign 129 127 (2) United States 143 142 (1) MBS 809 794 (15) States, municipalities and political subdivisions 572 552 (20) Redeemable preferred stock 4 2 (2) --------- --------- --------- TOTAL FIXED MATURITIES 27,094 25,387 (1,707) Common stock 106 102 (4) Non-redeemable preferred stock 529 482 (47) --------- --------- --------- TOTAL EQUITY 635 584 (51) --------- --------- --------- TOTAL TEMPORARILY IMPAIRED SECURITIES $27,729 $25,971 $(1,758) --------- --------- ---------
As of December 31, 2007, fixed maturities, comprised of approximately 2,920 securities, accounted for approximately 97% of the Company's total unrealized loss amount. The remaining 3% 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 six months. Other-than-temporary impairments for certain ABS and CMBS are recognized if the fair value of the security, as determined by external pricing sources, is less than its cost or amortized cost and there has been a decrease in the present value of the expected cash flows since the last reporting period. 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 1,850 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, 81% were securities priced at or greater than 90% of amortized cost. The remaining securities were primarily composed of CMBS, ABS, and corporate securities in the financial services sector, of F-29 which 78% had a credit rating of A 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 1,160 securities, with the majority of the unrealized loss amount relating to CMBS, corporate fixed maturities within the financial services sector and ABS. A description of the events contributing to the security types' unrealized loss position and the factors considered in determining that recording an other-than-temporary impairment was not warranted are outlined below. CMBS -- The CMBS 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. 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 96% 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 -- 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 securities with an average price of 96% 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. MORTGAGE LOANS The carrying value of mortgage loans on real estate was $4.2 billion and $2.6 billion as of December 31, 2007 and 2006, respectively. The Company's mortgage loans are collateralized by a variety of commercial and agricultural properties. The mortgage loans are diversified both geographically throughout the United States and by property type. At December 31, 2007 and 2006, the Company held no impaired, restructured, delinquent or in-process-of-foreclosure mortgage loans. The Company had no valuation allowance for mortgage loans at December 31, 2007 and 2006. The following table presents commercial mortgage loans by region and property type. COMMERCIAL MORTGAGE LOANS ON REAL ESTATE BY REGION
DECEMBER 31, 2007 DECEMBER 31, 2006 CARRYING VALUE PERCENT OF TOTAL CARRYING VALUE PERCENT OF TOTAL ------------------------------------------------------------------------------------------------------------------------ East North Central $101 2.4% $94 3.6% East South Central -- -- -- -- Middle Atlantic 503 12.1% 470 17.9% Mountain 101 2.4% 24 0.9% New England 348 8.4% 166 6.3% Pacific 959 23.0% 523 19.9% South Atlantic 749 18.0% 551 20.9% West North Central 25 0.6% 6 0.2% West South Central 179 4.3% 100 3.8% Other (1) 1,201 28.8% 697 26.5% -------- ------- -------- ------- TOTAL $4,166 100.0% $2,631 100.0% -------- ------- -------- -------
(1) Includes multi-regional properties. COMMERCIAL MORTGAGE LOANS ON REAL ESTATE BY PROPERTY TYPE
DECEMBER 31, 2007 DECEMBER 31, 2006 CARRYING VALUE PERCENT OF TOTAL CARRYING VALUE PERCENT OF TOTAL ------------------------------------------------------------------------------------------------------------------------ Industrial $424 10.2% $298 11.3% Lodging 424 10.2% 413 15.7% Agricultural 236 5.7% 58 2.2% Multifamily 708 17.0% 250 9.5% Office 1,550 37.2% 1,130 43.0% Retail 702 16.8% 352 13.4% Other 122 2.9% 130 4.9% -------- ------- -------- ------- TOTAL $4,166 100.0% $2,631 100.0% -------- ------- -------- -------
F-30 VARIABLE INTEREST ENTITIES ("VIE") In the normal course of business, the Company becomes involved with variable interest entities primarily as a collateral manager and through normal investment activities. The Company's involvement includes providing investment management and administrative services, and holding ownership or other investment interests in the entities. The following table summarizes the total assets, liabilities and maximum exposure to loss relating to VIEs for which the Company has concluded it is the primary beneficiary. Accordingly, the results of operations and financial position of these VIEs are included along with the corresponding minority interest liabilities in the accompanying consolidated financial statements.
DECEMBER 31, 2007 DECEMBER 31, 2006 CARRYING MAXIMUM EXPOSURE CARRYING MAXIMUM EXPOSURE VALUE (1) LIABILITY (2) TO LOSS (3) VALUE (1) LIABILITY (2) TO LOSS (3) ------------------------------------------------------------------------------------------------------------------------------ Collateralized loan obligations ("CLOs") and other funds (4) $359 $199 $171 $296 $167 $136 Limited partnerships 309 121 150 103 15 75 Other investments (5) 65 -- 81 -- -- -- ----- ----- ----- ----- ----- ----- TOTAL (6) $733 $320 $402 $399 $182 $211 ----- ----- ----- ----- ----- -----
(1) The carrying value of CLOs and other funds and Other investments is equal to fair value. Limited partnerships are accounted for under the equity method. (2) Creditors have no recourse against the Company in the event of default by the VIE. (3) The maximum exposure to loss does not include changes in fair value or the Company's proportionate shares of earnings associated with limited partnerships accounted for under the equity method. The Company's maximum exposure to loss as of December 31, 2007 and 2006 based on the carrying value was $413 and $217, respectively. The Company's maximum exposure to loss as of December 31, 2007 and 2006 based on the Comany's initial co-investment or amortized cost basis was $402 and $211, respectively. (4) The Company provides collateral management services and earns a fee associated with these structures. (5) Other investments include investment structures that are backed by preferred securities. (6) As of December 31, 2007 and 2006, the Company had relationships with six and four VIEs, respectively, where the Company was the primary beneficiary. In addition to the VIEs described above, as of December 31, 2007, the Company held variable interests in four VIEs, where the Company is not the primary beneficiary and as a result, these are not consolidated by the Company. As of December 31, 2007, these VIEs included two collateralized bond obligations and two CLOs which are managed by HIMCO. These investments have been held by the Company for a period of one year. The maximum exposure to loss consisting of the Company's investments based on the amortized cost of the non-consolidated VIEs was approximately $100 as of December 31, 2007 For the year ended December 31, 2007 the Company recognized $1 of the maximum exposure to loss representing an other-than-temporary impairment recorded as a realized capital loss. HIMCO is the collateral manager for four market value CLOs (included in the VIE discussion above) that invest in senior secured bank loans through total return swaps. For two of the CLOs, the Company has determined it is the primary beneficiary and accordingly consolidates the transactions. The maximum exposure to loss for these two consolidated CLOs, which is included in the "Collateral loan obligations and other funds" line in the table above, is $74 of which the Company has recognized a realized capital loss of $19. The Company is not the primary beneficiary for the remaining two CLOs, but maintains a significant involvement in the transactions. The maximum exposure to loss for these remaining two CLOs, included in the $100 in the preceding paragraph, is $14. The CLOs have triggers that allow the total return swap counterparty to terminate the transactions if the fair value of the aggregate referenced bank loan portfolio declines below a stated level. DERIVATIVE INSTRUMENTS The Company utilizes a variety of derivative instruments, including swaps, caps, floors, forwards, futures and options to achieve one of four Company approved objectives: to hedge risk arising from interest rate, equity market, credit spread including issuer default, price or currency exchange rate risk or volatility; to manage liquidity; to control transaction costs; or to enter into replication transactions. F-31 On the date the derivative contract is entered into, the Company designates the derivative as a fair-value hedge, cash-flow hedge, foreign-currency hedge, net investment hedge, or held for other investment and/or risk management purposes. The Company's derivative transactions are used in strategies permitted under the derivatives use plans required by the State of Connecticut and the State of New York insurance departments. Derivative instruments are recorded in the consolidated balance sheets at fair value. Asset and liability values are determined by calculating the net position, taking into account income accruals and cash collateral held, for each derivative counterparty by legal entity and are presented as of December 31, as follows:
ASSET VALUES LIABILITY VALUES 2007 2006 2007 2006 -------------------------------------------------------------------------------- Other investments $446 $271 $ -- $ -- Reinsurance recoverables 128 -- -- 22 Other policyholder funds and benefits payable 2 172 801 -- Consumer notes -- -- 5 1 Other liabilities -- -- 354 589 ------ ------ -------- ------ TOTAL $576 $443 $1,160 $612 ------ ------ -------- ------
The following table summarizes the derivative instruments used by the Company and the primary hedging strategies to which they relate. Derivatives in the Company's separate accounts are not included because the associated gains and losses accrue directly to policyholders. The notional value of derivative contracts represents the basis upon which pay or receive amounts are calculated and are not reflective of credit risk. The fair value amounts of derivative assets and liabilities are presented on a net basis as of December 31, 2007 and 2006. The total ineffectiveness of all cash-flow, fair-value and net investment hedges and total change in value of other derivative-based strategies which do not qualify for hedge accounting treatment, including periodic derivative net coupon settlements, are presented below on an after-tax basis for the years ended December 31, 2007 and 2006. F-32
HEDGE INEFFECTIVENESS, NOTIONAL AMOUNT FAIR VALUE AFTER-TAX HEDGING STRATEGY 2007 2006 2007 2006 2007 2006 ------------------------------------------------------------------------------------------------------------------------------- CASH-FLOW HEDGES Interest rate swaps Interest rate swaps are primarily used to convert interest receipts on floating-rate fixed maturity securities to fixed rates. These derivatives are predominantly used to better match cash receipts from assets with cash disbursements required to fund liabilities. Interest rate swaps are also used to hedge a portion of the Company's floating-rate guaranteed investment contracts. These derivatives convert the floating-rate guaranteed investment contract payments to a fixed rate to better match the cash receipts earned from the supporting investment portfolio. $4,019 $4,560 $73 $(19) $1 $(8) 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 swapped to minimize cash flow fluctuations due to changes in currency rates. In addition, foreign currency swaps are also used to convert foreign denominated cash flows associated with certain liability payments to U.S. dollars in order to minimize cash flow fluctuations due to changes in currency rates. 1,226 1,420 (269) (318) (1) (4) FAIR-VALUE HEDGES Interest rate swaps Interest rate swaps are used to hedge the changes in fair value of certain fixed rate liabilities and fixed maturity securities due to changes in the benchmark interest rate, LIBOR. 3,594 3,303 (38) 7 -- -- Foreign currency swaps Foreign currency swaps are used to hedge the changes in fair value of certain foreign denominated fixed rate liabilities due to changes in foreign currency rates. 696 492 25 (9) -- -- ----------- --------- ------- ------- ------- --------- TOTAL CASH-FLOW AND FAIR-VALUE HEDGES $9,535 $9,775 $(209) $(339) $ -- $(12) ----------- --------- ------- ------- ------- ---------
F-33
DERIVATIVE CHANGE IN VALUE, NOTIONAL AMOUNT FAIR VALUE AFTER-TAX HEDGING STRATEGY 2007 2006 2007 2006 2007 2006 ------------------------------------------------------------------------------------------------------------------------------- OTHER INVESTMENT AND/OR RISK MANAGEMENT ACTIVITIES Interest rate swaps, caps and floors The Company uses interest rate swaps, caps and floors to manage duration risk between assets and liabilities in certain portfolios. In addition, the Company enters into interest rate swaps to terminate existing swaps in hedging relationships, thereby offsetting the changes in value of the original swap. $6,666 $4,911 $ -- $(15) $15 $(27) Interest rate forwards The Company uses interest rate forwards to replicate the purchase of mortgage-backed securities to manage duration risk and liquidity. -- 644 -- (4) (1) 5 Foreign currency swaps and forwards The Company enters into foreign currency swaps and forwards to hedge the foreign currency exposures in certain of its foreign fixed maturity investments. 199 162 (8) (11) (5) (7) Credit default and total return swaps The Company enters into credit default swap agreements in which the Company assumes credit risk of an individual entity, referenced index or asset pool. These contracts entitle the Company to receive a periodic fee in exchange for an obligation to compensate the derivative counterparty should a credit event occur on the part of the referenced security issuers. The maximum potential future exposure to the Company is the notional value of the swap contracts, which is $1,202 and $786, after-tax, as of December 31, 2007 and 2006, respectively. 1,849 1,209 (235) (92) (83) 20 The Company also assumes credit risk through total return and credit index swaps which reference a specific index or collateral portfolio. The maximum potential future exposure to the Company for the credit index swaps is the notional value and for the total return swaps is the cash collateral associated with the transaction, which has termination triggers that limit investment losses. As of December 31, 2007 and 2006, the maximum potential future exposure to the Company from such contracts is $639 and $707, after-tax, respectively. 1,731 1,629 (62) 1 (48) 1
F-34
DERIVATIVE CHANGE IN VALUE, NOTIONAL AMOUNT FAIR VALUE AFTER-TAX HEDGING STRATEGY 2007 2006 2007 2006 2007 2006 ------------------------------------------------------------------------------------------------------------------------------- The Company enters into credit default swap agreements, in which the Company reduces credit risk to an individual entity. These contracts require the Company to pay a derivative counterparty a periodic fee in exchange for compensation from the counterparty should a credit event occur on the part of the referenced security issuer. The Company entered into these agreements as an efficient means to reduce credit exposure to specified issuers or sectors. $3,494 $1,882 $56 $(8) $38 $(6) Yen fixed annuity hedging instruments The Company enters into currency rate swaps and forwards to mitigate the foreign currency exchange rate and yen interest rate exposures associated with the yen denominated individual fixed annuity product. The associated liability is adjusted for changes in spot rates which was $(66) and $12, after-tax, as of December 31, 2007 and 2006, respectively, and offsets the derivative. 1,849 1,869 (115) (225) 34 (64) GMWB product derivatives The Company offers certain variable annuity products with a GMWB rider. The GMWB is a bifurcated embedded derivative that provides the policyholder with a GRB if the account value is reduced to zero through a combination of market declines and withdrawals. The GRB is generally equal to premiums less withdrawals. The policyholder also has the option, after a specified time period, to reset the GRB to the then-current account value, if greater. The notional value of the embedded derivative is the GRB balance. For a further discussion, see the Derivative Instruments section of Note 2. 44,852 37,769 (707) 53 (430) 79 GMWB reinsurance contracts Reinsurance arrangements are used to offset the Company's exposure to the GMWB embedded derivative for the lives of the host variable annuity contracts. The notional amount of the reinsurance contracts is the GRB amount. 6,579 7,172 128 (22) 83 (19) GMWB hedging instruments The Company enters into derivative contracts to economically hedge exposure to the volatility associated with the portion of the GMWB liabilities which are not reinsured. These derivative contracts include customized swaps, interest rate swaps and futures, and equity swaps, put and call options, and futures, on certain indices including the S&P 500 index, EAFE index, and NASDAQ index. 21,357 8,379 642 346 167 (77)
F-35
DERIVATIVE CHANGE IN VALUE, NOTIONAL AMOUNT FAIR VALUE AFTER-TAX HEDGING STRATEGY 2007 2006 2007 2006 2007 2006 ------------------------------------------------------------------------------------------------------------------------------- Guaranteed minimum benefit product reinsurance contracts Reinsurance arrangements are used to offset the Company's exposure to the GMIB and GMAB embedded derivatives for the lives of the host variable annuity contracts. The reinsurance contracts are accounted for as free-standing derivative contracts. The notional amount of the reinsurance contracts is the yen denominated GRB balance value converted at the year-end yen to U.S. dollar foreign spot exchange rate. $18,065 $11,304 $(70) $119 $(101) $(35) Equity index swaps and options The Company offers certain equity indexed products, which may contain an embedded derivative that requires bifurcation. The Company enters into S&P index swaps and options to economically hedge the equity volatility risk associated with these embedded derivatives. In addition, the Company is exposed to bifurcated options embedded in certain fixed maturity investments. 149 25 (22) (1) 1 -- Statutory reserve hedging instruments The Company purchases one and two year S&P 500 put option contracts to economically hedge the statutory reserve impact of equity risk arising primarily from GMDB and GMWB obligations against a decline in the equity markets. 661 2,220 18 29 (14) (9) Coinsurance and modified coinsurance reinsurance contract During 2007, a subsidiary insurance company entered into a coinsurance with funds withheld and modified coinsurance reinsurance agreement ("Agreement") with an affiliate reinsurance company to provide statutory surplus relief for certain life insurance policies. The Agreement is accounted for as a financing transaction for GAAP and includes a compound embedded derivative. 655 -- -- -- -- -- TOTAL OTHER INVESTMENT AND/OR RISK MANAGEMENT ACTIVITIES $108,106 $79,175 $(375) $170 $(344) $(139) ----------- --------- ------- ------- ------- --------- TOTAL DERIVATIVES (1) $117,641 $88,950 $(584) $(169) $(344) $(151) ----------- --------- ------- ------- ------- ---------
(1) Derivative change in value includes hedge ineffectiveness for cash-flow and fair-value hedges and total change in value, including periodic derivative net coupon settlements, of derivatives held for other investment and/or risk management activities. The increase in notional amount since December 31, 2006, is primarily due to an increase in embedded derivatives associated with the GMWB rider, an increase in the related GMWB hedging derivatives, and an increase in the guaranteed minimum benefit riders reinsured from a related party. The Company offers certain variable annuity products with a GMWB rider, which is accounted for as an embedded derivative. For further discussion on the GMWB rider, refer to Note 8 of Notes to Consolidated Financial Statements. For further discussion of the internal reinsurance of the guaranteed minimum benefit riders, including GMIB and GMAB products, which are accounted for as free standing derivatives, refer to Note 8 and Note 16 of Notes to Consolidated Financial Statements. F-36 The increase in notional of GMWB embedded derivatives is primarily due to additional product sales. The increase in notional of GMWB hedging derivatives primarily related to two customized swap contracts that were entered into during 2007 to hedge certain risk components for the remaining term of certain blocks of non-reinsured GMWB riders. These customized derivative contracts provide protection from capital markets risks based on policyholder behavior assumptions as specified by the Company. As of December 31, 2007, these swaps had a notional value of $12.8 billion and a market value of $50. Due to the significance of the non-observable inputs associated with pricing these derivatives, the initial difference between the transaction price and modeled value was deferred in accordance with EITF No. 02-3 "Issues Involved in Accounting for Derivative Contracts Held for Trading Purposes and Contracts Involved in Energy Trading and Risk Management Activities" and included in Other Assets in the Condensed Consolidated Balance Sheets. The deferred loss of $51 will be recognized in retained earnings upon the adoption of SFAS 157. In addition, the change in value of the customized derivatives due to the initial adoption of SFAS 157 of $35 will also be recorded in retained earnings with subsequent changes in fair value recorded in net realized capital gains (losses). The increase in notional of the reinsurance of guaranteed minimum benefit riders is primarily due GMIB product sales as well as depreciation of the U.S. dollar compared to the yen. Also contributing to the increase is a new reinsurance agreement entered into effective September 30, 2007, related to the GMAB rider, which is also accounted for as a free-standing derivative. The decrease in net fair value of derivative instruments since December 31, 2006, was primarily related to GMWB related derivatives, the internal reinsurance contract associated with GMIB, and credit derivatives, partially offset by the Japanese fixed annuity hedging instruments, interest rate derivatives, and foreign currency swaps. The GMWB related derivatives decreased in value primarily due to liability model assumption updates and modeling refinements made during the year, including those for dynamic lapse behavior and correlations of market returns across underlying indices as well as those to reflect newly reliable market inputs for volatility. The internal reinsurance contract associated with GMIB decreased in value primarily as a result of liability model refinements, a decrease in interest rates, and changes in equity volatility levels. Credit derivatives, including credit default swaps, credit index swaps, and bank loan total return swaps, declined in value due to credit spreads widening. Credit spreads widened primarily due to the deterioration in the U.S. housing market, tightened lending conditions, the market's flight to quality securities, as well as increased likelihood of a U.S. recession. The Japanese fixed annuity contract hedging instruments increased in value primarily due to appreciation of the Japanese yen in comparison to the U.S. dollar. Interest rate derivatives increased in value primarily due to the decline in interest rates. The fair value of foreign currency swaps hedging foreign bonds increased primarily as a result of the sale of certain swaps that were in loss positions due to the weakening of the U.S. dollar in comparison to certain foreign currencies. The total change in value for derivative-based strategies that do not qualify for hedge accounting treatment ("non-qualifying strategies"), including periodic derivative net coupon settlements, are reported in net realized capital gains (losses). For the years ended December 31, 2007 and 2006, these non-qualifying strategies resulted in after-tax net losses of $(344) and $(139), respectively. For the year ended December 31, 2007, net losses were primarily comprised of net losses on the GMWB related derivatives, net losses on credit derivatives, and net losses associated with the internal reinsurance of GMIB. The net losses on the GMWB rider embedded derivatives were primarily due to liability model assumption updates and modeling refinements made during the year, including those for dynamic lapse behavior and correlations of market returns across underlying indices, as well as other assumption updates made during the second quarter to reflect newly reliable market inputs for volatility. The net losses on credit derivatives, including credit default swaps, credit index swaps, and total return swaps, were due to credit spreads widening. The net losses associated with the internal reinsurance of GMIB were primarily driven by liability model refinements, a decrease in interest rates, and changes in equity volatility levels. For the year ended December 31, 2006, losses were largely comprised of losses on the reinsurance of GMIB, net losses on GMWB rider and hedging derivatives primarily driven by modeling refinements, net losses on interest rate derivatives due to an increase in interest rates, and net losses on the Japanese fixed annuity hedging instruments primarily due to an increase in Japan interest rates. As of December 31, 2007 and 2006, the after-tax deferred net (losses) on derivative instruments recorded in accumulated other comprehensive income (loss) ("AOCI") that are expected to be reclassified to earnings during the next twelve months are $(16) and $(8), respectively. This expectation is based on the anticipated interest payments on hedged investments in fixed maturity securities that will occur over the next twelve months, at which time the Company will recognize the deferred net gains (losses) as an adjustment to interest income over the term of the investment cash flows. For the year ended December 31, 2007 and 2006, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring. For the year ended December 31, 2005, after-tax net gains (losses) representing the total ineffectiveness of all cash-flow hedges was $(6) and fair-value hedges was $2, while there were no net gains (losses) on net investment hedges. F-37 SECURITIES LENDING AND COLLATERAL ARRANGEMENTS The Company participates in securities lending programs to generate additional income, whereby certain domestic fixed income securities are loaned for a specified period of time from the Company's portfolio to qualifying third parties, via two lending agents. 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 securities lending programs, the lending agent indemnifies the Company against borrower defaults. As of December 31, 2007 and 2006, the fair value of the loaned securities was approximately $2.1 billion and $1.6 billion, respectively, and was included in fixed maturities, equities, available for sale, and short-term investments in the consolidated balance sheets. 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 $6 and $2 for the years ended December 31, 2007 and 2006, respectively, which was included in net investment income. The Company 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 having a fair value of $355 and $441, respectively, was included in fixed maturities in the consolidated balance sheets. The classification and carrying amount of the loaned securities and the collateral pledged at December 31, 2007 and 2006, were as follows:
2007 2006 ------------------------------------------------------------ LOANED SECURITIES AND COLLATERAL PLEDGED ABS $4 $3 CMO 21 -- CMBS 244 169 Corporate 1,554 1,339 MBS 221 152 Government/Government Agencies Foreign 14 4 United States 303 327 Short-term 1 -- Preferred stock 53 -- -------- -------- TOTAL $2,415 $1,994 -------- --------
As of December 31, 2007 and 2006, the Company had accepted collateral relating to securities lending programs and collateral arrangements consisting of cash, U.S. Government and U.S. Government agency securities with a fair value of $3.3 billion and $1.8 billion, respectively. At December 31, 2007 and 2006, cash collateral of $3.1 billion and $1.6 billion, respectively, was invested and recorded in the consolidated balance sheets in fixed maturities with a corresponding amount predominately recorded in other liabilities. At December 31, 2007 and 2006, cash received from derivative counterparties of $175 and $109, respectively, was netted against the derivative assets values in accordance with FSP FIN 39-1 and recorded in other assets. For further discussion on the adoption of FSP FIN 39-1, see Note 2. The Company is only permitted by contract to sell or repledge the noncash collateral in the event of a default by the counterparty. The Company incurred no counterparty default for the years ended December 31, 2007 and 2006. As of December 31, 2007 and 2006, noncash collateral accepted was held in separate custodial accounts. SECURITIES ON DEPOSIT WITH STATES The Company is required by law to deposit securities with government agencies in states where it conducts business. As of December 31, 2007 and 2006, the fair value of securities on deposit was approximately $14 and $9, respectively. 4. FAIR VALUE OF FINANCIAL INSTRUMENTS SFAS No. 107 "Disclosure about Fair Value of Financial Instruments", requires disclosure of fair value information of financial instruments. For certain financial instruments where quoted market prices are not available, other independent valuation techniques and assumptions are used. Because considerable judgment is used, these estimates are not necessarily indicative of amounts that could be realized in a current market exchange. SFAS No. 107 excludes certain financial instruments from disclosure, including insurance contracts other than financial guarantees and investment contracts. The Company uses the following methods and assumptions in estimating the fair value of each class of financial instrument. Fair value for fixed maturities and marketable equity securities approximates those quotations published by applicable stock exchanges or received from other reliable sources. For policy loans and short-term investments, carrying amounts approximate fair value. Fair value of other investments, which primarily consist of partnership investments, is based on external market valuations from partnership management. F-38 For mortgage loans on real estate, fair values were estimated using discounted cash flow calculations based on current incremental lending rates for similar type loans. Derivative instruments are reported at fair value based upon either pricing valuation models, which utilize market data inputs and that are obtained from independent third parties or independent broker quotations. Other policyholder funds and benefits payable fair value information is determined by estimating future cash flows, discounted at the current market rate. For further discussion of other policyholder funds and derivatives, see Note 1. Fair value of consumer notes is based on discounted cash flow calculations based on the current market rates. The carrying amount and fair values of the Company's financial instruments as of December 31, 2007 and 2006 were as follows:
2007 2006 CARRYING FAIR CARRYING FAIR AMOUNT VALUE AMOUNT VALUE ---------------------------------------------------------------------------------------------- ASSETS Fixed maturities $45,611 $45,611 $44,646 $44,646 Equity securities 722 722 276 276 Policy loans 2,016 2,016 2,009 2,009 Mortgage loans on real estate 4,166 4,169 2,631 2,619 Short-term investments 752 752 694 694 Other investments (1) 480 480 273 273 LIABILITIES Other policyholder funds and benefits payable (2) $15,148 $15,097 $13,931 $13,186 Consumer notes 809 814 258 260 --------- ------- -- --
(1) 2007 and 2006 includes $446 and $271 of derivative related assets, respectively. (2) Excludes universal life insurance contracts, including corporate owned life insurance. 5. REINSURANCE The Company cedes insurance to other insurers in order to limit its maximum losses to diversify its exposures and provide surplus relief. Such transfers do not relieve the Company of its primary liability and, as such, failure of reinsurers to honor their obligations could result in losses to the Company. The Company also assumes reinsurance from other insurers and is a member of and participates in several reinsurance pools and associations. The Company evaluates the financial condition of its reinsurers and monitors concentrations of credit risk. As of December 31, 2007and 2006, the Company had no reinsurance recoverables and related concentrations of credit risk greater than 10% of the Company's stockholder's equity. In accordance with normal industry practice, the Company is involved in both the cession and assumption of insurance with other insurance and reinsurance companies. As of December 31, 2007, the Company's policy for the largest amount retained on any one life doubled from $5 to $10 compared to the corresponding 2006 and 2005 periods. Insurance fees, earned premiums and other were comprised of the following:
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- Gross fee income, earned premiums and other $5,173 $4,360 $4,019 Reinsurance assumed 13 19 39 Reinsurance ceded (694) (719) (798) -------- -------- -------- NET FEE INCOME, EARNED PREMIUMS AND OTHER $4,492 $3,660 $3,260 -------- -------- --------
The Company reinsures certain of its risks to other reinsurers under yearly renewable term, coinsurance, and modified coinsurance arrangements. Yearly renewable term and coinsurance arrangements result in passing all or a portion of the risk to the reinsurer. Generally, the reinsurer receives a proportionate amount of the premiums less an allowance for commissions and expenses and is liable for a corresponding proportionate amount of all benefit payments. Modified coinsurance is similar to coinsurance except that the cash and investments that support the liabilities for contract benefits are not transferred to the assuming company, and settlements are made on a net basis between the companies. Coinsurance with funds withheld is a form of coinsurance except that the investment assets that support the liabilities are withheld by the ceding company. In addition, the Company reinsures the majority of minimum death benefit guarantees as well as guaranteed minimum withdrawal benefits, on contracts issued prior to July 2003, offered in connection with its variable annuity contracts. F-39 The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies. Insurance recoveries on ceded reinsurance contracts, which reduce death and other benefits were $285, $241 and $378 for the years ended December 31, 2007, 2006 and 2005, respectively. The Company also assumes reinsurance from other insurers. The Company maintains certain reinsurance agreements with HLA, whereby the Company cedes both group life and group accident and health risk. Under these treaties, the Company ceded group life premium of $132, $166 and $130 in 2007, 2006 and 2005, respectively, and accident and health premium of $243, $259 and $221, respectively, to HLA. 6. DEFERRED POLICY ACQUISITION COSTS AND PRESENT VALUE OF FUTURE PROFITS Changes in deferred policy acquisition costs and present value of future profits is as follows:
2007 2006 2005 -------------------------------------------------------------------------------- BALANCE, JANUARY 1, BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE, PRE-TAX $ 7,334 $ 7,101 $ 6,453 Cumulative effect of accounting change, pre-tax (SOP05-1) (20) -- -- BALANCE, JANUARY 1, AS ADJUSTED 7,314 7,101 6,453 Capitalization 1,400 1,351 1,226 Amortization -- Deferred policy acquisitions costs and present value of future profits (817) (1,033) (945) AMORTIZATION -- UNLOCK, PRE-TAX (1) 302 (142) -- Adjustments to unrealized gains and losses on securities available-for-sale and other 194 57 367 -------- -------- -------- BALANCE, DECEMBER 31 $8,393 $7,334 $7,101 -------- -------- --------
(1) For a discussion of unlock effects, see Unlock Results in Note 1. Estimated future net amortization expense of present value of future profits for the succeeding five years is as follows. For the years ended December 31, -------------------------------------------------------------------------------- 2008 $27 2009 $27 2010 $25 2011 $23 2012 $22 --------------------------------------------------------------------------------
7. GOODWILL AND OTHER INTANGIBLE ASSETS As of December 31, 2007 and December 31, 2006, the carrying amount of goodwill for the Company's Retail Products segment was $85 and for the Company's Individual Life segment was $101. The Company's goodwill impairment test performed in accordance with SFAS No. 142 "Goodwill and Other Intangible Assets", resulted in no write-downs for the years ended December 31, 2007 and 2006. For a discussion of present value of future profits that continue to be subject to amortization and aggregate amortization expense, see Note 6. 8. SEPARATE ACCOUNTS, DEATH BENEFITS AND OTHER INSURANCE BENEFIT FEATURES The Company records the variable portion of individual variable annuities, 401(k), institutional, 403(b)/457, private placement life and variable life insurance products within separate account assets and liabilities, which are reported at fair value. Separate account assets are segregated from other investments. Investment income and gains and losses from those separate account assets, which accrue directly to, and whereby investment risk is borne by the policyholder, are offset by the related liability changes within the same line item in the consolidated statements of operations. The fees earned for administrative and contract holder maintenance services performed for these separate accounts are included in fee income. During 2007, 2006 and 2005 there were no gains or losses on transfers of assets from the general account to the separate account. F-40 Many of the variable annuity and universal life ("UL") contracts issued or reinsured by the Company offer various guaranteed minimum death and withdrawal benefits and UL secondary guarantee benefits. UL secondary guarantee benefits ensure that your policy will not terminate, and will continue to provide a death benefit, even if there is insufficient policy value to cover the monthly deductions and charges. Guaranteed minimum death benefits are offered in various forms as described in further detail throughout this Note. The Company currently reinsures a significant portion of the death benefit guarantees associated with its in-force block of business. Changes in the gross guaranteed minimum death benefit ("GMDB") and UL secondary guarantee benefits sold with annuity and/or UL products accounted for and collectively known as "SOP 03-1 reserve liabilities" are as follows:
UL SECONDARY GMDB (1) GUARANTEES (1) -------------------------------------------------------------------------------- LIABILITY BALANCE AS OF JANUARY 1, 2007 $ 476 7 Incurred 144 12 Unlock (4) -- Paid (85) -- ------ --- LIABILITY BALANCE AS OF DECEMBER 31, 2007 $531 19 ------ ---
(1) The reinsurance recoverable asset related to the GMDB was $325 as of December 31, 2007. The reinsurance recoverable asset related to the UL Secondary Guarantees was $10 as of December 31, 2007.
UL SECONDARY GMDB (1) GUARANTEES (1) -------------------------------------------------------------------------------- LIABILITY BALANCE AS OF JANUARY 1, 2006 $ 158 5 Incurred 130 2 Unlock 294 -- Paid (106) -- ------ --- LIABILITY BALANCE AS OF DECEMBER 31, 2006 $476 7 ------ ---
(1) The reinsurance recoverable asset related to the GMDB was $316 as of December 31, 2006. The reinsurance recoverable asset related to the UL Secondary Guarantees was $6 as of December 31, 2006. The net SOP 03-1 reserve liabilities are established by estimating the expected value of net reinsurance costs and death benefits in excess of the projected account balance. The excess death benefits and net reinsurance costs are recognized ratably over the accumulation period based on total expected assessments. The SOP 03-1 reserve liabilities are recorded in Future Policy Benefits on the Company's balance sheet. Changes in the SOP 03-1 liabilities are recorded in benefits, losses and loss adjustment expenses in the Company's statement of income. In a manner consistent with the Company's accounting policy for deferred acquisition costs, the Company regularly evaluates estimates used and adjusts the additional liability balances, with a related charge or credit to benefit expense if actual experience or other evidence suggests that earlier assumptions should be revised. As described within the Unlock Results in Note 1, the Company unlocked its assumptions related to its SOP 03-1 reserves during the third quarter of 2007 and the fourth quarter of 2006. The determination of the SOP 03-1 reserve liabilities and their related reinsurance recoverables, 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. The following assumptions were used as of December 31, 2007: GMDB: - 1000 stochastically generated investment performance scenarios for all issue years - For all issue years, the weighted average return is 8% after fund fees, but before mortality and expense charges; it varies by asset class with a low of 3% for cash and a high of 11% for aggressive equities. - Discount rate of 7.5% for issue year 2002 & prior; discount rate of 7% for issue year 2003 & 2004 and discount rate of 5.6% for issue year 2005 -- 2007. - Volatilities also vary by asset class with a low of 1% for cash, a high of 15% for aggressive equities, and a weighted average of 12%. - 100% of the Hartford experience mortality table was used for the mortality assumptions - Lapse rates by calendar year vary from a low of 8% to a high of 13%, with an average of 11% UL SECONDARY GUARANTEES: - Discount rate of 4.75% for issue year 2004, discount rate of 4.50% for issue year 2005 & 2006, and discount rate of 4.25% for issue year 2007. - 100% of the Hartford pricing mortality table for mortality assumptions. F-41 - Lapse rates for single life policies average 3% in policy years 1-10, declining to 0% by age 95. Lapse rate for last survivor policies is 0.4%. The following table provides details concerning GMDB exposure: BREAKDOWN OF VARIABLE ANNUITY ACCOUNT VALUE BY GMDB TYPE AT DECEMBER 31, 2007
RETAINED WEIGHTED AVERAGE ACCOUNT NET AMOUNT NET AMOUNT ATTAINED AGE OF VALUE AT RISK AT RISK ANNUITANT --------------------------------------------------------------------------------------------------------------------------------- Maximum anniversary value (MAV) (1) MAV only $47,463 $3,557 $419 65 With 5% rollup (2) 3,360 285 67 64 With Earnings Protection Benefit Rider (EPB) (3) 5,463 530 85 62 With 5% rollup & EPB 1,333 155 30 64 Total MAV 57,619 4,527 601 Asset Protection Benefit (APB) (4) 42,489 446 242 62 Lifetime Income Benefit (LIB) (5) 10,273 25 25 62 Reset (6) (5-7 years) 6,132 80 80 66 Return of Premium (7)/Other 10,321 28 28 54 ----------- -------- ------ --- TOTAL $126,834 $5,106 $976 63 ----------- -------- ------ ---
(1) MAV: the death benefit is the greatest of current account value, net premiums paid and the highest account value on any anniversary before age 80 (adjusted for withdrawals). (2) Rollup: the death benefit is the greatest of the MAV, current account value, net premium paid and premiums (adjusted for withdrawals) accumulated at generally 5% simple interest up to the earlier of age 80 or 100% of adjusted premiums. (3) EPB: the death benefit is the greatest of the MAV, current account value, or contract value plus a percentage of the contract's growth. The contract's growth is account value less premiums net of withdrawals, subject to a cap of 200% of premiums net of withdrawals. (4) APB: the death benefit is the greater of current account value or MAV, not to exceed current account value plus 25% times the greater of net premiums and MAV (each adjusted for premiums in the past 12 months). (5) LIB: the death benefit is the greatest of current account value or MAV, net premiums paid, or a benefit amount that ratchets over time, generally based on market performance. (6) Reset: the death benefit is the greatest of current account value, net premiums paid and the most recent five to seven year anniversary account value before age 80 (adjusted for withdrawals). (7) Return of premium: the death benefit is the greater of current account value and net premiums paid. The Company offers certain variable annuity products with a GMWB rider. The GMWB provides the policyholder with a guaranteed remaining balance ("GRB") if the account value is reduced to zero through a combination of market declines and withdrawals. The GRB is generally equal to premiums less withdrawals. However, annual withdrawals that exceed a specific percentage of the premiums paid may reduce the GRB by an amount greater than the withdrawals and may also impact the guaranteed annual withdrawal amount that subsequently applies after the excess annual withdrawals occur. For certain of the withdrawal benefit features, the policyholder also has the option, after a specified time period, to reset the GRB to the then-current account value, if greater. In addition, the Company has introduced features, for contracts issued beginning in the fourth quarter of 2005, that allow policyholders to receive the guaranteed annual withdrawal amount for as long as they are alive. Through this feature, the policyholder or their beneficiary will receive the GRB and the GRB is reset on an annual basis to the maximum anniversary account value subject to a cap. The GMWB represents an embedded derivative in the variable annuity contracts that is required to be reported separately from the host variable annuity contract. The GMIB and GMAB reinsurance represent free-standing derivatives and are carried at fair value and reported in other policyholder funds. See Note 16 for additional disclosure concerning reinsurance agreements. The fair value of the GMWB obligation, as well as the GMIB and GMAB obligations, assumed from a related party are calculated based on actuarial and capital market assumptions related to the projected cash flows, including benefits and related contract charges, over the lives of the contracts, incorporating expectations concerning policyholder behavior. Because of the dynamic and complex nature of these cash flows, best estimate assumptions and stochastic techniques under a variety of market return scenarios are used. Estimating these cash flows involves numerous estimates including those regarding expected market rates of return, market volatility, correlations of market returns and discount rates. At each valuation date, the Company assumes expected returns based on risk-free rates as represented by the current LIBOR forward curve rates; market volatility assumptions for each underlying index based primarily on a blend of observed market F-42 "implied volatility"; correlations of market returns across underlying indices based on actual observed market returns and relationships over the ten years preceding the valuation date; and current risk-free spot rates as represented by the current LIBOR spot curve to determine the present value of expected future cash flows produced in the stochastic projection process. As markets change, mature and evolve and actual policyholder behavior emerges, management continually evaluates the appropriateness of its assumptions. In addition, management regularly evaluates the valuation model, incorporating emerging valuation techniques where appropriate, including drawing on the expertise of market participants and valuation experts. During, the second quarter of 2007, the Company reflected newly reliable market inputs for volatility on Standard and Poor's ("S&P") 500, National Association of Securities Dealers Automated Quotations ("NASDAQ") and Europe, Australasia and Far East ("EAFE") index options. As of December 31, 2007 and December 31, 2006, the embedded derivative (liability) asset recorded for GMWB, before reinsurance or hedging, was $(707) and $53, respectively. During 2007, 2006 and 2005 the change in value of the GMWB, before reinsurance and hedging, reported in realized gains (losses) was $(661), $121and ($64), respectively. Included in the realized gain (loss) for the years ended December 31, 2007 and 2006 were liability model refinements, changes in policyholder behavior assumptions and changes in other assumptions to reflect newly reliable market inputs for volatility of a net $(234) and $(2), respectively. As of December 31, 2007 and 2006, $46.3 billion, or 82%, and $37.3 billion, or 77%, respectively, of account value representing substantially all of the contracts written after July 2003 with the GMWB feature, were unreinsured. In order to minimize the volatility associated with the unreinsured GMWB liabilities, the Company has established a risk management strategy. During the second and third quarter of 2007, as part of the Company's risk management strategy, the Company purchased two customized swap contracts which hedge certain capital market risk components for the remaining term of certain blocks of the non-reinsured GMWB riders. As of December 31, 2007, these swaps had a notional value of $12.8 billion. These customized derivative contracts provide protection from capital markets risks based on policyholder behavior assumptions as specified by the Company. The Company also uses other derivative instruments to hedge its unreinsured GMWB exposure including interest rate futures, S&P 500 and NASDAQ index options and futures contracts and EAFE Index swaps to hedge GMWB exposure to international equity markets. The total (reinsured and unreinsured) GRB as of December 31, 2007 and 2006 was $44.8 billion and $37.8 billion, respectively. A contract is 'in the money' if the contract holder's GRB is greater than the account value. For contracts that were 'in the money' the Company's exposure, after reinsurance, as of December 31, 2007 and 2006, was $139 and $8, respectively. However, the only ways the contract holder can monetize the excess of the GRB over the account value of the contract is upon death or if their account value is reduced to zero through a combination of a series of withdrawals that do not exceed a specific percentage of the premiums paid per year and market declines. If the account value is reduced to zero, the contract holder will receive a period certain annuity equal to the remaining GRB. As the amount of the excess of the GRB over the account value can fluctuate with equity market returns on a daily basis, the ultimate amount to be paid by the Company, if any, is uncertain and could be significantly more or less than $139. Account balances of contracts with guarantees were invested in variable separate accounts as follows:
AS OF AS OF DECEMBER 31, DECEMBER 31, 2007 2006 -------------------------------------------------------------------------------- ASSET TYPE Equity securities $109,354 $104,687 Cash and cash equivalents 9,975 8,931 ----------- ----------- TOTAL $119,329 $113,618 ----------- -----------
As of December 31, 2007, approximately 12% of the equity securities above were invested in fixed income securities through these funds and approximately 88% were invested in equity securities. 9. SALES INDUCEMENTS The Company currently offers enhanced crediting rates or bonus payments to contract holders on certain of its individual and group annuity products. The expense associated with offering a bonus is deferred and amortized over the life of the related contract in a pattern consistent with the amortization of deferred policy acquisition costs. Amortization expense associated with expenses previously deferred is recorded over the remaining life of the contract. Consistent with the Company's unlock, the Company unlocked the amortization of the sales inducement asset. See Note 1, for more information concerning the unlock. F-43 Changes in deferred sales inducement activity were as follows for the years ended December 31,:
2007 2006 -------------------------------------------------------------------------------- BALANCE, BEGINNING OF PERIOD $397 $359 Cumulative effect of accounting change, pre-tax (SOP 05-1) (1) -- BALANCE, JANUARY 1, AS ADJUSTED 396 359 Sales inducements deferred 97 84 Unlock (15) 4 Amortization charged to income (33) (50) ------ ------ BALANCE, END OF PERIOD $445 $397 ------ ------
10. COMMITMENTS AND CONTINGENCIES LITIGATION The Company is involved in claims litigation arising in the ordinary course of business, both as a liability insurer defending or providing indemnity for third-party claims brought against insureds and as an insurer defending coverage claims brought against it. The Company accounts for such activity through the establishment of unpaid loss and loss adjustment expense reserves. Management expects that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of the Company. The Company is also involved in other kinds of legal actions, some of which assert claims for substantial amounts. These actions include, among others, putative state and federal class actions seeking certification of a state or national class. Such putative class actions have alleged, for example, improper sales practices in connection with the sale of life insurance and other investment products; and improper fee arrangements in connection with mutual funds and structured settlements. The Company also is involved in individual actions in which punitive damages are sought, such as claims alleging bad faith in the handling of insurance claims. Management expects that the ultimate liability, if any, with respect to such lawsuits, after consideration of provisions made for estimated losses, will not be material to the consolidated financial condition of the Company. Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation, an adverse outcome in certain matters could, from time to time, have a material adverse effect on the Company's consolidated results of operations or cash flows in particular quarterly or annual periods. BROKER COMPENSATION LITIGATION -- Following the New York Attorney General's filing of a civil complaint against Marsh & McLennan Companies, Inc., and Marsh, Inc. (collectively, "Marsh") in October 2004 alleging that certain insurance companies, including The Hartford, participated with Marsh in arrangements to submit inflated bids for business insurance and paid contingent commissions to ensure that Marsh would direct business to them, private plaintiffs brought several lawsuits against The Hartford predicated on the allegations in the Marsh complaint, to which The Hartford was not party. Among these is a multidistrict litigation in the United States District Court for the District of New Jersey. There are two consolidated amended complaints filed in the multidistrict litigation, one related to conduct in connection with the sale of property-casualty insurance and the other related to alleged conduct in connection with the sale of group benefits products. The Company is named in the group benefits products complaint. The complaints assert, on behalf of a putative class of persons who purchased insurance through broker defendants, claims under the Sherman Act, the Racketeer Influenced and Corrupt Organizations Act ("RICO"), state law, and in the case of the group benefits products complaint, claims under ERISA. The claims are predicated upon allegedly undisclosed or otherwise improper payments of contingent commissions to the broker defendants to steer business to the insurance company defendants. . The district court has dismissed the Sherman Act and RICO claims in both complaints for failure to state a claim and has granted the defendants' motions for summary judgment on the ERISA claims in the group-benefits products complaint . The district court further has declined to exercise supplemental jurisdiction over the state law claims, has dismissed those state law claims without prejudice, and has closed both cases. The plaintiffs have appealed the dismissal of the Sherman Act, RICO and ERISA claims. REGULATORY DEVELOPMENTS 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 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, of which $84 represents restitution for market timing, $5 represents restitution for issues relating to the compensation of brokers, and $26 is a civil penalty. F-44 Hartford Life recorded charges of $54, after-tax, in the aggregate, none of which was attributed to the Company, through the first quarter of 2007 to establish a reserve for the market timing matters and, based on the settlement discussed above, Hartford Life recorded an additional charge of $21, after-tax, in the second quarter of 2007. In the second quarter of 2007, $75, after-tax, representing all of the charges that had been recorded at Hartford Life, was attributed to and recorded at the Company. LEASES The rent paid to Hartford Fire for operating leases entered into by the Company was $27, $35 and $35 for the years ended December 31, 2007, 2006 and 2005, respectively. Included in Hartford Fire's operating leases are the principal executive offices of Hartford Life Insurance Company, together with its parent, which are located in Simsbury, Connecticut. Rental expense for the facility located in Simsbury, Connecticut, which expires on December 31, 2007, as this operating lease will be replaced by a capital lease between its parent Company HLA and Hartford Fire Insurance Company, amounted to approximately $6, $27 and $27 for the years ended December 31, 2007, 2006 and 2005, respectively. Future minimum rental commitments on all operating leases are as follows: 2008 $17 2009 11 2010 8 2011 5 2012 2 Thereafter 2 ---- TOTAL $ 45 ----
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. 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 recorded benefits of $155, $174 and $184 related to the separate account DRD in the year ended December 31, 2007, December 31, 2006 and December 31, 2005, respectively. The 2007 benefit included a tax of $1 related to a true-up of the prior year tax return, the 2006 benefit included a benefit of $6 related to true-ups of prior years' tax returns and the 2005 benefit included a benefit of $3 related to a true-up of the prior year tax return In Revenue Ruling 2007-61, issued on September 25, 2007, the IRS announced its intention to issue regulations with respect to certain computational aspects of the DRD on separate account assets held in connection with variable annuity contracts. Revenue Ruling 2007-61 suspended Revenue Ruling 2007-54, issued in August 2007 that purported to change accepted industry and IRS interpretations of the statutes governing these computational questions. Any regulations that the IRS ultimately proposes for issuance in this area will be subject to public notice and comment, at which time insurance companies and other members of the public will have the opportunity to raise legal and practical questions about the content, scope and application of such regulations. As a result, the ultimate timing and substance of any such regulations are unknown, but they could result in the elimination of some or all of the separate account DRD tax benefit that the Company receives. Management believes that it is highly likely that any such regulations would apply prospectively only. 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 actual FTCs passed through by the mutual funds. The Company recorded benefits of $11 and $17 related to separate account FTC in the year ended December 31, 2007 and December 31, 2006, respectively. These amounts included benefits related to true-ups of prior years' tax returns of $0 and $7 in 2007 and 2006, respectively. UNFUNDED COMMITMENTS At December 31, 2007, the Company has outstanding commitments totaling $888, of which $616 is committed to fund limited partnership investments. These capital commitments can be called by the partnership during the commitment period (on average two to five years) to fund the purchase of new investments and partnership expenses. Once the commitment F-45 period expires, the Company is under no obligation to fund the remaining unfunded commitment but may elect to do so. The remaining outstanding commitments are primarily related to various funding obligations associated with investments in mortgage and construction loans. These have a commitment period of one month to three years. GUARANTY FUND AND OTHER INSURANCE-RELATED ASSESSMENTS In all states, insurers licensed to transact certain classes of insurance are required to become members of a guaranty fund. In most states, in the event of the insolvency of an insurer writing any such class of insurance in the state, members of the funds are assessed to pay certain claims of the insolvent insurer. A particular state's fund assesses its members based on their respective written premiums in the state for the classes of insurance in which the insolvent insurer was engaged. Assessments are generally limited for any year to one or two percent of premiums written per year depending on the state. The Company accounts for guaranty fund and other insurance assessments in accordance with Statement of Position No. 97-3, "Accounting by Insurance and Other Enterprises for Insurance-Related Assessments". Liabilities for guaranty fund and other insurance-related assessments are accrued when an assessment is probable, when it can be reasonably estimated, and when the event obligating the Company to pay an imposed or probable assessment has occurred. Liabilities for guaranty funds and other insurance-related assessments are not discounted and are included as part of other liabilities in the Consolidated Balance Sheets. As of December 31, 2007 and 2006, the liability balance was $4 and $4, respectively. As of December 31, 2007 and 2006, $12 and $13, respectively, related to premium tax offsets were included in other assets. 11. INCOME TAX The Company is included in The Hartford's consolidated Federal income tax return. The Company and The Hartford have entered into a tax sharing agreement under which each member in 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 tax adjustments, generally will be determined as though the Company were filing a separate Federal income tax return with current credit for net losses to the extent the losses provide a benefit in the consolidated return. Income tax expense (benefit) is as follows:
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- Current $106 $115 $71 Deferred 62 (12) 136 ------ ------ ------ INCOME TAX EXPENSE $168 $103 $207 ------ ------ ------
A reconciliation of the tax provision at the U.S. Federal statutory rate to the provision (benefit) for income taxes is as follows:
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- Tax provision at the U.S. federal statutory rate $318 $292 $391 Dividends received deduction (155) (174) (184) Penalties 7 -- 1 Foreign related investments (11) (10) (2) Other 9 (5) 1 ------ ------ ------ TOTAL $168 $103 $207 ------ ------ ------
F-46 Deferred tax assets (liabilities) include the following as of December 31:
2007 2006 -------------------------------------------------------------------------------- DEFERRED TAX ASSETS Tax basis deferred policy acquisition costs $682 $568 Unrealized Loss on Investments 294 -- Other Investment-related items 455 179 Minimum tax credit 239 217 Foreign tax credit carryovers -- 7 Other 17 -- --------- --------- TOTAL DEFERRED TAX ASSETS 1,687 971 DEFERRED TAX LIABILITIES Financial statement deferred policy acquisition costs and reserves (1,775) (1,252) Net unrealized gains on equity securities -- (169) Employee benefits (36) (39) Other -- (2) --------- --------- TOTAL DEFERRED TAX LIABILITIES (1,811) (1,462) --------- --------- TOTAL DEFERRED TAX LIABILITY $(124) $(491) --------- ---------
The Company had current federal income tax (payable) receivable of $62 and $(78) as of December 31, 2007 and 2006, respectively. In management's judgment, the gross deferred tax asset will more likely than not be realized through reductions of future taxes. Accordingly, no valuation allowance has been recorded. The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2002. During 2005, the Internal Revenue Service ("IRS") commenced an examination of the Company's U.S. income tax returns for 2002 through 2003 that is anticipated to be completed in early 2008. The 2004 through 2006 examination will begin in 2008. The Company anticipates that it is reasonably possible that the Internal Revenue Service will issue the 2002-2003 Revenue Agent's Report within 12 months. The Company does not anticipate that the outcome of the audit will result in a material change to its financial position. The Company adopted the provisions of FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, on January 1, 2007. As a result of the adoption, the Company recognized an $11 decrease in the liability for unrecognized tax benefits and a corresponding increase in the January 1, 2007 balance of retained earnings. The Company had no balance of unrecognized tax benefits as of January 1, 2007 or December 31, 2007. The Company classifies interest and penalties (if applicable) as income tax expense in the financial statements. 12. DEBT CONSUMER NOTES On September 8, 2006, Hartford Life Insurance Company filed a shelf registration statement with the SEC (Registration Statement No. 333-137215), effective immediately, for the offering and sale of Hartford Life Income Notes SM and Hartford Life medium-term notes (collectively called "Consumer Notes"). There are no limitations on the ability to issue additional indebtedness in the form of Hartford Life Income Notes SM and Hartford Life medium-term notes. Institutional Solutions Group began issuing Consumer Notes through its Retail Investor Notes Program in September 2006. A Consumer Note is an investment product distributed through broker-dealers directly to retail investors as medium-term, publicly traded fixed or floating rate, or a combination of fixed and floating rate, notes. In addition, discount notes, amortizing notes and indexed notes may also be offered and issued. Consumer Notes are part of the Company's spread-based business and proceeds are used to purchase investment products, primarily fixed rate bonds. Proceeds are not used for general operating purposes. Consumer Notes are offered weekly with maturities up to 30 years and varying interest rates and may include a call provision. Certain Consumer Notes may be redeemed by the holder in the event of death. Redemptions are subject to certain limitations, including calendar year aggregate and individual limits equal to the greater of $1 or 1% of the aggregate principal amount of the notes and $250 thousand per individual, respectively. Derivative instruments will be utilized to hedge the Company's exposure to interest rate risk in accordance with Company policy. As of December 31, 2007 and 2006, $809 and $258 of consumer notes had been issued. As of December 31, 2007, these consumer notes have interest rates ranging from 4.75% to 6.25% for fixed notes and, for variable notes, either consumer price index plus 157 to 267 basis points, or indexed to the S&P 500, Dow Jones Industrials or the Nikkei 225. The aggregate maturities of consumer notes are as follows: $222 in 2008, $494 in 2009, $34 in 2010, $19 in 2011 and $40 thereafter. For the year ended December 31, 2007 and 2006, interest credited to holders of consumer notes was $11 and $2, respectively. F-47 13. STATUTORY RESULTS
FOR THE YEARS ENDED DECEMBER 31, 2007 2006 2005 -------------------------------------------------------------------------------- Statutory net income $255 $777 $393 ------- ------- ------- Statutory capital and surplus $4,448 $3,276 $3,022 ------- ------- -------
A significant percentage of the consolidated statutory surplus is permanently reinvested or is subject to various state regulatory restrictions which limit the payment of dividends without prior approval. The payment of dividends by Connecticut-domiciled insurers is limited under the insurance holding company laws of Connecticut. Under these laws, the insurance subsidiaries may only make their dividend payments out of unassigned surplus. These laws require notice to and approval by the state insurance commissioner for the declaration or payment of any dividend, which, together with other dividends or distributions made within the preceding twelve months, exceeds the greater of (i) 10% of the insurer's policyholder surplus as of December 31 of the preceding year or (ii) net income (or net gain from operations, if such company is a life insurance company) for the twelve-month period ending on the thirty-first day of December last preceding, in each case determined under statutory insurance accounting principles. In addition, if any dividend of a Connecticut-domiciled insurer exceeds the insurer's earned surplus, it requires the prior approval of the Connecticut Insurance Commissioner. The insurance holding company laws of the other jurisdictions in which The Hartford's insurance subsidiaries are incorporated (or deemed commercially domiciled) generally contain similar (although in certain instances somewhat more restrictive) limitations on the payment of dividends. As of December 31, 2007, the maximum amount of statutory dividends which may be paid by the Company in 2008, without prior approval, is $445. The domestic insurance subsidiaries of the Company prepare their statutory financial statements in accordance with accounting practices prescribed by the applicable insurance department. Prescribed statutory accounting practices include publications of the National Association of Insurance Commissioners ("NAIC"), as well as state laws, regulations and general administrative rules. 14. PENSION PLANS, POSTRETIREMENT, HEALTH CARE AND LIFE INSURANCE BENEFIT AND SAVINGS PLANS PENSION PLANS Hartford Life's employees are included in The Hartford's non-contributory defined benefit pension and postretirement health care and life insurance benefit plans. Defined benefit pension expense, postretirement health care and life insurance benefits expense allocated by The Hartford to the Company, was $22, $22 and $21 for the years ended December 31, 2007, 2006 and 2005, respectively. INVESTMENT AND SAVINGS PLAN Substantially all U.S. employees 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 2004, the Company began allocating a percentage of base salary to the Plan for eligible employees. In 2007, employees who had salaries of less than $100,000 per year received a contribution of 1.5% of base salary and employees who had salaries of $100,000 or more per year received a contribution of 0.5% of base salary. The cost to Hartford Life for this plan was approximately $11, $9 and $8 for the years ended December 31, 2007, 2006 and 2005, respectively. 15. STOCK COMPENSATION PLANS Hartford Life's employees are included in The Hartford 2005 Incentive Stock Plan and The Hartford Employee Stock Purchase Plan. The Hartford has two primary stock-based compensation plans which are described below. Shares issued in satisfaction of stock-based compensation may be made available from authorized but unissued shares, shares held by The Hartford in treasury or from shares purchased in the open market. The Hartford typically issues new shares in satisfaction of stock-based compensation. Hartford Life was allocated compensation expense of $21 million, $19 million and $15 million for the years ended December 31, 2007, 2006 and 2005, respectively. Hartford Life's income tax benefit recognized for stock-based compensation plans was $7 million, $6 million and $5 million for the years ended December 31, 2007, 2006 and 2005, respectively. Hartford Life did not capitalize any cost of stock-based compensation. STOCK PLAN In 2005, the shareholders of The Hartford approved The Hartford 2005 Incentive Stock Plan (the "2005 Stock Plan"), which superseded and replaced The Hartford Incentive Stock Plan and The Hartford Restricted Stock Plan for Non-employee Directors. The terms of the 2005 Stock Plan are substantially similar to the terms of these superseded plans. F-48 The 2005 Stock Plan provides for awards to be granted in the form of non-qualified or incentive stock options qualifying under Section 422 of the Internal Revenue Code, stock appreciation rights, restricted stock units, restricted stock, performance shares, or any combination of the foregoing. The fair values of awards granted under the 2005 Stock Plan are measured as of the grant date and expensed ratably over the awards' vesting periods, generally three years. For stock option awards granted or modified in 2006 and later, the Company began expensing awards to retirement-eligible employees hired before January 1, 2002 immediately or over a period shorter than the stated vesting period because the employees receive accelerated vesting upon retirement and therefore the vesting period is considered non-substantive. If, prior to the adoption of SFAS 123(R), the Company had been expensing stock option awards to retirement-eligible employees over the shorter of the stated vesting period or the date of retirement eligibility, then the Company would have recognized an immaterial increase in net income for the year ended December 31, 2005 and an immaterial decrease in net income for the year ended December 31, 2004. All awards provide for accelerated vesting upon a change in control of The Hartford as defined in the 2005 Stock Plan. STOCK OPTION AWARDS Under the 2005 Stock Plan, all options granted have an exercise price equal to the market price of The Hartford's common stock on the date of grant, and an option's maximum term is ten years. Certain options become exercisable over a three year period commencing one year from the date of grant, while certain other options become exercisable at the later of the three years from the date of grant or upon the attainment of specified market appreciation of The Hartford's common shares. For any year, no individual employee may receive an award of options for more than 1,000,000 shares. As of December 31, 2007, The Hartford had not issued any incentive stock options under any plans. For all options granted or modified on or after January 1, 2004, The Hartford uses a hybrid lattice/Monte-Carlo based option valuation model (the "valuation model") that incorporates the possibility of early exercise of options into the valuation. The valuation model also incorporates The Hartford's historical termination and exercise experience to determine the option value. For these reasons, the Hartford believes the valuation model provides a fair value that is more representative of actual experience than the value calculated under the Black-Scholes model. SHARE AWARDS Share awards are valued equal to the market price of The Hartford's common stock on the date of grant, less a discount for those awards that do not provide for dividends during the vesting period. Share awards granted under the 2005 Plan and outstanding include restricted stock units, restricted stock and performance shares. Generally, restricted stock units vest after three years and restricted stock vests in three to five years. Performance shares become payable within a range of 0% to 200% of the number of shares initially granted based upon the attainment of specific performance goals achieved over a specified period, generally three years. The maximum award of restricted stock units, restricted stock or performance shares for any individual employee in any year is 200,000 shares or units. EMPLOYEE STOCK PURCHASE PLAN In 1996, The Hartford established The Hartford Employee Stock Purchase Plan ("ESPP"). Under this plan, eligible employees of The Hartford may purchase common stock of The Hartford at a 15% discount from the lower of the closing market price at the beginning or end of the quarterly offering period. Employees purchase a variable number of shares of stock through payroll deductions elected as of the beginning of the quarter. The fair value is estimated based on the 15% discount off of the beginning stock price plus the value of three-month European call and put options on shares of stock at the beginning stock price calculated using the Black-Scholes model. 16. TRANSACTIONS WITH AFFILIATES Transactions of the Company with Hartford Fire Insurance Company, Hartford Holdings and its affiliates relate principally to tax settlements, reinsurance, insurance coverage, rental and service fees, payment of dividends and capital contributions. In addition, an affiliated entity purchased group annuity contracts from the Company to fund structured settlement periodic payment obligations assumed by the affiliated entity as part of claims settlements with property casualty insurance companies and self-insured entities. As of December 31, 2007 and 2006 the Company had $4.8 billion and $3.8 billion of reserves for claim annuities purchased by affiliated entities. For the year ended December 31, 2007, 2006 and 2005, the Company recorded earned premiums of $525, $296 and $339 for these intercompany claim annuities. Substantially all general insurance expenses related to the Company, including rent and employee benefit plan expenses are initially paid by The Hartford. Direct expenses are allocated to the Company 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. Hartford Life sells fixed market value adjusted ("MVA") annuity products to customers in Japan. The yen based MVA product is written by HLIKK, a wholly owned Japanese subsidiary of Hartford Life and subsequently reinsured to the Company. As of F-49 December 31, 2007 and 2006, $1.8 billion and $1.7 billion, respectively, of the account value had been assumed by the Company. Effective August 31, 2005, a subsidiary of the Company, Hartford Life and Annuity Insurance Company ("HLAI"), entered into a reinsurance agreement with Hartford Life, Insurance KK ("HLIKK"), a wholly owned Japanese subsidiary of Hartford Life, Inc. ("Hartford Life"). Through this agreement, HLIKK agreed to cede and HLAI agreed to reinsure 100% of the risks associated with the in-force and prospective GMIB riders issued by HLIKK on its variable annuity business. Effective July 31, 2006, the agreement was modified to include the 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 reinsurance premium structure was implemented. On the date of recapture, HLAI forgave the reinsurance derivative asset of $110 and paid HLIKK $38. The net result of the recapture was recorded as a dividend of $93, after-tax. GMIB riders issued by HLIKK subsequent to April 1, 2005 continue to be reinsured by HLAI. While the form of the agreement between HLAI and HLIKK for GMIB business is reinsurance, in substance and for accounting purposes the agreement is a free standing derivative. As such, the reinsurance agreement for GMIB business is recorded at fair value on the Company's balance sheet, with prospective changes in fair value recorded in net realized capital gains (losses) in net income. Effective September 30, 2007, HLAI entered into another reinsurance agreement where HLIKK agreed to cede and HLAI agreed to reinsure 100% of the risks associated with the in-force and prospective GMAB, GMIB and GMDB riders issued by HLIKK on certain of its variable annuity business. The reinsurance of the GMAB riders is accounted for as a free-standing derivative in accordance with SFAS 133. Accordingly, the reinsurance of the GMAB is recorded at fair value on the Company's balance sheet, with prospective changes in fair value recorded in net realized capital gains (losses) in net income. The fair value of the GMAB is an asset of $2 at December 31, 2007. The initial fair value of the derivative associated with new business will be recorded as an in substance capital contribution or distribution between these related parties. As of December 31, 2007 and 2006, the fair value of the GMIB reinsurance derivative was an asset (liability) of $(72) and $119, respectively. During the year ended December 31, 2007 the Company recorded a net capital contribution (dividend) of $17 and a pre-tax realized loss of $156, representing the change in fair value of the GMIB reinsurance derivative. During the year ended December 31, 2006, the Company recorded a net capital contribution of $74 (including the net result of the recapture) and a pre-tax realized loss of $53, representing the change in fair value of the reinsurance derivative. (Included in the 2006 pre-tax loss amounts was a net $60 of losses related to changes in policyholder behavior assumptions and modeling refinements made by the Company during the year ended December 31, 2006.) The methodology for calculating the value of the reinsurance derivative's for GMIB and GMAB are consistent with the methodology used by the Company in valuing the guaranteed minimum withdrawal benefit rider sold with U.S. variable annuities. The calculation uses risk neutral Japanese capital market assumptions and includes estimates for dynamic policyholder behavior. The resulting reinsurance derivative value in Japanese yen is converted to U.S. dollars at the spot rate. Should actual policyholder behavior or capital markets experience emerge differently from these estimates, the resulting impact on the value of the reinsurance derivative could be material to the results of operations. The contracts underlying the GMIB and GMAB reinsurance contracts are 'in the money' if the contract holder's GRB is greater than the account value. For contracts that were 'in the money' the Company's exposure related to GMIB and GMAB, as of December 31, 2007 and 2006, was $130 and $0, respectively. However, for GMIB's, the only way the contract holder can monetize the excess of the GRB over the account value of the contract is upon annuitization and the amount to be paid by the Company will either be in the form of a lump sum, or over the annuity period for certain GMIB's or over the annuity period only for other GMIB's. For GMAB's the only way that contract holder can monetize the excess of the GRB over the account value of the contract is through a lump sum payment after a ten year waiting period. As the amount of the excess of the GRB over the account value can fluctuate with equity market returns on a daily basis, the ultimate amount to be paid by the Company, if any, is uncertain and could be significantly more than $130. The Reinsurance Agreement for GMDB business is accounted for under SOP 03-1 "Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts" ("SOP 03-1"). As of December 31, 2007 the liability for the assumed reinsurance of the GMDB and the net amount at risk was $4 and $380, respectively. As of December 31, 2006 the liability for the assumed reinsurance of the GMDB and the net amount at risk was immaterial. The Company has issued a guarantee to retirees and vested terminated employees ("Retirees") of The Hartford Retirement Plan for U.S. Employees ("the Plan") who retired or terminated prior to January 1, 2004. The Plan is sponsored by The Hartford. The guarantee is an irrevocable commitment to pay all accrued benefits which the Retiree or the Retiree's designated beneficiary is entitled to receive under the Plan in the event the Plan assets are insufficient to fund those benefits and The Hartford is unable to provide sufficient assets to fund those benefits. The Company believes that the likelihood that payments will be required under this guarantee is remote. F-50 Effective November 1, 2007, a subsidiary insurance company ("Ceding Company") entered into a coinsurance with funds withheld and modified coinsurance reinsurance agreement ("Agreement") with an affiliate reinsurance company ("Reinsurer") to provide statutory surplus relief for certain life insurance policies. The Agreement is accounted for as a financing transaction for GAAP. A standby unaffiliated third party Letter of Credit ("LOC") supports a portion of the statutory reserves that have been ceded to the Reinsurer. 17. QUARTERLY RESULTS FOR 2007 AND 2006 (UNAUDITED)
MARCH 31, JUNE 30, SEPTEMBER 30, DECEMBER 31, 2007 2006 2007 2006 2007 2006 2007 2006 --------------------------------------------------------------------------------------------------------------------------------- Revenues $1,692 $1,623 $1,660 $1,272 $1,751 $1,523 $1,503 $1,671 Benefits, claims and expenses 1,360 1,286 1,551 1,198 1,337 1,259 1,450 1,512 Net income 262 259 110 93 290 231 78 148 ------- ------- ------- ------- ------- ------- ------- -------
F-51 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 Insurance Company ("Hartford") authorizing 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) Articles of Incorporation of Hartford.(5) (6) (b) Bylaws of Hartford.(6) (7) Form of Reinsurance Agreement.(7) (8) Form of Participation Agreement.(8) (9) Opinion and Consent of Richard J. Wirth, Senior Counsel. (10) Consent of Deloitte & Touche LLP to be filed by Amendment. (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. 33-80738, dated May 1, 1995. (2) Incorporated by reference to Post-Effective Amendment No. 3, to the Registration Statement File No. 33-73570, 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. 333-101923 filed April 7, 2003. (5) Incorporated by reference to Post-Effective Amendment No. 6, to the Registration Statement File No. 333- 66343, dated February 8, 2001. (6) Incorporated by reference to Post-Effective Amendment No. 12, to the Registration Statement File No. 333-69485, dated April 9, 2001. (7) Incorporated by reference to Post-Effective Amendment No. 27, to the Registration Statement File No. 33-73570, filed on April 12, 1999. (8) Incorporated by reference to Post-Effective Amendment No. 6, to the Registration Statement File No. 333-119414, dated April 9, 2007. ITEM 25. DIRECTORS AND OFFICERS OF THE DEPOSITOR
NAME POSITION WITH HARTFORD ------------------------------------------------------------------------------------------------------------------ Daniel A. Andriola Vice President Robert Arena Senior Vice President Simpa Baiye Assistant Actuary Lynn R. Banziruk Assistant Vice President Richard E. Cady Assistant Vice President David A. Carlson Director of Taxes, Senior Vice President Christine D. Chaia Assistant Vice President Kathleen C. Ciullo Vice President Henry Collie Assistant Actuary Richard G. Costello Vice President and Secretary Rochelle S. Cummings Vice President James Davey Senior Vice President Joseph G. Eck Vice President Jason S. Frain Actuary, Assistant Vice President John Giamalis Senior Vice President, Treasurer Christopher M. Grinnell Assistant Vice President Susan M. Hess Vice President Jeannie M. Iannello Vice President Anne Iezzi Chief Compliance Officer, Vice President Edward Jaworski Assistant Vice President Thomas D. Jones Vice President Stephen T. Joyce Senior Vice President, Director* Thomas P. Kalmbach Vice President and Actuary Paula Knake Assistant Vice President Diane Krajewski Assistant Vice President Alan J. Kreczko Executive Vice President and General Counsel Lori A. LaForge Assistant Vice President Glenn D. Lammey Chief Financial Officer, Executive Vice President, Director* Dawn M. LeBlanc Assistant Vice President Alice Longworth 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 Peter J. Michalik Vice President John J. Mittelstadt Vice President Brian Murphy Executive Vice President Jamie Ohl Vice President John J. Pacheco, Jr. Assistant Vice President Colleen B. Pernerewski Chief Compliance Officer of Separate Accounts Craig R. Raymond Senior Vice President Sharon Roberts Vice President Stephen Roche Vice President Michael J. Roscoe Vice President and Actuary Richard Rubin Assistant Vice President Scott R. Sanderson Vice President Jerry K. Scheinfeldt 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
NAME POSITION WITH HARTFORD ------------------------------------------------------------------------------------------------------------------ Charles N. Vest Vice President and Actuary Andrew J. Waggoner Vice President Jean H. Walker Vice President John C. Walters Co-Chief Executive Officer, Co-President, Director* Richard J. Wirth Assistant Vice President Lizabeth H. Zlatkus Chairman of the Board, Co-Chief Executive Officer, Co-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 3,709 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, CT 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. The 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 INSURANCE COMPANY - SEPARATE ACCOUNT THREE (Registrant) By: John C. Walters *By: /s/ Richard J. Wirth ----------------------------------- ----------------------------------- John C. Walters, Richard J. Wirth Co-President, Co-Chief Executive Attorney-in-Fact Officer* By: Lizabeth H. Zlatkus ----------------------------------- Lizabeth H. Zlatkus Chairman of the Board, Co-Chief Executive Officer, Co-President*
HARTFORD LIFE INSURANCE COMPANY (Depositor) By: John C. Walters ----------------------------------- John C. Walters, Co-President, Co-Chief Executive Officer* By: Lizabeth H. Zlatkus ----------------------------------- Lizabeth H. Zlatkus Chairman of the Board, Co-Chief Executive Officer, Co-President*
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons and in the capacity and on the date indicated. Stephen T. Joyce, Senior Vice President, Director* Glenn D. Lammey, Chief Financial Officer, Executive Vice President, Director* John C. Walters, Co-Chief Executive Officer, Co-President, Director* *By: /s/ Richard J. Wirth ----------------------------------- Lizabeth H. Zlatkus, Chairman of the Board, Co-Chief Executive Richard J. Wirth Officer, Co-President, Attorney-in-Fact Director* David M. Znamierowski, Executive Vice Date: April 24, 2008 President & Chief Investment Officer, Director*
333-119415 EXHIBIT INDEX (9) Opinion and Consent of Richard J. Wirth, Senior Counsel. (10) Consent of Deloitte & Touch LLP. (99) Copy of Power of Attorney.