As filed with the Securities and Exchange Commission on June 28, 1996.
Reg. No. 33-52667
_______________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the Fiscal Year ended December 31, 1995
LINCOLN NATIONAL CORPORATION
EMPLOYEES' SAVINGS AND PROFIT-SHARING PLAN
(Full title of Plan)
[Current Reg. No. 33-52667]
LINCOLN NATIONAL CORPORATION
200 East Berry Street
Fort Wayne, Indiana 46802
(Name of Issuer and Principal Executive Office)
FORM 11-K
LNC Employees' Savings and Profit-Sharing Plan
<PAGE>
TABLE OF CONTENTS
Facing Sheet
Financial Statements
Signature
Exhibit 23--Consent of Ernst & Young LLP, Independent Auditors
<PAGE>
Financial Statements
and Schedules
Lincoln National Corporation
Employees' Savings
and Profit-Sharing Plan
Years ended December 31, 1995 and 1994
with Report of Independent Auditors
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Financial Statements
and Schedules
Years ended December 31, 1995 and 1994
Contents
Report of Independent Auditors 1
Audited Financial Statements
Statements of Net Assets Available for Plan Benefits 2
Statements of Changes in Net Assets Available for Plan Benefits 3
Notes to Financial Statements 4
Schedules
Schedule of Assets Held for Investment Purposes 13
Schedule of Reportable Transactions 14
<PAGE>
Report of Independent Auditors
Lincoln National Corporation Benefits Investment Committee
Lincoln National Corporation
We have audited the accompanying statements of net assets available
for plan benefits of the Lincoln National Corporation Employees'
Savings and Profit--Sharing Plan as of December 31, 1995 and 1994, and
the related statements of changes in net assets available for plan
benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for plan
benefits of the Plan at December 31, 1995 and 1994, and the changes in
its net assets available for plan benefits for the years then ended,
in conformity with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying supplemental
schedules of assets held for investment purposes as of December 31,
1995, and reportable transactions for the year then ended, are
presented for purposes of complying with the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974, and are not a required part of
the financial statements. The supplemental schedules have been
subjected to the auditing procedures applied in our audit of the 1995
financial statements and, in our opinion, are fairly stated in all
material respects in relation to the 1995 financial statements taken
as a whole.
Ernst & Young LLP
May 16, 1996, except for Note 8,
as to which it is May 28, 1996
Fort Wayne, Indiana
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Statements of Net Assets Available for Plan Benefits
<TABLE>
<CAPTION>
December 31
1995 1994
<S> <C> <C>
Assets
Investments:
Common stock--Lincoln National Corporation $191,353,118 $116,039,665
Segregated investment accounts--The Lincoln
National Life Insurance Company
Separate Accounts 95,253,320 65,760,304
Unallocated insurance contracts--The Lincoln
National Life Insurance Company 76,276,541 69,684,213
Participant loans 15,852,291 13,924,114
Total investments 378,735,270 265,408,296
Cash and invested cash 3,918,059 1,196,474
Accrued interest receivable 30,578 25,736
Other receivables -- 465,068
Contributions receivable from
participating employers 12,004,120 13,963,381
Total assets 394,688,027 281,058,955
Liabilities--miscellaneous payables 1,147,957 88,581
Net assets available for plan benefits $393,540,070 $280,970,374
</TABLE>
See accompanying notes.
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Statements of Changes in Net Assets Available for Plan Benefits
<TABLE>
<CAPTION> Year ended December 31
1995 1994
<S> <C> <C>
Additions:
Net realized and unrealized appreciation
(depreciation) in fair value of investments $ 85,420,076 $(27,159,152)
Investment income:
Cash dividends--Lincoln National Corporation 5,969,559 5,031,135
Interest:
The Lincoln National Life Insurance Company 6,493,723 4,732,210
Other 1,203,060 1,023,746
Total interest 7,696,783 5,755,956
Total investment income 13,666,342 10,787,091
Contributions:
Employees 19,897,636 18,773,777
Participating employers (net of forfeitures:
1995-$16,376; 1994-$20,070) 14,167,259 16,932,992
Total Contributions 34,064,895 35,706,769
Total Additions 133,151,313 19,334,708
Deductions:
Distributions to participants (20,363,921) (21,082,240)
Administrative expenses (217,696) (287,540)
Total Deductions (20,581,617) (21,369,780)
Net increase (decrease) in net assets
available for plan benefits 112,569,696 (2,035,072)
Net assets available for plan benefits at
beginning of the year 280,970,374 283,005,446
Net assets available for plan benefits at end
of the year $393,540,070 $280,970,374
</TABLE>
See accompanying notes.
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements
December 31, 1995
1. Significant Accounting Policies
Investments
The investment in Lincoln National Corporation ("LNC") common stock is
valued at the last reported sales price per the national securities
exchange on the last business day of the year. The fair value of the
participation units owned by Lincoln National Corporation Employees'
Savings and Profit--Sharing Plan ("Plan") in segregated investment
accounts is based on quoted redemption value on the last business day
of the year.
The unallocated insurance contracts are valued at contract value as
estimated by The Lincoln National Life Insurance Company ("Company").
Contract value represents net contributions made plus interest at the
contract rate.
Participant loans are valued at cost which approximates fair value.
The cost of investments sold, distributed or forfeited is determined
using the specific identification method.
2. Description of the Plan
The Plan is a contributory, defined contribution plan which covers
eligible employees of LNC and several of its subsidiaries ("Employer
Companies"). Any person 21 years of age or older who is an employee
of the Employer Companies is eligible to enroll in the Plan if the
person has been employed by LNC and any of its subsidiaries for at
least one year. A participant may make pre-tax contributions at a
rate of at least 1%, but not more than 15% of compensation, up to a
maximum annual amount as determined and adjusted annually by the
Internal Revenue Service ("IRS").
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
2. Description of the Plan (continued)
The participants are fully vested in their contributions and direct
the Plan to invest their contributions in any combination of the
investment options as described in Note 3. Participants can direct
employer contributions, but only after the contributions have been in
the Plan for two full plan years following the year for which they
were contributed.
The Employer Companies contribute to the Plan an amount equal to a
participant's contributions, not to exceed 6%, multiplied by a
percentage, ranging from 25% to 150%, which varies according to LNC's
increase in book value in relation to similar companies in the
insurance industry. The Employer Companies contributions are
invested in the LNC Common Stock Fund. The Employer Companies
contributions vest based upon years of service as defined in the Plan
document as follows:
Years of Service Percent Vested
1 0%
2 50%
3 or more 100%
During 1995, the Board of Directors of LNC approved a new employer
contribution formula which will be effective for the 1996 plan year.
The new formula gives the Board of Directors authorization to make a
discretionary change in the percentage used to compute the Employer
Companies contribution.
The Plan allows loans to participants in amounts up to 50% of the
vested account value to a maximum of $50,000 but not more than the
total value of the participant's accounts excluding employer
contributions that haven't been in the Plan for two full years, less
the highest outstanding loan balance in the previous twelve month
period.
The Employer Companies have the right in accordance with the Plan to
discontinue contributions at any time and terminate participation in
the Plan. In the event of termination of the Plan, all amounts
allocated to participants' accounts shall become vested.
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
3. INVESTMENT OPTIONS
The detail of the net assets available for plan benefits by investment option
is as follows:
<TABLE>
<CAPTION>
December 31, 1995
Investment Options
TOTAL 1 2 3 4
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock $191,353,118 $191,353,118
Segregated investment accounts 95,253,320 $8,624,705 $22,920,130
Unallocated insurance contracts 76,276,541 $76,276,541
Participant loans 15,852,291
Total Investments 378,735,270 191,353,118 8,624,705 76,276,541 22,920,130
Cash and invested cash 3,918,059 2,516,096 1,401,963
Accrued interest receivable 30,578
Contributions receivable from
participating employers 12,004,120 12,044,120
Total assets 394,688,027 205,873,334 8,624,705 77,678,504 22,920,130
Liabilities--miscellaneous
payables (1,147,957) (578,264) (569,693)
Net assets available for
plan benefits $393,540,070 $205,295,070 $8,624,705 $77,108,811 $22,920,130
</TABLE>
<TABLE>
<CAPTION>
5 6 7 8 9
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock
Segregated investment accounts $23,772,967 $8,902,420 $7,702,430 $12,969,067 $1,734,231
Unallocated insurance contracts
Participant loans
Total investments 23,772,967 8,902,420 7,702,430 12,969,067 1,734,231
Cash and invested cash
Accrued interest receivable
Contributions receivable from
anticipating employers
Total assets 23,772,967 8,902,420 7,702,430 12,969,067 1,734,231
Liabilities--miscellaneous
payables
Net assets available for
plan benefits $23,772,967 $8,902,420 $7,702,430 $12,969,067 $1,734,231
</TABLE>
<TABLE>
<CAPTION>
10 11 12 13 LOANS
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock
Segregated investment accounts $770,346 $2,029,374 $1,858,664 $3,968,986
Unallocated insurance contracts
Participant loans $15,852,291
Total investments 770,346 2,029,374 1,858,664 3,968,986 15,852,291
Cash and invested cash
Accrued interest receivable 30,578
Contributions receivable from
participating employers
Total assets 770,346 2,029,374 1,858,664 3,968,986 15,882,869
Liabilities--miscellaneous
payables
Net assets available for
plan benefits $770,346 $2,029,374 $1,858,664 $3,968,986 $15,882,869
</TABLE>
<TABLE>
<CAPTION>
December 31, 1994
Investment Options
TOTAL 1 2 3 4
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock $116,039,665 $116,039,665
Segregated investment
accounts 65,760,304 $8,116,181 $15,662,431
Unallocated insurance
contracts 69,684,213 $69,684,213
Participant loans 13,924,114
Total investments 265,408,296 116,039,665 8,116,181 69,684,213 15,662,431
Cash and invested cash
(overdrafts) 1,196,474 1,010,411 13,251 123,040 (4,266)
Accrued interest receivable 25,736
Other receivables 465,068 36,684 3,730 273,416 59,236
Contributions receivable from
participating employers 13,963,381 13,963,381
Total assets 281,058,955 131,050,141 8,133,162 70,080,669 15,717,401
Liabilities--miscellaneous
payables 88,581 70,985
Net assets available for
plan benefits $280,970,374 $130,979,156 $8,133,162 $70,080,669 $15,717,401
</TABLE>
<TABLE>
<CAPTION>
5 6 7 8 9
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock
Segregated investment
accounts $16,060,131 $7,005,554 $5,658,315 $9,234,735 $532,843
Unallocated insurance
contracts
Participant loans
Total investments 16,060,131 7,005,554 5,658,315 9,234,735 532,843
Cash and invested
cash (overdrafts) 7,957 (40,808) 19,415 14,541 46,433
Accrued interest receivable
Other receivables 40,424 43,603 514 597
Contributions receivable from
anticipating employers
Total assets 16,108,512 7,008,349 5,677,730 9,249,790 79,873
Liabilities--miscellaneous
payables 12,383
Net assets available for
plan benefits $16,108,512 $7,008,349 $5,665,347 $9,249,790 $579,873
</TABLE>
<TABLE>
<CAPTION>
10 11 12 13 LOANS
<S> <C> <C> <C> <C> <C>
Assets
Investments:
Common stock
Segregated investment accounts $187,725 $787,447 $617,234 $1,897,708
Unallocated insurance contracts
Participant loans $13,924,114
Total investments 187,725 787,447 617,234 1,897,708 13,924,114
Cash and invested cash
(overdrafts) 2,394 156 4,273 1,313 (1,636)
Accrued interest receivable 25,736
Other receivables 714 4,514 1,636
Contributions receivable from
participating employers
Total assets 190,119 788,317 621,507 1,903,535 13,949,850
Liabilities--miscellaneous
payables 2,394 2,819
Net assets available for
plan benefits $187,725 $788,317 $618,688 $1,903,535 $13,949,850
</TABLE>
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
3. INVESTMENT OPTIONS (CONTINUED)
The detail of the changes in net assets available for plan benefits by
investment option is as follows:
<TABLE>
<CAPTION>
Year Ended December 31, 1995
Investment Options
TOTAL 1 2 3 4
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation in fair
value of investments $ 85,420,076 $ 67,988,471 $1,073,220 $ 5,905,550
Investment income:
Cash dividends 5,969,559 5,969,559
Interest 7,696,783 $ 6,493,723
Total investment income 13,666,342 5,969,559 6,493,723
Contributions:
Employees 19,897,636 5,304,242 615,540 4,382,570 1,870,696
Participating employers
(net of forfeitures) 14,167,259 14,167,259
Total contributions 34,064,895 19,471,501 615,540 4,382,570 1,870,696
Total additions 133,151,313 93,429,531 1,688,760 10,876,293 7,776,246
Deductions:
Distributions to participants (20,363,921) (8,699,052) (569,094) (6,562,834) (1,033,475)
Administration expenses (217,696) (199,511) (1,055) (8,872) (2,202)
Net transfers (deductions) -- (10,215,054) (627,068) 2,723,555 462,160
Total deductions (20,581,617) (19,113,617) (1,197,217) (3,848,151) (573,517)
Net increase in net assets
available for plan benefits 112,569,696 74,315,914 491,543 7,028,142 7,202,729
Net assets available for
plan benefits at
beginning of the year 280,970,374 130,979,156 8,133,162 70,080,669 15,717,401
Net assets available for
plan benefits
at end of the year $393,540,070 $205,295,070 $8,624,705 $77,108,811 $22,920,130
</TABLE>
<TABLE>
<CAPTION>
5 6 7 8 9
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation in fair value
of investments $ 5,037,349 $ 433,404 $1,174,621 $ 2,717,975 $ 226,389
Investment income:
Cash dividends
Interest
Contributions:
Employees 2,384,637 509,372 784,575 1,693,786 457,925
Participating employers
(net of forfeitures)
Total contributions 2,384,637 509,372 784,575 1,693,786 457,925
Total additions 7,421,986 942,776 1,959,196 4,411,761 684,314
Deductions:
Distributions to participants (538,697) (1,101,485) (283,377) (893,780) (72,358)
Administration expenses (2,292) (903) (779) (1,339) (115)
Net transfers (deductions) 783,458 2,053,683 362,043 202,635 542,517
Total deductions 242,469 951,295 77,887 (692,484) 470,044
Net increase in net assets
available for plan benefits 7,664,455 1,894,071 2,037,083 3,719,277 1,154,358
Net assets available for
plan benefits at
beginning of the year 16,108,512 7,008,349 5,665,347 9,249,790 579,873
Net assets available for
plan benefits
at end of the year $23,772,967 $8,902,420 $7,702,430 $12,969,067 $1,734,231
</TABLE>
<TABLE>
<CAPTION>
10 11 12 13 Loans
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation in fair value
of investments $ 65,341 $ 129,576 $ 315,646 $ 352,534
Investment income:
Cash dividends
Interest $ 1,203,060
Total interest income 1,203,060
Contributions:
Employees 167,759 442,232 352,295 932,007
Participating employers
(net of forfeitures)
Total contributions 167,759 442,232 352,295 932,007
Total additions 233,100 571,808 667,941 1,284,541 1,203,060
Deductions:
Distributions to participants (14,593) (25,432) (12,063) (74,208) (483,473)
Administration expenses (42) (144) (117) (325)
Net transfers (deductions) 364,156 694,825 584,215 855,443 1,213,432
Total deductions 349,521 669,249 572,035 780,910 729,959
Net increase in net assets
available for plan benefits 582,621 1,241,057 1,239,976 2,065,451 1,933,019
Net assets available for
plan benefits at
beginning of the year 187,725 788,317 618,688 1,903,535 13,949,850
Net assets available for
plan benefits
at end of the year $770,346 $2,029,374 $1,858,664 $3,968,986 $15,882,869
</TABLE>
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
3. INVESTMENT OPTIONS (CONTINUED)
The detail of the changes in net assets available for plan benefits by
investment option is as follows:
<TABLE>
<CAPTION>
Year Ended December 31, 1994
Investment Options
TOTAL 1 2 3 4
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation (depreciation)
in fair value of investments $(27,159,152) $(26,530,162) $ (132,920) $ 252,063
Investment income:
Cash dividends 5,031,135 5,031,135
Interest 5,755,956 $ 4,732,210
Total interest income 10,787,091 5,031,135 4,732,210
Contributions:
Employees 18,773,777 5,503,603 687,192 4,174,286 1,886,377
Participating employers
(net of forfeitures) 16,932,992 16,932,992
Total contributions 35,706,769 22,436,595 687,192 4,174,286 1,886,377
Total additions 19,334,708 937,568 554,272 8,906,496 2,138,440
Deductions:
Distributions to participants (21,082,240) (8,934,755) (582,550) (7,395,098) (1,061,237)
Administration expenses (287,540) (268,102) (1,254) (10,032) (2,247)
Net transfers (deductions) -- 994,218 (1,029,086) (891,455) (830,348)
Total deductions (21,369,780) (8,208,639) (1,612,890) (8,296,585) (1,893,832)
Net increase (decrease) in
net assets available
for plan benefits (2,035,072) (7,271,071) (1,058,618) 609,911 244,608
Net assets available for
plan benefits at
beginning of the year 283,005,446 138,250,227 9,191,780 69,470,758 15,472,793
Net assets available for
plan benefits
at end of the year $280,970,374 $130,979,156 $8,133,162 $70,080,669 $15,717,401
</TABLE>
<TABLE>
<CAPTION>
5 6 7 8 9
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation (depreciation)
in fair value of investments $ (445,649) $ 277,250 $ (239,319) $ (296,077) $ 3,042
Investment income:
Cash dividends
Interest
Contributions:
Employees 2,387,322 509,064 756,164 1,748,974 224,271
Participating employers
(net of forfeitures)
Total contributions 2,387,322 509,064 756,164 1,748,974 224,271
Total additions 1,941,673 786,314 516,845 1,452,897 227,313
Deductions:
Distributions to participants (990,193) (497,042) (284,535) (579,465) (1,071)
Administration expenses (2,299) (1,070) (845) (1,337) (55)
Net transfers (deductions) (486,343) (863,523) (699,957) (325,903) 353,686
Total deductions (1,478,835) (1,361,635) (985,337) (906,705) 352,560
Net increase (decrease) in
net assets available for
plan benefits 462,838 (575,321) (468,492) 546,192 579,873
Net assets available for
plan benefits at
beginning of the year 15,645,674 7,583,670 6,133,839 8,703,598 --
Net assets available for
plan benefits
at end of the year $16,108,512 $7,008,349 $5,665,347 $9,249,790 $579,873
</TABLE>
<TABLE>
<CAPTION>
10 11 12 13 Loans
<S> <C> <C> <C> <C> <C>
Additions:
Net realized and unrealized
appreciation (depreciation)
in fair value of investments $ 4,847 $ 1,336 $ 18,681 $ (72,244)
Investment income:
Cash dividends
Interest $ 1,023,746
Total interest income 1,023,746
Contributions:
Employees 72,431 222,076 162,450 439,567
Participating employers
(net of forfeitures)
Total contributions 72,431 222,076 162,450 439,567
Total additions 77,278 223,412 181,131 367,323 1,023,746
Deductions:
Distributions to participants (4,619) (8,405) (21,158) (15,175) (706,937)
Administration expenses (17) (68) (47) (167)
Net transfers (deductions) 115,083 573,378 458,762 1,551,554 1,079,934
Total deductions 110,447 564,905 437,557 1,536,212 372,997
Net increase (decrease) in
net assets available for
plan benefits 187,725 788,317 618,688 1,903,535 1,396,743
Net assets available for plan
benefits at
beginning of the year -- -- -- -- 12,553,107
Net assets available for
plan benefits
at end of the year $187,725 $788,317 $618,688 $1,903,535 $13,949,850
</TABLE>
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
3. Investment Options (continued)
Information with respect to investment options is as follows:
Option Description of Investment Option
1 LNC Common Stock Fund, which invests primarily in shares of
Lincoln National Corporation's common stock;
2 Government Bond Fund, which directly or indirectly invests
primarily in fixed income securities issued by the United
States Government;
3 Guaranteed Fund, which invests primarily in contracts which
guarantee a rate of return and principal;
4 Core Equity Fund, which directly or indirectly invests
primarily in the common stock of established companies;
5 Medium Capitalization Equity Fund, which directly or
indirectly invests primarily in the stock of new, rapid
growth companies;
6 Short--Term Fund, which directly or indirectly invests
primarily in notes of government agencies and private
corporations;
7 Government/Corporate Bond Fund, which directly or
indirectly invests primarily in corporate and U.S.
government bonds and mortgage-backed securities;
8 Large Capitalization Equity Fund, which directly or
indirectly invests primarily in high-risk common stocks
which have the potential for a significant appreciation in
value over an 18 to 24 month period;
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
3. Investment Options (continued)
9 Balanced Fund, which directly or indirectly invests in
three different asset classes: stocks, bonds and money
market instruments, which provides growth through the
stock portion and reduced risk through the bond and
money market portion;
10 High Yield Bond Fund, which directly or indirectly
invests primarily in below-investment-grade bonds,
providing higher rates of return to compensate higher
risk;
11 Small Capitalization Equity Fund, which directly or
indirectly invests primarily in the stock of new, rapid
growth companies;
12 Value Equity Fund, which invests primarily in large
capitalization stocks of undervalued companies that are
industry leaders; and
13 International Equity Fund, which directly or indirectly
invests primarily in stocks of non-United States
companies.
Beginning January 1, 1994, the Plan began offering investment options
9 through 13 to participants. Investment options 2 through 13 are
provided by a group annuity contract issued by the Company.
Interest charged on new loans to participants is established monthly
based upon prevailing rates for similar loans. Loans are repaid over
1, 3, 5, 10, 15 or 20 year periods depending on the purpose of the
loan or when a participant withdraws from the Plan.
The unallocated insurance contracts earned an average interest rate of
approximately 6.72% and 6.86% in 1995 and 1994, respectively. The
credited interest rate for new contributions, which approximates the
current market rate, at December 31, 1995 and 1994, were 6.25% and
7.50%, respectively. The rate on new contributions is guaranteed
through the succeeding three calendar year quarters. The credited
interest rates for the remaining contract value balance at December
31, 1995 and 1994 were 6.90% and 7.15%, respectively, and are
determined based upon the performance of the Company's general
account. The credited interest rates change at least quarterly. The
minimum guaranteed rate is 4.50% for the first 5 contract years, 4.00%
for years 6-10 and 3.50% following year 10. The guarantee is based on
the Company's ability to meet its financial obligations out of the
general assets of the Company. The fair value of the unallocated
insurance contracts approximate contract value.
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Notes to Financial Statements (continued)
4. Income Tax Status
The Plan has received a determination letter from the IRS dated
February 9, 1995, stating that the Plan qualifies under Section 401(a)
of the Internal Revenue Code of 1986 ("Code") and, therefore, is
exempt from taxation. Once qualified, the Plan is required to operate
in conformity with the Code and the Employee Retirement Income
Security Act of 1974 to maintain its tax-exempt status. The Plan's
administrator is not aware of any course of action or series of events
that have occurred that might adversely affect the Plan's qualified
status.
5. Transactions With Parties-In-Interest
All investments held by the Plan and related investment transactions,
except for short-term cash investments, were with the Employer
Companies.
6. Concentrations of Credit Risk
The Plan has investments in common stock of LNC, segregated investment
accounts and unallocated insurance contracts with the Company of
$191,353,118, $95,253,320 and $76,276,541, respectively, at December
31, 1995 (48.6%, 24.3% and 19.5% of net assets, respectively). LNC
and the Company operate predominately in the insurance industry.
7. Sale of LNC Subsidiary
Effective February 2, 1994, LNC completed the sale of Security-
Connecticut Corporation, one of the Employer Companies. As a result
of the sale, $8,570,156 of 1994 Plan assets were transferred to
another plan.
<PAGE>
Lincoln National Corporation
Employees' Savings and Profit--Sharing Plan
Notes to Financial Statements (continued)
8. Sale of Minority Interest in Subsidiary
Effective May 28, 1996, the Company's principal subsidiary within its
Property-Casualty segment (American States Insurance Company) closed on
an initial public offering of 17% of its common stock. The filing of
a registration statement with the Securities and Exchange Commission,
marketing of the shares and receiving the necessary approvals is
expected to result in a closing of this transaction in the second
quarter of 1996. As of December 31, 1995, the Plan assets attributed
to American States employees that will be transferred to a new Plan
totalled approximately $179,566,000.
9. Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for plan benefits
per the financial statements to Form 5500:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Net assets available for plan
benefits per the financial statements $393,540,070 $280,970,374
Amounts allocated to withdrawing participants (1,273,955) (1,089,639)
Net assets available for plan benefits
per Form 5500 $392,266,115 $279,880,735
The following is a reconciliation of distributions to participants per the
financial statements to Form 5500:
</TABLE>
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Distributions to participants per the
financial statements $20,363,921 $21,082,240
Amounts allocated to withdrawing
participants at end of the year 1,273,955 1,089,639
Less amounts allocated to withdrawing
participants at beginning of the year (1,089,639) (232,652)
Distributions to participants per Form 5500 $20,548,237 $21,939,227
</TABLE>
Amounts allocated to withdrawing participants are recorded on Form 5500 for
distributions that have been processed and approved for payment prior to
year end but have not yet been paid.
<PAGE>
Schedules
Item 27a
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Schedule of Assets Held for Investment Purposes
December 31, 1995
<TABLE>
<CAPTION>
(c)
Description of Investment
(b) Including Maturity (e)
Identity of Issue, Borrower, Date, Rate of Interest, (d) Current
Lessor or Similar Party Par or Maturity Value Cost Value
<S> <C> <C> <C>
Common stock-
Lincoln National Corporation 3,560,058 shares $122,922,705 $191,353,118
Segregated investment
accounts--The Lincoln
National Life Insurance
Company Separate Accounts:
Government Bond Fund 5,961,664.925 participation units 6,615,965 8,624,705
Core Equity Fund 1,264,092.105 participation units 14,167,103 22,920,130
Medium Capitalization Equity Fund 3,112,599.024 participation units 15,221,037 23,772,967
Short--Term Fund 3,395,077.727 participation units 7,806,833 8,902,420
Government/Corporate Bond Fund 1,605,915.397 participation units 5,680,734 7,702,430
Large Capitalization Equity Fund 2,708,547.495 participation units 9,722,074 12,969,067
Balanced Fund 436,665.410 participation units 1,514,066 1,734,231
High Yield Bond Fund 408,365.340 participation units 704,683 770,346
Small Capitalization Equity Fund 320,513.868 participation units 1,914,502 2,029,374
Value Equity Fund 1,352,451.952 participation units 1,536,964 1,858,664
International Equity Fund 853,978.550 participation units 3,694,021 3,968,986
Total segregated investment accounts 68,577,982 95,253,320
Unallocated insurance contracts-
The Lincoln National Life
Insurance Company 76,276,541 76,276,541
Participant loans Various loans at interest rates
varying from 12.5% to 6.5%
due from 1996 to 2015. 15,852,291 15,852,291
Total investments $283,699,519 $378,735,270
</TABLE>
<PAGE>
Item 27d
Lincoln National Corporation
Employees' Savings and Profit-Sharing Plan
Schedule of Reportable Transactions
Year ended December 31, 1995
<TABLE>
<CAPTION>
(h)
Current Value (i)
(a) (c) (d) (g) of Assets on Net
Identity of (b) Purchase Selling Cost of Transaction Gain
Party Involved Description of Assets Price Price Assets Date (Loss)
<S> <S> <C> <C> <C> <C> <C>
Category (iii)
Norwest Bank Lincoln National Corporation
shares of common stock:
Purchases $53,965,282 $53,965,282 $53,965,282
Sales $46,640,318 35,683,789 46,640,318 $10,956,529
The Lincoln Segregated investment
National Life account--The Lincoln
Insurance National Life Insurance
Company Company Separate Accounts:
Purchases 25,092,671 25,092,671 25,092,671
Sales 13,031,264 10,547,810 13,031,264 2,483,454
The Lincoln Unallocated insurance
National Life contracts-The Lincoln
Insurance National Life Insurance
Company Company:
Purchases 17,424,452 17,424,452 17,424,452
Sales 10,832,124 10,832,124 10,832,124 --
</TABLE>
Note: Columns (e) and (f), and categories (i), (ii) and (iv) are not
applicable.
<PAGE>
SIGNATURE
THE PLAN. Pursuant to the requirements of the Securities
Exchange Act of 1934, the Members of the Lincoln National
Corporation Benefits Investment Committee have duly caused this
annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
LINCOLN NATIONAL CORPORATION
EMPLOYEES' SAVINGS AND
PROFIT-SHARING PLAN
/S/ H. THOMAS MCMEEKIN
Date: 6/26/96 ______________________________
H. Thomas McMeekin, Chairman
Lincoln National Corporation
Benefits Investment Committee
<PAGE>
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8 No. 33-52667) pertaining to the Lincoln
National Corporation Employees' Savings and Profit-Sharing Plan
of our report dated May 16, 1996 (except for Note 8, as to which it is
May 28, 1996) with respect to the financial statements and schedules of
the Lincoln National Corporation Employees' Savings and Profit-Sharing
Plan included in this Annual Report (Form 11-K) for the year ended
December 31, 1995.
/S/ ERNST & YOUNG LLP
Fort Wayne, Indiana
June 28, 1996
