* * LIFE AND ACCIDENT AND HEALTH COMPANIES - ASSOCIATION EDITION

Transcription

1 * * LIFE AND ACCIDENT AND HEALTH COMPANIES - ASSOCIATION EDITION QUARTERLY STATEMENT AS OF MARCH 31, 017 OF THE CONDITION AND AFFAIRS OF THE NAIC Group Code NAIC Company Code Employer's ID Number (Current) (Prior) Organized under the Laws of NEBRASKA, State of Domicile or Port of Entry NEBRASKA Country of Domicile UNITED STATES OF AMERICA Incorporated/Organized 01/0/1868 Commenced Business 05/01/1868 Statutory Home Office 6750 MERCY ROAD, OMAHA, NE, US (Street and Number) (City or Town, State, Country and Zip Code) Main Administrative Office 700 NEWPORT CENTER DRIVE (Street and Number) NEWPORT BEACH, CA, US 9660, (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Mail Address 700 NEWPORT CENTER DRIVE, NEWPORT BEACH, CA, US 9660 (Street and Number or P.O. Box) (City or Town, State, Country and Zip Code) Primary Location of Books and Records 700 NEWPORT CENTER DRIVE (Street and Number) NEWPORT BEACH, CA, US 9660, (City or Town, State, Country and Zip Code) (Area Code) (Telephone Number) Internet Website Address Statutory Statement Contact STEVEN HOWARD SPARKS, (Name) (Area Code) (Telephone Number) STEVE.SPARKS@PACIFICLIFE.COM, ( Address) (FAX Number) Chairman, President & Chief Executive Officer Senior Vice President & Chief Accounting Officer JANE MARIE GUON Vice President & Secretary JAMES THOMAS MORRIS EDWARD RALPH BYRD OFFICERS Executive Vice President & Chief Financial Officer DARRYL DOUGLAS BUTTON # OTHER JOSEPH WARD KRUM Vice President & Treasurer DIRECTORS OR TRUSTEES DARRYL DOUGLAS BUTTON # SHARON ANN CHEEVER ADRIAN SCOTT GRIGGS LAWRENCE FRANCIS HARR JAMES THOMAS MORRIS The officers of this reporting entity being duly sworn, each depose and say that they are the described officers of said reporting entity, and that on the reporting period stated above, all of the herein described assets were the absolute property of the said reporting entity, free and clear from any liens or claims thereon, except as herein stated, and that this statement, together with related exhibits, schedules and explanations therein contained, annexed or referred to, is a full and true statement of all the assets and liabilities and of the condition and affairs of the said reporting entity as of the reporting period stated above, and of its income and deductions therefrom for the period ended, and have been completed in accordance with the NAIC Annual Statement Instructions and Accounting Practices and Procedures manual except to the extent that: (1) state law may differ; or, () that state rules or regulations require differences in reporting not related to accounting practices and procedures, according to the best of their information, knowledge and belief, respectively. Furthermore, the scope of this attestation by the described officers also includes the related corresponding electronic filing with the NAIC, when required, that is an exact copy (except for formatting differences due to electronic filing) of the enclosed statement. The electronic filing may be requested by various regulators in lieu of or in addition to the enclosed statement. James Thomas Morris Darryl Douglas Button Edward Ralph Byrd Chairman, President & Chief Executive Officer Executive Vice President & Chief Financial Officer Senior Vice President & Chief Accounting Officer a. Is this an original filing?... Yes [ X ] No [ ] b. If no, 1. State the amendment number.... filed Number of pages attached... State of County of California Orange SS: Subscribed and sworn to (or affirmed) before me this day of May, 017 by James Thomas Morris, Darryl Douglas Button, and Edward Ralph Byrd, proved to me on the basis of satisfactory evidence to be the persons who appeared before me. Signature of Notary Public

2 ASSETS 1 Assets Current Statement 4 3 December 31 Net Admitted Assets Prior Year Net Nonadmitted Assets (Cols. 1 - ) Admitted Assets 1. Bonds 39,94,68,000 39,94,68,000 38,441,15,680. Stocks:.1 Preferred stocks 0,01,741 0,01,741 19,345,791. Common stocks 88,496,71 11,687, ,808,911,68,3, Mortgage loans on real estate: 3.1 First liens 10,314,800,88 10,314,800,88 9,876,37, Other than first liens 4. Real estate: 4.1 Properties occupied by the company (less $ 0 encumbrances) 130,688,73 130,688,73 13,604, Properties held for the production of income (less $ 0 encumbrances) 33,910,819 33,910,819 34,106, Properties held for sale (less $ encumbrances) 5. Cash ($ 10,919,967 ), cash equivalents ($ 0 ) and short-term investments ($ 441,360,133 ) 56,80,100 56,80, ,706,71 6. Contract loans (including $ 0 premium notes) 7,51,788, ,86 7,51,009,058 7,49,643,00 7. Derivatives 451,380,81 451,380,81 418,496, Other invested assets 3,511,810,555 1,685,95 3,499,15,59 1,634,17,33 9. Receivables for securities 14,669,7 14,669,7 34,671, Securities lending reinvested collateral assets 69,184,94 69,184,94 184,405, Aggregate write-ins for invested assets 5,865,53 5,865,53 7,514, Subtotals, cash and invested assets (Lines 1 to 11) 6,959,570,606 16,15,931 6,833,417,675 61,549,469, Title plants less $ charged off (for Title insurers only) 14. Investment income due and accrued 534,47, ,47, ,88, Premiums and considerations: 15.1 Uncollected premiums and agents' balances in the course of collection 137,481,938 1,019, ,46,83 143,838, Deferred premiums, agents' balances and installments booked but deferred and not yet due (including $ 103,513,49 earned but unbilled premiums) 111,467,8 111,467,8 143,636, Accrued retrospective premiums ($ ) and 16. Reinsurance: contracts subject to redetermination ($ ) 16.1 Amounts recoverable from reinsurers 179,100, ,100, ,97, Funds held by or deposited with reinsured companies 61,108,814 61,108,814 56,609, Other amounts receivable under reinsurance contracts 33,757,61 33,757,61 10,350, Amounts receivable relating to uninsured plans 18.1 Current federal and foreign income tax recoverable and interest thereon 145,88, ,88, ,876, Net deferred tax asset 1,19,690,794 44,41, ,78, ,110, Guaranty funds receivable or on deposit 3,179,60 3,179,60 3,169, Electronic data processing equipment and software 93,881,508 79,460,05 14,41,483 15,74, Furniture and equipment, including health care delivery assets ($ 0 ) 8,988,947 8,988,947. Net adjustment in assets and liabilities due to foreign exchange rates 3. Receivables from parent, subsidiaries and affiliates 40,04,518 40,04,518 1,108, Health care ($ 0 ) and other amounts receivable 19,850,107 8,08,38 11,81,779 11,080, Aggregate write-ins for other than invested assets 175,510,61 34,615, ,895,58 133,618, Total assets excluding Separate Accounts, Segregated Accounts and Protected Cell Accounts (Lines 1 to 5) 65,833,148,843 68,677,05 65,150,471,791 63,845,953, From Separate Accounts, Segregated Accounts and Protected Cell Accounts 56,101,10,147 56,101,10,147 54,78,493,73 8. Total (Lines 6 and 7) 11,934,358,990 68,677,05 11,51,681, ,68,447,191 DETAILS OF WRITE-INS Derivatives collateral receivable 5,865,53 5,865,53 7,514, Summary of remaining write-ins for Line 11 from overflow page Totals (Lines 1101 through 1103 plus 1198)(Line 11 above) 5,865,53 5,865,53 7,514, Prepaid pension costs 1,9,977 1,9, Cash value of life insurance policies 116,689,34 116,689,34 110,159, Accounts and notes receivable 8,90,900 8,90,900 8,347, Summary of remaining write-ins for Line 5 from overflow page 48,688,41 33,385,053 15,303,359 15,111, Totals (Lines 501 through 503 plus 598)(Line 5 above) 175,510,61 34,615, ,895,58 133,618,889

3 LIABILITIES, SURPLUS AND OTHER FUNDS 1 Current December 31 Prior Year Statement 1. Aggregate reserve for life contracts $ 50,93,49,047 less $ 0 included in Line 6.3 (including $ 5,981,631,06 Modco Reserve) 50,93,49,047 50,040,513,41. Aggregate reserve for accident and health contracts (including $ 0 Modco Reserve) 19,368,93 19,181, Liability for deposit-type contracts (including $ 0 Modco Reserve),799,495,44,71,461, Contract claims: 4.1 Life 816,03, ,715, Accident and health 5. Policyholders dividends $ 11,446 and coupons $ 0 due and unpaid 11, , Provision for policyholders dividends and coupons payable in following calendar year - estimated amounts: 6.1 Dividends apportioned for payment (including $ 0 Modco) 8,663,180 8,77, Dividends not yet apportioned (including $ 0 Modco) 1,13,845 1,50, Coupons and similar benefits (including $ Modco) 7. Amount provisionally held for deferred dividend policies not included in Line 6 8. Premiums and annuity considerations for life and accident and health contracts received in advance less $ 0 discount; including $ 0 accident and health premiums 1,755, , Contract liabilities not included elsewhere: 9.1 Surrender values on canceled contracts 9. Provision for experience rating refunds, including the liability of $ accident and health experience rating refunds of which $ is for medical loss ratio rebate per the Public Health Service Act 9.3 Other amounts payable on reinsurance, including $ 75,344,807 assumed and $ 55,778,91 ceded 131,13,78 113,39, Interest Maintenance Reserve 179,36, ,30, Commissions to agents due or accrued-life and annuity contracts $ 8,303,108, accident and health $ 0 and deposit-type contract funds $ 1,660,089 9,963,197,197, Commissions and expense allowances payable on reinsurance assumed 10,10,586 10,31,3 1. General expenses due or accrued 141,855, ,660, Transfers to Separate Accounts due or accrued (net) (including $ (813,469,13) accrued for expense allowances recognized in reserves, net of reinsured allowances) (814,06,556) (833,3,879) 14. Taxes, licenses and fees due or accrued, excluding federal income taxes,879,55 5,73, Current federal and foreign income taxes, including $ on realized capital gains (losses) 15. Net deferred tax liability 16. Unearned investment income 177,60,35 34,088, Amounts withheld or retained by company as agent or trustee 14,60,613 1,661, Amounts held for agents' account, including $ agents' credit balances 19. Remittances and items not allocated 9,38,683 3,149, Net adjustment in assets and liabilities due to foreign exchange rates 1. Liability for benefits for employees and agents if not included above 180,183, ,849,371. Borrowed money $ 5,17,47 and interest thereon $ 04,40 5,331,89 5,531, Dividends to stockholders declared and unpaid 4. Miscellaneous liabilities: 4.01 Asset valuation reserve 669,486, ,85, Reinsurance in unauthorized and certified ($ 751 ) companies 18,164,35 463, Funds held under reinsurance treaties with unauthorized and certified ($ 0 ) reinsurers 11,194,644 14,130, Payable to parent, subsidiaries and affiliates 5,750,31 7,376, Drafts outstanding 4.06 Liability for amounts held under uninsured plans 4.07 Funds held under coinsurance 6,355,167 58,558, Derivatives 34,309,976 4,44, Payable for securities 73,118,70 11,035, Payable for securities lending 69,184,94 184,405, Capital notes $ and interest thereon $ 5. Aggregate write-ins for liabilities 394,949, ,09, Total liabilities excluding Separate Accounts business (Lines 1 to 5) 56,45,715,858 55,97,533,04 7. From Separate Accounts Statement 56,101,10,147 54,78,493,73 8. Total liabilities (Lines 6 and 7) 11,553,96, ,080,06,97 9. Common capital stock 30,000,000 30,000, Preferred capital stock 31. Aggregate write-ins for other than special surplus funds 36,16,098 38,43, Surplus notes 1,715,418,838 1,715,361, Gross paid in and contributed surplus 1,185,538,610 1,185,438, Aggregate write-ins for special surplus funds 35. Unassigned funds (surplus) 5,530,67,388 5,379,375, Less treasury stock, at cost: 36.1 shares common (value included in Line 9 $ ) 36. shares preferred (value included in Line 30 $ ) 37. Surplus (Total Lines ) (including $ 0 in Separate Accounts Statement) 8,667,755,933 8,518,40, Totals of Lines 9, 30 and 37 8,697,755,933 8,548,40, Totals of Lines 8 and 38 (Page, Line 8, Col. 3) 11,51,681, ,68,447,191 DETAILS OF WRITE-INS 501. Derivatives collateral payable and income accruals 330,375,494 50,114, Disbursements payable 47,30,046 36,309, Unclaimed accounts and uncashed checks 5,767,381 6,757, Summary of remaining write-ins for Line 5 from overflow page 11,486,469 13,07, Totals (Lines 501 through 503 plus 598)(Line 5 above) 394,949, ,09, Other surplus adjustments - derivatives 36,16,098 38,43, Summary of remaining write-ins for Line 31 from overflow page Totals (Lines 3101 through 3103 plus 3198)(Line 31 above) 36,16,098 38,43, Summary of remaining write-ins for Line 34 from overflow page Totals (Lines 3401 through 3403 plus 3498)(Line 34 above) 3

4 SUMMARY OF OPERATIONS 1 Current Year Prior Year To 3 Prior Year Ended December 31 To 1. Premiums and annuity considerations for life and accident and health contracts,178,464,770 1,996,783,075 8,300,487,95. Considerations for supplementary contracts with life contingencies 141, , Net investment income 549,638,54 649,,01,414,587, Amortization of Interest Maintenance Reserve (IMR) 6,317,10 7,080,463 8,913, Separate Accounts net gain from operations excluding unrealized gains or losses 6. Commissions and expense allowances on reinsurance ceded 37,001,679 34,447, ,531, Reserve adjustments on reinsurance ceded (57,057,861) (18,583,371) (913,96,498) 8. Miscellaneous Income: 8.1 Income from fees associated with investment management, administration and contract guarantees from Separate Accounts 315,80,783 30,75,088 1,41,053, Charges and fees for deposit-type contracts 5,39,798 7,004,160 33,119, Aggregate write-ins for miscellaneous income 38,0,46 36,386,770 1,713, Totals (Lines 1 to 8.3),873,91,467,815,065,887 11,467,48, Death benefits 369,360, ,649,173 1,457,450, Matured endowments (excluding guaranteed annual pure endowments) 03, ,68 1,468, Annuity benefits 176,811,04 175,955, ,794, Disability benefits and benefits under accident and health contracts 97, ,75 4,991, Coupons, guaranteed annual pure endowments and similar benefits 15. Surrender benefits and withdrawals for life contracts 1,615,580,47 1,375,196,980 5,775,917, Group conversions 17. Interest and adjustments on contract or deposit-type contract funds 4,189,558 18,751,734 67,364, Payments on supplementary contracts with life contingencies 86,075 13, , Increase in aggregate reserves for life and accident and health contracts 891,11,01 854,866,889 3,415,50, Totals (Lines 10 to 19) 3,078,71,54,764,450,533 11,44,788, Commissions on premiums, annuity considerations, and deposit-type contract funds (direct business only) 195,343, ,137, ,539,59. Commissions and expense allowances on reinsurance assumed 5,889,051 5,3,769 4,870, General insurance expenses 176,553,37 157,511,349 64,153,67 4. Insurance taxes, licenses and fees, excluding federal income taxes 6,43,703 4,04,68 83,81,93 5. Increase in loading on deferred and uncollected premiums 104,465 77,340 98, Net transfers to or (from) Separate Accounts net of reinsurance (735,111,353) (537,958,638) (,440,386,91) 7. Aggregate write-ins for deductions (,916,479) 4,65,469 6,403, Totals (Lines 0 to 7),744,557,840,594,109,138 10,485,488, Net gain from operations before dividends to policyholders and federal income taxes (Line 9 minus Line 8) 19,363,67 0,956, ,759, Dividends to policyholders 3,608,716 3,833,86 8,993, Net gain from operations after dividends to policyholders and before federal income taxes (Line 9 minus Line 30) 15,754,911 17,13,463 97,766, Federal and foreign income taxes incurred (excluding tax on capital gains) 5,307,139 30,1, ,476, Net gain from operations after dividends to policyholders and federal income taxes and before realized capital gains or (losses) (Line 31 minus Line 3) 100,447,77 186,901,66 803,90, Net realized capital gains (losses) (excluding gains (losses) transferred to the IMR) less capital gains tax of $ 8,704,513 (excluding taxes of $,088,381 transferred to the IMR) 109,769,68 (4,035,901) 46,696, Net income (Line 33 plus Line 34) 10,17,040 16,865, ,987,344 CAPITAL AND SURPLUS ACCOUNT 36. Capital and surplus, December 31, prior year 8,548,40,65 7,76,479,501 7,76,479, Net income (Line 35) 10,17,040 16,865, ,987, Change in net unrealized capital gains (losses) less capital gains tax of $ (7,719,518) (5,179,653) (39,484,010) 38,161, Change in net unrealized foreign exchange capital gain (loss),869,706 3,000,736 (7,443,03) 40. Change in net deferred income tax (14,575,401) 14,96,519 33,00, Change in nonadmitted assets 17,199,410 (40,933,531) (84,6,466) 4. Change in liability for reinsurance in unauthorized and certified companies (17,700,506) (13,815,819) 1, Change in reserve on account of change in valuation basis, (increase) or decrease 44. Change in asset valuation reserve 5,338,657 4,99,589 5,79, Change in treasury stock 46. Surplus (contributed to) withdrawn from Separate Accounts during period 47. Other changes in surplus in Separate Accounts Statement 48. Change in surplus notes 56,908 (56,16,986) (55,956,6) 49. Cumulative effect of changes in accounting principles 50. Capital changes: 50.1 Paid in 50. Transferred from surplus (Stock Dividend) 50.3 Transferred to surplus 51. Surplus adjustment: 51.1 Paid in 100, Transferred to capital (Stock Dividend) 51.3 Transferred from capital 51.4 Change in surplus as a result of reinsurance 5. Dividends to stockholders 53. Aggregate write-ins for gains and losses in surplus (1,990,491) (0,64,348) 6,619, Net change in capital and surplus for the year (Lines 37 through 53) 149,335,669 53,133, ,940, Capital and surplus, as of statement date (Lines ) 8,697,755,933 7,815,613,41 8,548,40,65 DETAILS OF WRITE-INS Fee income 30,366,505 3,063, ,590, Miscellaneous income 7,835,90 4,3,790,3, Reinsurance recapture fee ,890, Summary of remaining write-ins for Line 8.3 from overflow page Totals (Lines through plus ) (Line 8.3 above) 38,0,46 36,386,770 1,713, Net periodic benefit cost 1,991,736,169,003 7,77, Miscellaneous disbursements (5,069,575),39,945 (,601,78) 703. Contingency expense 161,360 63,5 1,78, Summary of remaining write-ins for Line 7 from overflow page 799. Totals (Lines 701 through 703 plus 798)(Line 7 above) (,916,479) 4,65,469 6,403, Adjustments to retirement plans 17,50 0,651, Other surplus adjustments - derivatives (,117,741) (0,64,348) (6,456,88) Prior period tax adjustment 0 0 (3,580,000) Summary of remaining write-ins for Line 53 from overflow page ,004, Totals (Lines 5301 through 5303 plus 5398)(Line 53 above) (1,990,491) (0,64,348) 6,619,037 4

5 CASH FLOW 1 Current Year To Cash from Operations Prior Year To 3 Prior Year Ended December Premiums collected net of reinsurance,18,943,131 1,950,650,754 8,4,554,563. Net investment income 48,331, ,43,15,48,51,70 3. Miscellaneous income 04,574, ,697, ,31,86 4. Total (Lines 1 to 3),851,848,817,619,779,91 11,189,397, Benefit and loss related payments,175,75,979 1,878,467,077 7,99,076,83 6. Net transfers to Separate Accounts, Segregated Accounts and Protected Cell Accounts (754,137,676) (548,853,615) (,51,957,306) 7. Commissions, expenses paid and aggregate write-ins for deductions 459,801,73 444,756,375 1,433,530, Dividends paid to policyholders 3,789,67 4,496,911 13,664, Federal and foreign income taxes paid (recovered) net of $ tax on capital gains (losses) 5,51,438 (7,406,175) 168,03, Total (Lines 5 through 9) 1,890,4,146 1,771,460,573 7,031,338, Net cash from operations (Line 4 minus Line 10) 961,606, ,319,348 4,158,059,66 Cash from Investments 1. Proceeds from investments sold, matured or repaid: 1.1 Bonds 83,684, ,40,08 3,336,736, Stocks 16,03,105 1,900 8,063, Mortgage loans 70,996, ,417, ,789, Real estate 1.5 Other invested assets 360,7,567 19,755,97 787,114, Net gains or (losses) on cash, cash equivalents and short-term investments (1,436,15) (7,3,408) (1,911,086) 1.7 Miscellaneous proceeds 77,538, ,405,715 79,018, Total investment proceeds (Lines 1.1 to 1.7) 1,547,043,3 1,168,767,896 4,793,81, Cost of investments acquired (long-term only): 13.1 Bonds 1,649,33,436,08,351,731 7,73,11, Stocks 13,58, ,000 61,800, Mortgage loans 503,166,899 5,081,096 1,46,785, Real estate 117,30 8,060 1,4, Other invested assets 358,581,556 85,053, ,776, Miscellaneous applications 6,055,794 17,445,045 33,848, Total investments acquired (Lines 13.1 to 13.6),586,503,578,493,459,819 10,10,754, Net increase (or decrease) in contract loans and premium notes 91,417,89 (4,00,51) 105,15, Net cash from investments (Line 1.8 minus Line 13.7 and Line 14) (1,130,878,149) (1,8,671,67) (5,43,095,33) 16. Cash provided (applied): Cash from Financing and Miscellaneous Sources 16.1 Surplus notes, capital notes 0 (56,05,000) (56,05,000) 16. Capital and paid in surplus, less treasury stock 16.3 Borrowed funds (199,978) (165,34) (673,786) 16.4 Net deposits on deposit-type contracts and other insurance liabilities 58,780,43 77,665, ,460, Dividends to stockholders 16.6 Other cash provided (applied) (35,735,408) (35,783,18) (19,491,964) 17. Net cash from financing and miscellaneous sources (Line 16.1 through Line 16.4 minus Line 16.5 plus Line 16.6),844,856 (14,487,440) 465,089,796 RECONCILIATION OF CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS 18. Net change in cash, cash equivalents and short-term investments (Line 11, plus Lines 15 and 17) (146,46,61) (448,839,763) (808,945,901) 19. Cash, cash equivalents and short-term investments: 19.1 Beginning of year 708,706,71 1,517,65,6 1,517,65,6 19. End of period (Line 18 plus Line 19.1) 56,80,100 1,068,81, ,706,71 Note: Supplemental disclosures of cash flow information for non-cash transactions: Bonds disposed and acquired 19,088,73 57,705, ,31, Stocks disposed and acquired 1,900 1,900 7, Common stock contributed from Pacific LifeCorp 100, Bonds converted to stocks 0 0 1,811, Bonds converted to other invested assets ,477, Common stock transferred to other invested assets 1,089,675, Bond interest and common stock dividend in-kind received 1,50,041,595,135 10,451, Premiums reported in funds withheld assets 66, ,496 61,71 5

6 EXHIBIT 1 DIRECT PREMIUMS AND DEPOSIT-TYPE CONTRACTS 1 Current Year To Prior Year To 3 Prior Year Ended December Industrial life. Ordinary life insurance 746,646, ,74,845 3,0,168, Ordinary individual annuities 1,40,118,986 1,304,048, 4,98,50, Credit life (group and individual) 5. Group life insurance 6. Group annuities 58,841,903 67,116,56 530,948, A & H - group 8. A & H - credit (group and individual) 9. A & H - other 10. Aggregate of all other lines of business 11. Subtotal,5,607,696,036,907,69 8,481,60,61 1. Deposit-type contracts 111,3,14 156,440, ,031, Total,336,830,838,193,348,568 9,0,65,19 DETAILS OF WRITE-INS Summary of remaining write-ins for Line 10 from overflow page Totals (Lines 1001 through 1003 plus 1098)(Line 10 above) 6

7 NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND GOING CONCERN A. Accounting Practices: Pacific Life Insurance Company (the Company or Pacific Life) prepares its financial statements based on accounting practices prescribed or permitted by the Nebraska Department of Insurance (NE DOI). The National Association of Insurance Commissioners (NAIC) Accounting Practices and Procedures Manual (NAIC SAP) has been adopted as a component of prescribed or permitted practices by the NE DOI. Prescribed statutory accounting practices include state laws and regulations. Additionally, the Director of the NE DOI has the right to permit other specific practices, which deviate from prescribed practices. The NE DOI has a prescribed accounting practice for certain synthetic guaranteed interest contract (GIC) reserves that differs from NAIC SAP. The NE DOI reserve method is based on an annual accumulation of 30% of the contract fees on synthetic GICs and is subject to a maximum of 150% of the annualized contract fees. This reserve amounted to $65 million and $63 million as of March 31, 017 and December 31, 016, respectively, and has been recorded by the Company. The NAIC SAP basis for this reserve equals the excess, if any, of the value of guaranteed contract liabilities over the market value of the assets in the segregated portfolio less deductions based on asset valuation reserve (AVR) factors, if applicable. As of March 31, 017 and December 31, 016, the reserve for synthetic GICs using the NAIC SAP basis was zero. The following table reconciles the Company s net income for the three months ended March 31, 017 and the year end December 31, 016 and statutory surplus as of March 31, 017 and December 31, 016, between NAIC SAP and practices prescribed and permitted by the NE DOI: F/S F/S March 31, December 31, SSAP # Page Line NET INCOME 1. Net Income, Nebraska basis (Page 4, Line 35, Columns 1 & 3) $10,17,040 $849,987,344. State Prescribed Practices that increase/(decrease) NAIC SAP: Synthetic GICs (1,848,674) (1,30,010) 3. State Permitted Practices that increase/(decrease) NAIC SAP: Net Income, NAIC SAP (1--3=4) $1,065,714 $851,17,354 SURPLUS 5. Statutory Surplus, Nebraska basis (Page 3, Line 38, Columns 1 & ) $8,697,755,933 $8,548,40,65 6. State Prescribed Practices that increase/(decrease) NAIC SAP: Synthetic GICs (65,085,886) (63,37,1) 7. State Permitted Practices that increase/(decrease) NAIC SAP: Statutory Surplus, NAIC SAP (5-6-7=8) $8,76,841,819 $8,611,657,477 B. Use of Estimates in the Preparation of the Financial Statements: No change C. Accounting Policies: No change D. Going Concern: The Company is not aware of any current situation or event that would cause doubt about its ability to continue as a going concern.. ACCOUNTING CHANGES AND CORRECTIONS OF ERRORS Effective January 1, 017, the Statement of Statutory Accounting Principles (SSAP) No. 51R, Life Contracts, was issued which made substantive revisions to SSAP No. 51 to reference the Valuation Manual as part of Principle-Based Reserve (PBR) implementation. For life insurance policies issued during , the first three years following the operative date of the Valuation Manual, the Valuation Manual allows companies to continue using the current reserve methodologies. As of March 31, 017, the Company has not yet determined the date when it will implement PBR for newly issued life insurance policies. 3. BUSINESS COMBINATIONS AND GOODWILL None 4. DISCONTINUED OPERATIONS None 7

8 NOTES TO FINANCIAL STATEMENTS 5. INVESTMENTS A. Mortgage Loans, including mezzanine real estate loans: 1. The maximum and minimum lending rates for new mortgage loans during 017 were: Maximum Minimum a. Farm 5.00% 4.40% b. Construction and land development 5.69% 5.3% c. M ulti-family residential 7.00% 5.35% d. Commerical 4.3% 4.%. The maximum percentage of any one loan to the value of security at the time of the loan, exclusive of insured or guaranteed or purchase money mortgages was 100%. M arch 31, December 31, Taxes, assessments, and any amounts advanced and not included in the mortgage loan total $0 $0 4. Age analysis of mortgage loans 5. Investment in impaired loans with or without allowance for credit losses Residential Commercial Farm Insured All Other Insured All Other Mezzanine Total a. Current Year 1. Recorded Investment (All) (a) Current $13,19,55 $0 $16,415,787 $0 $9,974,705,374 $110,460,14 $10,314,800,88 (b) Days Past Due (c) Days Past Due (d) Days Past Due (e) 180+ Days Past Due Accruing Interest Days Past Due (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Interest Accrued Accruing Interest 180+ Days Past Due (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Interest Accrued Interest Reduced (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Number of Loans (c) Percent Reduced 0% 0% 0% 0% 0% 0% 0% b. Prior Year 1. Recorded Investment (a) Current $,395,019 $0 $187,410,745 $0 $9,575,664,916 $110,90,093 $9,876,37,773 (b) Days Past Due (c) Days Past Due (d) Days Past Due (e) 180+ Days Past Due Accruing Interest Days Past Due (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Interest Accrued Accruing Interest 180+ Days Past Due (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Interest Accrued Interest Reduced (a) Recorded Investment $0 $0 $0 $0 $0 $0 $0 (b) Number of Loans (c) Percent Reduced 0% 0% 0% 0% 0% 0% 0% Residential Commercial Farm Insured All Other Insured All Other Mezzanine Total a. Current Year 1. With Allowance for Credit Losses $0 $0 $0 $0 $0 $0 $0. No Allowance for Credit Losses ,643, ,643,191 b. Prior Year 1. With Allowance for Credit Losses $0 $0 $0 $0 $0 $0 $0. No Allowance for Credit Losses ,047, ,047,

9 NOTES TO FINANCIAL STATEMENTS 6. Investment in impaired loans average recorded investment, interest income recognized, recorded investment on nonaccrual status and amount of interest income recognized using a cash-basis method of accounting: Residential Commercial Farm Insured All Other Insured All Other Mezzanine Total a. Current Year 1. Average Recorded Investment $0 $0 $0 $0 $306,345,189 $0 $306,345,189. Interest Income Recognized ,388,931 0,388, Recorded Investments on Nonaccrual Status ,000, ,000, Amount of Interest Income Recognized Using a Cash- Basis Method of Accounting ,67, ,67,818 b. Prior Year 1. Average Recorded Investment $0 $0 $0 $0 $308,591,766 $0 $308,591,766. Interest Income Recognized ,76, ,76, Recorded Investments on Nonaccrual Status ,000, ,000, Amount of Interest Income Recognized Using a Cash- Basis Method of Accounting ,043,855 0,043,855 M arch 31, December 31, 7. Allowance for credit losses: a. Balance at beginning of period $0 $0 b. Additions charged to operations 0 0 c. Direct write-downs charged against the allowances 0 0 d. Recoveries of amounts previously charged off 0 0 e. Balance at end of period $0 $0 8. No mortgage loans were derecognized as a result of foreclosure. 9. The Company generally recognizes interest income on its impaired loans upon receipt. B. Debt Restructuring: M arch 31, December 31, The total recorded investment in restructured loans and bonds, as of year-end $,669,834 $3,36,385. The realized capital losses related to these loans and bonds 0 1,006, Total contractual commitments to extend credit to debtors owing receivables whose terms have been modified in troubled debt restructurings 519,79 519,79 4. The Company accrues interest income on impaired loans and bonds to the extent it is deemed collectible (delinquent less than 90 days) and the loans and bonds continue to perform under their original or restructured contractual terms. Interest income on non-performing loans is generally recognized on a cash basis. C. Reverse Mortgages: None D. Loan-backed Securities: 1. Prepayment assumptions for loan-backed and structured securities (LBASS) were obtained from industry prepayment models and internal estimates. These assumptions are consistent with the current interest rate and economic conditions at the time of valuation.. None 3. None 4. The unrealized losses of LBASS where fair value is less than cost or amortized cost for which an OTTI has not been recognized in earnings as of March 31, 017 are as follows: a. The aggregate amount of unrealized losses: March 31, Less than 1 M onths $5,887, M onths or Longer 38,358,300 b. The aggregate related estimated fair value of securities with unrealized losses: 1. Less than 1 M onths $1,189,864, M onths or Longer 838,375,095 7.

10 NOTES TO FINANCIAL STATEMENTS 5. Additional information: In determining whether a decline in value is other than temporary, the Company considers several factors including, but not limited to the following: the extent and duration of the decline in value, the reasons for the decline (credit event, currency, or interest rate related including spread widening); the Company s inability or lack of intent to retain the investment for a period of time sufficient to recover the amortized cost basis; and the performance of the security s underlying collateral and projected future cash flows. In projecting future cash flows, the Company incorporates inputs from third-party sources and applies reasonable judgment in developing assumptions used to estimate the probability and timing of collecting all contractual cash flows. E. Repurchase agreements and/or securities lending transactions 1. The Company participates in securities lending programs administered by an authorized financial institution whereby certain investment securities are loaned to third parties. With respect to securities loaned, the Company requires initial cash collateral equal to a minimum of 10% of the fair value of domestic securities loaned. The Company records an offsetting liability in payable for securities lending on Page 3 Liabilities, Surplus and Other Funds. The Company monitors the fair value of securities loaned with additional collateral obtained as necessary. The borrower of the loaned securities is permitted to sell or repledge those securities.. None 3. Collateral Received a. Aggregate Amount of Collateral Received 1. Repurchase Agreement: None Estimated Fair. Securities Lending (a) Open $69,184,94 (b) 30 Days or Less 0 (c) 31 to 60 days 0 (d) 61 to 90 days 0 (e) Greater Than 90 days 0 (f) Sub-Total 69,184,94 (g) Securities Received 0 (h) Total Collateral Received $69,184,94 3. Dollar Repurchase Agreement: None b. The Company has not sold or repledged collateral received from securities lending agreements. c. The Company invests collateral received on securities lending in short-term investments. 4. The Company s securities lending transactions are not administered by an affiliated agent. 5. Collateral Reinvestment a. Aggregate Amount of Collateral Reinvested 1. Repurchase Agreement: None Amortized Estimated Fair Cost. Securities Lending (a) Open $0 $0 (b) 30 Days or Less 69,184,94 69,184,94 (c) 31 to 60 days 0 0 (d) 61 to 90 days 0 0 (e) 91 to 10 days 0 0 (f) 11 to 180 days 0 0 (g) 181 to 365 days 0 0 (h) 1 to years 0 0 (i) to 3 years 0 0 (j) Greater than 3 years 0 0 (k) Sub-total 69,184,94 69,184,94 (l) Securities Received 0 0 (m) Total Collateral Reinvested $69,184,94 $69,184,94 3. Dollar Repurchase Agreement: None b. To manage the mismatch of maturity dates between the security lending transactions and the related reinvestment of the collateral received, the Company reinvests in highly liquid assets and ensures that the collateral reinvested matures on the next business day. 6. The Company has not accepted collateral that is not permitted by contract or custom to sell or repledge for the reporting period. 7. The Company does not have any collateral for securities lending transactions that extend beyond one year from March 31,

11 NOTES TO FINANCIAL STATEMENTS F. Real Estate: 1. Impairment losses: None. Investments sold or classified as held for sale: None 3. Changes to a plan of sale: None 4. Retail land sales operations: Not applicable 5. Participating mortgage loan features: None G. Investments in low income housing tax credits (LIHTC): No change H. Restricted Assets: 1. Restricted Assets (Including Pledged) Gross (Admitted& Nonadmitted) Restricted Current Year Percentage G/A Supporting S/A Activity (a) Total Separate Account (S/A) Restricted Assets S/A Assets Supporting G/A Activity (b) Increase/ (Decrease) (5 minus 6) Total Nonadmitted Restricted Total Admitted Restricted (5 minus 8) Gross (Admitted & Nonadmitted) Restricted to Total Assets (c) Admitted Restricted to Total Admitted Assets (d) Restricted Asset Category Total General Account (G/A) Total (1 plus 3) Total From Prior Statement Subject to contractual obligation for which a. liability is not shown Collateral held under security lending b. agreements $69,184,94 $69,184,94 $ 184,405,876 $84,779,048 $69,184,94 0.1% 0.% Subject to repurchase c. agreements Subject to reverse d. repurchase agreements Subject to dollar e. repurchase agreements Subject to dollar reverse f. repurchase agreements Placed under option g. contracts Letter stock or securities h. restricted as to sale i. FHLB capital stock 55,000 55, , , % 0.000% j. On deposit with states 5,831,607 5,831,607 5,83,34 (67) 5,831, % 0.005% On deposit with other k. regulatory bodies Pledged collateral to FHLB (including assets backing l. funding agreements) Pledged as collateral not captured in other m. categories 18,771,587 18,771, ,771,587 18,771, % 0.015% n. Other restricted assets o. Total restricted assets $94,340,118 $94,340,118 $190,790,010 $103,550,108 $94,340, % 0.4% (a) Subset of column 1 (b) Subset of column 3 (c) Column 5 divided by Asset Page, Column 1, Line 8 (d) Column 9 divided by Asset Page, Column 3, Line 8. Detail of assets pledged as collateral not captured in other categories (contracts that share similar characteristics, such as reinsurance and derivatives, are reported in the aggregate) Gross (Admitted& Nonadmitted) Restricted Current Year Percentage Total General Account (G/A) G/A Supporting S/A Activity (a) Total Separate Account (S/A) Restricted Assets S/A Assets Supporting G/A Activity (b) Total (1 plus 3) Total From Prior Year Increase/ (Decrease) (5 minus 6) Total Current Year Admitted Restricted Gross (Admitted & Nonadmitted) Restricted to Total Assets Admitted Restricted to Total Admitted Assets Reinsurance Agreement - Cash Pledged $18,771,587 $18,771,587 $0 $18,771,587 $18,771, % 0.015% Total $18,771,587 $18,771,587 $0 $18,771,587 $18,771, % 0.015% (a) Subset of column 1 (b) Subset of column 3 3. Detail of other restricted assets (contracts that share similar characteristics, such as reinsurance and derivatives, are reported in the aggregate): None 7.4

12 NOTES TO FINANCIAL STATEMENTS 4. Collateral Received and Reflected as Assets Within the Reporting Entity s Financial Statements: Collateral Assets Adjusted (BACV) Fair % of BACV to Total Assets (Admitted & Nonadmitted)(*) % of BACV to Total Admitted Assets (**) a. Cash $1,77,000 $1,77, % 0.340% b. Schedule D, Part 1 c. Schedule D, Part, Section 1 d. Schedule D, Part, Section e. Schedule B f. Schedule A g. Schedule BA, Part 1 h. Schedule DL, Part 1 69,184,94 69,184, % 0.413% i. Other Total Collateral Assets j. (a+b+c+d+e+f+g+h+i) $490,461,94 $490,461, % 0.753% (*) Column 1 divided by Asset Page, Line 6, Column 1 (**) Column 1 divided by Asset Page, Line 6, Column 3 1 k. % of Liability to Total Liabilities Amount (*) Recognized Obligations to Return Collateral Asset $490,461, % (*) Column 1 divided by Liability Page, Line 6, Column 1 I. Working Capital Finance Investments (WCFI): 1. Aggregate WCFI Adjusted by NAIC Designation a. WCFI Designation 1 b. WCFI Designation c. WCFI Designation 3 d. WCFI Designation 4 e. WCFI Designation 5 f. WCFI Designation 6 g. Total Gross Asset Mar. 31, 017 Non-admitted Asset Mar. 31, 017 Net Admitted Asset Mar. 31, 017 $4,81,013 $0 $4,81,013 79,447, ,447, $303,78,499 $0 $303,78,499. Aggregate maturity distribution on the underlying WCFP c. Up to 180 days d. 181 to 365 Days e. Total Adjusted $54,395,074 49,333,45 $303,78, Events of default during the reporting period: None J. Offsetting and Netting of Assets and Liabilities: None K. Structured Notes: No change L. 5* Securities: No change M. Short Sales: None N. Prepayment Penalty and Acceleration Fees General Account Separate Account 1. Number of CUSIPS Aggregate Amount of Investment Income $3,965,741 $0 7.5

13 NOTES TO FINANCIAL STATEMENTS 6. JOINT VENTURES, PARTNERSHIPS AND LIMITED LIABILITY COMPANIES A. Investments in joint ventures, partnerships and limited liability companies that exceed 10% of the admitted assets of the insurer: None B. Impaired investments in joint ventures, partnerships and limited liability companies: None 7. INVESTMENT INCOME A. No change B. There was no investment income due and accrued excluded from surplus as of March 31, DERIVATIVE INSTRUMENTS A. Market risk, credit risk and cash requirement: No change B. Other risk management activities: No change C. Accounting policies: No change D. For the three months ended March 31, 017, $43 million of option premium expense recorded in net investment income for call options hedging life indexed account insurance products was excluded from the assessment of hedge effectiveness. For all other hedging relationships, no component of the hedging instrument s estimated fair value was excluded from the assessment of hedge effectiveness. E. For the three months ended March 31, 017, the Company did not record any unrealized capital gain or loss resulting from derivatives that no longer qualified for hedge accounting. F. Derivatives accounted for as cash flow hedges: 1. None. None 9. INCOME TAXES A. to D. No change E. Additional disclosures: No change F. Consolidation of return with other entities: No change G. Federal or foreign income tax loss contingencies: None 10. INFORMATION CONCERNING PARENT, SUBSIDIARIES, AFFILIATES AND OTHER RELATED PARTIES A, B, C. No change D. Amounts due to/from: No change E. Guarantees: No change F. Underwriting and administrative services: No change G. Company ownership: No change H. The Company does not own shares of any upstream intermediate or ultimate parent, either directly or indirectly via a downstream subsidiary, controlled or affiliated entity (SCA). I. The Company holds no investments in SCA entities that exceed 10% of admitted assets of the Company. J. The Company did not recognize any impairment write downs for its investments in SCA entities during three months ended March 31, 017. K. insurance subsidiaries with adjusted U.S. GAAP (Generally Accepted Accounting Principles) reserves: None L. Reporting entity utilizes the look-through approach valuation for the downstream noninsurance company: No change 7.6

14 NOTES TO FINANCIAL STATEMENTS M. The Company has the following SCA Investments as of March 31, 017: Percentage of SCA Ownership Gross Amount Admitted Amount Nonadmitted Amount SCA Entity a. SSAP No. 978a Entities Total SSAP No. 978a Entities b. SSAP No. 978b(ii) Entities Total SSAP No. 978b(ii) Entities c. SSAP No. 978b(iii) Entities AdvisorShares Pacific Asset Float ETF 90.90% $4,67,533 $4,67,533 Pacific Asset M gmt Sr Loan Fund USD Cap 84.35% 54,365,000 54,365,000 Pacific Funds Diversified Alt CL A 0.09% 11,119 11,119 Pacific Funds Diversified Alt CL C 0.08% 10,849 10,849 Pacific Funds Diversified Alt CL D 17.05%,16,614,16,614 Pacific Funds Limited Duration High Income 67.41%,644,747,644,747 Pacific Life Reins. Co. II Limited % 4,613,733 4,613,733 Pacific Select Diversified Alternatives 64.93%,19,400,19,400 Pacific Select Focused 30 Port P SHS 0.01% 19,71 19,71 Pacific Select Health Sciences Port P SHS 0.01% 6,846 6,846 Pacific Select Technology Port P SHS 0.01% 13,394 13,394 Pacific Services Canada Limited %,83,06 $,83,06 Pacific Funds Large-Cap 7.63% 3,167,90 3,167,90 Pacific Funds Small-Cap Growth 9.68% 11,053,480 11,053,480 Pacific Funds Small-Cap 54.74% 17,76,030 17,76,030 Pacific Funds Small/M id-cap 1.8% 1,48,571 1,48,571 Total SSAP No. 978b(iii) Entities XXX 166,994, ,161,877,83,06 d. SSAP No. 978b(iv) Entities Total SSAP No. 978b(iv) Entities e. Total SSAP No. 978b Entities (except 8bi entities) (b+c+d) XXX 166,994, ,161,877,83,06 f. Aggregate Total (a+e) XXX $166,994,083 $164,161,877 $,83,06 Type of NAIC Filing (a) of Filing to the NAIC NAIC Valuation Amount NAIC Response Received (Y/N) NAIC Disallowed Entities Valuation Method, Resubmission Required (Y/N) SCA Entity Code (b) a. SSAP No. 978a Entities Total SSAP No. 978a Entities b. SSAP No. 978b(ii) Entities Total SSAP No. 978b(ii) Entities c. SSAP No. 978b(iii) Entities AdvisorShares Pacific Asset Float ETF S 6/9/016 $3,577,64 Yes No I Pacific Asset Mgmt Sr Loan Fund USD Cap S 6/0/016 49,840,000 Yes No I Pacific Funds Diversified Alt CL A S 6/6/016 10,31 Yes No I Pacific Funds Diversified Alt CL C S 6/3/016 10,077 Yes No I Pacific Funds Diversified Alt CL D S 6/3/016,035,496 Yes No I Pacific Funds Limited Duration High Income S 6/6/016 0,687,779 Yes No I Pacific Life Reins. Co. II Limited S 5/18/016 4,537,86 Yes No I Pacific Select Diversified Alternatives S 3/4/016 1,998,467 Yes No I Pacific Select Focused 30 Port P SHS S 3/16/016 17,19 Yes No I Pacific Select Health Sciences Port P SHS S 3/17/016 5,796 Yes No I Pacific Select Technology Port P SHS S 3/17/016 1,666 Yes No I Pacific Services Canada Limited S 5/4/016 - Yes No I Pacific Funds Large-Cap S1 11/9/016 NV (Standard for S1) Yes No N/A Pacific Funds Small-Cap Growth S1 11/9/016 NV (Standard for S1) Yes No N/A Pacific Funds Small-Cap S1 11/9/016 NV (Standard for S1) Yes No N/A Pacific Funds Small/Mid-Cap S1 11/9/016 NV (Standard for S1) Yes No N/A Total SSAP No. 978b(iii) Entities XXX XXX 10,753,17 XXX XXX XXX d. SSAP No. 978b(iv) Entities Total SSAP No. 978b(iv) Entities e. Total SSAP No. 978b Entities (except 8bi entities) (b+c+d) XXX XXX 10,753,17 XXX XXX XXX f. Aggregate Total (a+e) XXX XXX $10,753,17 XXX XXX XXX (a) S1- Sub-1, S- Sub- or RDF - Resubmission of Disallowed Filing (b) I- Immaterial or M - Material 7.7

15 NOTES TO FINANCIAL STATEMENTS N. Reporting entity that reports an investment in an insurance SCA for which the audited statutory equity reflects departure from the NAIC statutory accounting practices and procedures: None 11. DEBT A. No change B. FHLB (Federal Home Loan Bank) Agreements 1. The Company is a member of the Federal Home Loan Bank (FHLB) of Topeka. The Company is eligible to receive advances from the FHLB of Topeka based on a percentage of the Company s statutory general account assets provided it has sufficient available eligible collateral and is in compliance with the FHLB of Topeka requirements, debt covenant restrictions and insurance laws and regulations. The Company had estimated available eligible collateral of $1.7 billion and $.0 billion as of March 31, 017 and December 31, 016, respectively. Interest is at variable or fixed rates. There was no debt outstanding with FHLB as of March 31, 017 and December 31, FHLB Capital Stock a. Aggregate Totals 1. Current Year +3 Account Account (a) M embership Stock - Class A * $500,000 $500,000 $0 (b) Membership Stock - Class B * (c) Activity Stock (d) Excess Stock 5,000 5,000 0 (e) Aggregate Total $55,000 $55,000 $0 (f) Actual or estimated borrowing capacity as determined by the insurer $1,704,6,174 XXX XXX. Prior Year 1 Total General b. Membership Stock (Class A and B) Eligible and Not Eligible for Redemption 3 Separate +3 Account Account (a) M embership Stock - Class A * $500,000 $500,000 $0 (b) Membership Stock - Class B * (c) Activity Stock (d) Excess Stock 51,900 51,900 0 (e) Aggregate Total $551,900 $551,900 $0 (f) Actual or estimated borrowing capacity as determined by the insurer $1,981,434,835 XXX XXX * Required stock 1 Total General 3 Separate Current Year Not Eligible for Less Than 6 6 Months to Less 1 to Less Membership Stock Total Redemption Months Than 1 Year Than 3 Years 3 to 5 Years 1. Class A $500,000 $500,000 $0 $0 $0 $0. Class B Collateral Pledged to FHLB: None 4. Borrowing from FHLB: None 7.8

16 NOTES TO FINANCIAL STATEMENTS 1. RETIREMENT PLANS, DEFERRED COMPENSATION, POSTEMPLOYMENT BENEFITS, COMPENSATED ABSENCES AND OTHER POSTRETIREMENT BENEFIT PLANS A. Defined Benefit Retirement Plan: 1. to 3. No change 4. Components of net periodic benefit cost Postretirement Special or Contractual Pension Benefits Benefits Benefits Per SSAP No. 11 March 31, December 31, March 31, December 31, March 31, December 31, a. Service cost $939,7 $3,59,048 $750 $3,000 $0 $0 b. Interest cost 599,003,45,401 85, , c. Expected return on plan assets d. Transition asset or obligation e. Gains and losses,849 1,016,360 40, , f. Prior service cost or credit 89, ,55 0 (73,000) 0 0 g. Gain or loss recognized due to a settlement or curtailment h. Total net periodic benefit cost $1,850,467 $7,391,361 $17,50 $537,000 $0 $0 5. to 1. No change B. Narrative description of investment plans and strategies: Not applicable C. Fair of Each Class of Plan Assets: None D. Narrative description of the basis used to determine the overall expected long-term rate of return on asset assumptions: Not applicable E. Defined Contribution Plans: No change F. Multi-employer Plans: Not applicable G. Consolidated/Holding Company Plans: Not applicable H. Postemployment Benefits and Compensated Absences: Not applicable. I. Impact of Medicare Modernization Act on Postretirement Benefits: No change 13. CAPITAL AND SURPLUS, SHAREHOLDERS DIVIDEND RESTRICTIONS AND QUASI-REORGANIZATIONS 1. to 3. Capital and Surplus and Dividend Restrictions: No change 4. For the three months ended March 31, 017, the Company paid no ordinary cash dividend to Pacific LifeCorp. 5. Profits paid as ordinary dividends: No change 6. There are no other restrictions on unassigned surplus. 7. Advances to surplus for mutual companies: Not applicable 8. The Company does not hold any stock for special purposes. 9. Special surplus funds: No change 10. The portion of unassigned funds (surplus) represented or reduced by cumulative unrealized gains and (losses) is $1,011 million. 11. The Company issued the following surplus debentures or similar obligations: Issued Interest Rate Par (Face Amount of Notes) 1. and 13. Quasi-reorganizations: Not applicable of Notes Principal and/or Interest Paid Current Year Total Principal and/or Interest Paid Unapproved Principal And/Or Interest of Maturity 1/30/ $150,000,000 $149,907,55 $0 $7,550,000 1/30/03 06/15/ ,00,000 60,781, ,90,408 06/15/039 03/30/ ,000, ,000,000 13,500, ,500,000 0/05/00 01// ,000, ,730,086 1,81,500 10,713,54 01/5/043 Total $1,71,00,000 $1,715,418,838 $6,31,500 $1,535,053,950 XXX 7.9