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        Lincoln
National Corporation

        150 N.
Radnor-Chester Road

        Radnor,
PA  19087

        phone
484-583-1430

        January
13, 2010

        Mr. Jim
B. Rosenberg

        Senior
Assistant Chief Accountant

        Securities
and Exchange Commission

        100 F.
Street, N.E.

        Washington,
D.C. 20549

        Re:  Lincoln
National Corporation

        Form 10-Q for the Quarter Ended June
30, 2009

        Form 10-Q
for the Quarter Ended September 30, 2009

        File No. 1-06028

        Dear Mr.
Rosenberg:

        This
letter is in response to the staff of the Division of Corporation Finance’s (the
“Staff”) letter of December 4, 2009, concerning Lincoln National Corporation’s
(“LNC” or the “Company”) Forms 10-Q for the quarters ended June 30, 2009, and
September 30, 2009.  Our reply refers to the specific comments in the
Staff’s letter.  In responding to the Staff’s comments, we acknowledge
the following:

                  ·

                  The
      Company is responsible for the adequacy and accuracy of the disclosure in
      the filing;

                  ·

                  Staff
      comments or changes to disclosure in response to Staff comments do not
      foreclose the commission from taking any action with respect to the
      filing; and

                  ·

                  The
      Company may not assert Staff comments as a defense in any proceeding
      initiated by the Commission or any person under the federal securities
      laws of the United States.

        The
following are the Staff’s comments and our responses:

        Form
10-Q for the quarter ended June 30, 2009

                  Consolidated
      Statements of Cash Flows, page
4

                  1.

                  Refer
      to your response to our comment 2.  Please tell us the nature of
      the derivative investments classified as investing cash
      flows.  Please also tell us your basis for classifying gains and
      losses on derivative transactions related to your annuity and life
      insurance operations within operating cash flows but the related
      derivative collateral posting requirements within investing cash
      flows.

              Page
2

              January
13, 2010

              Re:
Lincoln National Corp

        Response:

        We recognize cash outflows for purchases and cash
proceeds received on the sale or maturities of all of our derivative
investments as cash flows from investing
activities on our Consolidated Statements of Cash Flows as these transactions
represent acquiring and disposing of financial instruments with other
enterprises.  However, we recognize cash collected or paid for
interest on the derivative investments as cash flows from operating activities
on our Consolidated Statements of Cash Flows as the results of these transactions are included in the
determination of net income.  See
Note 6 of our Form 10-Q for the quarter ended September 30, 2009, for details
about these derivative instruments that are classified as derivative investments
on our Consolidated Balance Sheet.

        For our
annuity and life insurance operations, we purchase and issue financial
instruments and products that contain embedded derivative instruments, which are
carried at fair value with changes in fair value reported in realized gain
(loss) on our Consolidated Statements of Income.  Since we report our
cash flows from operating activities on our Consolidated Statements of Cash
Flows using the indirect method, the amount reported in realized gain (loss) on
our Consolidated Statements of Income is one of the adjustments to net income to
reconcile it to net cash flows from operating activities, which removes the
effects of the changes in fair value of our embedded derivative
instruments.  However, the payments or receipts upon settlement (e.g.,
claim payment) of our embedded derivative instruments are included within cash
flows from operating activities on our Consolidated Cash Flows as the results of these transactions are included in the
determination of net income

        All of
the cash received or paid related to changes in payables for collateral on
derivative investments is invested in or expended out of cash and invested cash
or investments, and these transactions represent acquiring and disposing of
financial instruments with other enterprises as well; therefore, we also
recognize these changes in payables for collateral on investments within cash
flows from investing activities on our Consolidated Statements of Cash
Flows.  However, we recognize the cash collected or paid for interest
on the payables for collateral on derivative investments as cash flows from
operating activities on our Consolidated Statements of Cash Flows as the results of these transactions are included in the
determination of net income.

                  Note
      5.  Investments, page
14

                  2.

                  Refer
      to your response to our comment 4.  Even though there are
      numerous subjective and objective inputs involved in determining the
      amount of credit losses on your corporate bonds, we would expect there to
      be significant valuation inputs that can be quantified, such as credit
      spread ranges or weighted averages, etc.  Please revise your
      disclosure accordingly.  In addition, please quantify the
      significant inputs used to measure the amounts of your credit losses
      related to your ABS/CDO's.

              Page
3

              January
13, 2010

              Re:
Lincoln National Corp

        Response:

        When we
evaluate the amount of credit losses on our corporate bonds and ABS CDO
portfolios, we do not generally quantify the implied credit spreads based upon
the current market prices and yields as we do not believe this information, in
isolation, represents an effective indicator of impairment.  The
individual securities within our corporate bonds and ABS CDO portfolios are
purchased at varying times, prices and yields and in different credit
environments, and because of this, we believe that disclosing a range or
weighted average for these portfolios would not aid investors in evaluating our
credit losses.

        However,
we do quantify the weighted average credit ratings of our corporate bond and ABS
CDO portfolios, which is one of the inputs we use in determining the recovery
value.  Therefore, to address the Staff’s comment, we will update our
disclosures in future filings, beginning with our Form 10-K for the year ended
December 31, 2009, to include the following:

        Determination
of Credit Losses on Corporate Bonds and ABS CDOs

        To
determine recovery value of a corporate bond or ABS CDO, we perform analysis
related to the underlying issuer including, but not limited to, the
following:

                  ·

                  Fundamentals
      of the issuer to determine what we would recover if they were to file
      bankruptcy versus the price at which the market is
  trading;

                  ·

                  Fundamentals
      of the industry in which the issuer
operates;

                  ·

                  Earnings
      multiples for the given industry or sector of an industry that the
      underlying issuer operates within, divided by the outstanding debt to
      determine an expected recovery value of the security in the case of a
      liquidation;

                  ·

                  Expected
      cash flows of the issuer (e.g., whether the issuer has cash flows in
      excess of what is required to fund its
  operations);

                  ·

                  Expectations
      regarding defaults and recovery
rates;

                  ·

                  Changes
      to the rating of the security by a rating agency;
  and

                  ·

                  Additional
      market information (e.g., if there has been a replacement of the corporate
      debt security).

        As of
September 30, 2009, we reviewed our corporate bond and ABS CDO portfolios for
potential shortfall in contractual principal and interest based on numerous
subjective and objective inputs.  The factors used to determine the
amount of credit loss for each individual security, include, but are not limited
to, near term risk, substantial discrepancy between book and market value,
sector or company-specific volatility, negative operating trends and trading
levels wider than peers.

        Credit
ratings express opinions about the credit quality of a
security.  Securities rated investment grade, that is those rated BBB-
or higher by Standard & Poor’s Rating Services or Baa3 or higher by Moody’s
Investors Service, are generally considered by the rating agencies and market
participants to be low credit risk.  As of September 30, 2009, 93% of
the fair value of our corporate bond portfolio was rated investment
grade.  As of September 30, 2009, our corporate bond portfolio rated
below investment grade had an amortized cost of $3.5 billion and a fair value of
$3 billion.  As of September 30, 2009, 89% of the fair value of our
ABS CDO portfolio was rated investment grade.  As of September 30,
2009, our ABS CDO portfolio rated below investment grade had an amortized cost
of $20 million and fair value $16 million.  Based upon the analysis
discussed above we believed as of September 30, 2009 we would recover the
amortized cost of each corporate bond and ABS CDO security.

        For
securities where we recorded an OTTI recognized in net income (loss) for the
nine months ended September 30, 2009 the recovery as a percentage of amortized
cost was 70% for corporate bonds and 32% for ABS CDOs.

              Page
4

              January
13, 2010

              Re:
Lincoln National Corp

                  3.

                  Refer
      to your response to our comment 5.  Please disclose what other
      evidence was considered in determining that the unrealized loss related to
      your CMBS's, hybrid and redeemable preferred securities and corporate loan
      obligations were not other-than-temporarily-impaired, including the
      following for each security type:

                  1.

                  The
      estimated range and average period until
  recovery;

                  2.

                  The
      estimated range and average holding period to
  maturity;

                  3.

                  Current
      subordination level versus level when asset-backed structure was
      originated;

                  4.

                  Your
      ability to hold securities for a sufficient period to ensure recovery
      given that you have cash of $2.5 billion and total liabilities of $158
      billion at June 30,2009; and

                  5.

                  Contractual
      and regulatory cash obligations.

        Response:

        The
evaluation of our ability to hold securities for a sufficient period to ensure
recovery should consider that the majority of our future contract benefit, other
contract holder funds and long-term debt are long-term in nature.  We
attempt to match such liabilities with long-term assets that have similar
expected lives.  In addition, our $70 billion separate account
liabilities as of September 30, 2009, were matched with the mutual fund assets
(i.e., separate account assets) that are valued at fair value and available to
be sold at any point in time to fund withdrawals made by our contract holders
from the separate account liabilities.  To address the Staff’s
comment, we will update our disclosures in future filings, beginning with our
Form 10-K for the year ended December 31, 2009, to include the following refined
disclosure (the information is ordered differently than your numbered comments
as we believe the proposed order works best for our Form 10-K and 10-Q
filings):

        As
described more fully below, we regularly review our investment holdings for
OTTIs.  Based upon this review, the cause of the $4.3 billion decrease
in our gross AFS securities unrealized losses for the nine months ended
September 30, 2009, was attributable primarily to increased liquidity in several
market segments and improved credit fundamentals (i.e., market improvement and
narrowing credit spreads), partially offset by the cumulative adjustment
resulting from the adoption of new accounting guidance related to the
recognition of OTTI, which resulted in the $165 million increase in amortized
cost in AFS securities as discussed in Note 2.  As discussed further
below, we believed that the securities in an unrealized loss position as of
September 30, 2009, were not other-than-temporarily impaired as we did not
intend to sell these fixed maturity AFS securities and it is not more likely
than not that we will be required to sell the fixed maturity AFS securities
before recovery of their amortized cost basis, and we had the ability and intent
to hold the equity AFS securities for a period of time sufficient for
recovery.

              Page
5

              January
13, 2010

              Re:
Lincoln National Corp

        Our
conclusion that it is not more likely than not that we will be required to sell
the fixed maturity AFS securities before recovery of their amortized cost basis
and the ability to hold the equity AFS securities for a period of time
sufficient for recovery is based upon our asset-liability management
process.  Management considers the following as part of the
evaluation:

                  ·

                  The
      current economic environment and market
  conditions;

                  ·

                  Our
      business strategy and current business
plans;

                  ·

                  The
      nature and type of security, including expected maturities and exposure to
      general credit, liquidity, market and interest rate
  risk;

                  ·

                  Our
      analysis of data from financial models and other internal and industry
      sources to evaluate the current effectiveness of our hedging and overall
      risk management strategies;

                  ·

                  The
      current and expected timing of contractual maturities of our assets and
      liabilities, expectations of prepayments on investments and expectations
      for surrenders and withdrawals of life insurance policies and annuity
      contracts;

                  ·

                  The
      capital risk limits approved by management;
and

                  ·

                  Our
      current financial condition and liquidity
  demands.

        Based
upon this evaluation as of September 30, 2009, management believed we had the
ability to generate adequate amounts of cash from our normal operations (e.g.,
insurance premiums and fees and investment income) to meet cash requirements
with a prudent margin of safety without requiring the sale of our
temporarily-impaired securities.

        For our
fixed maturity AFS securities, we generally consider the following to determine
that our unrealized losses are not other-than-temporarily-impaired:

                  ·

                  The
      estimated range and average period until
  recovery;

                  ·

                  The
      estimated range and average holding period to
  maturity;

                  ·

                  Remaining
      payment terms of the security;

                  ·

                  Current
      delinquencies and nonperforming assets of underlying
      collateral;

                  ·

                  Expected
      future default rates;

                  ·

                  Collateral
      value by vintage, geographic region, industry concentration or property
      type;

                  ·

                  Subordination
      levels or other credit enhancements as of September 30, 2009 as compared
      to origination; and