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      Lincoln Correspondence

    Letterhead
      of Douglas N. Miller

    July
      28,
      2006

    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-K for the Fiscal Year Ended December 31, 2005

              Filed
                March 15, 2006

              File
                Number: 001-6028

    Dear
      Mr.
      Rosenberg:

    This
      letter is in response to your comment letter that we received on July 18, 2006.
      The comment letter related to our May 9, 2006 correspondence to your letter
      of
      April 26, 2006 concerning Lincoln National Corporation’s Form 10-K for the year
      ended December 31, 2005. Our reply in this letter refers to the specific
      comment.

    The
      following is your comment and our response:

    Comment:

    For
      10-K for the year ended December 31, 2005

    Consolidated
      Financial Statements, page 106

    Consolidated
      Statements of Cash Flows, page 111

              1.

              We
                are not able to concur with the conclusion in your response that
                the
                proposed revision does not materially change the statement of cash
                flows.
                Including the increase in funds withheld liability as a financing
                activity
                does not comply with the requirement in SFAS 95 to include only cash
                transactions in the statement of cash flows. Further, cash flows
                from
                operating activities is an important measure to investors. The effect
                in
                2003 and 2004 of including the increase in funds withheld liability
                in net
                cash flows provided by operating activities is between five and ten
                percent and the effect in 2005 is 12 percent. We believe this increase
                is
                material for the three years presented. Please amend your Form 10-K
                for
                the year ended December 31, 2005 to reflect those changes as the
                correction of an error.

    Letterhead
      of Douglas N. Miller

    Response: In
      the
      comment above, the Staff asserts that the quantitative effect of including
      the
      increase in funds withheld liability in net cash flows provided by operating
      activities was material for the three years presented in LNC’s Consolidated
      Statements of Cash Flows, and based on that conclusion, requests that we amend
      our Form 10-K for the year ended December 31, 2005 to reflect the changes.
      We
      would request that the Staff reconsider its position that we amend our 2005
      Form
      10-K and permit us to implement the requested change beginning with our Form
      10-Q for the quarter ended June 30, 2006 with prior period amounts as a
      reclassification with appropriate explanation and disclosure.

    We
      do not
      believe that the increases in operating cash flows resulting from including
      the
      increase in funds withheld liability in net cash flows provided by operating
      activities rather than in financing activities significantly impacts the manner
      in which an investor would view the cash flow information being presented.
      Although the use of quantitative factors may provide a “preliminary assumption”
of materiality, “all relevant circumstances” must be considered in making a
      final determination as to materiality. See
      SEC
      Staff Accounting Bulleting: No. 99—Materiality (“SAB 99”). As SAB 99 points out
      in quoting the U.S. Supreme Court, “[a] fact is material if there is—‘a
      substantial likelihood that the …fact would have been viewed by the reasonable
      investor as having significantly altered the ‘total mix’ of information made
      available.’” SAB 99 (quoting TSC
      Industries v. Northway, Inc.,
      426
      U.S. 438, 439 (1976)).

    As
      a
      holding company with our largest operating companies being regulated insurance
      subsidiaries, from a cash flow standpoint, our investors are primarily concerned
      with the dividend capacity of our insurance subsidiaries, or free cash flow.
      Unlike an industrial company, the statement of cash flows provides
      only limited information on free cash flow available for investment, servicing
      of debt, or returning capital to shareholders.  Our investors
      focus more on our statutory statements and risk-based capital disclosures in
      evaluating free cash flow. See
      Merrill
      Lynch, Primer
      VII—Heavy Lifting, But Here’s Some Help
      32
      (2005) (“However, the statutory income statement and balance sheet are important
      determinants of free cash flow and free capital, respectively….”) Furthermore,
      as the Staff is aware, filing under Article 11 of Regulation S-X, we report
      life
      insurance policy cash flows in both the operating section (for FAS No. 60
      products) and financing section (for FAS No. 97 products) of our Consolidated
      Statement of Cash Flows. Accordingly, we believe investors consider both
      sections of the Consolidated Statement of Cash Flows to fully understand our
      cash flow activities. Therefore, we do not believe that, in this instance,
      the
      reclassification of cash flows from financing activities to operating activities
      would be an important factor for an investor in deciding whether to buy, sell
      or
      hold our securities.

    In
      amending the Form 10-K, we would be telling investors that instead of having
      cash flows from operating activities of approximately $0.97 billion, $1.0
      billion and $0.93 billion for 2005, 2004 and 2003, our cash flows were
      approximately $1.1 billion, $1.1 billion and $0.99 billion for 2005, 2004 and
      2003. As the Staff recognizes, the change would result in an increase, not
      decrease, in operating cash flows, and otherwise would

    Letterhead
      of Douglas N. Miller

    not
      affect consolidated cash flows or any of our other financial statements for
      the
      years presented. In addition and as we stated in our June 9, 2006 letter, the
      change would not result in a change in the trend in operating cash flows
      previously presented. Furthermore, the change would not affect compliance with
      regulatory requirements, covenants under our credit agreements or debt ratings.
      Accordingly, we believe making this change would not be viewed by a reasonable
      investor as “significantly” altering the “total mix” of financial information
      available regarding LNC.

    Finally,
      we believe that the primary measures used by investors and analysts in valuing
      life insurance companies are “price-to-earnings and price-to-book value ratios,
      with the price-to-book value versus ROE regression model perhaps the most widely
      used methodology.” Keefe, Bruyette & Woods, U.S.
      Life Insurance Primer—The Meaning Of Life
      134
      (2005). Although discounted cash flows may be used in conjunction with these
      measurements, based on our experience with investors, we believe our investors
      focus on these balance sheet and income statement ratios in valuing LNC as
      well
      as other insurance companies. Accordingly and for this reason also, we do not
      believe that the reclassification of cash flows from financing activities to
      operating activities would significantly alter the total mix of financial
      information available regarding LNC.

    Based
      on
      the foregoing, we respectfully request that any change in the classification
      of
      changes in funds withheld liability be implemented in future periodic reports
      beginning with the Form 10-Q for the quarter ending June 30, 2006, with
      reclassification of prior period amounts.

    ****

    If
      you
      have any questions regarding our response, please contact me directly at (215)
      448-1430.

    Sincerely,

    /s/
      Douglas N. Miller

    Douglas
      N. Miller

    Vice
      President & Chief Accounting Officer

    Cc: Fredrick
      Crawford, Senior Vice President & Chief Financial Officer