Lincoln National Corp.

The stable outlook reflects LFG's competitive position across a number of products and its robust risk management that we view as sustainable. We could lower the ratings on LFG within the next two years if, contrary to our expectations, its: Capital adequacy deteriorates for an extended period to a level that no longer supports the ratings and we believe it will stay there; Competitive position erodes significantly in its key markets because of material sales decline or net outflow, and we believe this will be sustained relative to peers; or Operating performance is more in line with lower-rated peers. We view an upgrade as unlikely over the next two years because we believe both LFG's business and financial risk profiles

...Lincoln Financial Group (LFG) has diverse earnings and has consistently achieved risk-adjusted return targets, as well as sacrificed some premium volume due to recent repricing actions. LFG's sources of earnings include annuity, life, group protection, and retirement plan services. The group has historically enjoyed top market positions in several products (such as universal life, variable universal life, combination life and long-term care products, and variable annuities). Its recent pricing actions have affected sales in a few products, though we view the repricing actions consistent with its business strategies and expect its market positions in core products to be relatively stable. We expect LFG to remain financially strong despite potential volatility in profitability. LFG's management team is committed to '##' capital adequacy, per our proprietary risk-based capital (RBC) model. Its earnings can be volatile due to total hedging of the risks in its annuity products, but are generally...

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