Reinsurance Group of America, Incorporated

Notes to consolidated financial statements

For the years ended December 31, 2010, 2009 and 2008

Note 1 ORGANIZATION

Reinsurance Group of America, Incorporated ("RGA") is an insurance holding company that was formed on December 31, 1992. The consolidated financial statements include the assets, liabilities, and results of operations of RGA, RGA Reinsurance Company ("RGA Reinsurance"), Reinsurance Company of Missouri, Incorporated (“RCM”), RGA Reinsurance Company (Barbados) Ltd. ("RGA Barbados"), RGA Americas Reinsurance Company, Ltd. ("RGA Americas"), RGA Life Reinsurance Company of Canada ("RGA Canada"), RGA Reinsurance Company of Australia, Limited ("RGA Australia"), RGA Reinsurance UK Limited ("RGA UK") and RGA Atlantic Reinsurance Company, Ltd. (“RGA Atlantic”) as well as other subsidiaries, subject to an ownership position of greater than fifty percent (collectively, the "Company").

The Company is primarily engaged in life reinsurance. Reinsurance is an arrangement under which an insurance company, the reinsurer, agrees to indemnify another insurance company, the ceding company, for all or a portion of the insurance risks underwritten by the ceding company. Reinsurance is designed to (i) reduce the net liability on individual risks, thereby enabling the ceding company to increase the volume of business it can underwrite, as well as increase the maximum risk it can underwrite on a single life or risk; (ii) stabilize operating results by leveling fluctuations in the ceding company's loss experience; (iii) assist the ceding company to meet applicable regulatory requirements; and (iv) enhance the ceding company's financial strength and surplus position.

Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Consolidation and Basis of Presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America. 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 and the reported amounts of revenues and expenses during the reporting period. The most significant estimates include those used in determining deferred policy acquisition costs, premiums receivable, future policy benefits, other policy claims and benefits, including incurred but not rep orted claims, provision for adverse litigation, income taxes, and valuation of investments and investment impairments. Actual results could differ materially from the estimates and assumptions used by management.

For each of its reinsurance contracts, the Company must determine if the contract provides indemnification against loss or liability relating to insurance risk, in accordance with applicable accounting standards. The Company must review all contractual features, particularly those that may limit the amount of insurance risk to which the Company is subject to or features that delay the timely reimbursement of claims. If the Company determines that a contract does not expose it to a reasonable possibility of a significant loss from insurance risk, the Company records the contract on a deposit method of accounting with the net amount payable/rece ivable reflected in other reinsurance assets or liabilities on the consolidated balance sheets. Fees earned on the contracts are reflected as other revenues, as opposed to premiums, on the consolidated statements of income.

The accompanying consolidated financial statements include the accounts of RGA and its subsidiaries, both direct and indirect, subject to an ownership position greater than fifty percent, and any variable interest entities where the Company is the primary beneficiary. Entities in which the Company has an ownership position greater than twenty percent, but less than or equal to fifty percent are reported under the equity method of accounting. The Company evaluates variable interest entities in accordance with the general accounting principles for Consolidation. Intercompany balances and transactions have been eliminated.

The Company has determined that there were no subsequent events, other than as disclosed in Note 23 – “Subsequent Events”, that would require disclosure or adjustments to the accompanying consolidated financial statements through the date the financial statements were issued.

Investments

Fixed Maturity Securities

Fixed maturity securities available-for-sale are reported at fair value and are so classified based upon the possibility that such securities could be sold prior to maturity if that action enables the Company to execute its investment philosophy and appropriately match investment results to operating and liquidity needs.

Unrealized gains and losses on fixed maturity securities classified as available-for-sale, less applicable deferred income taxes as well as related adjustments to deferred acquisition costs, if applicable, are reflected as a direct charge or credit to accumulated other comprehensive income (“AOCI”) in stockholders' equity on the consolidated balance sheets.

Mortgage Loans on Real Estate

Mortgage loans on real estate are carried at unpaid principal balances, net of any unamortized premium or discou nt and valuation allowances. A mortgage loan is considered to be impaired when, based on the current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the mortgage agreement. Valuation allowances on mortgage loans are established based upon losses expected by management to be realized in connection with future dispositions or settlement of mortgage loans, including foreclosures. The Company establishes valuation allowances for estimated impairments on an individual loan basis as of the balance sheet date. Such valuation allowances are based on the excess carrying value of the loan over the present value of expected future cash flows discounted at the loan's original effective interest rate, the value of the loan's collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or the loan's market value if the loan is being sold. The Company will continue to accrue interest on loans until it is probable the Company will not receive interest or the loan is 90 days past due. Any interest accrued or received on the net carrying amount of the impaired loan will be included in investment income or applied to the principal of the loan, depending on the assessment of the collectability of the loan. Mortgage loans deemed to be uncollectible or that have been foreclosed upon are charged-off against the valuation allowances and subsequent recoveries, if any, are credited to the valuation allowances. Changes in valuation allowances are reported in investment related gains (losses), net on the consolidated income statements.

Policy Loans

Policy loans are reported at the unpaid principal balance. Interest income on such loans is recorded as earned using the contractually agreed upon interest rate. These policy loans present no credit risk because the amount of the loan cannot exceed the obligation due the ceding company upon the death of the insured or surrender of the underlying policy.

Funds Withheld at Interest

Funds withheld at interest represent amounts contractually withheld by ceding companies in accordance with reinsurance agreements. For agreements written on a modified coinsurance basis and agreements written on a coinsurance funds withheld basis, assets equal to the net statutory reserves are withheld and legally owned by the ceding company. Interest accrues to these assets at rates defined by the treaty terms. Assets and liabilities are reported on a net or gross basis, depending on the specific details within each treaty. Reinsurance agreements reported on a net basis, where a legal right of offset exists, are generally included in other reinsurance balances on the consolidated balance sheets.

Short-term Investments

Short-term investments represent investments with original maturities of greater than three months but less than twelve months and are stated at amortized cost, which approximates fair value.

Other Invested Assets

In addition to derivative contracts discussed below, other invested assets include equity securities and preferred stocks, carried at fair valu e, and limited partnership interests and structured loans, primarily carried at cost. Changes in fair value of equity securities and preferred stocks are recorded through AOCI.

Other-than-Temporary Impairment

Impairment losses on equity securities are recognized in net income. The way in which impairment losses on fixed maturity securities are recognized in the financial statements is dependent on the facts and circumstances related to the specific security. If the Company intends to sell a security or it is more likely than not that it would be required to sell a security before the recovery of its amortized cost, less any recorded credit loss, it recognizes an other-than-temporary im pairment in net income for the difference between amortized cost and fair value. If the Company does not expect to recover the amortized cost basis, it does not plan to sell the security and if it is not more likely than not that it would be required to sell a security before the recovery of its amortized cost, less any recorded credit loss, the recognition of the other-than-temporary impairment is bifurcated. The Company recognizes the credit loss portion in investment related gains (losses), net and the non-credit loss portion in AOCI.

The cost of other invested assets is adjusted for impairments in value deemed to be other-than-temporary in the period in which the determination is made. These impairments are included within investment related gains (losses), net and the cost basis of the investment securities is reduced accordingly. The Company does n ot change the revised cost basis for subsequent recoveries in value. However, the Company adjusts the cost basis for accretion or amortization.

The assessment of whether impairments have occurred is based on management's case-by-case evaluation of the underlying reasons for the decline in fair value. See Note 4 - "Investments” for additional information regarding the Company's assessment of other-than-temporary impairments on its securities.

Derivative Instruments

Overview

Derivatives are financial instruments whose values are derived from interest rates, foreign currency exchange rates, or other financial indices. The Company utilizes a variety of derivative instruments including swaps, options, forwards and futures, primarily to manage or hedge interest rate risk, credit risk, inflation risk, foreign currency risk, market volatility and various other market risks associated with its business. The Company does not invest in derivatives for speculative purposes. It is the Company's policy to enter into derivative contracts primarily with highly rated parties. See Note 5 – “Derivative Instruments” for additional detail on the Company's derivative positions.

Accounting and Financial Statement Presentation of Derivatives

Derivatives are carried on the Company's co nsolidated balance sheets in other invested assets or as liabilities within other liabilities, at fair value. Certain derivatives are subject to master netting provisions and reported as a net asset or liability. On the date a derivative contract is executed, the Company designates the derivative as (1) a fair value hedge, (2) a cash flow hedge, (3) a foreign currency hedge, (4) a net investment hedge in a foreign operation or (5) held for other risk management purposes, which primarily involve managing asset or liability risks associated with the Company's reinsurance treaties which do not qualify for hedge accounting.

Under a fair value hedge, changes in the fair value of the hedging derivative, including amounts measured as ineffective, and changes in the fair value of the hedged item related to the designated risk being hedged, are reported within investment related gains (losses), net. The fair values of the hedging derivatives are exclusive of any accruals that are separately reported in the consolidated statement of income within interest income or interest expense to match the location of the hedged item.

Under a cash flow hedge, changes in the fair value of the hedging derivative measured as effective are reported within AOCI and the deferred gains or losses on the derivative are reclassified into the consolidated statement of income when the Company's earnings are affected by the variability in cash flows of the hedged item. Changes in the fair value of the hedging instrument measured as ineffective are reported within investment related gains (losses), net. The fair values of the hedging derivatives are exclusive of any accruals that are separately reported in the consolidated statement of income within interest income or interest expense to match the location of the hedged item.

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 investment related gains (losses), net. 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.

In a hedge of a net investment in a foreign operation, changes in the fair value of the hedging derivative that are measured as effective are reported within AOCI consistent with the translation adjustment for the hedged net investment in the foreign operation. Changes in the fair value of the hedging instrument measured as ineffective are reported within investment related gains (losses), net.

Changes in the fair value of free-standing derivative instruments, which do not receive accounting hedge treatment, are reflected in investment related gains (losses), net.

Hedge Documentation and Hedge Effectiveness

To qualify for hedge accounting, at the inception of the hedging relationship, the Company formally documents its risk management objective and strategy for undertaking the hedging transaction, as well as its designation of the hedge as either (i) a fair value hedge; (ii) a cash flow hedge; (iii) a foreign currency hedge; or (iv) a hedge of a net investment in a foreign operation. In this documentation, the Company sets forth how the hedging instrument is expected to hedge the designated risks related to the hedged item and sets forth the method that will be used to retrospectively and prospectively assess the hedging instrument's effectiveness and the method which will be used to measure ineffectiveness. A d erivative designated as a hedging instrument must be assessed as being highly effective in offsetting the designated risk of the hedged item. Hedge effectiveness is formally assessed at inception and periodically throughout the life of the designated hedging relationship. Assessments and measurement of hedge effectiveness are also subject to interpretation and estimation and different interpretations or estimates may have a material effect on the amount reported in net income.

The accounting for derivatives is complex and interpretations of the primary accounting standards continue to evolve in practice. Judgment is applied in determining the availability and application of hedge accounting designations and the appropriate accounting treatment under these accounting standards. If it was determined that hedge accounting designations were not appropriately applied, reported net income could be materially affected. Differences in judgment as to the availability and application of hedge accounting designations and the appropriate accounting treatment may result in a differing impact on the consolidated financial statements of the Company from that previously reported.

Embedded Derivatives

The Company reinsures certain annuity products that contain terms that are deemed to be embedded derivatives, primarily equity-indexed annuities and variable annuities with guaranteed minimum benefits. The Company assesses each identified embedded derivative to determine whether it is required to be bifurcated under the general accounting principles for ;/fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;". If the instrument would not be reported for in its entirety at fair value and it is determined that the terms of the embedded derivative are not clearly and closely related to the economic characteristics of the host contract, and that a separate instrument with the same terms would qualify as a derivative instrument, the embedded derivative is bifurcated from the host contract and accounted for separately. Such embedded derivatives are carried on the consolidated balance sheets at fair value with the host contract. Changes in the fair value of embedded derivatives associated with equity-indexed annuities are reflected in interest credited on the consolidated statements of income and changes in the fair value of embedded derivatives associated with variable annuity guaranteed minimum benefits are reflected in inves tment related gains (losses), net on the consolidated statements of income. The Company has implemented a hedging strategy to mitigate the volatility associated with its reinsurance of variable annuity guaranteed minimum benefits. The hedging strategy is designed such that changes in the fair value of the hedge contracts, primarily future/fontfont style="font-family:Times New Roman;font-size:10pt;"s,/fontfont style="font-family:Times New Roman;font-size:10pt;" swap contracts/fontfont style="font-family:Times New Roman;font-size:10pt;" and options/fontfont style="font-family:Times New Roman;font-size:10pt;", move in the opposite direction of changes in the fair value of the embedded derivatives. While the Company actively manages its hedging program, the hedges that are in place may not be totally effective in offsetting the embedded derivative changes due to the many variables that must be managed./font/pp style='margin-to p:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Additionally, reinsurance treaties written on a modified coinsurance or funds withheld basis are subject to the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;" related to embedded derivatives./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The majority of the Company's funds withheld at interest balances are associated with its reinsurance of annuity contracts, the majority of which were subject to the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging /fontfont style="font-family:Times New Roman;font-size: 10pt;"related to embedded derivatives. Management believes the embedded derivative feature in each of these reinsurance treaties is similar to a total return swap on the assets held by the ceding companies. The valuation of these embedded derivatives is sensitive to the credit spread environment./fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;"The change in the fair value of these embedded derivatives increased /fontfont style="font-family:Times New Roman;font-size:10pt;"(decreased) /fontfont style="font-family:Times New Roman;font-size:10pt;"revenues /fontfont style="font-family:Times New Roman;font-size:10pt;"by $160.3/fontfont style="font-family:Times New Roman;font-size:10pt;" million/fontfont style="font-family:Times New Roman;font-size:10pt;",/fontfont style="font-family:Times New Roman;font-size:10pt ;" /fontfont style="font-family:Times New Roman;font-size:10pt;"$78.4/fontfont style="font-family:Times New Roman;font-size:10pt;" million/fontfont style="font-family:Times New Roman;font-size:10pt;" and $/fontfont style="font-family:Times New Roman;font-size:10pt;"(/fontfont style="font-family:Times New Roman;font-size:10pt;"427.8/fontfont style="font-family:Times New Roman;font-size:10pt;")/fontfont style="font-family:Times New Roman;font-size:10pt;" million in 2010, 2009 and 2008/fontfont style="font-family:Times New Roman;font-size:10pt;" respectively/fontfont style="font-family:Times New Roman;font-size:10pt;". These changes in fair values of the embedded derivatives are net of a/fontfont style="font-family:Times New Roman;font-size:10pt;"n increase/fontfont style="font-family:Times New Roman;font-size:10pt;" /font ;font style="font-family:Times New Roman;font-size:10pt;"(/fontfont style="font-family:Times New Roman;font-size:10pt;"decrease/fontfont style="font-family:Times New Roman;font-size:10pt;")/fontfont style="font-family:Times New Roman;font-size:10pt;" in revenues of/fontfont style="font-family:Times New Roman;font-size:10pt;" $/fontfont style="font-family:Times New Roman;font-size:10pt;"(/fontfont style="font-family:Times New Roman;font-size:10pt;"32.2/fontfont style="font-family:Times New Roman;font-size:10pt;")/fontfont style="font-family:Times New Roman;font-size:10pt;" million/fontfont style="font-family:Times New Roman;font-size:10pt;",/fontfont style="font-family:Times New Roman;font-size:10pt;" $/fontfont style="font-family:Times New Roman;font-size:10pt;"(/fontfont style="font-family:Times New Roman;font-size:10p t;"301.7/fontfont style="font-family:Times New Roman;font-size:10pt;")/fontfont style="font-family:Times New Roman;font-size:10pt;" million/fontfont style="font-family:Times New Roman;font-size:10pt;" and $376.3 million/fontfont style="font-family:Times New Roman;font-size:10pt;" for t/fontfont style="font-family:Times New Roman;font-size:10pt;"he y/fontfont style="font-family:Times New Roman;font-size:10pt;"ears ended December 31, 2010,/fontfont style="font-family:Times New Roman;font-size:10pt;" 2009/fontfont style="font-family:Times New Roman;font-size:10pt;" and 2008/fontfont style="font-family:Times New Roman;font-size:10pt;", respectively, associated with the Company's own credit risk. The change in fair value, which is a non-cash item, also affects the amortization of deferred acquisition costs since the Company is required to include it in its expectatio n of gross profits. /fontfont style="font-family:Times New Roman;font-size:10pt;"The change in fair value of these embedded derivatives increased (decreased) related deferred acquisition expenses by $115.9 million, $45.3 million and $(246.7) million, for the years ended December 31, 2010, 2009 and 2008, respectively. /fontfont style="font-family:Times New Roman;font-size:10pt;"The fair value of the embedded derivatives is included in the funds withheld at interest line item on the consolidated balance sheets. The change in the fair value of the embedded derivatives is recorded in investment related gains (losses), net on the consolidated income statements. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In addition to its reinsured annuity contracts, the Company has entered into various financial reinsurance treaties on a funds withheld and modified coinsurance basis. These treaties do not transfer significant insurance risk and are recorded on a deposit method of accounting with the Company earning a net fee. As a result of the experience refund provisions contained in these treaties, the value of the embedded derivatives in these contracts is currently considered immaterial. The Company monitors the performance of these treaties on a quarterly basis. Significant adverse performance or losses on these treaties may result in a loss associated with the embedded derivative./font/pp style='margin-top:0pt; margin-bottom:6pt'#160;/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Fair Value Measurements /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"General accounting principles for /fontfont style="font-family:Times New Ro man;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures/fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;"defines fair value, establishes a framework for measuring fair value, establishes a fair value hierarchy based on the inputs used to measure fair value and enhances disclosure requirements for fair value measurements. In compliance with these principles, the Company has categorized its financial instruments, based on the priority of the inputs to the valuation technique, into a three level hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3)./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"If the inputs used to measure fair va lue fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In accordance with/fontfont style="font-family:Times New Roman;font-size:10pt;" the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures/fontfont style="font-family:Times New Roman;font-size:10pt;", assets and liabilities recorded at fair value on the consolidated balance sheets are categorized as follows:/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"#160;#160;#160;#160;#160;#160;#160;Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:36px;"Level 2 #160;#160;#160;#160;#160;#160;#160;Quoted prices in markets that are not active or inputs that are observable either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities other than quoted prices in Level 1; quoted prices in markets that are not active; or other inputs that are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:36px;"Level 3 #160;#160;#160;#160;#160;#160;#160;Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. Unobservable inputs reflect the reporting entity's own assumptions about the assumptions that market participants would use in pricing the asset or liability. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"See Note 6 - #8220;Fair Value of Financial Instruments#8221; for further details on the Company's assets and liabilities recorded at fair value./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0p x;"Cash and Cash Equivalents/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company considers all investments purchased with an original maturity of three months or less to be cash equivalents./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Additional Information Regarding Statements of Cash Flows/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Cash and cash equivalents include cash on deposit and highly liquid debt instruments purchased with an original maturity of three months or less. The consolidated statements of cash flows includes the results of discontinued operations in net cash from operations for all years presented, as the effect of the discontinued operations on cash flows is not considered material./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Premiums Receivable/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Premiums are accrued when due and in accordance with information received from the ceding company. When a ceding company fails to report information on a timely basis, the Company records accruals based on the terms of the reinsurance treaty as well as historical experience. Other management estimates include adjustments for lapsed premiums given historical experience, the financial health of specific ceding companies, collateral value and the legal right of offset on related amounts (i.e. allowances and claims) owed to the ceding company. Under the legal right of offset provisions in its reinsurance treaties, the Company can withhold payments for allowances and claims for unpaid premiums. Based on its review of these factors and historical experience, the Company did not believe a provision for doubtful accounts was necessary as of December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10 or 2009/fontfont style="font-family:Times New Roman;font-size:10pt;"./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Deferred Policy Acquisition Costs/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Costs of acquiring new business, which vary with and are primarily related to the production of new business, have b een deferred to the extent that such costs are deemed recoverable from future premiums or gross profits. Such costs include commissions and allowances as well as certain costs of policy issuance and underwriting. The Company performs periodic tests to establish that Deferred Policy Acquisition Costs (#8220;DAC#8221;) remain recoverable at all times, including at issue, and if financial performance significantly deteriorates to the point where a premium deficiency exists, a cumulative charge to current operations will be recorded. As a result of recoverability testing for new business issues, a charge of approximately $7.7 million to current operations was recorded in the Asset Intensive sub-segment in 2009 with projected revenue deemed insufficient to cover future benefits and expenses. /fontfont style="font-family:Times New Roman;font-size:10pt;"No such adjustments related to DAC recoverability were made in 2010 or 2008./font/pp style='margin-top:0pt; margin- bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Deferred costs related to traditional life insurance contracts, substantially all of which relate to long-duration contracts, are amortized over the premium-paying period of the related policies in proportion to the ratio of individual period premium revenues to total anticipated premium revenues over the life of the policy. Such anticipated premium revenues are estimated using the same assumptions used for computing liabilities for future policy benefits. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Deferred costs related to interest-sensitive life and investment-type policies are amortized over the lives of the policies, in relation to the present value of estimated gross profits from mortality, investment income less interest credited, and expense margins./font/pp style='margin-top:0p t; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Other Reinsurance Balances/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company assumes and retrocedes financial reinsurance contracts that represent low mortality risk reinsurance treaties. These contracts are reported as deposits and are included in other reinsurance assets/liabilities. The amount of revenue reported in other revenues on these contracts represents fees and the cost of insurance under the terms of the reinsurance agreement. Balances resulting from the assumption and/or subsequent transfer of benefits and obligations resulting from cash flows related to variable annuities have also been classified as other reinsurance balance assets and/or liabilities. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Goodwill and Value of Business Acquired/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Goodwill and certain intangibles/fontfont style="font-family:Times New Roman;font-size:10pt;", reported in other assets,/fontfont style="font-family:Times New Roman;font-size:10pt;" are not amortized into results of operations, but instead are reviewed at least annually for impairment and written down and charged to results of operations only in the periods in which the recorded value of goodwill and certain intangibles is more/fontfont style="font-family:Times New Roman;font-size:10pt;" than its fair value. From 2008 through 2010/fontfont st yle="font-family:Times New Roman;font-size:10pt;", there were no changes to goodwill as a result of acquisitions or disposals. /fontfont style="font-family:Times New Roman;font-size:10pt;"Goodwill as of December 31, 2010 and 2009/fontfont style="font-family:Times New Roman;font-size:10pt;" totaled $7.0 million including accumulated amortization of $1.0 million, and was related to the purchase by the Company's U.S. operations of RGA Financial Group L.L.C. in 2000. The value of business acquired /fontfont style="font-family:Times New Roman;font-size:10pt;"(#8220;VOBA#8221;) /fontfont style="font-family:Times New Roman;font-size:10pt;"is amortized in proportion to the ratio of annual premium revenues to total anticipated premium revenues or in relation to the present value of estimated profits. Anticipated premium revenues have been estimated using assumptions consistent with those used in estimating reserves for future policy benef its. The carrying value is reviewed at least annually for indicators of impairment in value. The /fontfont style="font-family:Times New Roman;font-size:10pt;"VOBA/fontfont style="font-family:Times New Roman;font-size:10pt;" was approximately $/fontfont style="font-family:Times New Roman;font-size:10pt;"1.0/fontfont style="font-family:Times New Roman;font-size:10pt;" million and $1./fontfont style="font-family:Times New Roman;font-size:10pt;"3/fontfont style="font-family:Times New Roman;font-size:10pt;" million, including accumulated amortization of $/fontfont style="font-family:Times New Roman;font-size:10pt;"24.4/fontfont style="font-family:Times New Roman;font-size:10pt;" million and $/fontfont style="font-family:Times New Roman;font-size:10pt;"12.1/fontfont style="font-family:Times New Roman;font-size:10pt;" million, as of December 31, 20/fon tfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;" and 200/fontfont style="font-family:Times New Roman;font-size:10pt;"9/fontfont style="font-family:Times New Roman;font-size:10pt;", respectively. The /fontfont style="font-family:Times New Roman;font-size:10pt;"VOBA/fontfont style="font-family:Times New Roman;font-size:10pt;" amortization expense for the years ended December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;", 200/fontfont style="font-family:Times New Roman;font-size:10pt;"9/fontfont style="font-family:Times New Roman;font-size:10pt;" and 200/fontfont style="font-family:Times New Roman;font-size:10pt;"8/fontfont style="font-family:Times New Roman;font-size:10pt;" gt; was $/fontfont style="font-family:Times New Roman;font-size:10pt;"12.3/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $0.4 /fontfont style="font-family:Times New Roman;font-size:10pt;"million, and $0./fontfont style="font-family:Times New Roman;font-size:10pt;"4/fontfont style="font-family:Times New Roman;font-size:10pt;" million, respectively. /fontfont style="font-family:Times New Roman;font-size:10pt;"The increase in the VOBA amortization in 2010 is related to acquisition of /fontfont style="font-family:Times New Roman;font-size:10pt;"Reliastar/fontfont style="font-family:Times New Roman;font-size:10pt;" Life Insurance Company's U.S. and Canadian group life, accident and health reinsurance business/fontfont style="font-family:Times New Roman;font-size:10pt;", which was entirely amortized in 2010/fontfont style="font-family:T imes New Roman;font-size:10pt;". /fontfont style="font-family:Times New Roman;font-size:10pt;"These/fontfont style="font-family:Times New Roman;font-size:10pt;" amortized balances are included in other assets on the consolidated balance sheets. Amortization of the /fontfont style="font-family:Times New Roman;font-size:10pt;"VOBA/fontfont style="font-family:Times New Roman;font-size:10pt;" is estimated to be $/fontfont style="font-family:Times New Roman;font-size:10pt;"0.2/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-family:Times New Roman;font-size:10pt;"0.2/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-family:Times New Roman;font-size:10pt;"0.1/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-fam ily:Times New Roman;font-size:10pt;"0.1/fontfont style="font-family:Times New Roman;font-size:10pt;" million and $/fontfont style="font-family:Times New Roman;font-size:10pt;"0.1/fontfont style="font-family:Times New Roman;font-size:10pt;" million during 201/fontfont style="font-family:Times New Roman;font-size:10pt;"1/fontfont style="font-family:Times New Roman;font-size:10pt;", 201/fontfont style="font-family:Times New Roman;font-size:10pt;"2/fontfont style="font-family:Times New Roman;font-size:10pt;", 201/fontfont style="font-family:Times New Roman;font-size:10pt;"3/fontfont style="font-family:Times New Roman;font-size:10pt;", 201/fontfont style="font-family:Times New Roman;font-size:10pt;"4/fontfont style="font-family:Times New Roman;font-size:10pt;" and 201/fontfont style="font-family:Times New Roman;font-size:10p t;"5/fontfont style="font-family:Times New Roman;font-size:10pt;", respectively./fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Value of Distribution Agreements and Customer Relationships Acquired/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Value of distribution agreements (#8220;VODA#8221;) is reported in other assets and represents the present value of future profits associated with the expected future business derived from the distribution agreements. Value of customer relationships acquired (#8220;VOCRA#8221;) is also reported in other assets and represents the present value of the expected future profits associated with the expected future business acquired through existing customers of the acquired company or business. /fontfont style="font-family:Times New Roman;font-size:10pt;"The Company's VODA and VOCRA /fontfont style="font-family:Times New Roman;font-size:10pt;"are/fontfont style="font-family:Times New Roman;font-size:10pt;" related to the acquisition of /fontfont style="font-family:Times New Roman;font-size:10pt;"Reliastar/fontfont style="font-family:Times New Roman;font-size:10pt;" Life Insurance Company's U.S. and Canadian group life, accident and health reinsurance business in 2010./fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;"The VODA/fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;" is/fontfont style="font-family:Times New Roman;font-size:10pt;" amortized over a useful life of 15 years and/fontfont style="font-family:Times New Roman;font-size:10pt;" the VOCRA is also amortized over a 15 year period in proportion to expected revenues generated./fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;" S/fontfont style="font-family:Times New Roman;font-size:10pt;"uch amortization is included in policy acquisition costs and other insurance expenses. Each year the Company reviews VODA and VOCRA to determine the recoverability of these balances. /fontfont style="font-family:Times New Roman;font-size:10pt;"VODA and VOCRA /fontfont style="font-family:Times New Roman;font-size:10pt;"totaled/fontfont style="font-family:Times New Roman;font-size:10pt;" approximately $/fontfont style="font-fami ly:Times New Roman;font-size:10pt;"117.3/fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;"million, including accumulated amortization of $/fontfont style="font-family:Times New Roman;font-size:10pt;"3.4 /fontfont style="font-family:Times New Roman;font-size:10pt;"million, as of December 31, 2010. The VODA and VOCRA amortization expense for the year ended December 31, 2010 was $/fontfont style="font-family:Times New Roman;font-size:10pt;"3.4/fontfont style="font-family:Times New Roman;font-size:10pt;" million. Amortization of the VODA and VOCRA is estimated to be $/fontfont style="font-family:Times New Roman;font-size:10pt;"10.9/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-family:Times New Roman;font-size:10pt;"10.5/fontfont style= "font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-family:Times New Roman;font-size:10pt;"10.1/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $/fontfont style="font-family:Times New Roman;font-size:10pt;"9.5/fontfont style="font-family:Times New Roman;font-size:10pt;" million and $/fontfont style="font-family:Times New Roman;font-size:10pt;"9.4/fontfont style="font-family:Times New Roman;font-size:10pt;" million during 2011, 2012, 2013, 2014 and 2015, respectively. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Other Assets/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin- left:0px;"In addition to the goodwill/fontfont style="font-family:Times New Roman;font-size:10pt;",/fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;"VOBA, VODA and VOCRA/fontfont style="font-family:Times New Roman;font-size:10pt;" previously discussed, other assets primarily includes unamortized debt issuance costs, capitalized software, and other capitalized assets. Capitalized software is stated at cost, less accumulated amortization. Purchased software costs, as well as internal and external costs incurred to develop internal-use computer software during the application development stage, are capitalized. As of December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;" and 200/fontfont style="font-family:Times New Roman;font-size:10pt;"9 /fontfont style="font-family:Times New Roman;font-size:10pt;", the Company had unamortized computer software costs of approximately $/fontfont style="font-family:Times New Roman;font-size:10pt;"14.6/fontfont style="font-family:Times New Roman;font-size:10pt;" million and $13./fontfont style="font-family:Times New Roman;font-size:10pt;"1/fontfont style="font-family:Times New Roman;font-size:10pt;" million, respectively. During 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;", 200/fontfont style="font-family:Times New Roman;font-size:10pt;"9/fontfont style="font-family:Times New Roman;font-size:10pt;" and 200/fontfont style="font-family:Times New Roman;font-size:10pt;"8/fontfont style="font-family:Times New Roman;font-size:10pt;", the Company amortized compute r software costs of $/fontfont style="font-family:Times New Roman;font-size:10pt;"4.0/fontfont style="font-family:Times New Roman;font-size:10pt;" million, $3./fontfont style="font-family:Times New Roman;font-size:10pt;"5/fontfont style="font-family:Times New Roman;font-size:10pt;" million, and $/fontfont style="font-family:Times New Roman;font-size:10pt;"3/fontfont style="font-family:Times New Roman;font-size:10pt;".4 million, respectively. Amortization of software costs is recorded on a straight-line basis over periods ranging from three to ten years. Carrying values are reviewed periodically for indicators of impairment in value. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Future Policy Benefits and Interest-Sensitive Contract Liabilities/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Liabilities for future benefits on life policies are established in an amount adequate to meet the estimated future obligations on policies in force. Liabilities for future policy benefits under long-term life insurance policies have been computed based upon expected investment yields, mortality and withdrawal (lapse) rates, and other assumptions. These assumptions include a margin for adverse deviation and vary with the /fontfont style="font-family:Times New Roman;font-size:10pt;"characteristics of the plan of insurance, year of issue, age of insured, and other appropriate facto/fontfont style="font-family:Times New Roman;font-size:10pt;"rs. Interest rates range from 3/fontfont style="font-family:Times New Roman;font-size:10pt;".0% to 6.3%. The mortality and withdrawal ass umptions are based on the Company's experience as well as industry experience and standards. Liabilities for future benefits on interest-sensitive life and investment-type contract liabilities are carried at the accumulated contract holder values without reduction for potential surrender or withdrawal charges. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company periodically reviews actual and anticipated experience compared to the assumptions used to establish policy benefits. The Company establishes premium deficiency reserves if actual and anticipated experience indicates that existing policy liabilities together with the present value of future gross premiums will not be sufficient to cover the present value of future benefits, settlement and maintenance costs and to recover unamortized acquisition costs. The premium deficiency reserve is established by a charge to income, as well as a red uction in unamortized acquisition costs and, to the extent there are no unamortized acquisition costs, an increase in future policy benefits./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In establishing reserves for future policy benefits, the Company assigns policy liability/fontfont style="font-family:Times New Roman;font-size:10pt;" assumptions to particular time/fontfont style="font-family:Times New Roman;font-size:10pt;"frames (eras) in such a manner as to be consistent with the underlying assumptions and economic conditions at the time the risks are assumed. The Company maintains a consistent approach to setting the provision for adverse deviation between eras. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The reserving process includes normal periodic revi ews of assumptions used and adjustments of reserves to incorporate the refinement of the assumptions. Any such adjustments relate only to policies assumed in recent periods and the adjustments are reflected by a cumulative charge or credit to current operations. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company establishes future policy benefits for guaranteed minimum death benefits (#8220;GMDB#8221;) relating to the reinsurance of certain variable annuity contracts by estimating the expected value of death benefits in excess of the projected account balance and recognizing the excess proportionally over the accumulation period based on total expected assessments. The Company regularly evaluates estimates used and adjusts the additional liability balance, with a related charge or credit to claims and other policy benefits, if actual experience or other evidence suggests that earlie r assumptions should be revised. The assumptions used in estimating the GMDB liabilities are consistent with those used for amortizing DAC, and are thus subject to the same variability and risk. The Company's GMDB liabilities at /fontfont style="font-family:Times New Roman;font-size:10pt;"December 31, 2010/fontfont style="font-family:Times New Roman;font-size:10pt;" were not material. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company reinsures asset-intensive products, including annuities and corporate-owned life insurance. The investment portfolios for these products are segregated for management purposes within the general account of RGA Reinsurance. The liabilities under asset-intensive reinsurance contracts reinsured on a coinsurance basis are included in interest-sensitive contract liabilities on the consolidated balance sheets. /fontfont st yle="font-family:Times New Roman;font-size:10pt;"Investment-type contracts principally include traditional individual fixed annuities in the accumulation phase, equity-indexed annuities, non-variable group annuity contracts and individual variable annuity contracts. Interest-sensitive contract liabilities are equal to (i) policy account values, which consist of an accumulation of gross premium payments; (ii) credited interest less expenses, mortality charges, and withdrawals; and (iii) fair value adjustments relating to business combinations. Additionally, certain annuity contracts the Company reinsures contain terms, such as guaranteed minimum benefits and equity participation options, which are deemed to be embedded derivatives and are accounted for based on the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;"./font /pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company establishes liabilities for guaranteed minimum living benefits relating to certain variable annuity products as follows:/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Guaranteed minimum income benefits (#8220;GMIB#8221;) provide the contract holder, after a specified period of time determined at the time of issuance of the variable annuity contract, with a minimum level of income (annuity) payments. Under the reinsurance treaty, the Company makes a payment to the ceding company equal to the GMIB net amount-at-risk at the time of annuitization and thus these contracts meet the net settlement criteria of the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivativ es and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;" and the Company assumes no mortality risk. Accordingly, the GMIB is considered an embedded derivative, which is measured at fair value separately from the host variable annuity product./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Guaranteed minimum withdrawal benefits (#8220;GMWB#8221;) guarantee the contract holder a return of their purchase payment via partial withdrawals, even if the account value is reduced to zero, provided that the contract holder's cumulative withdrawals in a contract year do not exceed a certain limit. The initial guaranteed withdrawal amount is equal to the initial benefit base as defined in the contract (typically, the initial purchase payments plus applicable bonus amounts). The GMWB is also an embedded derivative, which is measured at fair value separately from the host variable annuity product./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Guaranteed minimum accumulation benefits (#8220;GMAB#8221;) provide the contract holder, after a specified period of time determined at the time of issuance of the variable annuity contract, with a minimum accumulation of their purchase payments even if the account value is reduced to zero. The initial guaranteed accumulation amount is equal to the initial benefit base as defined in the contract (typically, the initial purchase payments plus applicable bonus amounts). The GMAB is also an embedded derivative, which is measured at fair value separately from the host variable annuity product./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"For GMIB, GMWB and GMAB, the initial benefit base is increased by additional purch ase payments made within a certain time period and decreased by benefits paid and/or withdrawal amounts. After a specified period of time, the benefit base may also increase as a result of an optional reset as defined in the contract./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The fair values of the GMIB, GMWB and GMAB liabilities are reflected in interest-sensitive contract liabilities on the consolidated balance sheets and 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, such as lapses, withdrawals and benefit selections. In measuring the fair value of GMIBs, GMWBs and GMABs, the Company attributes a portion of the fees collected from the policyholder equal to the present value of expected future guarant eed minimum income, withdrawal and accumulation benefits (at inception). The changes in fair value are reported in investment related gains (losses), net. Any additional fees represent #8220;excess#8221; fees and are reported in other revenues on the consolidated statements of income. These variable annuity guaranteed living benefits may be more costly than expected in volatile or declining markets, causing an increase in interest-sensitive contract liabilities, negatively affecting net income./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company reinsures equity-indexed annuity contracts. These contracts allow the contract holder to elect an interest rate return or an equity market component where interest credited is based on the performance of common stock market indices, such as the Samp;P 500 Index#174;, the Dow Jones Industrial Average, or the NASDAQ. The equity marke t option is considered an embedded derivative, similar to a call option, which is reflected at fair value on the consolidated balance sheets in interest-sensitive contract liabilities. The fair value of embedded derivatives is computed based on a projection of future equity option costs using a budget methodology, discounted back to the balance sheet date using current market indicators of volatility and interest rates. Changes in the fair value of the embedded derivatives are included as a component of interest credited on the consolidated statements of income. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company periodically reviews its estimates of actuarial liabilities for interest-sensitive contract liabilities and compares them with its actual experience. Differences between actual experience and the assumptions used in pricing these guarantees and benefits and in the establishment of th e related liabilities result in variances in profit and could result in losses. The effects of changes in such estimated liabilities are included in the results of operations in the period in which the changes occur./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Other Policy Claims and Benefits/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Claims payable for incurred but not reported losses are determined using case-basis estimates and lag studies of past experience. The time lag from the date of the claim or death to when the ceding company reports the claim to the Company can vary significantly by ceding company and business segment, b/fontfont style="font-family:Times New Roman;font-size :10pt;"ut generally averages around 2./fontfont style="font-family:Times New Roman;font-size:10pt;"9/fontfont style="font-family:Times New Roman;font-size:10pt;" months. The Company updates its analysis of incurred but not reported, including lag studies, on a quarterly basis and adjusts its claim liabilities accordingly./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Other Liabilities/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Other liabilities primarily includes investments in transit, separate accounts, employee benefits, current federal income taxes payable, and payables related to repurchase agreements. The Company utilizes sales of investment securities with agreements to repurchase the same securities for purposes of short-term financi ng. The repurchase obligation is a component of other liabilities. /fontfont style="font-family:Times New Roman;font-size:10pt;"There were no securities subject to these agreements outstanding at /fontfont style="font-family:Times New Roman;font-size:10pt;"December 31, 2010/fontfont style="font-family:Times New Roman;font-size:10pt;" or /fontfont style="font-family:Times New Roman;font-size:10pt;"2009/fontfont style="font-family:Times New Roman;font-size:10pt;". /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Income Taxes /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"RGA and its eligible subsidiaries file a consolidated federal income tax return. The /fontfont style="font-family:Times Ne w Roman;font-size:10pt;"U.S./fontfont style="font-family:Times New Roman;font-size:10pt;" consolidated tax return includes the operations of RGA, RGA Americas, RGA Reinsurance, RGA Barbados, RGA Technology Partners, Inc., RCM, Timberlake Financial L.L.C. (#8220;Timberlake Financial#8221;), Timberlake Reinsurance Company II (#8220;Timberlake Re#8221;), Reinsurance Partners, Inc., RGA Worldwide Reinsurance Company, Ltd. (#8220;RGA World/fontfont style="font-family:Times New Roman;font-size:10pt;"wide") /fontfont style="font-family:Times New Roman;font-size:10pt;"and Parkway Reinsurance Company ("Parkwa/fontfont style="font-family:Times New Roman;font-size:10pt;"y Re"). The Company's/fontfont style="font-family:Times New Roman;font-size:10pt;" Australian, certain Barbadian, Bermudian, Canadian, South Afri/fontfont style="font-family:Times New Roman;font-size:10pt;"can, Indian, Irish /fontfont style="font-family:Times New Roman;font-size:10pt;"and United Kingdom subsidiaries are taxed under applicable local statutes. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company provides for federal, state and foreign income taxes currently payable, as well as those deferred due to temporary differences between the financial reporting and tax bases of assets and liabilities. The Company's accounting for income taxes represents management's best estimate of various events and transactions./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Deferred tax assets and liabilities resulting from temporary differences between the financial reporting and tax bases of assets and liabilities are measured at the balance sheet date using enacted tax rates expected to apply to taxable i ncome in the years the temporary differences are expected to reverse. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The realization of deferred tax assets depends upon the existence of sufficient taxable income within the carryback or carryforward periods under the tax law in the applicable tax jurisdiction. The Company has significant deferred tax assets related to net operating and capital losses. Most of the Company's exposure related to its deferred tax assets are within legal entities that file a consolidated U.S. federal income tax return. The Company has projected its ability to utilize its /fontfont style="font-family:Times New Roman;font-size:10pt;"U.S. /fontfont style="font-family:Times New Roman;font-size:10pt;"net operating losses and has determined that all of these losses are expected to be utilized prior to their expiration. The Company has also done extensive analysis of its capital losses and has determined that sufficient unrealized capital gains exist within its investment portfolios that should offset any capital loss realized. It is also the Company's intention to hold all unrealized loss securities until maturity or until their market value recovers. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company will establish a valuation allowance when management determines, based on available information, that it is more likely than not that deferred income tax assets will not be realized. Significant judgment is required in determining whether valuation allowances should be established as well as the amount of such allowances. When making such determination, consideration is given to, among other things, the following:/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-s ize:10pt;margin-left:0px;"(i)#160;#160;#160;#160;#160;#160;#160;future taxable income exclusive of reversing temporary differences and carryforwards;/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"(ii)#160;#160;#160;#160;#160;#160;#160;future reversals of existing taxable temporary differences;/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"(iii)#160;#160;#160;#160;#160;#160;#160;taxable income in prior carryback years; and /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"(iv)#160;#160;#160;#160;#160;#160;#160;tax planning strategies. /font/p t;p style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company may be required to change its provision for income taxes in certain circumstances. Examples of such circumstances include when the ultimate deductibility of certain items/fontfont style="font-family:Times New Roman;font-size:10pt;" for which there is no tax reserve/fontfont style="font-family:Times New Roman;font-size:10pt;" is challenged by taxing authorities, when /fontfont style="font-family:Times New Roman;font-size:10pt;"previous positions for which the Company reserved are effectively settled/fontfont style="font-family:Times New Roman;font-size:10pt;" when estimates used in determining valuation allowances on deferred tax assets significantly change or when receipt of new information indicates the need for adjustment in valuation allowances. Additionally, future events such as changes in tax le gislation could have an impact on the provision for income tax and the effective tax rate. Any such changes could significantly affect the amounts reported in the consolidated financial statements in the year these changes occur./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company classifies interest recognized as interest expense and penalties recognized as a component of income tax./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Collateral Finance Facility/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Collateral finance facility represents notes issued to fund collateral requirements for statutory reserves on specified term life insurance policies reinsured by RGA Rein surance. The cost of the facility is reflected in collateral finance facility expense. See Note 16 - "Collateral Finance Facility" for additional information. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Company-Obligated Mandatorily Redeemable Preferred Securities of Subsidiary Trust Holding Solely Junior Subordinated Debentures of the Company/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"During December 2001, RGA Capital Trust I (the "Trust"), a wholly-owned subsidiary of RGA, sold Preferred Income Equity Redeemable Securities (#8220;PIERS#8221;) Units. Each unit consists of a preferred security (#8220;Preferred Securities#8221;) issued by the Trust with a detachable warrant t o purchase 1.2508 shares of RGA common stock. The Trust sold 4.5 million PIERS units. The fair value of the Preferred Securities on the date issued, $158.1 million, was recorded in liabilities on the consolidated balance sheets under the caption "Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely junior subordinated debentures#8221;. The coupon rate of the Preferred Securities is 5.75% on a face amount of $225.0 million. /fontfont style="font-family:Times New Roman;font-size:10pt;" See Note 23 #8211; #8220;Subsequent Events#8221; for additional information./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Warrants/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The fair value of the detachable warrants on the date the PIERS units were issued is recorded in stockholders' equity on the consolidated balance sheets under the caption "Warrants#8221;. In the aggregate as of /fontfont style="font-family:Times New Roman;font-size:10pt;"December 31, 2010/fontfont style="font-family:Times New Roman;font-size:10pt;", 4.5 million warrants to purchase approximately 5.6 million shares of Company common stock at a price per share of $39.98 were outstanding. If on any date after December 18, 2004, the closing price of RGA common stock exceeds and has exceeded a price per share equal to $47.97 for at least 20 trading days within the immediately preceding 30 consecutive trading days, the Company may redeem the warrants in whole for cash, RGA common stock, or a combination of cash and RGA common stock./fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;" See Note 23 #8211; #82 20;Subsequent Events#8221; for additional information./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Foreign Currency Translation/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The translation of the foreign currency into U.S. dollars is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for revenue and expense accounts using a weighted-average exchange rate during each year. Gains or losses, net of applicable deferred income taxes, resulting from such translation are included in accumulated currency translation adjustments, in AOCI on the consolidated balance sheets until the underlying subsidiary is sold or substantially liquidated. The Compa ny's material functional currencies are the Canadian dollar, the British pound, the Australian dollar, the/fontfont style="font-family:Times New Roman;font-size:10pt;" Japanese yen, the Korean won, E/fontfont style="font-family:Times New Roman;font-size:10pt;"uros and the South African rand. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Retrocession Arrangements and Reinsurance Ceded Receivables/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company generally reports retrocession activity on a gross basis. Amounts paid or deemed to have been paid for reinsurance are reflected in reinsurance ceded receivables. The cost of reinsurance related to long-duration contract s is recognized over the terms of the reinsured policies on a basis consistent with the reporting of those policies./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In the normal course of business, the Company seeks to limit its exposure to loss on any single insured and to recover a portion of benefits paid by ceding reinsurance to other insurance enterprises or reinsurers under excess coverage and coinsurance contracts/fontfont style="font-family:Times New Roman;font-size:10pt;". In the individual life markets/fontfont style="font-family:Times New Roman;font-size:10pt;", the Company/fontfont style="font-family:Times New Roman;font-size:10pt;" retains a /fontfont style="font-family:Times New Roman;font-size:10pt;"maximum of /fontfont style="font-family:Times New Roman;font-size:10pt;"$8.0 million of /fontfont st yle="font-family:Times New Roman;font-size:10pt;"coverage per /fontfont style="font-family:Times New Roman;font-size:10pt;"individual /fontfont style="font-family:Times New Roman;font-size:10pt;"life. Claims in excess of this retention amount are retroceded to retrocessionaires; however, the Company remains fully liable to the ceding company for the ent/fontfont style="font-family:Times New Roman;font-size:10pt;"ire amount of risk it assumes. /fontfont style="font-family:Times New Roman;font-size:10pt;"In certain limited situations, due to the acquisition of in force blocks of business, the Company has retained more than $8.0 million per individual policy. /fontfont style="font-family:Times New Roman;font-size:10pt;"In total, the Company has identified /fontfont style="font-family:Times New Roman;font-size:10pt;"17/fontfont style="font-family:Times New Roman;font-size:10pt;" such cases of ov er-retained /fontfont style="font-family:Times New Roman;font-size:10pt;"lives, for a total amount of $/fontfont style="font-family:Times New Roman;font-size:10pt;"54.9/fontfont style="font-family:Times New Roman;font-size:10pt;" million over the Company's normal retention l/fontfont style="font-family:Times New Roman;font-size:10pt;"imit. These amounts include 8 cases with $36.3/fontfont style="font-family:Times New Roman;font-size:10pt;" million of exposure related to second to die policies with coverages split between multiple insureds. The largest amount in excess of the Company's r/fontfont style="font-family:Times New Roman;font-size:10pt;"etention on any one life is $19.5/fontfont style="font-family:Times New Roman;font-size:10pt;" million. The Company enters into agreements with other reinsurers to mitigate the residual risk related to the over-retained policies. Additionally, due to so me lower face amount reinsurance coverages provided by the Company in addition to individual life, such as group life, disability and health, under certain circumstances, the Company could potentially incur claims totaling more than $8.0 million per individual life. /fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Retrocessions are arranged through the Company's retrocession pools for amounts in excess of the Company's retention limit. As of December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;", all rated retrocession pool participants followed by the A.M. Best Company were rated #8220;A-/fontfont style="font-family:Times New Roman;font-size:10pt;" (excellent)/fontfont style="fo nt-family:Times New Roman;font-size:10pt;"#8221; or better. /fontfont style="font-family:Times New Roman;font-size:10pt;"The Company verifies retrocession pool participants' ratings on a quarterly basis. /fontfont style="font-family:Times New Roman;font-size:10pt;"For a majority of the retrocessionaires that were not rated, security in the form of letters of credit or trust assets has been given as additional security in favor of RGA Reinsurance. In addition, the Company performs annual financial reviews of its retrocessionaires to evaluate financial stability and performance. In addition to its third party retrocessionaires, various RGA reinsurance subsidiaries retrocede amounts in excess of their retention to RGA Reinsurance, RGA Barbados, RGA Americas, /fontfont style="font-family:Times New Roman;font-size:10pt;"Manor Reinsurance, Ltd. (#8220;/fontfont style="font-family:Times New Roman;font-size:10pt;"Manor Re/font lt;font style="font-family:Times New Roman;font-size:10pt;"#8221;)/fontfont style="font-family:Times New Roman;font-size:10pt;", /fontfont style="font-family:Times New Roman;font-size:10pt;"RGA Worldwide or RGA Atlantic. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"As of December 31, 2010, the Company had claims recoverable due from retrocessionaires of $/fontfont style="font-family:Times New Roman;font-size:10pt;"162.4/fontfont style="font-family:Times New Roman;font-size:10pt;" million, which is included in reinsurance ceded receivables, in the consolidated balance sheets. The Company considers outstanding claims recoverable in excess of 90 days to be past due. /fontfont style="font-family:Times New Roman;font-size:10pt;"There was $16.0/fontfont style="font-family:Times New Roman;font-size:10pt;" gt; million of past due claims recoverable as of December 31, 2010/fontfont style="font-family:Times New Roman;font-size:10pt;". /fontfont style="font-family:Times New Roman;font-size:10pt;"Based on the Company' s annual financial reviews noted in the paragraph above, the/fontfont style="font-family:Times New Roman;font-size:10pt;" Company has /fontfont style="font-family:Times New Roman;font-size:10pt;"not established a valuation allowance /fontfont style="font-family:Times New Roman;font-size:10pt;"for claims recoverable from retrocessionaires. The Company/fontfont style="font-family:Times New Roman;font-size:10pt;" has /fontfont style="font-family:Times New Roman;font-size:10pt;"never experienced a material default in connection with retrocession arrangements, nor has it experienced any difficulty in collecting claims recoverable from retrocessionaires; however, no assurance can be given as to the future performance of such retrocessionaires or as to recoverability of any such claims./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Recognition of Revenues and Related Expenses/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Life and health premiums are recognized as revenue when due from the insured, and are reported net of amounts retroceded. Benefits and expenses are reported net of amounts retroceded and are associated with earned premiums so that profits are recognized over the life of the related contract. This association is accomplished through the provision for future policy benefits and the amortization of deferred policy acquisition costs. Other revenue includes items such as treaty r ecapture fees, fees associated with financial reinsurance and policy changes on interest-sensitive and investment-type products that the Company reinsures. Any fees that are collected in advance of the period benefited are deferred and recognized over the period benefited. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"For certain reinsurance transactions involving in force blocks of business, the ceding company pays a premium equal to the initial required reserve (future policy benefit). In such transactions, for income statement presentation, the Company nets the expense associated with the establishment of the reserve on the consolidated balance sheet against the premiums from the transaction./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Revenues for interest-sensitive and investment-type p roducts consist of investment income, policy charges for the cost of insurance, policy administration, and surrenders that have been assessed against policy account balances during the period. Interest-sensitive contract liabilities for these products represent policy account balances before applicable surrender charges. Deferred policy acquisition costs are recognized as expenses over the term of the policies. Policy benefits and claims that are charged to expenses include claims incurred in the period in excess of related policy account balances and interest credited to policy account balances. /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The following table presents the weighted average interest-crediting rates and minimum guaranteed rate ranges for contracts containing guaranteed rates by major class of interest-sensitive product /fontfont style="font-family:Times New Roman;font-size: 10pt;"as of December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;"./font/pp style='margin-top: 0pt; margin-bottom: 0pt;'/pdivtable style="border-collapse:collapse;margin-top:20px;"tr style="height: 26px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="TEXT-DECORATION: underline;FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Interest sensitive contract liability/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 127px; border-bottom-style:solid;border-bottom-width:1px;text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"Current weighted-average interest crediting rate/font/tdtd style="width: 12px; text-align:center;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; border-bottom-style:solid;border-bottom-width:1px;text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"Minimum guaranteed rate ranges/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/trtr style="height: 15px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Traditional individual fixed annuities/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 127px; border-top-style:solid;border-top-widt h:1px;text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"3.79%/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; border-top-style:solid;border-top-width:1px;text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"2.50 #8211; 4.50%/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/trtr style="height: 15px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Equity-indexed annuities/font/tdtd style="width: 12px; text-align:left;border-color:# 000000;min-width:12px;"#160;/tdtd style="width: 127px; text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"3.69%/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"1.00 #8211; 3.00%/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/trtr style="height: 15px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Individual variable annuity contracts/font/tdtd style="wi dth: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 127px; text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"5.12%/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"1.50 #8211; 5.71%/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/trtr style="height: 15px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Guaranteed investment contracts/fo nt/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 127px; text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"3.79%/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"0.00 #8211; 4.50%/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/trtr style="height: 15px"td style="width: 275px; text-align:left;border-color:#000000;min-width:275px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: left;"Uni versal life #8211; type policies/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 127px; text-align:center;border-color:#000000;min-width:127px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"5.00%/font/tdtd style="width: 12px; text-align:left;border-color:#000000;min-width:12px;"#160;/tdtd style="width: 189px; text-align:center;border-color:#000000;min-width:189px;"font style="FONT-FAMILY: Times New Roman;FONT-SIZE: 8pt;COLOR: #000000;TEXT-ALIGN: center;"3.00 #8211; 6.00%/font/tdtd style="width: 55px; text-align:center;border-color:#000000;min-width:55px;"#160;/td/tr/table/divp style='margin-top: 0pt; margin-bottom: 0pt;'/pp style='margin-top:12pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The spread profits on the Company's fixed annuity and interest-sensitive whole life, universal life (#8220;UL#8221;) and fixed portion of variable universal life (#8220;VUL#8221;) insurance policies are at risk if interest rates decline and remain relatively low for a period of time, which has generally been the case in recent years. Should interest rates remain at current levels that are significantly lower than those existing prior to the declines of recent years, the average earned rate of return on the Company's annuity and UL investment portfolios will continue to decline. Declining portfolio yields may cause the spreads between investment portfolio yields and the interest rate credited to contract holders to deteriorate as the Company's ability to manage spreads can become limited by minimum guaranteed rates on annuity and UL policies. Minimum guaranteed rates on non-variable annuity and UL policies generally range from /font ;font style="font-family:Times New Roman;font-size:10pt;"1/fontfont style="font-family:Times New Roman;font-size:10pt;".0% to 6.0%, with an average guaranteed rate of approximately /fontfont style="font-family:Times New Roman;font-size:10pt;"2.8/fontfont style="font-family:Times New Roman;font-size:10pt;"%/fontfont style="font-family:Times New Roman;font-size:10pt;". /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company manages interest rate spreads for near term income through a combination of crediting rate actions and portfolio management. Certain annuity products contain crediting rates that reset annually, of which /fontfont style="font-family:Times New Roman;font-size:10pt;"$/fontfont style="font-family:Times New Roman;font-size:10pt;"860.4/fontfont style="font-family:Times New Rom an;font-size:10pt;" million of account balances are not subject to surrender charges, with /fontfont style="font-family:Times New Roman;font-size:10pt;"76.1/fontfont style="font-family:Times New Roman;font-size:10pt;"%/fontfont style="font-family:Times New Roman;font-size:10pt;" of these already at their minimum guaranteed rates as of December 31, 20/fontfont style="font-family:Times New Roman;font-size:10pt;"10/fontfont style="font-family:Times New Roman;font-size:10pt;". As such, certain management monitoring processes are designed to minimize the effect of sudden and/or sustained changes in interest rates on fair value, cash flows, and net interest income. The Company manages its exposure to interest rates principally by matching floating rate liabilities with corresponding floating rate assets and by matching fixed rate liabilities with corresponding fixed rate assets. On a limited basis, the Company may use equity opt ions or other derivatives to minimize its exposure to movements in equity markets that have a direct correlation with certain of its reinsurance products./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Investment income is recognized as it accrues or is legally due. Realized gains and losses on sales of investments are included in investment related gains (losses), net, as are credit impairments that are other-than-temporary in nature. The cost/fontfont style="font-family:Times New Roman;font-size:10pt;"s/fontfont style="font-family:Times New Roman;font-size:10pt;" of investments sold is /fontfont style="font-family:Times New Roman;font-size:10pt;"primarily /fontfont style="font-family:Times New Roman;font-size:10pt;"determined based upon the specific identification method./font/pp style='margin-top:0pt; margin-bottom:6 pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Net Earnings Per Share/font/pp style='margin-top:0pt; margin-bottom:0pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Basic earnings per share exclude any dilutive effects of any outstanding options, warrants or units. Diluted earnings per share include the dilutive effects assuming outstanding stock options, warrants or units were exercised. /font/pp style='margin-top: 0pt; margin-bottom: 0pt;'/pp style='margin-top:12pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"New Accounting Pronouncements /font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"Changes to the general accounting principles are established by the Financial Accounting Stan dards Board (#8220;FASB#8221;) in the form of accounting standards updates to the FASB Accounting Standards Codification#8482;.#160;Accounting standards updates not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company's consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Consolidation and Business Combinations/font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In December 2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Business Combinations/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to the disclosure of supplement ary pro forma information for business combinations. The amendment requires the disclosure of pro forma information for business combinations that occurred in the current reporting period. The disclosures include pro forma revenue and earnings of the combined entity for the current reporting period as though the acquisition date for all business combinations that occurred during the year had been as of the beginning of the annual reporting period. This amendment also explains that if comparative financial statements are presented, the pro forma revenue and earnings of the combined entity for the comparable prior reporting period should be reported as though the acquisition date for all business combinations that occurred during the current year had been as of the beginning of the comparable prior annual reporting period. The amendment is effective for fiscal years and interim periods beginning on or after December 15, 2010. The adoption of this amendment is not expected to have an impact on the Company's consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In February 2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Consolidation/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to the assessment of a variable interest entity for potential consolidation. The amendment defers the effective date of the /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Consolidation/fontfont style="font-family:Times New Roman;font-size:10pt;" amendment made in June 2009 for certain variable interest entities. This update also clarifies how a related party's interest should be considered when evaluating variable interests. The amendment is effective for fiscal years and interim periods be ginning after January 31, 2010. The adoption of this amendment did not have an impact on the Company's consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In January#160;2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Consolidation /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to decreases in ownership of a subsidiary. This amendment clarifies the scope of the decrease in ownership provisions. This amendment also requires additional disclosures about the deconsolidation of a subsidiary or derecognition of a group of assets. The amendment is effective for fiscal years and interim periods beginning after December#160;15, 2009. The adoption of this amendment did not have an impact on the Company's consolidated finan cial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In June#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Consolidation /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the assessment of a variable interest entity for potential consolidation. This amendment also requires additional disclosures to provide transparent information regarding the involvement in a variable interest entity. The amendment is effective for fiscal years and interim periods beginning after November 15, 2009. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margi n-left:0px;"In December#160;2007, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Business Combinations/fontfont style="font-family:Times New Roman;font-size:10pt;". This amendment establishes principles and requirements for how an acquirer recognizes and measures certain items in a business combination, as well as disclosures about the nature and financial effects of a business combination. The FASB also amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Consolidation /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to noncontrolling interests in consolidated financial statements. This amendment establishes accounting and reporting standards surrounding noncontrolling interest, or minority interests, which are the portions of equity in a subsidiary not attributable, directly or indirectly, to a parent. The amendments are effective for fiscal years beginning on or after December#160;15, 2008 and apply prospectively to business combinations. Presentation and disclosure requirements related to noncontrolling interests must be retrospectively applied. The adoption of these amendments did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Investments/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:0pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In July#160;2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Receivables /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the disclosures about the credit quality of financing receivables and the allowance for credit losses. This amendment requires additional disclosures that provide a greater level of disaggregated information about the credit quality of financing receivables and the allowance for credit losses. It also requires the disclosure of credit quality indicators, past due information, and modifications of financing receivables. The amendment is effective for interim and annual reporting periods ending on or after December 15, 2010, except for disclosures about activity that occurs during the reporting period. Those disclosures are effective for interim and annual reporting periods beginning after December 15, 2010. The Company adopted the effective portions of this amendment in the fourth quarter of 2010 and is evaluating the impact of the disclosures about activity that occurs during the reporting period. The required discl osures are provided in Note 4 #8212;/fontfont style="font-family:Times New Roman;font-size:10pt;" #8220;Investments#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;"./font/pp style='margin-top:0pt; margin-bottom:0pt'#160;/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In April#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Investments /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the recognition and presentation of other-than-temporary impairments. This amendment updates the other-than-temporary impairment guidance for fixed maturity securities to make it more operational and to improve the presentation and disclosure of other-than-temporary impairments (#8 220;OTTI#8221;) on fixed maturity and equity securities in the financial statements. The recognition provisions apply only to fixed maturity securities classified as available-for-sale and held-to-maturity, while the presentation and disclosure requirements apply to both fixed maturity and equity securities. An impaired fixed maturity security will be considered other-than-temporarily impaired if the Company has the intent to sell or it more likely than not will be required to sell prior to recovery of the amortized cost. If the holder of a fixed maturity security does not expect recovery of the entire cost basis, even if there is no intention to sell the security, an OTTI has occurred. This amendment also changes how an entity recognizes an OTTI for a fixed maturity security by separating the loss between the amount representing the credit loss and the amount relating to other factors, if the Company does not have the intent to sell or it more likely than not will not be required to sell prior to recov ery of the amortized cost less any current period credit loss. Credit losses will be recognized in net income and losses relating to other factors will be recognized in accumulated other comprehensive income (#8220;AOCI#8221;). If the Company has the intent to sell or it more likely than not will be required to sell before its recovery of amortized cost less any current period credit loss, the entire OTTI will be recognized in net income. This amendment is effective for interim and annual reporting periods ending after June#160;15, 2009. The adoption of this amendment resulted in a net after-tax increase to retained earnings and a decrease to accumulated other comprehensive income of $4.4#160;million, as of April#160;1, 2009. The required disclosures are provided in Note 4 #8212;/fontfont style="font-family:Times New Roman;font-size:10pt;" #8220;Investments#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;". /font /pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Transfers and Servicing/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In June#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Transfers and Servicing/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to the transfers of financial assets. This amendment also requires additional disclosures to address concerns regarding the transparency of transfers of financial assets. The amendment is effective for fiscal years and interim periods beginning after November#160;15, 2009. The adoption of this amendment did not h ave a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In February#160;2008, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Transfers and Servicing /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the accounting for transfers of financial assets and repurchase financing transactions. This amendment provides guidance for evaluating whether to account for a transfer of a financial asset and repurchase financing as a single transaction or as two separate transactions. The amendment is effective prospectively for financial statements issued for fiscal years beginning after November#160;15, 2008. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In March 2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to embedded derivatives.#160; This amendment clarifies the scope exception for embedded credit derivative features related to the transfer of credit risk in the form of subordination of a financial instrument to another.#160; The amendment is effective for financial statements issu ed for fiscal years and interim periods beginning after June 15, 2010.#160; The adoption of this amendment did not have a material impact on the Company's consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In March#160;2008, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Derivatives and Hedging/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to the disclosures about derivative instruments and hedging activities. This amendment requires enhanced qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. The amendmen t is effective for financial statements issued for fiscal years and interim periods beginning after November#160;15, 2008. The Company adopted this amendment in the first quarter of 2009. The required disclosures are provided in Note 5 #8212; #8220;Derivativ/fontfont style="font-family:Times New Roman;font-size:10pt;"e Instruments#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;". /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Fair Value Measurements and Disclosures/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In January#160;2010, the FASB amended the general accounting principles for /fontfont style="font-family:Tim es New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the disclosures about fair value measurements. This amendment requires new disclosures about the transfers in and out of Level 1 and 2 measurements and also enhances disclosures about the activity within the Level 3 measurements. It also clarifies the required level of disaggregation and the disclosures regarding valuation techniques and inputs to fair value measurements. The amendment is effective for interim and annual reporting periods beginning after December#160;15, 2009, except for the enhanced Level 3 disclosures. Those disclosures are effective for interim and annual reporting periods beginning after December#160;15, 2010. The Company adopted the effective portions of this amendment in the first quarter of 2010 and is evaluating the impact of the enhanced Level 3 disclosures. The required disclosures are prov ided in Note 6 #8212; #8220;Fair Value of Financia/fontfont style="font-family:Times New Roman;font-size:10pt;"l Instruments#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;". /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In September#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the fair value measurement of investments in certain entities that calculate net asset value per share. This amendment allows the fair value of certain investments to be measured on the basis of the net asset value. It also requires disclosure, by major category type, of the attributes of those investments, such as the nature of any restrictions on redemption, any unfunded commitments, and the investment strategies of the investees. The amendment is effective for interim and annual reporting periods ending after December#160;15, 2009. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In August#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to measuring liabilities at fair value. This amendment provides guidance for measuring liabilities at fair value when a quoted price in an active market for the identical liability is not available. It also clarifies t hat the inclusion of a separate input, used in the fair value measurement, relating to the existence of a restriction that prevents the transfer of a liability is not necessary. The amendment is effective for interim and annual reporting beginning after issuance. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In April#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to determining fair value when the volume and level of activity for asset or liability have significantly decreased and identifying transactions that are not orderly. This amendment pro vides additional guidance for estimating fair value when the volume and level of activity for the asset or liability have significantly decreased in relation to normal market activity for the asset or liability and clarifies that the use of multiple valuation techniques may be appropriate. It also provides additional guidance on circumstances that may indicate a transaction is not orderly. Further, it requires additional disclosures about fair value measurements in annual and interim reporting periods. This amendment is effective prospectively for interim and annual reporting periods ending after June#160;15, 2009. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. The required disclosures are provided in Note 6 #8212; #8220;Fair Value of Financia/fontfont style="font-family:Times New Roman;font-size:10pt;"l Instruments#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;". /fon t/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In October#160;2008, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Fair Value Measurements and Disclosures /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to determining the fair value of a financial asset when the market for that asset is not active. This amendment clarifies the application of fair value in a market that is not active and provides an example to illustrate key considerations in determining the fair value of a financial asset when the market for that financial asset is not active. The amendment was effective upon issuance on October#160;10, 2008, including prior periods for which financial statements had not been issued. The Company did not consider it necessary to change any valuation techniqu es as a result of the amendment. The Company also adopted an amendment that delayed the effective date of fair value measurement for certain nonfinancial assets and liabilities that are recorded at fair value on a nonrecurring basis. The effective date was delayed until January#160;1, 2009 and impacts balance sheet items including nonfinancial assets and liabilities in a business combination and the impairment testing of goodwill and long-lived assets. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Deferred Policy Acquisition Costs/font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In October#160;2010, the FASB amended the general accounting principles for / fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Financial Services #8211; Insurance /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to accounting for costs associated with acquiring or renewing insurance contracts. This amendment clarifies that only those costs that result directly from and are essential to the contract transaction and that would not have been incurred had the contract transaction not occurred can be capitalized. It also defines acquisitions costs as costs that are related directly to the successful acquisitions of new or renewal insurance contracts. The amendment is effective for fiscal years and interim periods beginning after December 15, 2011. The Company is currently evaluating the impact of this amendment on its consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;ma rgin-left:0px;"Compensation/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In April 2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Compensation/fontfont style="font-family:Times New Roman;font-size:10pt;" as it relates to stock compensation. This amendment clarifies that an employee share-based payment award with an exercise price denominated in the currency of a market in which a substantial portion of the entity's equity securities trades should not be considered to contain a condition that is not a market, performance, or service condition. Therefore, such an award should not be classified as a liability if it otherwise qualifies as equity. /fontfont style="font-family:Times New Roman; font-size:10pt;"The amendment is effective for fiscal years and interim periods beginning after December 15, 2010. The adoption of this amendment is not expected to have an impact on the Company's consolidated financial statements./font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In December#160;2008, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Compensation /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to employers disclosures about postretirement benefit plan assets. This amendment provides guidance for disclosure of the types of assets and associated risks in retirement plans. The new disclosures are designed to provide additional insight into the major categories of plan assets, the inputs and valuation techniques used to measure the fair value of plan assets, the effect of fair value measurements using significant unobservable inputs on changes in plan assets for the period, significant concentrations of risk within plan assets and how investment decisions are made, including factors necessary to understanding investment policies and strategies. The disclosures about plan assets required by this amendment is effective for financial statements with fiscal years ending after December#160;15, 2009. The adoption of this amendment did not have a material impact on the Company's consolidated financial statements./fontfont style="font-family:Times New Roman;font-size:10pt;" The required disclosures are provided in Note /fontfont style="font-family:Times New Roman;font-size:10pt;"10 /fontfont style="font-family:Times New Roman;font-size:10pt;"#8212; #8220;/fontfont style="font-family:Times New Roman;font-size:10pt;"Employee Benefit Plans/fontfont style="font-family: Times New Roman;font-size:10pt;"#8221;/fontfont style="font-family:Times New Roman;font-size:10pt;"./font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Debt/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In October#160;2009, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Debt /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to the accounting for own-share lending arrangements entered into in contemplation of a convertible debt issuance or other financing. This amendment provides accounting and disclosure guidance for own-share lending a rrangements issued in contemplation of convertible debt issuance. The amendment is effective for fiscal years and interim periods beginning after December#160;15, 2009. The adoption of this amendment did not have an impact on the Company's consolidated financial statements. /font/pp style='margin-top:0pt; margin-bottom:10pt'font style="font-family:Times New Roman;font-size:10pt;font-style:italic;margin-left:0px;"Equity/fontfont style="font-family:Times New Roman;font-size:10pt;" /font/pp style='margin-top:0pt; margin-bottom:0pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"In January#160;2010, the FASB amended the general accounting principles for /fontfont style="font-family:Times New Roman;font-size:10pt;font-style:italic;"Equity /fontfont style="font-family:Times New Roman;font-size:10pt;"as it relates to distributions to shareholders with components of stock and cash. This amendment clarifies that the stock portion of a distribution to shareholders, which allows them to elect to receive cash or stock with a limitation on the total amount of cash that shareholders can receive, is considered a share issuance that is reflected in earnings per share prospectively and is not a stock dividend. The amendment is effective for fiscal years and interim periods beginning after December#160;15, 2009. The adoption of this amendment did not have an impact on the Company's consolidated financial statements. /font/pp style='margin-top: 0pt; margin-bottom: 0pt;'/pp style='margin-top:12pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;font-weight:bold;margin-left:0px;"Reclassification/font/pp style='margin-top:0pt; margin-bottom:6pt'font style="font-family:Times New Roman;font-size:10pt;margin-left:0px;"The Company has reclassified the presentation of certain prior peri od in/fontfont style="font-family:Times New Roman;font-size:10pt;"formation to conform to the 2010/fontfont style="font-family:Times New Roman;font-size:10pt;" presentation./fontfont style="font-family:Times New Roman;font-size:10pt;" /fontfont style="font-family:Times New Roman;font-size:10pt;" Such reclassifications include combining #8220;U.S. corporate securities#8221; and #8220;Foreign corporate securities#8221; and display them as #8220;Corporate securities#8221; in the Company's investment and fair values disclosures. In addition, the consolidated statements of cash flows have been revised to separately disclose the deposits and the withdrawals on universal life and other investment type policies and contracts./font/pp style='margin-top:0pt; margin-bottom:6pt'#160;/p