Exhibit 12
LINCOLN NATIONAL CORPORATION AND SUBSIDIARIES
HISTORICAL RATIO OF EARNINGS TO FIXED CHARGES
(dollars in millions)
For the Years Ended December 31, | ||||||||||||||||
2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||
Income (loss) from continuing operations before taxes | $ | 1,568 | $ | 503 | $ | 1,135 | $ | (673 | ) | $ | (168 | ) | ||||
Sub-total of fixed charges | 282 | 308 | 307 | 292 | 303 | |||||||||||
Sub-total of adjusted income (loss) | 1,850 | 811 | 1,442 | (381 | ) | 135 | ||||||||||
Interest on annuities and financial products | 2,478 | 2,488 | 2,499 | 2,513 | 2,538 | |||||||||||
Adjusted income (loss) base | $ | 4,328 | $ | 3,299 | $ | 3,941 | $ | 2,132 | $ | 2,673 | ||||||
Fixed Charges | ||||||||||||||||
Interest and debt expense (1) | $ | 268 | $ | 286 | $ | 286 | $ | 261 | $ | 281 | ||||||
Interest expense related to uncertain tax positions | 1 | 9 | 7 | 13 | 2 | |||||||||||
Portion of rent expense representing interest | 13 | 13 | 14 | 18 | 20 | |||||||||||
Sub-total of fixed charges excluding interest on annuities and financial products | 282 | 308 | 307 | 292 | 303 | |||||||||||
Interest on annuities and financial products | 2,478 | 2,488 | 2,499 | 2,513 | 2,538 | |||||||||||
Total fixed charges | $ | 2,760 | $ | 2,796 | $ | 2,806 | $ | 2,805 | $ | 2,841 | ||||||
Ratio of sub-total of adjusted income (loss) to sub-total of fixed charges excluding interest on annuities and financial products (2) | 6.56 | 2.63 | 4.70 | NM | NM | |||||||||||
Ratio of adjusted income (loss) base to total fixed charges (2) | 1.57 | 1.18 | 1.40 | NM | NM |
(1) | Interest and debt expense excludes a $5 million loss, $8 million loss, $5 million loss and $64 million gain related to the early retirement of debt in 2012, 2011, 2010 and 2009, respectively. |
(2) | The ratios of earnings to fixed charges for the years ended December 31, 2009 and 2008, indicated a less than one-to-one coverage and are therefore not presented. Additional earnings of $673 million and $168 million would have been required for the years ended December 31, 2009 and 2008, respectively, to achieve ratios of one-to-one coverage. |