HARTFORD LIFE INSURANCE CO - 10-Q Quarterly Report

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934

For the quarterly period ended March 31, 2005

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number 001-32293

HARTFORD LIFE INSURANCE COMPANY
(Exact name of registrant as specified in its charter)

CONNECTICUT 06-0974148
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

200 HOPMEADOW STREET, SIMSBURY, CONNECTICUT 06089
(Address of principal executive offices)

(860) 547-5000
(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[ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act)

Yes [ ] No[X]

As of April 25, 2005 there were outstanding 1,000 shares of Common Stock, $5,690
par value per share, of the registrant.

The 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.

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INDEX

PAGE
----

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm 3

Condensed Consolidated Statements of Income - Three Months Ended
March 31, 2005 and 2004 4

Condensed Consolidated Balance Sheets - As of March 31, 2005
and December 31, 2004 5

Condensed Consolidated Statements of Changes in
Stockholder's Equity - Three Months Ended March 31, 2005 and 2004 6

Condensed Consolidated Statements of Cash Flows - Three
Months Ended March 31, 2005 and 2004 7

Notes to Condensed Consolidated Financial Statements 8

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS 17

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 32

ITEM 4. CONTROLS AND PROCEDURES 32

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS 33

ITEM 6. EXHIBITS 34

SIGNATURE 35

EXHIBITS INDEX 36

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Stockholder of
Hartford Life Insurance Company
Hartford, Connecticut

We have reviewed the accompanying condensed consolidated balance sheet of
Hartford Life Insurance Company and subsidiaries (the "Company") as of March 31,
2005, and the related condensed consolidated statements of income, changes in
stockholder's equity, and cash flows for the three-month periods ended March 31,
2005 and 2004. These interim financial statements are the responsibility of the
Company's management.

We conducted our reviews in accordance with the standards of the Public Company
Accounting Oversight Board (United States). A review of interim financial
information consists principally of applying analytical procedures and making
inquiries of persons responsible for financial and accounting matters. It is
substantially less in scope than an audit conducted in accordance with the
standards of the Public Company Accounting Oversight Board (United States), the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we are not aware of any material modifications that should
be made to such condensed consolidated interim financial statements for them to
be in conformity with accounting principles generally accepted in the United
States of America.

We have previously audited, in accordance with the standards of the Public
Company Accounting Oversight Board (United States), the consolidated balance
sheet of the Company as of December 31, 2004, and the related consolidated
statements of income, changes in stockholder's equity, and cash flows for the
year then ended (not presented herein); and in our report dated February 24,
2005 (which report includes an explanatory paragraph relating to the Company's
change in its method of accounting and reporting for certain nontraditional
long-duration contracts and for separate accounts in 2004), we expressed an
unqualified opinion on those consolidated financial statements. In our opinion,
the information set forth in the accompanying condensed consolidated balance
sheet as of December 31, 2004 is fairly stated, in all material respects, in
relation to the consolidated balance sheet from which it has been derived.

DELOITTE & TOUCHE, LLP
Hartford, Connecticut
April 29, 2005

3

HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME

THREE MONTHS
ENDED
MARCH 31,
---------------
(In millions) (Unaudited) 2005 2004
- ------------------------- ------ ------

REVENUES
Fee income $ 682 $ 618
Earned premiums and other 58 103
Net investment income 623 609
Net realized capital gains 72 64
------ ------
TOTAL REVENUES 1,435 1,394
------ ------
BENEFITS, CLAIMS AND EXPENSES
Benefits, claims, and claim adjustment expenses 678 744
Insurance expenses and other 191 164
Amortization of deferred policy acquisition costs
and present value of future profits 226 199
Dividends to policyholders 18 14
------ ------
TOTAL BENEFITS, CLAIMS AND EXPENSES 1,113 1,121
------ ------
INCOME BEFORE INCOME TAX EXPENSE AND CUMULATIVE
EFFECT OF ACCOUNTING CHANGE 322 273
Income tax expense 81 74
------ ------
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING
CHANGE
241 199
Cumulative effect of accounting change, net of tax -- (18)
------ ------
NET INCOME $ 241 $ 181
====== ======

SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

4

HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS

MARCH 31, DECEMBER 31,
(In millions, except for share data) 2005 2004
- ------------------------------------ ----------- ------------
(Unaudited)

ASSETS
Investments
Fixed maturities, available for sale, at fair value
(amortized cost of $41,640 and $40,479) $ 43,161 $ 42,691
Equity securities, available for sale, at fair
value (cost of $240 and $171) 250 179
Equity securities, held for trading, at fair value 1 1
Policy loans, at outstanding balance 2,077 2,617
Other investments 1,154 1,083
-------- --------
Total investments 46,643 46,571
Cash 251 216
Premiums receivable and agents' balances 20 20
Reinsurance recoverables 1,308 1,460
Deferred policy acquisition costs and present value
of future profits 6,768 6,453
Deferred income taxes (585) (638)
Goodwill 186 186
Other assets 1,718 1,562
Separate account assets 138,260 139,812
-------- --------
TOTAL ASSETS $194,569 $195,642
======== ========
LIABILITIES
Reserve for future policy benefits $ 7,383 $ 7,244
Other policyholder funds 37,726 37,493
Other liabilities 4,281 3,844
Separate account liabilities 138,260 139,812
-------- --------
TOTAL LIABILITIES 187,650 188,393
======== ========
STOCKHOLDER'S EQUITY
Common Stock - 1,000 shares authorized, issued and
outstanding; par value $5,690 6 6
Capital surplus 2,240 2,240
Accumulated other comprehensive income
Net unrealized capital gains on securities,
net of tax 618 940
Foreign currency translation adjustments (1) (1)
-------- --------
Total accumulated other comprehensive income 617 939
-------- --------
Retained earnings 4,056 4,064
-------- --------
TOTAL STOCKHOLDER'S EQUITY 6,919 7,249
======== ========
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $194,569 $195,642
======== ========

SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

5

HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY

THREE MONTHS ENDED MARCH 31, 2005

ACCUMULATED OTHER
COMPREHENSIVE INCOME
----------------------------------------
NET NET GAIN
UNREALIZED (LOSS) ON
CAPITAL CASH FLOW FOREIGN
GAINS ON HEDGING CURRENCY TOTAL
COMMON CAPITAL SECURITIES, INSTRUMENTS, TRANSLATION RETAINED STOCKHOLDER'S
(In millions) (Unaudited) STOCK SURPLUS NET OF TAX NET OF TAX ADJUSTMENTS EARNINGS EQUITY
------------------------- ------ ------- ----------- ------------ ----------- -------- -------------

Balance, December 31, 2004 $6 $2,240 $1,124 $(184) $(1) $4,064 $7,249
Comprehensive income
Net income 241 241
------
Other comprehensive income, net of
tax (1)
Net change in unrealized capital
gains on securities (2) (296) (296)
Net loss on cash flow hedging
instruments (26) (26)
------
Total other comprehensive income (322)
------
Total comprehensive income (81)
Dividends declared (249) (249)
--- ------ ------ ----- --- ------ ------
BALANCE, MARCH 31, 2005 $6 $2,240 $ 828 $(210) $(1) $4,056 $6,919
=== ====== ====== ===== === ====== ======

THREE MONTHS ENDED MARCH 31, 2004

ACCUMULATED OTHER
COMPREHENSIVE INCOME
----------------------------------------
NET
UNREALIZED NET GAIN ON
CAPITAL CASH FLOW FOREIGN
GAINS ON HEDGING CURRENCY TOTAL
COMMON CAPITAL SECURITIES, INSTRUMENTS, TRANSLATION RETAINED STOCKHOLDER'S
(In millions) (Unaudited) STOCK SURPLUS NET OF TAX NET OF TAX ADJUSTMENTS EARNINGS EQUITY
------------------------- ------ ------- ----------- ------------ ----------- -------- -------------

Balance, December 31, 2003 $6 $2,240 $ 728 $(17) $(1) $3,648 $6,604
Comprehensive income
Net income 181 181
------
Other comprehensive income, net of
tax (1)
Cumulative effect of accounting
change 292 292
Net change in unrealized capital
gains on securities (2) 355 355
Net gain on cash flow hedging
instruments 39 39
------
Total other comprehensive income 686
------
Total comprehensive income 867
Dividends declared (300) (300)
--- ------ ------ ---- --- ------ ------
BALANCE, MARCH 31, 2004 $6 $2,240 $1,375 $ 22 $(1) $3,529 $7,171
=== ====== ====== ==== === ====== ======

(1) Unrealized capital gains on securities is reflected net of tax (benefit)
provision and other items of $(159) and $191 for the three months ended
March 31, 2005 and 2004, respectively. Net gain (loss) on cash flow hedging
instruments is net of tax (benefit) provision of $(14) and $21 for the
first quarters ended March 31, 2005 and 2004, respectively. There is no tax
effect on cumulative translation adjustments.

(2) Net of reclassification adjustment for gains (losses) realized in net
income of $44 and $34 for the first quarters ended March 31, 2005 and 2004,
respectively.

SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

6

HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

THREE MONTHS ENDED
MARCH 31,
------------------
(In millions) (Unaudited) 2005 2004
- ------------------------- ------- --------

OPERATING ACTIVITIES
Net income $ 241 $ 181
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES
Net realized capital (gains) losses (72) (64)
Cumulative effect of adoption of SOP 03-1 -- 18
Amortization of deferred policy acquisition costs and present value of
future profits 226 199
Additions to deferred policy acquisition costs and present value of future profits (310) (381)
Depreciation and amortization (accretion) (14) 25
Increase in premiums receivable and agents' balances -- (3)
Increase (decrease) in other liabilities 17 (50)
Decrease (increase) in receivables 2 (185)
Decrease in payables and accruals (108) (227)
Decrease in accrued tax (94) (5)
Decrease in deferred income tax 62 506
Amortization of sales inducements 10 6
Additions to deferred sales inducements (22) (33)
Increase in future policy benefits 139 203
(Increase) decrease in reinsurance recoverables (14) 12
Other, net 227 216
------- -------
NET CASH PROVIDED BY OPERATING ACTIVITIES 290 418
======= =======
INVESTING ACTIVITIES
Purchases of fixed maturity and equity security investments, available-for-sale (6,913) (2,520)
Sales of fixed maturity and equity security investments, available-for-sale 6,017 1,935
Maturities of fixed maturity and equity security investments, available-for-sale 453 575
Decrease in other assets (1) 1
------- -------
NET CASH USED FOR INVESTING ACTIVITIES (444) (9)
======= =======
FINANCING ACTIVITIES
Dividends paid (249) (300)
Net (disbursements) receipts for investment and universal life-type contracts charged
against policyholder accounts 438 (151)
------- -------
NET CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES 189 (451)
======= =======
Net (decrease) increase in cash 35 (42)
Cash - beginning of period 216 96
------- -------
CASH - END OF PERIOD $ 251 $ 54
======= =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
NET CASH PAID (RECEIVED) DURING THE PERIOD FOR
Income taxes $ 53 $ 10

SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

7

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollar amounts in millions, unless otherwise stated)
(Unaudited)

1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES

BASIS OF PRESENTATION

Hartford Life Insurance Company, together with its consolidated subsidiaries
("Hartford Life Insurance Company" or the "Company"), is a leading financial
services and insurance organization which provides investment, retirement,
estate planning and group benefits products. The Company is a wholly-owned
subsidiary of Hartford Life and Accident Insurance Company ("HLA"), a
wholly-owned subsidiary of Hartford Life, Inc. ("Hartford Life"). Hartford Life
is a direct subsidiary of Hartford Holdings, Inc., a direct subsidiary of The
Hartford Financial Services Group, Inc. ("The Hartford"), the Company's ultimate
parent company.

The condensed consolidated financial statements have been prepared on the basis
of accounting principles generally accepted in the United States, which differ
materially from the accounting prescribed by various insurance regulatory
authorities. All material intercompany transactions and balances between
Hartford Life Insurance Company, its subsidiaries and affiliates have been
eliminated.

The accompanying condensed consolidated financial statements and notes as of
March 31, 2005, and for the first quarters ended March 31, 2005 and 2004 are
unaudited. These financial statements reflect all adjustments (consisting only
of normal accruals) which are, in the opinion of management, necessary for the
fair presentation of the financial position, results of operations, and cash
flows for the interim periods. These financial statements and condensed notes
should be read in conjunction with the consolidated financial statements and
notes thereto included in Hartford Life Insurance Company's 2004 Form 10-K
Annual Report. The results of operations for the interim periods should not be
considered indicative of results to be expected for the full year.

RECLASSIFICATIONS

Certain reclassifications have been made to prior year financial information to
conform to the current year classifications.

USE OF ESTIMATES

The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States, requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

The most significant estimates include those used in determining reserves for
future policyholder benefits, deferred policy acquisition costs and present
value of future profits, valuation of investments and evaluation of
other-than-temporary impairments, income taxes and contingencies.

SIGNIFICANT ACCOUNTING POLICIES

For a description of accounting policies, see Note 2 of Notes to Consolidated
Financial Statements included in Hartford Life Insurance Company's 2004 Form
10-K Annual Report.

FUTURE ADOPTION OF ACCOUNTING STANDARDS

In March 2004, the Emerging Issues Task Force ("EITF") reached a final consensus
on EITF Issue No. 03-1, "The Meaning of Other-Than-Temporary Impairment and Its
Application to Certain Investments" ("EITF Issue No. 03-1"). EITF Issue No. 03-1
was effective for periods beginning after June 15, 2004 and adopts a three-step
impairment model for securities within its scope. The three-step model must be
applied on a security-by-security basis as follows:

Step 1: Determine whether an investment is impaired. An investment is impaired
if the fair value of the investment is less than its cost basis.

Step 2: Evaluate whether an impairment is other-than-temporary. For debt
securities that cannot be contractually prepaid or otherwise settled in
such a way that the investor would not recover substantially all of its
cost, an impairment is deemed

8

other-than-temporary if the investor does not have the ability and intent
to hold the investment until a forecasted market price recovery or it is
probable that the investor will be unable to collect all amounts due
according to the contractual terms of the debt security.

Step 3: If the impairment is other-than-temporary, recognize an impairment loss
equal to the difference between the investment's cost basis and its fair
value.

Subsequent to an other-than-temporary impairment loss, a debt security should be
accounted for in accordance with SOP 03-3, "Accounting for Certain Loans and
Debt Securities Acquired in a Transfer" ("SOP 03-3"). SOP 03-3 requires that the
amount of a security's expected cash flows in excess of the investor's initial
cost or amortized cost investment be recognized as interest income on a
level-yield basis over the life of the security. EITF Issue No. 03-1 does not
replace the impairment guidance for investments accounted for under EITF Issue
No. 99-20, "Recognition of Interest Income and Impairments on Purchased and
Retained Beneficial Interests in Securitized Financial Assets" ("EITF Issue No.
99-20"), however, it requires investors to determine if a security is
other-than-temporarily impaired under EITF Issue No. 03-1 if the security is
determined not to be other-than-temporarily impaired under EITF Issue No. 99-20.

In September 2004, the Financial Accounting Standards Board ("FASB") staff
issued clarifying guidance for comment in FASB Staff Position ("FSP") EITF Issue
No. 03-1-a, "Implementation Guidance for the Application of Paragraph 16 of EITF
Issue No. 03-1" ("FSP Issue No. 03-1-a") and subsequently voted to delay the
implementation of the impairment measurement and recognition guidance contained
in paragraphs 10-20 of EITF Issue No. 03-1.

In April 2005, the FASB and the International Accounting Standards Board
("IASB") added a joint project to their agenda to converge impairment models for
financial instruments. The FASB subsequently decided not to redeliberate EITF
03-1.

2. SEGMENT INFORMATION

The Company has three reportable operating segments: Retail Products Group
("Retail"), Institutional Solutions Group ("Institutional"), and Individual
Life. The Company evaluates performance based on revenues and net income. For a
full discussion of each segment, please refer to Hartford Life Insurance
Company's 2004 Form 10-K Annual Report.

Retail Institutional
Products Solutions Individual
MARCH 31, 2005 Group Group Life Other Total
- ------------------ -------- ------------- ---------- ----- ------

THREE MONTHS ENDED
Total revenues $670 $417 $241 $107 $1,435
Net income 112 37 36 56 241

Retail Institutional
Products Solutions Individual
MARCH 31, 2004 Group Group Life Other Total
- ------------------ -------- ------------- ---------- ----- ------

THREE MONTHS ENDED
Total revenues $628 $434 $230 $102 $1,394
Net income 76 18 32 55 181

9

3. INVESTMENTS AND DERIVATIVE INSTRUMENTS

AS OF MARCH 31, 2005 AS OF DECEMBER 31, 2004
--------------------------------------------- ---------------------------------------------
GROSS GROSS GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED FAIR AMORTIZED UNREALIZED UNREALIZED FAIR
COST GAINS LOSSES VALUE COST GAINS LOSSES VALUE
--------- ---------- ---------- ------- --------- ---------- ---------- -------

BONDS AND NOTES
Asset-backed securities ("ABS") $ 6,013 $ 59 $ (66) $ 6,006 $ 5,881 $ 72 $ (61) $ 5,892
Collateralized mortgage obligations
("CMOs")
Agency backed 713 4 (2) 715 834 9 (3) 840
Non-agency backed 95 -- (1) 94 48 -- -- 48
Commercial mortgage-backed
securities ("CMBS")
Agency backed 54 -- -- 54 54 -- -- 54
Non-agency backed 7,312 206 (63) 7,455 7,336 329 (17) 7,648
Corporate 21,921 1,479 (160) 23,240 21,066 1,826 (57) 22,835
Government/Government agencies
Foreign 667 42 (6) 703 649 60 (2) 707
United States 797 21 (10) 808 774 19 (4) 789
Mortgage-backed securities ("MBS") 2,056 9 (20) 2,045 1,542 18 (2) 1,558
States, municipalities and political
subdivisions 754 34 (5) 783 675 30 (5) 700
Redeemable preferred stock 1 -- -- 1 1 -- -- 1
Short-term investments 1,257 -- -- 1,257 1,619 -- -- 1,619
------- ------ ----- ------- ------- ------ ----- -------
TOTAL FIXED MATURITIES $41,640 $1,854 $(333) $43,161 $40,479 $2,363 $(151) $42,691
======= ====== ===== ======= ======= ====== ===== =======

DERIVATIVE INSTRUMENTS

The Company utilizes a variety of derivative instruments, including swaps, caps,
floors, forwards, futures and options designed to achieve one of four
Company-approved objectives: to hedge risk arising from interest rate, price or
currency exchange rate volatility; to manage liquidity; to control transaction
costs; or to enter into replication transactions.

On the date the derivative contract is entered into, the Company designates the
derivative as (1) a hedge of the fair value of a recognized asset or liability
("fair value" hedge), (2) a hedge of a forecasted transaction or of the
variability of cash flows to be received or paid related to a recognized asset
or liability ("cash flow" hedge), (3) a foreign-currency fair value or cash flow
hedge ("foreign-currency" hedge), (4) a hedge of a net investment in a foreign
operation ("net investment" hedge) or (5) held for other investment and risk
management activities, which primarily involve managing asset or liability
related risks that do not qualify for hedge accounting treatment.

The Company's derivative transactions are permitted uses of derivatives under
the derivatives use plan filed and/or approved, as applicable, by the State of
Connecticut and the State of New York insurance departments. The Company does
not make a market or trade in these instruments for the express purpose of
earning short-term trading profits.

For a detailed discussion of the Company's use of derivative instruments, see
Notes 2 and 4 of Notes to Consolidated Financial Statements included in Hartford
Life Insurance Company's 2004 Form 10-K Annual Report.

Derivative instruments are recorded at fair value and presented in the condensed
consolidated balance sheets as follows:

MARCH 31, 2005 DECEMBER 31, 2004
------------------ ------------------------
ASSET LIABILITY LIABILITY
VALUES VALUES ASSET VALUES VALUES
------ --------- ------------ ---------

Other investments $ 31 $ -- $ 42 $ --
Reinsurance recoverables -- 136 -- 129
Other policyholder funds and
benefits payable 136 -- 129 --
Fixed maturities -- 1 4 --
Other liabilities -- 469 -- 449
---- ---- ---- ----
Total $167 $606 $175 $578
==== ==== ==== ====

10

The following table summarizes the notional amount and fair value of derivatives
by hedge designation as of March 31, 2005 and December 31, 2004. The notional
amount of derivative contracts represents the basis upon which pay or receive
amounts are calculated and are not necessarily reflective of credit risk. The
fair value amounts of derivative assets and liabilities are presented on a net
basis in the following table.

MARCH 31, 2005 DECEMBER 31, 2004
--------------------- ---------------------
NOTIONAL NOTIONAL
AMOUNT FAIR VALUE AMOUNT FAIR VALUE
-------- ---------- -------- ----------

Cash flow hedge $ 6,619 $(412) $ 6,255 $(381)
Fair value hedge 468 (11) 349 (6)
Other investment and risk
management activities 62,473 (16) 58,130 (16)
------- ----- ------- -----
Total $69,560 $(439) $64,734 $(403)
======= ===== ======= =====

The increase in notional amount since December 31, 2004 is primarily due to new
hedging strategies. The decrease in net fair value of derivative instruments
since December 31, 2004 was primarily due to rising interest rates during 2005.

During the first quarter of 2005, the Company entered into interest rate swap
agreements with a combined notional and fair value of $122 and $(2),
respectively, to hedge variability in certain variable rate contracts. These
swaps convert the variable liability payment (e.g. based off of the Consumer
Price Index) to a variable rate, London-Interbank Offered Rate ("LIBOR"), to
better match the cash receipts earned from the supporting investment portfolio.
Certain of these swap agreements are designated as cash flow hedges and have a
notional and fair value of $75 and $(1), respectively, as of March 31, 2005. In
addition, swap agreements that do not receive hedge accounting a notional and
fair value of $47 and $(1), respectively, as of March 31, 2005.

For the first quarter ended March 31, 2005, gross gains and losses representing
the total ineffectiveness of all fair value and net investment hedges were
immaterial. For the first quarter ended March 31, 2005, the Company's net gain
and loss representing hedge ineffectiveness on cash flow hedges was $(2),
after-tax. For the first quarter ended March 31, 2004, the Company's net gains
and losses representing the total ineffectiveness of all cash flow, fair value
and net investment hedges were immaterial.

The total change in value for other derivative-based strategies which do not
qualify for hedge accounting treatment, including periodic net coupon
settlements, are reported as net realized capital gains and losses in the
condensed consolidated statements of income. For the first quarter ended March
31, 2005 and 2004, the Company recognized an after-tax net gain of $3 and $8,
respectively, for derivative-based strategies, which do not qualify for hedge
accounting treatment.

As of March 31, 2005, the after-tax deferred net gains on derivative instruments
accumulated in AOCI that are expected to be reclassified to earnings during the
next twelve months are $1. This expectation is based on the anticipated interest
payments on hedged investments in fixed maturity securities that will occur over
the next twelve months, at which time the Company will recognize the deferred
net gains (losses) as an adjustment to interest income over the term of the
investment cash flows. The maximum term over which the Company is hedging its
exposure to the variability of future cash flows (for all forecasted
transactions, excluding interest payments on variable rate debt) is twenty-four
months. For the first quarter ended March 31, 2005 and 2004, the net
reclassifications from AOCI to earnings resulting from the discontinuance of
cash flow hedges were immaterial.

11

4. DEFERRED POLICY ACQUISITION COSTS AND PRESENT VALUE OF FUTURE PROFITS

Changes in deferred policy acquisition costs and present value of future profits
is as follows:

2005 2004
------ ------

BALANCE, JANUARY 1 $6,453 $6,088
Capitalization 310 381
Amortization - Deferred Policy Acquisitions costs (217) (191)
Amortization - Present Value of Future Profits (9) (8)
Amortization - Realized Capital Gains/(Losses) (5) (5)
Adjustments to unrealized gains and losses on securities
available-for-sale and other 236 (241)
Cumulative effect of accounting changes (SOP 03-1) [1] -- (105)
------ ------
BALANCE, MARCH 31 $6,768 $5,919
====== ======

[1] For the three months ended March 31, 2004, represents the Company's
adoption of American Institute of Certified Public Accountants ("AICPA")
Statement of Position ("SOP") 03-1, "Accounting and Reporting by Insurance
Enterprises for Certain Nontraditional Long-Duration Contracts and for
Separate Accounts" ("SOP 03-1").

5. SEPARATE ACCOUNTS, DEATH BENEFITS AND OTHER INSURANCE BENEFIT FEATURES

Many of the variable annuity contracts issued by the Company offer various
guaranteed minimum death and withdrawal benefits. Guaranteed minimum death
benefits are offered in various forms as described in the footnotes to the table
below. The Company currently reinsures a significant portion of the death
benefit guarantees associated with its in-force block of business. Upon adoption
of SOP 03-1, the Company recorded a liability for guaranteed minimum death
benefits ("GMDB") of $217 and a related reinsurance recoverable asset of $108.

Changes in the gross guaranteed minimum death benefit ("GMDB") liability balance
sold with annuity products were as follows:

GMDB [1]
--------

LIABILITY BALANCE AS OF JANUARY 1, 2005 $174
Incurred 32
Paid 38
----
LIABILITY BALANCE AS OF MARCH 31, 2005 $168
====

[1] The reinsurance recoverable asset, related to the GMDB was $55 as of March
31, 2005.

GMDB [1]
--------

LIABILITY BALANCE UPON ADOPTION - AS OF JANUARY 1, 2004 $217
Incurred 123
Paid 166
----
LIABILITY BALANCE AS OF DECEMBER 31, 2004 $174
====

[1] The reinsurance recoverable asset, related to the GMDB was $108 upon
adoption of SOP 03-1 and $64 as of December 31, 2004.

The net GMDB liability is established by estimating the expected value of net
reinsurance costs and death benefits in excess of the projected account balance.
The excess death benefits and net reinsurance costs are recognized ratably over
the accumulation period based on total expected assessments. The GMDB
liabilities are recorded in Future Policy Benefits on the Company's balance
sheet. Changes in the GMDB liability are recorded in Benefits, Claims and Claims
Adjustment Expenses on the Company's statement of income. The Company regularly
evaluates estimates used and adjusts the additional liability balances, with a
related charge or credit to benefit expense, if actual experience or other
evidence suggests that earlier assumptions should be revised.

12

The following table provides details concerning GMDB exposure as of March 31,
2005:

BREAKDOWN OF VARIABLE ANNUITY ACCOUNT VALUE BY GMDB TYPE

RETAINED NET WEIGHTED AVERAGE
ACCOUNT NET AMOUNT AMOUNT ATTAINED AGE OF
MAXIMUM ANNIVERSARY VALUE (MAV) [1] VALUE AT RISK AT RISK ANNUITANT
- ----------------------------------- -------- ---------- ------------ ----------------

MAV only $ 58,807 $7,015 $ 804 63
With 5% rollup [2] 4,025 642 121 62
With Earnings Protection Benefit Rider (EPB) [3] 4,985 193 42 60
With 5% rollup & EPB 1,442 122 21 61
-------- ------ ------ ---
Total MAV 69,259 7,972 988 63
Asset Protection Benefit (APB) [4] 18,885 71 41 61
Ratchet [5] (5 years) 38 3 -- 66
Reset [6] (5-7 years) 7,759 690 690 64
Return of Premium [7]/Other 8,263 53 53 49
-------- ------ ------ ---
TOTAL $104,204 $8,789 $1,772 62
======== ====== ====== ===

[1] MAV: the death benefit is the greatest of current account value, net
premiums paid and the highest account value on any anniversary before age
80 (adjusted for withdrawals).

[2] Rollup: the death benefit is the greatest of the MAV, current account
value, net premium paid and premiums (adjusted for withdrawals) accumulated
at generally 5% simple interest up to the earlier of age 80 or 100% of
adjusted premiums.

[3] EPB: The death benefit is the greatest of the MAV, current account value,
or contract value plus a percentage of the contract's growth. The
contract's growth is account value less premiums net of withdrawals,
subject to a cap of 200% of premiums net of withdrawals.

[4] APB: the death benefit is the greater of current account value or MAV, not
to exceed current account value plus 25% times the greater of net premiums
and MAV (each adjusted for premiums in the past 12 months).

[5] Ratchet: the death benefit is the greatest of current account value, net
premiums paid and the highest account value on any specified anniversary
before age 85 (adjusted for withdrawals).

[6] Reset: the death benefit is the greatest of current account value, net
premiums paid and the most recent five to seven year anniversary account
value before age 80 (adjusted for withdrawals).

[7] Return of premium: the death benefit is the greater of current account
value and net premiums paid.

The Company offers certain variable annuity products with a GMWB rider. The GMWB
provides the policyholder with a guaranteed remaining balance ("GRB") if the
account value is reduced to zero through a combination of market declines and
withdrawals. The GRB is generally equal to premiums less withdrawals. However,
annual withdrawals that exceed a specified percentage of the premiums paid may
reduce the GRB by an amount greater than the withdrawals and may also impact the
guaranteed annual withdrawal amount that subsequently applies after the excess
annual withdrawals occur. In certain contracts, the policyholder also has the
option, after a specified time period, to reset the GRB to the then-current
account value, if greater. The GMWB represents an embedded derivative liability
in the variable annuity contract that is required to be reported separately from
the host variable annuity contract. It is carried at fair value and reported in
other policyholder funds. The fair value of the GMWB obligations are calculated
based on actuarial assumptions related to the projected cash flows, including
benefits and related contract charges, over the lives of the contracts,
incorporating expectations concerning policyholder behavior. Because of the
dynamic and complex nature of these cash flows, stochastic techniques under a
variety of market return scenarios and other best estimate assumptions are used.
Estimating cash flows involves numerous estimates and subjective judgments
including those regarding expected market rates of return, market volatility,
correlations of market returns and discount rates.

As of March 31, 2005 and December 31, 2004, the embedded derivative asset
recorded for GMWB, before reinsurance, was $136 and $129, respectively. During
the three months ended March 31, 2005 and 2004, the change in value of the GMWB,
before reinsurance, reported in realized gains (losses) was $19 and $(27),
respectively. There were no payments made for the GMWB during the three months
ended March 31, 2005 and 2004.

6. COMMITMENTS AND CONTINGENCIES

LITIGATION

The Hartford Financial Services Group, Inc. and its consolidated subsidiaries
("The Hartford") is involved in various legal actions arising in the ordinary
course of business, some of which assert claims for substantial amounts. These
actions include, among others, putative state and federal class actions seeking
certification of a state or national class. Such putative class actions have
alleged, for example, improper sales practices in connection with the sale of
life insurance and other investment products; and improper fee

13

arrangements in connection with mutual funds. The Hartford also is involved in
individual actions in which punitive damages are sought, such as claims alleging
bad faith in the handling of insurance claims. Management expects that the
ultimate liability, if any, with respect to such lawsuits, after consideration
of provisions made for estimated losses, will not be material to the
consolidated financial condition of the Company. Nonetheless, given the large or
indeterminate amounts sought in certain of these actions, and the inherent
unpredictability of litigation, it is possible that an adverse outcome in
certain matters could, from time to time, have a material adverse effect on the
Company's consolidated results of operations or cash flows in particular
quarterly or annual periods.

Broker Compensation Litigation - On October 14, 2004, the New York Attorney
General's Office filed a civil complaint (the "NYAG Complaint") against Marsh
Inc. and Marsh & McLennan Companies, Inc. (collectively, "Marsh") alleging,
among other things, that certain insurance companies, including The Hartford,
participated with Marsh in arrangements to submit inflated bids for business
insurance and paid contingent commissions to ensure that Marsh would direct
business to them. The Hartford was not joined as a defendant in the action,
which has since settled. Since the filing of the NYAG Complaint, several private
actions have been filed against The Hartford asserting claims arising from the
allegations of the NYAG Complaint.

Two securities class actions, now consolidated, have been filed in the United
States District Court for the District of Connecticut alleging claims against
The Hartford and certain of its executive officers under Section 10(b) of the
Securities Exchange Act and SEC Rule 10b-5. The consolidated amended complaint
alleges on behalf of a putative class of shareholders that The Hartford and the
four named individual defendants, as control persons of The Hartford, failed to
disclose to the investing public that The Hartford's business and growth was
predicated on the unlawful activity alleged in the NYAG Complaint. The class
period alleged is August 6, 2003 through October 13, 2004, the day before the
NYAG Complaint was filed. The complaint seeks damages and attorneys' fees. The
Hartford and the individual defendants dispute the allegations and intend to
defend these actions vigorously.

In addition, three putative class actions, now consolidated, have been filed in
the same court on behalf of participants in The Hartford's 401(k) plan against
The Hartford, Hartford Fire Insurance Company, The Hartford's Pension Fund Trust
and Investment Committee, The Hartford's Pension Administration Committee, The
Hartford's Chief Financial Officer, and John/Jane Does 1-15. The suits assert
claims under the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), alleging that The Hartford and the other named defendants breached
their fiduciary duties to plan participants by, among other things, failing to
inform them of the risk associated with investment in The Hartford's stock as a
result of the activity alleged in the NYAG Complaint. The class period alleged
is November 5, 2003 through the present. The complaints seek restitution of
losses to the plan, declaratory and injunctive relief, and attorneys' fees. All
defendants dispute the allegations and intend to defend these actions
vigorously.

Two corporate derivative actions, now consolidated, also have been filed in the
same court. The consolidated amended complaint, brought by a shareholder on
behalf of The Hartford against its directors and an executive officer, alleges
that the defendants knew adverse non-public information about the activities
alleged in the NYAG Complaint and concealed and misappropriated that information
to make profitable stock trades, thereby breaching their fiduciary duties,
abusing their control, committing gross mismanagement, wasting corporate assets,
and unjustly enriching themselves. The complaint seeks damages, injunctive
relief, disgorgement, and attorneys' fees. All defendants dispute the
allegations and intend to defend these actions vigorously.

Ten putative class actions also have been filed by alleged policyholders in
federal district courts against several brokers and insurers, including The
Hartford. These actions assert, on behalf of a class of persons who purchased
insurance through the broker defendants, claims under the Sherman Act and state
law, and in some cases the Racketeer Influenced and Corrupt Organizations Act
("RICO"), arising from the conduct alleged in the NYAG Complaint. The class
period alleged is 1994 through the date of class certification, which has not
yet occurred. The complaints seek treble damages, injunctive and declaratory
relief, and attorneys' fees. Pursuant to an order of the Judicial Panel on
Multidistrict Litigation, it is likely that the venue for all of these actions
will be the United States District Court for the District of New Jersey.
Putative class actions also have been filed in the Circuit Court for Cook
County, Illinois, Chancery Division and in the Circuit Court for Seminole
County, Florida, Civil Division, on behalf of a class of all persons who
purchased insurance from defendant insurers, including Hartford entities. These
state court actions assert unjust enrichment claims and violations of state
unfair trade practices acts arising from the conduct alleged in the NYAG
Complaint and seek remedies including restitution of premiums, and, in the
Illinois action, imposition of a constructive trust, and declaratory and
injunctive relief. The class period alleged is 1994 through the present. The
Hartford has removed both actions to federal court, but the plaintiffs have
moved to remand the actions to the respective state courts. The plaintiffs'
motion to remand the Illinois action was denied; the remand motion in the
Florida action has not been decided. The Hartford disputes the allegations in
all of these actions and intends to defend the actions vigorously.

Additional complaints may be filed against The Hartford in various courts
alleging claims under federal or state law arising from the conduct alleged in
the NYAG Complaint. The Hartford's ultimate liability, if any, in the pending
and possible future suits is highly uncertain and subject to contingencies that
are not yet known, such as how many suits will be filed, in which courts they
will be lodged, what claims they will assert, what the outcome of investigations
by the New York Attorney General's Office and other regulatory agencies will be,
the success of defenses that The Hartford may assert, and the amount of
recoverable damages if liability

14

is established. In the opinion of management, it is possible that an adverse
outcome in one or more of these suits could have a material adverse effect on
the Company's consolidated results of operations or cash flows in particular
quarterly or annual periods.

REGULATORY DEVELOPMENTS

In June 2004, The Hartford received a subpoena from the New York Attorney
General's Office in connection with its inquiry into compensation arrangements
between brokers and carriers. In mid-September 2004 and subsequently, The
Hartford has received additional subpoenas from the New York Attorney General's
Office, which relate more specifically to possible anti-competitive activity
among brokers and insurers. Since the beginning of October 2004, The Hartford
has received subpoenas or other information requests from Attorneys General and
regulatory agencies in more than a dozen jurisdictions regarding broker
compensation and possible anti-competitive activity. The Hartford may receive
additional subpoenas and other information requests from Attorneys General or
other regulatory agencies regarding similar issues. The Hartford also has
received a subpoena from the New York Attorney General's Office requesting
information related to The Hartford's underwriting practices with respect to
legal professional liability insurance. In addition, The Hartford has received a
request for information from the New York Attorney General's Office concerning
The Hartford's compensation arrangements in connection with the administration
of workers compensation plans. The Hartford intends to continue cooperating
fully with these investigations, and is conducting an internal review, with the
assistance of outside counsel, regarding broker compensation issues in its
Property & Casualty and Group Benefits operations.

On October 14, 2004, the New York Attorney General's Office filed a civil
complaint against Marsh & McLennan Companies, Inc., and Marsh, Inc.
(collectively, "Marsh"). The complaint alleges, among other things, that certain
insurance companies, including The Hartford, participated with Marsh in
arrangements to submit inflated bids for business insurance and paid contingent
commissions to ensure that Marsh would direct business to them. The Hartford was
not joined as a defendant in the action, which has since settled. Although no
regulatory action has been initiated against The Hartford in connection with the
allegations described in the civil complaint, it is possible that the New York
Attorney General's Office or one or more other regulatory agencies may pursue
action against The Hartford or one or more of its employees in the future. The
potential timing of any such action is difficult to predict. If such an action
is brought, it could have a material adverse effect on The Hartford.

On October 29, 2004, the New York Attorney General's Office informed The
Hartford that the Attorney General is conducting an investigation with respect
to the timing of the previously disclosed sale by Thomas Marra, a director and
executive officer of The Hartford, of 217,074 shares of The Hartford's common
stock on September 21, 2004. The sale occurred shortly after the issuance of two
additional subpoenas dated September 17, 2004 by the New York Attorney General's
Office. The Hartford has engaged outside counsel to review the circumstances
related to the transaction and is fully cooperating with the New York Attorney
General's Office. On the basis of the review, The Hartford has determined that
Mr. Marra complied with The Hartford's applicable internal trading procedures
and has found no indication that Mr. Marra was aware of the additional subpoenas
at the time of the sale.

There continues to be significant federal and state regulatory activity relating
to financial services companies, particularly mutual funds companies. These
regulatory inquiries have focused on a number of mutual fund issues, including
market timing and late trading, revenue sharing and directed brokerage, fees,
transfer agents and other fund service providers, and other mutual-fund related
issues. The Hartford has received requests for information and subpoenas from
the SEC, subpoenas from the New York Attorney General's Office, a subpoena from
the Connecticut Attorney General's Office, requests for information from the
Connecticut Securities and Investments Division of the Department of Banking,
and requests for information from the New York Department of Insurance, in each
case requesting documentation and other information regarding various mutual
fund regulatory issues.

The SEC's Division of Enforcement and the New York Attorney General's Office are
investigating aspects of The Hartford's variable annuity and mutual fund
operations related to market timing. The Hartford's mutual funds are available
for purchase by the separate accounts of different variable universal life
insurance policies, variable annuity products, and funding agreements, and they
are offered directly to certain qualified retirement plans. Although existing
products contain transfer restrictions between subaccounts, some products,
particularly older variable annuity products, do not contain restrictions on the
frequency of transfers. In addition, as a result of the settlement of litigation
against The Hartford with respect to certain owners of older variable annuity
products, The Hartford's ability to restrict transfers by these owners is
limited. In February 2005, The Hartford agreed in principle with the Boards of
Directors of the mutual funds to indemnify the mutual funds for any material
harm caused to the funds from frequent trading by these owners. The specific
terms of the indemnification have not been determined.

The SEC's Division of Enforcement also is investigating aspects of The
Hartford's variable annuity and mutual fund operations related to directed
brokerage and revenue sharing. The Hartford discontinued the use of directed
brokerage in recognition of mutual fund sales in late 2003. The Hartford also
has received subpoenas from the New York Attorney General's Office and the
Connecticut Attorney General's Office requesting information related to The
Hartford's group annuity products. The Hartford continues to cooperate fully
with the SEC, the New York Attorney General's Office and other regulatory
agencies.

15

To date, neither the SEC's and New York Attorney General's market timing
investigation nor the SEC's directed brokerage investigation has resulted in
either regulator initiating any formal action against The Hartford. However,
The Hartford believes that the SEC and the New York Attorney General's Office
are likely to take some action against The Hartford at the conclusion of the
respective investigations. The potential timing of any such action is difficult
to predict. Based on The Hartford's discussions with the SEC and the New York
Attorney General's Office and its own analysis, Hartford Life, Inc. ("Hartford
Life"), an indirect subsidiary of The Hartford, recorded a charge of $66 to
establish a reserve for these matters during the first quarter of 2005. This
reserve is an estimate; in view of the uncertainties regarding the timing and
outcome of any payments relating to these types of regulatory investigations, as
well as the tax-deductibility, if any, and any potential deferred acquisition
cost effects (though no deferred acquisition cost effects are included in this
estimate) that may be applicable, it is possible that the ultimate cost to
Hartford Life of these matters may exceed or be below the reserve amount,
perhaps by a significant amount. It is reasonably possible that the Company, an
indirect subsidiary of Hartford Life, may ultimately be liable for all or a
portion of the ultimate cost to Hartford Life. However, the ultimate liability
of the Company, if any, is not reasonably estimable at this time.

7. TRANSACTIONS WITH AFFILIATES

For a description of transactions with affiliates, see Note 15 of Notes to
Consolidated Financial Statements included in Hartford Life Insurance Company's
2004 Form 10-K Annual Report.

16

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

(Dollar amounts in millions, unless otherwise stated)

Management's Discussion and Analysis of Financial Condition and Results of
Operations ("MD&A") addresses the financial condition of Hartford Life Insurance
Company and its subsidiaries ("Hartford Life Insurance Company" or the
"Company") as of March 31, 2005, compared with December 31, 2004, and its
results of operations for the three months ended March 31, 2005 compared with
the equivalent period in 2004. This discussion should be read in conjunction
with the MD&A in Hartford Life Insurance Company's 2004 Form 10-K Annual Report.

Certain of the statements contained herein are forward-looking statements. These
forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995 and include estimates and
assumptions related to economic, competitive and legislative developments. These
forward-looking statements are subject to change and uncertainty which are, in
many instances, beyond the Company's control and have been made based upon
management's expectations and beliefs concerning future developments and their
potential effect upon the Company. There can be no assurance that future
developments will be in accordance with management's expectations or that the
effect of future developments on the Company will be those anticipated by
management. Actual results could differ materially from those expected by the
Company, depending on the outcome of various factors. These factors include: the
possible occurrence of terrorist attacks; the response of reinsurance companies
under reinsurance contracts and the availability, pricing and adequacy of
reinsurance to protect the Company against losses; changes in the stock markets,
interest rates or other financial markets, including the potential effect on the
Company's statutory capital levels; the inability to effectively mitigate the
impact of equity market volatility on the Company's financial position and
results of operations arising from obligations under annuity product guarantees;
the difficulty in predicting the Company's potential exposure arising out of
regulatory proceedings or private claims relating to incentive compensation or
payments made to brokers or other producers and alleged anti-competitive
conduct; the uncertain effect on the Company of regulatory and market-driven
changes in practices relating to the payment of incentive compensation to
brokers and other producers, including changes that have been announced and
those which may occur in the future; the possibility of more unfavorable loss
experience than anticipated; stronger than anticipated competitive activity;
unfavorable judicial or legislative developments, including the possibility that
the Terrorism Risk Insurance Act of 2002 is not extended beyond 2005; the
potential effect of domestic and foreign regulatory developments, including
those which could increase the Company's business costs and required capital
levels; the possibility of general economic and business conditions that are
less favorable than anticipated; the Company's ability to distribute its
products through distribution channels, both current and future; the uncertain
effects of emerging claim and coverage issues; the effect of assessments and
other surcharges for guaranty funds; a downgrade in the Company's claims-paying,
financial strength or credit ratings; the ability of the Company's subsidiaries
to pay dividends to the Company; and other factors described in such
forward-looking statements.

INDEX

Overview 17
Critical Accounting Estimates 21
Consolidated Results of Operations - Operating Summary 24
Retail Products Group 25
Institutional Solutions Group 26
Individual Life 27
Investments 27
Investment Credit Risk 29
Capital Markets Risk Management 31
Capital Resources and Liquidity 31
Accounting Standards 32

OVERVIEW

The Company has three reportable operating segments: Retail Products Group,
Institutional Solutions Group and Individual Life. The Company provides
investment and retirement products such as variable and fixed annuities and
retirement plan services and other institutional investment products; structured
settlements; private placement life insurance; individual life insurance
products including variable universal life, universal life, interest sensitive
whole life and term life.

17

The Company derives its revenues principally from: (a) fee income, including
asset management fees, on separate account and mutual fund assets and mortality
and expense fees, as well as cost of insurance charges; (b) net investment
income on general account assets; (c) fully insured premiums; and (d) certain
other fees. Asset management fees and mortality and expense fees are primarily
generated from separate account assets, which are deposited with the Company
through the sale of variable annuity and variable universal life products. Cost
of insurance charges are assessed on the net amount at risk for
investment-oriented life insurance products.

The Company's expenses essentially consist of interest credited to policyholders
on general account liabilities, insurance benefits provided, amortization of the
deferred policy acquisition costs, expenses related to the selling and servicing
the various products offered by the Company, dividends to policyholders, and
other general business expenses.

The Company's profitability in its variable annuity and to a lesser extent,
variable universal life businesses depends largely on the amount of the contract
holder account value on which it earns fees and the level of fees charged.
Changes in account value are driven by two main factors: net flows, which
measure the success of the Company's asset gathering and retention efforts and
the market return of the funds, which is heavily influenced by the return on the
equity markets. Net flows are comprised of new sales and other deposits less
surrenders, death benefits, policy charges and annuitizations of investment type
contracts, for instance variable annuity contracts. The Company uses the average
daily value of the S&P 500 Index as an indicator for evaluating market returns
of the underlying account portfolios in the United States. Relative
profitability of variable products is highly correlated to the growth in account
values since these products generally earn fee income on a daily basis. Thus, a
prolonged downturn in the financial markets could reduce revenues and
potentially raise the possibility of a charge against deferred policy
acquisition costs.

The profitability of the Company's fixed annuities and other spread based
products depends largely on its ability to earn target spreads between earned
investment rates on its general account assets and interest credited to
policyholders. Profitability is also influenced by operating expense management
including the benefits of economies of scale in the administration of its United
States variable annuity businesses in particular. In addition, the size and
persistency of gross profits from these businesses is an important driver of
earnings as it affects the rate of amortization of the deferred policy
acquisition costs.

The Company's profitability in its individual life insurance business depends
largely on the size of its in force block, the adequacy of product pricing and
underwriting discipline, actual mortality experience, and the efficiency of its
claims and expense management.

PERFORMANCE MEASURES

Fee Income

Fee income is largely driven from amounts collected as a result of contractually
defined percentages of assets under management on investment type contracts.
These fees are generally collected on a daily basis from the contract holder's
account. For individual life insurance products, fees are contractually defined
percentages based on levels of insurance, age, premiums and deposits collected
and contractholder account value. Life insurance fees are generally collected on
a monthly basis. Therefore, the growth in assets under management either through
positive net flows and favorable equity market performance will have a favorable
impact on fee income. Conversely, negative net flows and unfavorable equity
market performance will reduce fee income generated from investment type
contracts.

18

AS OF AND FOR THE
THREE MONTHS ENDED
MARCH 31,
-------------------
2005 2004
-------- --------

PRODUCT/KEY INDICATOR INFORMATION
VARIABLE ANNUITIES
Account value, beginning of period $ 99,617 $ 86,501
Net flows 412 2,201
Change in market value (1,958) 1,684
Account Value, end of period $ 98,071 $ 90,386
INDIVIDUAL LIFE INSURANCE
Variable universal life account value $ 5,249 $ 4,797
Total life insurance inforce 136,716 126,900
S&P 500 INDEX
Period end closing value 1,181 1,126
Daily average value 1,192 1,132

- The increase in assets under management and average account values can
be attributed to market appreciation and net flows over the past four
quarters, with most of the growth occurring in the fourth quarter of
2004.

- Net flows for the variable annuity business have slowed due to lower
sales levels and higher surrender levels.

- The change in market value will be volatile based on market
conditions.

Net Investment Income and Interest Credited

Certain investment type contracts such as fixed annuities and other spread-based
contracts generate deposits that the Company collects and invests to earn
investment income. These deposits comprise the majority of the assets of the
general account that are invested to generate investment income for the Company.
The investment type contracts use this investment income to credit the contract
holder an amount of interest specified in the respective contract. As discussed
in the overview, the amount of investment income earned in excess of the
interest credited to the contract holder is the spread income earned by the
Company. For insurance type contracts, net investment income earned during the
time that premiums are invested prior to paying claims and expenses supports the
profitability of these products.

Expenses

There are three major categories for expenses. The first category of expenses is
benefits and claims. These include the costs of mortality, in the individual
life business, as well as other contract holder benefits to policyholders.

The second major category is insurance operating costs and expenses, which is
commonly expressed in a ratio of a revenue measure depending on the type of
business. The third category is the amortization of deferred policy acquisition
costs and the present value of future profits, which is typically expressed as a
percentage of pretax income before the cost of this amortization. The individual
annuity business within the Retail Products Group segment accounts for the
majority of the amortization of deferred policy acquisition costs and present
value of future profits for the Company.

19

THREE MONTHS
ENDED MARCH 31,
----------------
2005 2004
----- -----

RETAIL PRODUCTS GROUP
Insurance expenses, net of deferrals $ 120 $ 101
Expense ratio (individual annuity) 17.8 bps 18.5 bps
DAC amortization ratio (individual annuity) 50.0% 51.4%

INDIVIDUAL LIFE
Death benefits $ 59 $ 55
Insurance expenses, net of deferrals $ 38 $ 37

- Retail Products Group's expense ratios continue to benefit from the
Company's economies of scale in the variable annuity business.

Profitability

Management evaluates the rates of return various businesses can provide as a way
of determining where additional capital is invested to increase net income and
shareholder returns. Specifically, because of the importance of its individual
annuity products, the Company uses the return on assets for the individual
annuity business for evaluating profitability.

RATIOS 2005 2004
- ------ ---- ----

RETAIL PRODUCTS GROUP
Individual annuity return on assets 50.2 bps 36.9 bps

- Return on assets increased from prior year due to higher income as a
result of market appreciation and growth in assets under management
and the change in accounting recorded in 2004.

REGULATORY DEVELOPMENTS

In June 2004, The Hartford received a subpoena from the New York Attorney
General's Office in connection with its inquiry into compensation arrangements
between brokers and carriers. In mid-September 2004 and subsequently, The
Hartford has received additional subpoenas from the New York Attorney General's
Office, which relate more specifically to possible anti-competitive activity
among brokers and insurers. Since the beginning of October 2004, The Hartford
has received subpoenas or other information requests from Attorneys General and
regulatory agencies in more than a dozen jurisdictions regarding broker
compensation and possible anti-competitive activity. The Hartford may receive
additional subpoenas and other information requests from Attorneys General or
other regulatory agencies regarding similar issues. The Hartford also has
received a subpoena from the New York Attorney General's Office requesting
information related to The Hartford's underwriting practices with respect to
legal professional liability insurance. In addition, The Hartford has received a
request for information from the New York Attorney General's Office concerning
The Hartford's compensation arrangements in connection with the administration
of workers compensation plans. The Hartford intends to continue cooperating
fully with these investigations, and is conducting an internal review, with the
assistance of outside counsel, regarding broker compensation issues in its
Property & Casualty and Group Benefits operations.

On October 14, 2004, the New York Attorney General's Office filed a civil
complaint against Marsh & McLennan Companies, Inc., and Marsh, Inc.
(collectively, "Marsh"). The complaint alleges, among other things, that certain
insurance companies, including The Hartford, participated with Marsh in
arrangements to submit inflated bids for business insurance and paid contingent
commissions to ensure that Marsh would direct business to them. The Hartford was
not joined as a defendant in the action, which has since settled. Although no
regulatory action has been initiated against The Hartford in connection with the
allegations described in the civil complaint, it is possible that the New York
Attorney General's Office or one or more other regulatory agencies may pursue
action against The Hartford or one or more of its employees in the future. The
potential timing of any such action is difficult to predict. If such an action
is brought, it could have a material adverse effect on The Hartford.

On October 29, 2004, the New York Attorney General's Office informed The
Hartford that the Attorney General is conducting an investigation with respect
to the timing of the previously disclosed sale by Thomas Marra, a director and
executive officer of The Hartford, of 217,074 shares of The Hartford's common
stock on September 21, 2004. The sale occurred shortly after the issuance of two
additional subpoenas dated September 17, 2004 by the New York Attorney General's
Office. The Hartford has engaged outside counsel to review the circumstances
related to the transaction and is fully cooperating with the New York Attorney
General's Office.

20

On the basis of the review, The Hartford has determined that Mr. Marra complied
with The Hartford's applicable internal trading procedures and has found no
indication that Mr. Marra was aware of the additional subpoenas at the time of
the sale.

There continues to be significant federal and state regulatory activity relating
to financial services companies, particularly mutual funds companies. These
regulatory inquiries have focused on a number of mutual fund issues, including
market timing and late trading, revenue sharing and directed brokerage, fees,
transfer agents and other fund service providers, and other mutual-fund related
issues. The Hartford has received requests for information and subpoenas from
the SEC, subpoenas from the New York Attorney General's Office, a subpoena from
the Connecticut Attorney General's Office, requests for information from the
Connecticut Securities and Investments Division of the Department of Banking,
and requests for information from the New York Department of Insurance, in each
case requesting documentation and other information regarding various mutual
fund regulatory issues.

The SEC's Division of Enforcement and the New York Attorney General's Office are
investigating aspects of The Hartford's variable annuity and mutual fund
operations related to market timing. The Hartford's mutual funds are available
for purchase by the separate accounts of different variable universal life
insurance policies, variable annuity products, and funding agreements, and they
are offered directly to certain qualified retirement plans. Although existing
products contain transfer restrictions between subaccounts, some products,
particularly older variable annuity products, do not contain restrictions on the
frequency of transfers. In addition, as a result of the settlement of litigation
against The Hartford with respect to certain owners of older variable annuity
products, The Hartford's ability to restrict transfers by these owners is
limited. In February 2005, The Hartford agreed in principle with the Boards of
Directors of the mutual funds to indemnify the mutual funds for any material
harm caused to the funds from frequent trading by these owners. The specific
terms of the indemnification have not been determined.

The SEC's Division of Enforcement also is investigating aspects of The
Hartford's variable annuity and mutual fund operations related to directed
brokerage and revenue sharing. The Hartford discontinued the use of directed
brokerage in recognition of mutual fund sales in late 2003. The Hartford also
has received subpoenas from the New York Attorney General's Office and the
Connecticut Attorney General's Office requesting information related to The
Hartford's group annuity products. The Hartford continues to cooperate fully
with the SEC, the New York Attorney General's Office and other regulatory
agencies.

To date, neither the SEC's and New York Attorney General's market timing
investigation nor the SEC's directed brokerage investigation has resulted in
either regulator initiating any formal action against The Hartford. However,
The Hartford believes that the SEC and the New York Attorney General's Office
are likely to take some action against The Hartford at the conclusion of the
respective investigations. The potential timing of any such action is difficult
to predict. Based on The Hartford's discussions with the SEC and the New York
Attorney General's Office and its own analysis, Hartford Life, Inc. ("Hartford
Life"), an indirect subsidiary of The Hartford, recorded a charge of $66 to
establish a reserve for these matters during the first quarter of 2005. This
reserve is an estimate; in view of the uncertainties regarding the timing and
outcome of any payments relating to these types of regulatory investigations, as
well as the tax-deductibility, if any, and any potential deferred acquisition
cost effects (though no deferred acquisition cost effects are included in this
estimate) that may be applicable, it is possible that the ultimate cost to
Hartford Life of these matters may exceed or be below the reserve amount,
perhaps by a significant amount. It is reasonably possible that the Company, an
indirect subsidiary of Hartford Life, may ultimately be liable for all or a
portion of the ultimate cost to Hartford Life. However, the ultimate liability
of the Company, if any, is not reasonably estimable at this time.

BROKER COMPENSATION

As The Hartford has disclosed previously, the Company pays brokers and
independent agents commissions and other forms of incentive compensation in
connection with the sale of many of the Company's insurance products. Since the
New York Attorney General's Office filed a civil complaint against Marsh &
McLennan Companies, Inc. and Marsh, Inc. (collectively, "Marsh") on October 14,
2004, several of the largest national insurance brokers, including Marsh, Aon
Corporation and Willis Group Holdings Limited, have announced that they have
discontinued the use of contingent compensation arrangements. Other industry
participants may make similar, or different, determinations in the future. In
addition, legal, legislative, regulatory, business or other developments may
require changes to industry practices relating to incentive compensation. At
this time, it is not possible to predict the effect of these announced or
potential changes on the Company's business or distribution strategies.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States of America ("GAAP"), requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.

21

The Company has identified the following estimates as critical in that they
involve a higher degree of judgment and are subject to a significant degree of
variability; insurance reserves; deferred policy acquisition costs and present
value of future profits; the valuation of investments and derivative instruments
and the evaluation of other-than-temporary impairments; and contingencies. In
developing these estimates management makes subjective and complex judgments
that are inherently uncertain and subject to material change as facts and
circumstances develop. Although variability is inherent in these estimates,
management believes the amounts provided are appropriate based upon the facts
available upon compilation of the financial statements. For a discussion of each
of these critical accounting estimates, see Hartford Life Insurance Company's
Form 10-K Annual Report.

DEFERRED POLICY ACQUISITION COSTS AND PRESENT VALUE OF FUTURE PROFITS

Policy acquisition costs include commissions and certain other expenses that
vary with and are primarily associated with acquiring business. Present value of
future profits is an intangible asset recorded upon applying purchase accounting
in an acquisition of a life insurance company. Deferred policy acquisition costs
and the present value of future profits intangible asset are amortized in the
same way. Both are amortized over the estimated life of the contracts acquired,
usually 20 years. Within the following discussion, deferred policy acquisition
costs and the present value of future profits intangible asset will be referred
to as "DAC". At March 31, 2005 and December 31, 2004, the carrying value of the
Company's DAC was $6.8 billion and $6.5 billion, respectively. For statutory
accounting purposes, such costs are expensed as incurred.

DAC related to traditional policies are amortized over the premium-paying period
in proportion to the present value of annual expected premium income. DAC
related to investment contracts and universal life-type contracts are deferred
and amortized using the retrospective deposit method. Under the retrospective
deposit method, acquisition costs are amortized in proportion to the present
value of estimated gross profits ("EGPs"), arising principally from projected
investment, mortality and expense margins and surrender charges. The
attributable portion of the DAC amortization is allocated to realized gains and
losses on investments. The DAC balance is also adjusted through other
comprehensive income by an amount that represents the amortization of deferred
policy acquisition costs that would have been required as a charge or credit to
operations had unrealized gains and losses on investments been realized. Actual
gross profits that vary from management's estimates result in increases or
decreases in the rate of amortization, commonly referred to as a true-up, which
are recorded in the current period.

The Company regularly evaluates its estimates of future gross profits combined
with actual gross profits earned to date to determine if actual experience or
other evidence suggests that those earlier estimates of future gross profits
should be revised. In the event that the Company were to revise its EGPs, the
cumulative DAC amortization would be adjusted to reflect such revised EGPs in
the period the revision was determined to be necessary. Several assumptions
considered to be significant in the development of EGPs include separate account
fund performance, surrender and lapse rates, estimated interest spread and
estimated mortality. The separate account fund performance assumption is
critical to the development of the EGPs related to the Company's variable
annuity and to a lesser extent, variable universal life insurance businesses.
The average annual long-term rate of assumed separate account fund performance
(before mortality and expense charges) used in estimating gross profits for the
variable annuity and variable universal life business was 9% for the three
months ended March 31, 2005 and 2004. For other products including fixed
annuities and other universal life-type contracts, the average assumed
investment yield ranged from 5.7% to 7.9% for the three months ended March 31,
2005 and 2004.

The Company had developed models to evaluate its DAC asset, which allowed it to
run a large number of stochastically determined scenarios of separate account
fund performance. These scenarios were then utilized to calculate a
statistically significant range of reasonable estimates of EGPs. This range was
then compared to the present value of EGPs currently utilized in the DAC
amortization model. As of March 31, 2005, the present value of the EGPs utilized
in the DAC amortization model fall within a reasonable range of statistically
calculated present value of EGPs. As a result, the Company does not believe
there is sufficient evidence to suggest that a revision to the EGPs (and
therefore, a revision to the DAC) as of March 31, 2005 is necessary; however, if
in the future the EGPs utilized in the DAC amortization model were to fall
outside of the margin of the reasonable range of statistically calculated EGPs,
a revision could be necessary. Furthermore, the Company has estimated that the
present value of the EGPs is likely to remain within a reasonable range if
overall separate account returns decline by 18% or less over the next twelve
months, and if certain other assumptions that are implicit in the computations
of the EGPs are achieved.

Additionally, the Company continues to perform analyses with respect to the
potential impact of a revision to future EGPs. If such a revision to EGPs were
deemed necessary, the Company would adjust, as appropriate, all of its
assumptions for products accounted for in accordance with Statement of Financial
Accounting Standards ("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", and reproject its future EGPs based on
current account values at the end of the quarter in which a revision is deemed
to be necessary. To illustrate the effects of this process, assume the Company
had concluded that a revision of the Company's EGPs was required at March 31,
2005. If the Company assumed a 9% average long-term rate of growth from March
31, 2005 forward along with other appropriate assumption changes in determining
the revised EGPs, the Company estimates the cumulative increase to amortization
would be

22

approximately $65-$70, after-tax. If instead the Company were to assume a
long-term growth rate of 8% in determining the revised EGPs, the adjustment
would be approximately $90-$100, after-tax. Any such adjustment would not affect
statutory income or surplus, due to the prescribed accounting for such amounts
that is discussed above.

Aside from absolute levels and timing of market performance assumptions,
additional factors that will influence this determination include the degree of
volatility in separate account fund performance and shifts in asset allocation
within the separate account made by policyholders. The overall return generated
by the separate account is dependent on several factors, including the relative
mix of the underlying sub-accounts among bond funds and equity funds as well as
equity sector weightings. The Company's overall separate account fund
performance has been reasonably correlated to the overall performance of the S&P
500 Index (which closed at 1,181 on March 31, 2005), although no assurance can
be provided that this correlation will continue in the future.

The overall recoverability of the DAC asset is dependent on the future
profitability of the business. The Company tests the aggregate recoverability of
the DAC asset by comparing the amounts deferred to the present value of total
EGPs. In addition, the Company routinely stress tests its DAC asset for
recoverability against severe declines in its separate account assets, which
could occur if the equity markets experienced another significant sell-off, as
the majority of policyholders' funds in the separate accounts is invested in the
equity market. As of March 31, 2005, the Company believed variable annuity
separate account assets could fall by at least 35% before portions of its DAC
asset would be unrecoverable.

OTHER CRITICAL ACCOUNTING ESTIMATES

There have been no material changes to the Company's other critical accounting
estimates since the filing of the Company's 2004 Form 10-K Annual Report.

23

CONSOLIDATED RESULTS OF OPERATIONS - OPERATING SUMMARY

THREE MONTHS ENDED
MARCH 31,
------------------------
OPERATING SUMMARY 2005 2004 CHANGE
- ----------------- ------ ------ ------

Fee income $ 682 $ 618 10%
Earned premiums 58 103 (44%)
Net investment income 623 609 2%
Net realized capital gains 72 64 13%
------ ------ ---
TOTAL REVENUES 1,435 1,394 3%
------ ------ ---
Benefits, claims, and claim adjustment expenses 678 744 (9%)
Insurance operating costs and other expenses 209 178 17%
Amortization of deferred policy acquisition costs
and present value of future profits 226 199 14%
------ ------ ---
TOTAL BENEFITS, CLAIMS AND EXPENSES 1,113 1,121 (1%)
------ ------ ---
INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 322 273 18%
Income tax expense 81 74 9%
------ ------ ---
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 241 199 21%
Cumulative effect of accounting change, net of tax [1] -- (18) NM
------ ------ ---
NET INCOME $ 241 $ 181 33%
====== ====== ===

[1] For the three months ended March, 31, 2004, represents the cumulative
impact of the Company's adoption of SOP 03-1.

The Company defines "NM" as not meaningful for increases or decreases greater
than 200%, or changes from a net gain to a net loss position, or vice versa.

The Company's net income increased due primarily to business growth in all of
its segments. Net income in the Retail segment increased 47%, principally driven
by higher fee income from growth in the variable annuity business as a result of
increasing assets under management. The Institutional segment contributed higher
earnings due to first quarter 2005 surrender activity in the leveraged block of
the private placement life insurance business, as well as favorable mortality
experience and higher investment spreads in the institutional business.
Additionally, net income was higher for the Individual Life segment. The
increase in Individual Life earnings was primarily driven by growth in account
values and life insurance inforce.

24

RETAIL PRODUCTS GROUP

THREE MONTHS ENDED
MARCH 31,
----------------------------
OPERATING SUMMARY 2005 2004 CHANGE
- ----------------- -------- -------- ------

Fee income $ 440 $ 377 17%
Earned premiums (35) (21) (67%)
Net investment income 265 272 (3%)
-------- -------- ---
TOTAL REVENUES 670 628 7%
-------- -------- ---
Benefits, claims, and claim adjustment expenses 247 257 (4%)
Insurance operating costs and other expenses 120 101 19%
Amortization of deferred policy acquisition costs and
present value of future profits 174 154 13%
-------- -------- ---
TOTAL BENEFITS, CLAIMS AND EXPENSES 541 512 6%
-------- -------- ---
INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 129 116 11%
Income tax expense 17 21 (19%)
-------- -------- ---
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 112 95 18%
Cumulative effect of accounting change, net of tax [1] -- (19) NM
-------- -------- ---
NET INCOME $ 112 $ 76 47%
======== ======== ===

ASSETS UNDER MANAGEMENT
Individual variable annuity account values $ 98,071 $ 90,386 9%
Individual fixed annuity and other account values 10,946 11,312 (3%)
Other retail products account values 7,070 5,162 37%
-------- -------- ---
TOTAL ACCOUNT VALUES [2] $116,087 $106,860 9%
======== ======== ===

[1] For the three months ended March 31, 2004, represents the cumulative impact
of the Company's adoption of SOP 03-1.

[2] Includes policyholder balances for investment contracts and reserves for
future policy benefits for insurance contracts.

Net income in the Retail segment increased, principally driven by higher fee
income from growth in the assets under management in virtually all businesses of
the segment and the cumulative effect of accounting change from the Company's
adoption of SOP 03-1 recognized in the first quarter of 2004. Fee income
generated by the variable annuity operation increased as average account values
were higher in the first quarter of 2005 compared to the prior period. The
increase in average account values can be attributed to market appreciation of
$4.0 billion over the past four quarters, with most of the growth occurring in
the fourth quarter of 2004, and approximately $3.7 billion of net flows over the
past four quarters. Another contributing factor to the increase in fee income
was the 401(k) business. Assets under management for the 401(k) business grew
37% to $7.1 billion as a result of favorable net flows and market conditions. In
addition, the fixed annuity business contributed higher net income, excluding
the cumulative effects of accounting change in 2004, due to improved investment
spreads from the market value adjusted ("MVA") products. A consequence of the
positive earnings drivers discussed above was higher DAC amortization costs due
to higher gross profits.

25

INSTITUTIONAL SOLUTIONS GROUP

THREE MONTHS ENDED
MARCH 31,
--------------------------
OPERATING SUMMARY 2005 2004 CHANGE
- ----------------- ------- ------- ------

Fee income $ 65 $ 71 (8%)
Earned premiums 84 109 (23%)
Net investment income 268 253 6%
Net realized capital gains -- 1 NM
------- ------- ---
TOTAL REVENUES 417 434 (4%)
------- ------- ---
Benefits, claims, and claim adjustment expenses 312 361 (14%)
Insurance operating costs and other expenses 43 38 13%
Amortization of deferred policy acquisition costs and
present value of future profits 9 9 --
------- ------- ---
TOTAL BENEFITS, CLAIMS AND EXPENSES 364 408 (11%)
------- ------- ---
INCOME BEFORE INCOME TAXES 53 26 104%
Income tax expense 16 8 100%
------- ------- ---
NET INCOME $ 37 $ 18 106%
======= ======= ===

Institutional account values $15,209 $12,649 20%
Governmental account values 9,882 9,243 7%
Private Placement Life Insurance account values
Variable Products 22,641 21,305 6%
Leveraged COLI 1,957 2,537 (23%)
------- ------- ---
Total Private Placement Life Insurance account values [1] 24,598 23,842 3%
------- ------- ---
TOTAL ASSETS UNDER MANAGEMENT $49,689 $45,734 9%
======= ======= ===

[1] Includes policyholder balances for investment contracts and reserves for
future policy benefits for insurance contracts.

Net income in the Institutional segment increased, principally driven by higher
earnings in the private placement life insurance business ("PPLI") combined with
a favorable after-tax mortality gain of $3 and improved investment spreads in
the institutional business. The PPLI business contributed higher earnings due
primarily to surrender activity of $572 in account value associated with the
leveraged COLI product. This increase in surrenders resulted in the recognition
of an after-tax deferred gain of $6 in the first quarter of 2005 that was
recognized in benefits, claims and claim adjustment expenses. In addition, PPLI
reported higher earnings due to favorable mortality experience in the first
quarter of 2005. The institutional business earned higher investment spreads due
to the growth in average account values within the institutional businesses as a
result of positive net flows that were largely attributable to increased sales
levels for the funding agreement backed investor notes program. Partially
offsetting these increases to net income was lower fee income due to the
leveraged COLI product surrender activity discussed above.

26

INDIVIDUAL LIFE

THREE MONTHS ENDED
MARCH 31,
------------------------
OPERATING SUMMARY 2005 2004 CHANGE
- ----------------- ------ ------ ------

Fee income and other $ 174 $ 165 5%
Net investment income 67 65 3%
------ ------ ---
TOTAL REVENUES 241 230 5%
------ ------ ---
Benefits, claims, and claim adjustment expenses 107 108 (1%)
Insurance operating costs and other expenses 38 37 3%
Amortization of deferred policy acquisition costs and
present value of future profits 43 36 19%
------ ------ ---
TOTAL BENEFITS, CLAIMS AND EXPENSES 188 181 4%
------ ------ ---
INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 53 49 8%
Income tax expense 17 16 6%
------ ------ ---
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 36 33 9%
Cumulative effect of accounting change, net of tax -- (1) NM
------ ------ ---
NET INCOME $ 36 $ 32 13%
====== ====== ===

ACCOUNT VALUES

Variable universal life insurance $5,249 $4,797 9%
------ ------ ---
TOTAL ACCOUNT VALUES $8,918 $8,313 7%
------ ------ ---

Net income in the Individual Life segment increased primarily driven by 8%
growth and aging of the life insurance inforce and 7% growth in account value.
Fee income included increased cost of insurance charges of $4 and other fee
income of $3. These were primarily driven by business growth and aging in the
variable universal, universal, and interest sensitive whole life insurance
inforce. Variable fee income, also a component of fee income, grew $2 as
favorable equity markets and sales added 9% to the variable universal life
account value. Investment income grew with the increase in general account
assets from continued sales of general account products. Partially offsetting
these positive earnings drivers was higher amortization of deferred acquisitions
costs as a result of higher gross margins.

INVESTMENTS

General

The investment portfolios are managed by Hartford Investment Management Company
("HIM"), a wholly-owned subsidiary of The Hartford. HIM manages the portfolios
to maximize economic value, while attempting to generate the income necessary to
support the Company's various product obligations, within internally established
objectives, guidelines and risk tolerances. (For a further discussion of how HIM
manages the investment portfolios, see the Investments section of the MD&A under
the "General" section in Hartford Life Insurance Company's 2004 Form 10-K Annual
Report. Also, for a further discussion of how the investment portfolio's credit
and market risks are assessed and managed, see the Investment Credit Risk
section that follows.)

Return on general account invested assets is an important element of Hartford
Life Insurance Company's financial results. Significant fluctuations in the
fixed income or equity markets could weaken the Company's financial condition or
its results of operations. Additionally, changes in market interest rates may
impact the period of time over which certain investments, such as
mortgage-backed securities, are repaid and whether certain investments are
called by the issuers. Such changes may, in turn, impact the yield on these
investments and also may result in reinvestment of funds received from calls and
prepayments at rates below the average portfolio yield. Net investment income
and net realized capital gains and losses accounted for approximately 49% and
48% of the Company's consolidated revenues for the first quarter ended March 31,
2005 and 2004, respectively.

Fluctuations in interest rates affect the Company's return on, and the fair
value of, general account fixed maturity investments, which comprised
approximately 93% and 92% of the fair value of its invested assets as of March
31, 2005 and December 31, 2004, respectively. Other events beyond the Company's
control could also adversely impact the fair value of these investments.
Specifically, a downgrade of an issuer's credit rating or default of payment by
an issuer could reduce the Company's investment return.

27

A decrease in the fair value of any investment that is deemed
other-than-temporary would result in the Company's recognition of a net realized
capital loss in its financial results prior to the actual sale of the
investment. (For a further discussion of the evaluation of other-than-temporary
impairments, see the Critical Accounting Estimates section of the MD&A under
"Valuation of Investments and Derivative Instruments and Evaluation of
Other-Than-Temporary Impairments" section in Hartford Life Insurance Company's
2004 Form 10-K Annual Report.)

The primary investment objective of the Company's general account is to maximize
economic value consistent with acceptable risk parameters, including the
management of the interest rate sensitivity of invested assets, while generating
of sufficient after-tax income to meet policyholder and corporate obligations.

The following table identifies the Company's invested assets by type as of March
31, 2005 and December 31, 2004.

COMPOSITION OF INVESTED ASSETS

MARCH 31, 2005 DECEMBER 31, 2004
----------------- -----------------
AMOUNT PERCENT AMOUNT PERCENT
------- ------- ------- -------

Fixed maturities, available-for-sale, at fair value $43,161 92.5% $42,691 91.7%
Equity securities, available-for-sale, at fair value 250 0.5% 179 0.4%
Policy loans, at outstanding balance 2,077 4.5% 2,617 5.6%
Mortgage loans, at cost 858 1.8% 794 1.7%
Limited partnerships, at fair value 265 0.6% 247 0.5%
Other investments 32 0.1% 43 0.1%
------- ----- ------- -----
TOTAL INVESTMENTS $46,643 100.0% $46,571 100.0%
======= ===== ======= =====

Fixed maturity investments increased $470, or 1%, since December 31, 2004,
primarily the result of positive operating cash flow, partially offset by a
decrease in fair value due to an increase in interest rates. Policy loans
decreased $540, or 21%, since December 31, 2004, as a result of certain policy
loan surrenders.

INVESTMENT RESULTS

The following table summarizes the Company's investment results.

FIRST QUARTER ENDED
MARCH 31,
-------------------
(before-tax) 2005 2004
- ------------ ---- ----

Net investment income - excluding income on policy loans $587 $565
Policy loan income 36 44
---- ----
Net investment income - total $623 $609
Yield on average invested assets [1] 5.7% 5.9%
---- ----
Gross gains on sale $ 92 $ 85
Gross losses on sale (45) (15)
Impairments (1) (8)
Other, net [2] 26 2
---- ----
Net realized capital gains $ 72 $ 64
==== ====

[1] Represents annualized net investment income divided by the monthly weighted
average invested assets at cost or amortized cost, as applicable, excluding
the collateral received associated with the securities lending program and
consolidated variable interest entity minority interests.

[2] Primarily consists of changes in fair value on non-qualifying derivatives
and hedge ineffectiveness on qualifying derivative instruments, foreign
currency transaction remeasurements, as well as the amortization of
deferred acquisition costs related to realized capital gains.

For the first quarter ended March 31, 2005, net investment income, excluding
income on policy loans, increased $22, or 4%, compared to the prior year period.
The increase in net investment income was primarily due to income earned on a
higher average invested assets base, as compared to the respective prior year
period. The increase in the average invested assets base, as compared to the
prior year period, was primarily due to positive operating cash flows,
investment contract sales such as retail and institutional notes, and universal
life-type product sales such as individual fixed annuity products sold in Japan.
This increase was partially offset by a decrease in the yield on average
invested assets.

For the first quarter ended March 31, 2005, the yield on average invested assets
decreased slightly from the respective prior year period as a result of new
investment purchases at rates below the average portfolio yield due to the
continued low interest rate environment and decreased policy loan income. Since
the Company invests primarily in long-term fixed rate debt securities, current
period changes in long-term interest rates impact the yield on new asset
purchases and, therefore, have a gradual impact on the

28

overall portfolio yield. The weighted average yield on new invested asset
purchases in the first quarter ended March 31, 2005 of approximately 5.1%,
before-tax, continues to be below the average portfolio yield.

Net realized capital gains for the first quarter ended March 31, 2005 increased
by $8 compared to the respective prior year period, primarily the result of
higher net realized gains on non-qualifying foreign currency derivatives and
foreign currency transaction remeasurement, partially offset by lower net
realized gains on fixed maturity and equity securities.

Gross gains on sales for the first quarter ended March 31, 2005 were primarily
within fixed maturities and were concentrated in the commercial mortgage-backed
securities ("CMBS"), corporate and foreign government sectors. The CMBS sales
resulted from a decision to divest securities that were backed by a single asset
due to the currently scheduled expiration of the Terrorism Risk Insurance Act
("TRIA") at the end of 2005. Gains on these sales were realized as a result of
an improved credit environment and interest rate declines from the date of
purchase. Foreign government securities were sold in the first quarter of 2005
primarily to reduce the foreign currency exposure in the portfolio due to the
expected near term volatility of foreign exchange rates. Gains resulted from the
depreciation of the U.S. Dollar against foreign currencies and credit spread
tightening. Certain lower quality corporate securities that had appreciated in
value as a result of an improved corporate credit environment were sold in order
to reposition the corporate holdings into higher quality securities.

Gross losses on sales for the first quarter ended March 31, 2005 were primarily
within foreign and U.S. government securities, corporate securities and CMBS
with no single security sold at a loss in excess of $4 and an average loss as a
percentage of the fixed maturity's amortized cost of less than 2%, which, under
the Company's current impairment policy, were deemed to be depressed only to a
minor extent.

Gross gains on sales for the first quarter ended March 31, 2004 were primarily
from sales of fixed maturity investments in the corporate, foreign government
and asset-backed securities ("ABS") sectors. The majority of the sales in the
corporate and ABS sectors were the result of portfolio rebalancing that resulted
in divesting securities that had appreciated in value due to a decline in
interest rates and an improved corporate credit environment. Foreign government
securities were sold in the first quarter of 2004 primarily to realize gains
associated with the decline in value of the U.S. Dollar against foreign
currencies.

Gross losses on sales for the first quarter ended March 31, 2004 were primarily
within ABS and corporate securities, with no single security sold at a loss in
excess of $5 and an average loss as a percentage of the fixed maturity's
amortized cost of less than 4%.

OTHER-THAN-TEMPORARY IMPAIRMENTS

For the first quarter ended March 31, 2005, total other-than-temporary
impairments were less than $1, as compared with $8 for the comparable period in
2004.

The Company believes the favorable other-than-temporary impairments trend will
depend on continued strong economic fundamentals, continued positive issuer
performance, political stability and collateral performance. Adverse issuer
specific circumstances may result in future other-than-temporary impairments.
(For further discussion of risk factors associated with portfolio sectors with
significant unrealized loss positions, see the risk factor commentary under the
Fixed Maturity by Type schedule in the Investment Credit Risk section that
follows.)

INVESTMENT CREDIT RISK

Hartford Life Insurance Company has established investment credit policies that
focus on the credit quality of obligors and counterparties, limit credit
concentrations, encourage diversification and require frequent creditworthiness
reviews. Investment activity, including setting of policy and defining
acceptable risk levels, is subject to regular review and approval by senior
management and by the Finance Committee of The Hartford's Board of Directors.

Refer to the Investment Credit Risk section of the MD&A in Hartford Life
Insurance Company's 2004 Form 10-K Annual Report for a description of the
Company's objectives, policies and strategies, including the use of derivative
instruments.

The Company invests primarily in securities that are rated investment grade, and
has established exposure limits, diversification standards and review procedures
for all credit risks including borrower, issuer and counterparty.
Creditworthiness of specific obligors is determined by an internal credit
evaluation supplemented by consideration of external determinants of
creditworthiness, typically ratings assigned by nationally recognized ratings
agencies. Obligor, asset sector and industry concentrations are subject to
established limits and are monitored on a regular basis.

Hartford Life Insurance Company is not exposed to any credit concentration risk
of a single issuer greater than 10% of the Company's stockholders' equity other
than certain U.S. government and government agencies.

29

The following table identifies fixed maturity securities by type, as of March
31, 2005 and December 31, 2004.

FIXED MATURITIES BY TYPE

MARCH 31, 2005
--------------------------------------------------------
PERCENT
OF TOTAL
AMORTIZED UNREALIZED UNREALIZED FAIR FAIR
COST GAINS LOSSES VALUE VALUE
--------- ---------- ---------- ------- --------

ABS $ 6,013 $ 59 $ (66) $ 6,006 13.9%
CMBS 7,366 206 (63) 7,509 17.4%
Collateralized mortgage
obligations ("CMOs") 808 4 (3) 809 1.9%
Corporate
Basic industry 2,080 123 (15) 2,188 5.1%
Capital goods 1,402 115 (6) 1,511 3.5%
Consumer cyclical 2,353 95 (33) 2,415 5.6%
Consumer non-cyclical 2,325 162 (14) 2,473 5.7%
Energy 1,186 100 (5) 1,281 3.0%
Financial services 6,004 371 (36) 6,339 14.7%
Technology and
communications 3,117 249 (27) 3,339 7.7%
Transportation 563 36 (3) 596 1.4%
Utilities 2,103 200 (11) 2,292 5.3%
Other 788 28 (10) 806 1.9%
Government/Government
agencies
Foreign 667 42 (6) 703 1.6%
United States 797 21 (10) 808 1.9%
Mortgage-backed
securities ("MBS") - agency 2,056 9 (20) 2,045 4.7%
Municipals 754 34 (5) 783 1.8%
Redeemable preferred stock 1 -- -- 1 --
Short-term 1,257 -- -- 1,257 2.9%
------- ------ ----- ------- -----
TOTAL FIXED MATURITIES $41,640 $1,854 $(333) $43,161 100.0%
======= ====== ===== ======= =====

DECEMBER 31, 2004
--------------------------------------------------------
PERCENT
OF TOTAL
AMORTIZED UNREALIZED UNREALIZED FAIR FAIR
COST GAINS LOSSES VALUE VALUE
--------- ---------- ---------- ------- --------

ABS $ 5,881 $ 72 $ (61) $ 5,892 13.8%
CMBS 7,390 329 (17) 7,702 18.0%
Collateralized mortgage
obligations ("CMOs") 882 9 (3) 888 2.1%
Corporate
Basic industry 2,130 171 (5) 2,296 5.4%
Capital goods 1,324 118 (4) 1,438 3.4%
Consumer cyclical 2,194 158 (5) 2,347 5.5%
Consumer non-cyclical 2,294 196 (4) 2,486 5.8%
Energy 1,172 116 (1) 1,287 3.0%
Financial services 5,419 448 (18) 5,849 13.7%
Technology and
communications 3,197 314 (10) 3,501 8.2%
Transportation 586 44 (1) 629 1.5%
Utilities 2,040 215 (7) 2,248 5.3%
Other 710 46 (2) 754 1.8%
Government/Government
agencies
Foreign 649 60 (2) 707 1.7%
United States 774 19 (4) 789 1.8%
Mortgage-backed
securities ("MBS") - agency 1,542 18 (2) 1,558 3.6%
Municipals 675 30 (5) 700 1.6%
Redeemable preferred stock 1 -- -- 1 --
Short-term 1,619 -- -- 1,619 3.8%
------- ------ ----- ------- -----
TOTAL FIXED MATURITIES $40,479 $2,363 $(151) $42,691 100.0%
======= ====== ===== ======= =====

The Company's fixed maturity portfolio gross unrealized gains and losses as of
March 31, 2005 in comparison to December 31, 2004 were primarily impacted by
changes in interest rates and security sales. The Company's fixed maturity gross
unrealized gains decreased $509 from December 31, 2004 to March 31, 2005
primarily due to an increase in interest rates and, to a lesser extent, sales of
securities in a gain position. The gross unrealized loss amount increased by
$182 from December 31, 2004 to March 31, 2005 primarily due to interest rate
increases partially offset by asset sales.

The sectors with the most significant concentration of unrealized losses were
CMBS, ABS supported by aircraft lease receivables and corporate fixed maturities
primarily within the financial services and consumer cyclical sectors. The
Company's current view of risk factors relative to these fixed maturity types is
as follows:

CMBS -- The increase in the unrealized loss position during first quarter 2005
was primarily the result of an increase in interest rates. Substantially all of
these securities are investment grade securities priced at or greater than 90%
of amortized cost as of March 31, 2005. Additional changes in fair value of
these securities are primarily dependent on future changes in interest rates.

AIRCRAFT LEASE RECEIVABLES -- The unrealized loss was $52 at March 31, 2005
compared to $50 for December 31, 2004. Although worldwide travel and aircraft
demand has improved, uncertainty surrounding the stability of domestic airlines
continues to weigh heavily on these securities. Airline operating costs,
including fuel and certain employee benefits costs, continue to adversely impact
this sector. Because of the valuation of the underlying collateral, the Company
expects to receive principal and interest payments, however, additional price
recovery will depend on continued improvement in economic fundamentals,
political stability and airline operating performance.

FINANCIAL SERVICES -- The increase in the unrealized loss as of March 31, 2005
in comparison to December 31, 2004 is primarily due to an increase in interest
rates. As of March 31, 2005, the Company held approximately 45 different
securities in the financial services sector that had been in an unrealized loss
position for greater than six months. Substantially all of these securities are
investment grade securities priced at or greater than 90% of amortized cost as
of March 31, 2005. These positions are a mixture of

30

fixed and variable rate securities with extended maturity dates, which have been
adversely impacted by changes in interest rates after the purchase date.
Additional changes in fair value of these securities are primarily dependent on
future changes in interest rates.

CONSUMER CYCLICAL --Within the consumer cyclical sector, $13 of the unrealized
loss is related to a major automotive manufacturer. In March 2005, this
manufacturer revised downward 2005 earnings and cash flow guidance primarily due
to sluggish sales, rising employee and retiree benefit costs and their debt
service interest burden. Sales of this manufacturer's most successful product
offerings, SUVs and trucks, have been hurt by rising gasoline prices, market
competition and high inventory levels. The manufacturer expects new product
offerings emphasizing sedans and mid-sized SUVs to begin to increase sales.
Associated with this manufacturer is a financial services unit which provides
consumer and wholesale financial products and services, a significant portion of
which is to the customers of the manufacturer via automobile loans and lease
financing. The financial services unit continues to produce strong operating
cash flows. The manufacturer and the financial services unit have substantial
liquid resources that should be adequate to fund operations and service debt
until the cost structure can be adjusted and sales and margins improve. As of
March 31, 2005, Hartford Life Insurance Company owns securities of the
manufacturer and the financial services unit with an amortized cost of $48 and
$62, respectively, that were in a gross unrealized loss position of $7 and $6,
respectively. Hartford Life Insurance Company continues to monitor these
securities in accordance with its impairment policy.

(For further discussion of risk factors associated with securities in unrealized
loss positions, see the Investment Credit Risk section of the MD&A in Hartford
Life Insurance Company's 2004 Form 10-K Annual Report.)

Investment sector allocations as a percentage of total fixed maturities have
remained materially consistent since December 31, 2004, except for MBS and
corporate fixed maturities within the financial services sector. Both MBS and
financial service securities increased as a percentage of total fixed maturities
since December 31, 2004 as a result of a decision to increase the Company's
investment in this asset class primarily due to its attractive yields and
diversification opportunities. Also, HIM continues to overweight, in comparison
to the Lehman Aggregate Index, ABS supported by diversified pools of consumer
loans (e.g. home equity and auto loans and credit card receivables) and CMBS due
to the securities' attractive spread levels and underlying asset diversification
and quality. In general, CMBS have lower prepayment risk than MBS due to
contractual penalties.

As of March 31, 2005, 23% of the fixed maturities were invested in private
placement securities, including 14% of Rule 144A offerings to qualified
institutional buyers. Private placement securities are generally less liquid
than public securities. Most of the private placement securities are rated by
nationally recognized rating agencies.

At the March 22, 2005 Federal Open Market Committee meeting, the Federal Reserve
increased the target federal funds rate by 25 basis points to 2.75%, a 50 basis
point increase from year end 2004 levels. The Fed members indicated that the
economy continues to grow at a moderate pace, although inflation pressures have
increased in recent months and pricing power is more evident. The Company
continues to expect the Federal Reserve to raise short-term interest rates at a
measured pace until rates approach neutral levels, unless inflationary pressures
accelerate, at which time the Fed would likely raise short-term rates in greater
increments. The risk of inflation could increase if energy and commodity prices
continue to rise, productivity growth slows, U.S. budget or trade deficits
continue to rise or the U.S. Dollar continues to devalue in comparison to
foreign currencies. Increases in future interest rates may result in lower fixed
maturity valuations.

CAPITAL MARKETS RISK MANAGEMENT

For a complete discussion on our capital markets risk management, please refer
to the MD&A included in Hartford Life Insurance Company's 2004 Annual Report on
Form 10-K.

CAPITAL RESOURCES AND LIQUIDITY

RATINGS

Ratings are an important factor in establishing the competitive position in the
insurance and financial services marketplace. There can be no assurance that the
Company's ratings will continue for any given period of time or that they will
not be changed. In the event the Company's ratings are downgraded, the level of
revenues or the persistency of the Company's business may be adversely impacted.

The following table summarizes Hartford Life Insurance Company's significant
United States member companies' financial ratings from the major independent
rating organizations as of April 29, 2005:

31

STANDARD &
A.M. BEST FITCH POOR'S MOODY'S
--------- ----- ---------- -------

INSURANCE RATINGS
Hartford Life Insurance Company A+ AA AA- Aa3
Hartford Life and Annuity A+ AA AA- Aa3

OTHER RATINGS
Hartford Life Insurance Company:
Short Term Rating -- -- A-1+ P-1

The agencies consider many factors in determining the final rating of an
insurance company. One consideration is the relative level of statutory surplus
necessary to support the business written. Statutory surplus represents the
capital of the insurance company reported in accordance with accounting
practices prescribed by the applicable state insurance department.

CONTINGENCIES

Regulatory Developments - For a discussion regarding contingencies related to
regulatory developments that affect the Company, please see
"Overview--Regulatory Developments" above.

For further information on other contingencies, see Note 6 of Notes to
Consolidated Financial Statements.

ACCOUNTING STANDARDS

For a discussion of accounting standards, see Note 2 of Notes to Condensed
Consolidated Financial Statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information contained in the Capital Markets Risk Management section of
Management's Discussion and Analysis of Financial Condition and Results of
Operations is incorporated herein by reference.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

The Company's principal executive officer and its principal financial officer,
based on their evaluation of the Company's disclosure controls and procedures
(as defined in Exchange Act Rule 13a-15(e)) have concluded that the Company's
disclosure controls and procedures are effective for the purposes set forth in
the definition thereof in Exchange Act Rule 13a-15(e) as of March 31, 2005.

32

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There was no change in the Company's internal control over financial reporting
that occurred during the Company's first fiscal quarter of 2005 that has
materially affected, or is reasonably likely to materially affect, the Company's
internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

LITIGATION

The Hartford Financial Services Group, Inc. and its consolidated subsidiaries
("The Hartford") is involved in various legal actions arising in the ordinary
course of business, some of which assert claims for substantial amounts. These
actions include, among others, putative state and federal class actions seeking
certification of a state or national class. Such putative class actions have
alleged, for example, improper sales practices in connection with the sale of
life insurance and other investment products; and improper fee arrangements in
connection with mutual funds. The Hartford also is involved in individual
actions in which punitive damages are sought, such as claims alleging bad faith
in the handling of insurance claims. Management expects that the ultimate
liability, if any, with respect to such lawsuits, after consideration of
provisions made for estimated losses, will not be material to the consolidated
financial condition of the Company. Nonetheless, given the large or
indeterminate amounts sought in certain of these actions, and the inherent
unpredictability of litigation, it is possible that an adverse outcome in
certain matters could, from time to time, have a material adverse effect on the
Company's consolidated results of operations or cash flows in particular
quarterly or annual periods.

Broker Compensation Litigation - On October 14, 2004, the New York Attorney
General's Office filed a civil complaint (the "NYAG Complaint") against Marsh
Inc. and Marsh & McLennan Companies, Inc. (collectively, "Marsh") alleging,
among other things, that certain insurance companies, including The Hartford,
participated with Marsh in arrangements to submit inflated bids for business
insurance and paid contingent commissions to ensure that Marsh would direct
business to them. The Hartford was not joined as a defendant in the action,
which has since settled. Since the filing of the NYAG Complaint, several private
actions have been filed against The Hartford asserting claims arising from the
allegations of the NYAG Complaint.

Two securities class actions, now consolidated, have been filed in the United
States District Court for the District of Connecticut alleging claims against
The Hartford and certain of its executive officers under Section 10(b) of the
Securities Exchange Act and SEC Rule 10b-5. The consolidated amended complaint
alleges on behalf of a putative class of shareholders that The Hartford and the
four named individual defendants, as control persons of The Hartford, failed to
disclose to the investing public that The Hartford's business and growth was
predicated on the unlawful activity alleged in the NYAG Complaint. The class
period alleged is August 6, 2003 through October 13, 2004, the day before the
NYAG Complaint was filed. The complaint seeks damages and attorneys' fees. The
Hartford and the individual defendants dispute the allegations and intend to
defend these actions vigorously.

In addition, three putative class actions, now consolidated, have been filed in
the same court on behalf of participants in The Hartford's 401(k) plan against
The Hartford, Hartford Fire Insurance Company, The Hartford's Pension Fund Trust
and Investment Committee, The Hartford's Pension Administration Committee, The
Hartford's Chief Financial Officer, and John/Jane Does 1-15. The suits assert
claims under the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), alleging that The Hartford and the other named defendants breached
their fiduciary duties to plan participants by, among other things, failing to
inform them of the risk associated with investment in The Hartford's stock as a
result of the activity alleged in the NYAG Complaint. The class period alleged
is November 5, 2003 through the present. The complaints seek restitution of
losses to the plan, declaratory and injunctive relief, and attorneys' fees. All
defendants dispute the allegations and intend to defend these actions
vigorously.

Two corporate derivative actions, now consolidated, also have been filed in the
same court. The consolidated amended complaint, brought by a shareholder on
behalf of The Hartford against its directors and an executive officer, alleges
that the defendants knew adverse non-public information about the activities
alleged in the NYAG Complaint and concealed and misappropriated that information
to make profitable stock trades, thereby breaching their fiduciary duties,
abusing their control, committing gross mismanagement, wasting corporate assets,
and unjustly enriching themselves. The complaint seeks damages, injunctive
relief, disgorgement, and attorneys' fees. All defendants dispute the
allegations and intend to defend these actions vigorously.

Ten putative class actions also have been filed by alleged policyholders in
federal district courts against several brokers and insurers, including The
Hartford. These actions assert, on behalf of a class of persons who purchased
insurance through the broker defendants, claims under the Sherman Act and state
law, and in some cases the Racketeer Influenced and Corrupt Organizations Act
("RICO"), arising from the conduct alleged in the NYAG Complaint. The class
period alleged is 1994 through the date of class certification, which has not
yet occurred. The complaints seek treble damages, injunctive and declaratory
relief, and attorneys' fees.

33

Pursuant to an order of the Judicial Panel on Multidistrict Litigation, it is
likely that the venue for all of these actions will be the United States
District Court for the District of New Jersey. Putative class actions also have
been filed in the Circuit Court for Cook County, Illinois, Chancery Division and
in the Circuit Court for Seminole County, Florida, Civil Division, on behalf of
a class of all persons who purchased insurance from defendant insurers,
including Hartford entities. These state court actions assert unjust enrichment
claims and violations of state unfair trade practices acts arising from the
conduct alleged in the NYAG Complaint and seek remedies including restitution of
premiums, and, in the Illinois action, imposition of a constructive trust, and
declaratory and injunctive relief. The class period alleged is 1994 through the
present. The Hartford has removed both actions to federal court, but the
plaintiffs have moved to remand the actions to the respective state courts. The
plaintiffs' motion to remand the Illinois action was denied; the remand motion
in the Florida action has not been decided. The Hartford disputes the
allegations in all of these actions and intends to defend the actions
vigorously.

Additional complaints may be filed against The Hartford in various courts
alleging claims under federal or state law arising from the conduct alleged in
the NYAG Complaint. The Hartford's ultimate liability, if any, in the pending
and possible future suits is highly uncertain and subject to contingencies that
are not yet known, such as how many suits will be filed, in which courts they
will be lodged, what claims they will assert, what the outcome of investigations
by the New York Attorney General's Office and other regulatory agencies will be,
the success of defenses that The Hartford may assert, and the amount of
recoverable damages if liability is established. In the opinion of management,
it is possible that an adverse outcome in one or more of these suits could have
a material adverse effect on the Company's consolidated results of operations or
cash flows in particular quarterly or annual periods.

ITEM 6. EXHIBITS

See Exhibits Index on page 36.

34

SIGNATURE

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.

HARTFORD LIFE INSURANCE COMPANY

/s/ Ernest M. McNeill Jr.
----------------------------------------
Ernest M. McNeill Jr.
Vice President and Chief Accounting
Officer

May 2, 2005

35

HARTFORD LIFE INSURANCE COMPANY AND SUBSIDIARIES
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 2005
EXHIBITS INDEX

EXHIBIT #
- ---------

15.01 Deloitte & Touche LLP Letter of Awareness
31.01 Section 302 Certification of Thomas M. Marra
31.02 Section 302 Certification of Lizabeth H. Zlatkus
32.01 Section 906 Certification of Thomas M. Marra
32.02 Section 906 Certification of Lizabeth H. Zlatkus

36