<PAGE> 1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL QUARTER ENDED SEPTEMBER 30, 1995
COMMISSION FILE NUMBER 33-26322; 33-46827; 33-52254; 33-60290; 33-58303
MERRILL LYNCH LIFE INSURANCE COMPANY
(Exact name of Registrant as specified in its charter)
ARKANSAS 91-1325756
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
800 SCUDDERS MILL ROAD
PLAINSBORO, NEW JERSEY 08536
(Address of Principal Executive Offices)
(609) 282-1429
(Registrant's telephone number including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
COMMON 200,000
REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a)
AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
================================================================================
<PAGE> 2
PART I Financial Information
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
BALANCE SHEETS
(Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
----------------- -----------------
<S> <C> <C>
INVESTMENTS:
Fixed maturity securities available for sale, at estimated fair
value (amortized cost: 1995 - $3,770,889; 1994 - $4,014,272) $ 3,863,847 $ 3,867,833
Equity securities available for sale, at estimated fair value
(cost: 1995 - $19,225; 1994 - $15,946) 23,407 16,777
Mortgage loans on real estate 121,892 149,249
Real estate available for sale 8,149 12,955
Policy loans on insurance contracts 1,018,399 985,213
----------------- -----------------
Total Investments 5,035,694 5,032,027
----------------- -----------------
CASH AND CASH EQUIVALENTS 115,354 139,087
ACCRUED INVESTMENT INCOME 101,420 95,133
DEFERRED POLICY ACQUISITION COSTS 380,391 466,334
FEDERAL INCOME TAXES - DEFERRED 14,105 38,919
REINSURANCE RECEIVABLES 1,562 1,832
RECEIVABLES FROM AFFILIATES - NET 0 3,113
OTHER ASSETS 46,560 28,656
SEPARATE ACCOUNTS ASSETS 6,623,361 5,798,973
----------------- -----------------
TOTAL ASSETS $ 12,318,447 $ 11,604,074
================= =================
</TABLE>
See notes to financial statements. (Continued)
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
BALANCE SHEETS
(Concluded) (Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDER'S EQUITY September 30, December 31,
1995 1994
----------------- -----------------
<S> <C> <C>
LIABILITIES:
POLICY LIABILITIES AND ACCRUALS:
Policyholders' account balances $ 4,908,117 $ 5,148,971
Claims and claims settlement expenses 28,247 26,177
----------------- -----------------
Total policy liabilities and accruals 4,936,364 5,175,148
----------------- -----------------
OTHER POLICYHOLDER FUNDS 12,335 21,221
LIABILITY FOR GUARANTY FUND ASSESSMENTS 22,848 24,774
OTHER LIABILITIES 33,790 36,775
FEDERAL INCOME TAXES - CURRENT 24,055 2,274
AFFILIATED PAYABLES 7,963 0
SEPARATE ACCOUNTS LIABILITIES 6,614,950 5,784,311
----------------- -----------------
Total Liabilities 11,652,305 11,044,503
----------------- -----------------
STOCKHOLDER'S EQUITY:
Common stock, $10 par value - 200,000 shares
authorized, issued and outstanding 2,000 2,000
Additional paid-in capital 535,450 535,450
Retained earnings 125,429 66,005
Net unrealized investment gain (loss) 3,263 (43,884)
----------------- -----------------
Total Stockholder's Equity 666,142 559,571
----------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 12,318,447 $ 11,604,074
================= =================
</TABLE>
See notes to financial statements.
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
STATEMENTS OF EARNINGS
(Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------------------
1995 1994
----------------- -----------------
<S> <C> <C>
REVENUES:
Investment revenue:
Net investment income $ 285,266 $ 333,167
Net realized investment gains (losses) 2,543 (10,587)
Policy charge revenue 103,973 83,211
----------------- -----------------
Total Revenues 391,782 405,791
----------------- -----------------
BENEFITS AND EXPENSES:
Interest credited to policyholders' account balances 198,254 243,735
Market value adjustment expense 2,973 6,143
Policy benefits (net of reinsurance recoveries: 1995 - $5,454;
1994 - $4,647) 14,953 12,353
Reinsurance premium ceded 10,363 10,444
Amortization of deferred policy acquisition costs 41,501 53,624
Insurance expenses and taxes 32,508 28,056
----------------- -----------------
Total Benefits and Expenses 300,552 354,355
----------------- -----------------
Earnings Before Federal Income Tax Provision 91,230 51,436
----------------- -----------------
FEDERAL INCOME TAX PROVISION (BENEFIT):
Current 32,378 20,229
Deferred (572) (9,227)
----------------- -----------------
Total Federal Income Tax Provision 31,806 11,002
----------------- -----------------
NET EARNINGS $ 59,424 $ 40,434
================= =================
</TABLE>
See notes to financial statements.
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
STATEMENTS OF EARNINGS
(Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
--------------------------------------
1995 1994
----------------- -----------------
<S> <C> <C>
REVENUES:
Investment revenue:
Net investment income $ 93,137 $ 102,149
Net realized investment gains (losses) 1,209 (414)
Policy charge revenue 34,669 29,370
----------------- -----------------
Total Revenues 129,015 131,105
----------------- -----------------
BENEFITS AND EXPENSES:
Interest credited to policyholders' account balances 64,009 71,661
Market value adjustment expense 1,757 631
Policy benefits (net of reinsurance recoveries: 1995 - $1,458;
1994 - $1,436) 4,130 4,289
Reinsurance premium ceded 3,434 3,451
Amortization of deferred policy acquisition costs 7,830 17,338
Insurance expenses and taxes 12,253 9,040
----------------- -----------------
Total Benefits and Expenses 93,413 106,410
----------------- -----------------
Earnings Before Federal Income Tax Provision 35,602 24,695
----------------- -----------------
FEDERAL INCOME TAX PROVISION (BENEFIT):
Current 11,533 9,212
Deferred 811 (7,466)
----------------- -----------------
Total Federal Income Tax Provision 12,344 1,746
----------------- -----------------
NET EARNINGS $ 23,258 $ 22,949
================= =================
</TABLE>
See notes to financial statements.
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
STATEMENTS OF STOCKHOLDER'S EQUITY
(Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
Net
Additional unrealized Total
Common paid-in Retained investment stockholder's
stock capital earnings gain (loss) equity
------------- ----------- ------------ ------------- --------------
<S> <C> <C> <C> <C> <C>
BALANCE, JANUARY 1, 1994 $ 2,000 $ 637,590 $ 47,860 $ (395) $ 687,055
Dividend to Parent 0 (102,140) (47,860) 0 (150,000)
Net earnings 0 0 66,005 0 66,005
Net unrealized investment loss 0 0 0 (43,489) (43,489)
------------- ----------- ------------ ------------- --------------
BALANCE, DECEMBER 31, 1994 2,000 535,450 66,005 (43,884) 559,571
Net earnings 0 0 59,424 0 59,424
Net unrealized investment gain 0 0 0 47,147 47,147
------------- ----------- ------------ ------------- --------------
BALANCE, SEPTEMBER 30, 1995 $ 2,000 $ 535,450 $ 125,429 $ 3,263 $ 666,142
============= =========== ============ ============= ==============
</TABLE>
See notes to financial statements.
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
STATEMENTS OF CASH FLOWS
(Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------------------
1995 1994
----------------- -----------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net earnings $ 59,424 $ 40,434
Adjustments to reconcile net earnings to net cash and cash
equivalents provided (used) by operating activities:
Amortization of deferred policy acquisition costs 41,501 53,624
Capitalization of policy acquisition costs (38,984) (90,955)
Depreciation and amortization (5,382) (2,985)
Net realized investment (gains) losses (2,543) 10,587
Interest credited to policyholders' account balances 198,254 243,735
Benefit for deferred Federal income tax (572) (9,227)
Cash and cash equivalents provided (used) by changes in
operating assets and liabilities:
Accrued investment income (6,287) 18,555
Claims and claims settlement expenses 2,070 5,416
Federal income taxes - current 21,781 (909)
Other policyholder funds (8,886) (15,355)
Liability for guaranty fund assessments (1,926) (2,970)
Receivable / payable from affiliates - net 11,076 (2,816)
Change in policy loans (33,186) (44,551)
Change in investment trading securities 0 873
Other, net (21,664) (29,897)
----------------- -----------------
Net cash and cash equivalents provided by operating
activities 214,676 173,559
----------------- -----------------
INVESTING ACTIVITIES:
Fixed maturity securities sold 486,579 653,327
Fixed maturity securities matured 443,195 1,066,944
Fixed maturity securities purchased (679,709) (467,420)
Equity securities available for sale sold 2,622 16,876
Equity securities available for sale purchased (5,363) 0
Mortgage loans on real estate - purchased (3,608) 0
Mortgage loans on real estate principal payments received 30,123 31,872
Real estate available for sale - improvements acquired (589) (1,323)
Real estate available for sale sold 7,435 8,616
Investment in Separate Accounts (316) (15,076)
Recapture of investment in Separate Accounts 6,559 0
----------------- -----------------
Net cash and cash equivalents provided by investing
activities 286,928 1,293,816
----------------- -----------------
</TABLE>
See notes to financial statements (continued)
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
STATEMENTS OF CASH FLOWS
(Concluded) (Dollars in Thousands) (Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------------------
1995 1994
----------------- -----------------
<S> <C> <C>
FINANCING ACTIVITIES:
Policyholders' account balances:
Deposits 436,661 771,832
Withdrawals (includes transfers to Separate Accounts) (961,996) (2,264,628)
----------------- -----------------
Net cash and cash equivalents used by financing activities (525,335) (1,492,796)
----------------- -----------------
NET DECREASE IN CASH AND CASH EQUIVALENTS (23,733) (25,421)
CASH AND CASH EQUIVALENTS:
Beginning of year 139,087 122,218
----------------- -----------------
End of period $ 115,354 $ 96,797
================= =================
Supplementary Disclosure of Cash Flow Information:
Cash paid for:
Federal income taxes $ 10,597 $ 10,122
Intercompany interest $ 995 $ 311
</TABLE>
See notes to financial statements
<PAGE>
MERRILL LYNCH LIFE INSURANCE COMPANY
(a wholly-owned subsidiary of Merrill Lynch Insurance Group,
Inc.)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1: BASIS OF PRESENTATION:
Merrill Lynch Life Insurance Company (the "Company") is a wholly-
owned subsidiary of Merrill Lynch Insurance Group, Inc. ("MLIG").
The Company is an indirect wholly-owned subsidiary of Merrill
Lynch & Co., Inc. ("Merrill Lynch & Co."). The Company sells life
insurance and annuity products, including variable life insurance
and variable annuities.
The condensed financial statements included herein have been
prepared by the Company without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. In the opinion of
management, the unaudited financial statements presented herein
include all adjustments (consisting only of normal recurring
accruals) necessary for a fair presentation of the financial
position and the results of operations in accordance with
generally accepted accounting principles for the periods
presented. Results for the three months and nine months ended
September 30, 1995 and 1994 are not necessarily indicative of
annual results. These unaudited financial statements should be
read in conjunction with the financial statements and the notes
thereto included in the Company's 1994 Annual Report on Form 10-K
("1994 Report").
NOTE 2. STATUTORY ACCOUNTING PRACTICES:
The Company maintains its statutory accounting records in
conformity with accounting practices prescribed or permitted by
the Insurance Department of the State of Arkansas and the
National Association of Insurance Commissioners. Statutory
capital and surplus at September 30, 1995 and December 31, 1994,
was $383.5 million and $264.4 million, respectively. For the
nine months ended September 30, 1995 and 1994, statutory net
income was $106.7 million and $15.2 million, respectively.
NOTE 3. ACCOUNTING CHANGES:
In the first quarter of 1995, the Company adopted Statement of
Financial Accounting Standards ("SFAS") No. 114, "Accounting by
Creditors for Impairment of a Loan" and SFAS No. 118, "Accounting
by Creditors for Impairment of a Loan - Income Recognition and
Disclosures". SFAS No. 114 establishes accounting standards for
creditors to measure the impairment of certain loans. SFAS No.
118 amends SFAS No. 114 to allow creditors to use existing
methods for recognizing interest income on an impaired loan,
rather than the method originally required by SFAS No. 114. The
impact of these pronouncements on the Company's financial
statements as of September 30, 1995 was not material.
NOTE 4. INVESTMENTS:
The Company's investments in debt and equity securities are
classified as available for sale and are recorded at fair value.
The Company is required to adjust deferred policy acquisition
costs and certain policyholder liabilities associated with
investments classified as available for sale. These adjustments
are recorded in stockholder's equity and assume that the
unrealized gain or loss on available for sale securities was
realized. These investments primarily support in-force, universal
life-type contracts under SFAS No. 97, "Accounting and Reporting
by Insurance Enterprises for Certain Long-Duration Contracts and
for Realized Gains and Losses from the Sale of Investments". The
table that follows provides the components of the unrealized gain
(loss) recorded in stockholder's equity for available for sale
investments:
<TABLE>
<CAPTION>
Sept. 30, Dec. 31,
1995 1994
----------- -----------
(In Thousands)
<C> <C>
Assets:
Fixed maturity securities available for sale $ 92,958 $ (146,439)
Equity securities available for sale 3,261 831
Deferred policy acquisition costs (11,206) 72,220
Federal income taxes - deferred (1,757) 23,629
Separate Account Assets (190) (549)
----------- -----------
83,066 (50,308)
----------- -----------
Liabilities:
Policyholders' account balances 79,803 (6,424)
----------- -----------
Stockholder's equity:
Net unrealized investment gain (loss) $ 3,263 $ (43,884)
=========== ===========
</TABLE>
<PAGE>
Item 2 Management's Narrative Analysis of the Results of
Operations
This Management's Narrative Analysis of the Results of Operations
should be read in conjunction with the accompanying unaudited
financial statements and notes thereto, in addition to the 1994
Financial Statements and Notes to Financial Statements and the
Management's Discussion and Analysis of Financial Condition and
Results of Operations filed in the 1994 Report.
Changes in revenues and expenses in most cases are similar for
the three month and nine month periods. Therefore, the discussion
emphasizes the comparison between the nine months of 1995 and
1994, with additional information on the three month periods
presented where appropriate.
Business Overview
The Company's earnings are principally derived from two sources;
the net investment income from investment of fixed rate life
insurance and annuity contract owner deposits less interest
credited to contract owners, commonly known as spread, and fees
charged to variable life insurance and variable annuity contract
owners. The costs associated with acquiring contract owner
deposits are amortized over the period in which the Company
anticipates holding those funds. In addition, the Company incurs
expenses associated with the maintenance of in-force contracts.
New life insurance premiums and annuity deposits received in the
first nine months of 1995 and 1994 were $437 million and $772
million, respectively. Variable annuity deposits received during
the first nine months of 1995 decreased $380 million to $255
million as compared to the same period in 1994. However, modified
guaranteed annuity sales increased $48 million to $107 million
during the first nine months of 1995. The increase in modified
guaranteed annuity sales trended higher during the first three
months of 1995; however, sales decreased during the next six
months as interest rates declined. The decline in total life
insurance and annuity deposits received during the first nine
months of 1995 as compared to the same period in 1994 is
reflective of increased competition by non-affiliated insurers
whose products may also be sold through Merrill Lynch & Co.'s
retail distribution network.
During the first nine months of 1995, approximately $522 million
of fixed deferred annuity liabilities reached the expiration of
their interest rate guarantee period. At the expiration of an
interest rate guarantee period, the contract owner has an option
to either surrender the contract without incurring a surrender
charge, or to "renew" with an adjustment of the interest
crediting rate to the prevailing rate at the time of renewal. The
Company has offered those contract owners electing to surrender
the opportunity to exchange their contract for either a variable
annuity or market value adjusted annuity contract. The following
table summarizes the contract owners' selections for the
first nine months of 1995 and 1994:
<TABLE>
<CAPTION>
1995 1994
------------------- -------------------
Amount % Amount %
-------- ----- -------- -----
(Dollars in Millions)
<S> <C> <C> <C> <C>
Renewed with an adjustment to the
applicable interest crediting rate $ 124 24% $ 262 17%
Exchanged into either the variable annuity
product or the market value adjusted
annuity product offered by the Company 175 34% 735 45%
Surrendered 223 42% 602 38%
-------- ----- -------- -----
Total $ 522 100% $ 1,599 100%
======== ===== ======== =====
</TABLE>
The rates of renewal, exchange and surrender experienced are
consistent with management's expectations.
To fund all business activities, the Company maintains a high
quality and liquid investment portfolio. As of September 30,
1995, the Company's assets included $3.3 billion of cash, short-
term investments and investment grade publicly traded fixed
maturity securities that could be liquidated if funds were
required.
As of September 30, 1995, approximately $186 million (4.8%) of
the Company's fixed maturity securities were considered non-
investment grade. The Company defines non-investment grade as
unsecured corporate debt obligations which do not have a rating
equivalent to Standard and Poor's BBB or higher (or similar
rating agency), and are not guaranteed by an agency of the
federal government. Non-investment grade securities are
speculative and are subject to significantly greater risks
related to the creditworthiness of the issuers and the liquidity
of the market for such securities. The Company carefully selects,
and closely monitors, such investments.
During the first nine months of 1995, the Company foreclosed on
one mortgage loan with a current estimated fair value of $1.3
million. Additionally, during the first nine months of 1995, the
Company sold two real estate properties with a combined carrying
value of $5 million for a gain of $1 million. The Company
continues to carry reserves of $36 million for potential losses
from mortgage loans.
Results of Operations
For the nine month periods ended September 30, 1995 and 1994, the
Company reported net earnings of $59 million and $40 million,
respectively. The Company reported $23 million for each of the
three month periods ended September 30, 1995 and 1994.
Net investment income and interest credited to policyholders'
account balances for the nine months ended September 30, 1995 as
compared to the same period in 1994 have declined by
approximately $48 million and $45 million, respectively,
resulting in a $3 million reduction in interest spread. The
reductions in net investment income, interest credited to
policyholders' account balances and interest spread are primarily
attributable to the reduction in fixed rate contracts in-force.
The Company experienced net realized investment gains (losses) of
$3 million and $(11) million for the nine months ended September
30, 1995 and 1994, respectively. During 1994, the Company's
trading portfolio experienced $12 million of realized and
unrealized losses. The Company ceased utilizing the trading
portfolios during the fourth quarter 1994. Additionally, the
Company recorded $4 million of valuation allowances on its
commercial mortgage loan portfolio during 1994. No commercial
mortgage loan valuation allowances have been recorded during
1995. The remaining change in realized investment gains (losses)
is primarily attributable to normal sales activity from the
available for sale portfolios.
Policy charge revenue increased approximately $21 million during
the current nine month period as compared to the same period in
1994. MLIG and Merrill Lynch Asset Management, L.P. ("MLAM") have
entered into an agreement pursuant to which MLAM paid to MLIG an
administrative services fee in an amount equal to a portion of
the annual gross investment advisory fees received by MLAM from
Merrill Lynch Series Fund, Inc. ("Series Fund") and Merrill Lynch
Variable Series Funds, Inc. ("Variable Series Funds"). The
Company invests in the various mutual fund portfolios of the
Series Fund and the Variable Series Funds in connection with the
variable life insurance and variable annuities the Company has in-
force. During 1995, the Company recorded $9 million of revenue
attributable to this agreement and which was allocated to the
Company pursuant to it's service agreement with MLIG. The
remaining increase in policy charge revenue is primarily
attributable to the increase in policyholders' account balances
of the variable annuity product.
The market value adjustment expense is attributable to the
Company's market value adjusted annuity product. This contract
provision results in a market value adjustment to the cash
surrender value of those contracts which are surrendered before
the expiration of their interest rate guarantee period. The
market value adjustment expense has decreased $3 million during
the current nine month period as compared to the same period
during 1994 primarily as a result of the interest rate
environment during 1995 as compared to 1994. During the first
nine months of 1994 interest rates were generally lower than
during the first nine months of 1995. The market value adjustment
expense generally changes in an inverse relationship with the
movement of interest rates. Interest rates were generally lower
during the third quarter 1995 as compared to the same period
during 1994 resulting in the $1 million increase in the market
value adjustment expense between the three month periods.
Policy benefits increased approximately $3 million from $17
million for the first nine months of 1994 to $20 million for the
current nine month period. This increase is primarily
attributable to an increase in mortality claims during the first
nine months of 1995 as compared to the same period during 1994.
Amortization of deferred policy acquisition costs declined $12
million during the current nine month period as compared to the
same period during 1994. During the current quarter, the Company
reevaluated the expected gross profits on certain of it's life
insurance and annuity in-force contracts and determined that life
to date amortization required adjustment. As a result, the
Company recorded a reduction in amortization of $8 million. In
addition, there was a decline in fixed annuity contracts in-force
partially offset by the increase in variable annuity contracts in-
force.
Insurance expenses and taxes increased $4 million during the
current nine month period as compared to the same period in 1994.
This increase is primarily attributable to an increase in non-
capitalizable commission expense paid on in-force life and
annuity contracts.
The Company's effective federal income tax rate increased from
21% during the first nine months of 1994 to 35% for the same
period during 1995, principally as a result of recording an
adjustment to pre-1994 tax liabilities during the third quarter
1994.
I-1
<PAGE> 3
PART II Other Information
Item 1. Legal Proceedings.
Nothing to report.
Item 5. Other Information.
Nothing to report.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
Financial Data Schedule.
(b) Reports on Form 8-K.
None.
I-2
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MERRILL LYNCH LIFE INSURANCE COMPANY
/s/ JOSEPH E. CROWNE
-----------------------------------------
Joseph E. Crowne
Senior Vice President and
Chief Financial Officer
Date: November 14, 1995
I-3
<PAGE> 5
EXHIBIT INDEX
-------------
Exhibit
No. Description
- ------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 7
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<DEBT-HELD-FOR-SALE> 3,863,847
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 23,407
<MORTGAGE> 121,892
<REAL-ESTATE> 8,149
<TOTAL-INVEST> 5,035,694
<CASH> 115,354
<RECOVER-REINSURE> 1,562
<DEFERRED-ACQUISITION> 380,391
<TOTAL-ASSETS> 12,318,447
<POLICY-LOSSES> 28,247
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 12,335
<POLICY-HOLDER-FUNDS> 4,908,117
<NOTES-PAYABLE> 0
<COMMON> 2,000
0
0
<OTHER-SE> 664,142
<TOTAL-LIABILITY-AND-EQUITY> 12,318,447
0
<INVESTMENT-INCOME> 285,266
<INVESTMENT-GAINS> 2,543
<OTHER-INCOME> 103,973
<BENEFITS> 14,953
<UNDERWRITING-AMORTIZATION> 41,501
<UNDERWRITING-OTHER> 32,508
<INCOME-PRETAX> 91,230
<INCOME-TAX> 31,806
<INCOME-CONTINUING> 59,424
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 59,424
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<RESERVE-OPEN> 0
<PROVISION-CURRENT> 0
<PROVISION-PRIOR> 0
<PAYMENTS-CURRENT> 0
<PAYMENTS-PRIOR> 0
<RESERVE-CLOSE> 0
<CUMULATIVE-DEFICIENCY> 0
</TABLE>
