AUTOMATIC INDEMNITY REINSURANCE AGREEMENT

CEDING COMPANY: LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK
(hereinafter referred to as the "Ceding Company")

REINSURER: LINCOLN NATIONAL REINSURANCE COMPANY (BARBADOS) LIMITED
(hereinafter referred to as the "Reinsurer")

EFFECTIVE DATE: December 31, 2007

Commencing on the Effective Date, the Ceding Company will submit and the
Reinsurer agrees to accept the Ceding Company's Guaranteed Benefit (GB) risks as
defined in Schedule A, associated with the Contracts listed in Schedule B,
subject to the provisions of this Agreement.

TABLE OF CONTENTS

ARTICLE I DEFINITIONS 1
ARTICLE II AUTOMATIC REINSURANCE 2
ARTICLE III PREMIUMS, PAYMENTS, EXPENSES AND REPORTING 3
ARTICLE IV ERRORS 5
ARTICLE V FORMS 5
ARTICLE VI REPRESENTATIONS, WARRANTIES AND COVENANTS 5
ARTICLE VII RECAPTURE PRIVILEGE 6
ARTICLE VIII AUDIT AND INSPECTION 6
ARTICLE IX CONFIDENTIALITY 7
ARTICLE X INSOLVENCY 8
ARTICLE XI PARTIES TO THE AGREEMENT 8
ARTICLE XII DURATION AND TERMINATION OF AGREEMENT 9
ARTICLE XIII RESERVE CREDIT 9
ARTICLE XIV ARBITRATION 13
ARTICLE XV DEFERRED ACQUISITION COST TAX ELECTION 13
ARTICLE XVI ENTIRE AGREEMENT 14
ARTICLE XVII MISCELLANEOUS 14
SCHEDULE A GB REINSURANCE BENEFITS 18
SCHEDULE B CONTRACTS WITH ACCEPTED COVERAGES 19
SCHEDULE C PREMIUM RATE SCHEDULE 20
SCHEDULE D REPORTS 22
SCHEDULE E ARBITRATION 23

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ARTICLE I
DEFINITIONS

AGREEMENT means this Automatic Indemnity Reinsurance Agreement.

BASE REINSURANCE PREMIUM(S) means the premium so designated and calculated as
described in Schedule C.

CEDING COMPANY means Lincoln Life & Annuity Company of New York

CONFIDENTIAL INFORMATION means any and all information acquired by the Reinsurer
or the Ceding Company prior or subsequent to the execution of this Agreement
with the exception of either information readily available in the public domain
or information acquired from sources other than the other party.

CONTRACT(S) means those specific annuity contracts enumerated in Schedule B.

EFFECTIVE DATE is December 31, 2007

EPRC means Reinsurer's expense, profit and risk charge, calculated as described
in Article III, Section 6.

GAAP RESERVE(S) means the Ceding Company's net reserves calculated using U.S.
Generally Accepted Accounting Principles ("GAAP") before reinsurance under this
Agreement, less the Ceding Company's net reserves for GAAP purposes after
reinsurance under this Agreement.

INDIVIDUAL POLICY means a Contract issued to a contractholder.

GB means Guaranteed Benefits and refers specifically to those guaranteed living
benefits specified in Schedule A.

LNAR means the living net amount at risk and is equal to the greater of the
living benefit if provided for in the Contract minus the account value and zero.

MATERIAL CHANGE means a modification to a practice, procedure or condition that
a prudent insurance executive would consider as likely to impact on experience
under this Agreement.

REINSURER means Lincoln National Reinsurance Company (Barbados) Limited

STATUTORY RESERVE(S) means the Ceding Company's net reserves for New York's
insurance regulatory purposes before reinsurance under this Agreement, less the
Ceding Company's net reserves for New York insurance regulatory purposes after
reinsurance under this Agreement. For purposes of this Agreement, Statutory
Reserves shall be computed on a basis consistent with the Ceding Company's New
York insurance regulatory reporting valuation practices as of December 1, 2007.

TREATY RESERVE(S) means the greater of the GAAP Reserve(s) and the Statutory
Reserve(s).

TRUST ACCOUNT means the account established pursuant to the Trust Agreement.

TRUST AGREEMENT means that trust agreement among the Reinsurer, as grantor, the
Ceding Company, as beneficiary, and Bank of New York, as trustee, entered into
contemporaneously with this Agreement pursuant to Article XIII, Section 2,
including any amendments and successor agreements thereto.

TRUSTEE means Bank of New York and its successors as trustee, if any, pursuant
to the Trust Agreement.

ARTICLE II
AUTOMATIC REINSURANCE

1. CESSION

Beginning with the Effective Date of this Agreement, the Ceding Company
will cede and the Reinsurer will accept, subject to the limits and
conditions set forth in this Agreement and the attached Schedules,
reinsurance of a quota share equal to 100% of the GB risks attached to the
Contracts as specified in Schedule B.

2. COVERAGE

This Agreement covers the Ceding Company's liability for all GB liabilities
either issued or assumed by the Ceding Company, as contained in the
Contracts enumerated in Schedule B. It does not include any liability
arising under the Contracts other than those specifically attributable to
GB claims.

3. NEW ANNUITY CONTRACTS OR REVISIONS

The Ceding Company may cede to the Reinsurer liability for GB claims with
respect to a new annuity contract, or a revised version of an annuity
contract where such revision affects the calculation of the GB risks,
simply by providing the Reinsurer with written notice of such intention
together with a copy of the proposed annuity contract, or revision. In
addition, to the extent that Ceding Company reinsures GB risks of any life
insurance company affiliate, the Ceding Company may automatically retrocede
such GB risks to the Reinsurer by providing Reinsurer with: a) written
notice of its intention to retrocede such risks; and, b) all necessary and
appropriate documentation reasonably requested by the Reinsurer. Unless the
Reinsurer rejects the changes in writing within thirty (30) days after
receipt of the additions and revisions, such retrocessions, additions and
revisions shall automatically be included in this Agreement. Schedules A
and B shall be updated as necessary to reflect the addition of Contracts
and revisions to Contracts covered under this Agreement. Notwithstanding
the foregoing, the Reinsurer retains the right to terminate this Agreement
as to new business according to the terms of Article XII, Section 2.

ARTICLE III
PREMIUMS, PAYMENTS, EXPENSES
AND REPORTING

1. REINSURANCE PREMIUMS AND CEDING COMMISSION

A. Both the Initial Reinsurance Premium and the Base Reinsurance Premium
shall be determined in accordance with Schedule C. The Initial
Reinsurance Premium shall be paid on the Effective Date or as soon
thereafter as the amount has been determined. The Base Reinsurance
Premiums shall be paid monthly in arrears. The Base Reinsurance
Premium, when added to the EPRC, will at all times be equal to or less
than the explicit charges collected by the Ceding Company from the
contract holder for each covered GB risk listed in Schedule A of this
Agreement.

B. Reinsurer shall pay a Ceding Commission to the Ceding Company in the
amount of $1,560,000. This amount shall be offset by the Initial
Reinsurance Premium amount owed to Reinsurer above.

2. OFFSET

Any debts or credits relating solely to this Agreement, regardless of how,
when or where they arose or were incurred, in favor of or against either
the Ceding Company or the Reinsurer shall be offset and only the balance
allowed or paid. If either the Ceding Company or the Reinsurer is under
formal delinquency proceedings, this right of offset shall be subject to
the laws of the state exercising primary jurisdiction over such delinquency
proceedings. The application of this offset provision shall not be deemed
to constitute diminution of liability in the event of insolvency of either
party.

3. REIMBURSEMENT OF LOSSES

A. All reinsurance claims settlements are subject to the terms and
conditions of the Individual Policy under which the Ceding Company is
liable. The Reinsurer shall accept the Ceding Company's good faith
settlement of all GB claims under the Contracts. When requested, the
Ceding Company shall provide the Reinsurer with copies of any
documentation within the Ceding Company's possession with respect to
specific GB claims under the Contracts or with respect to items used
to compute amounts contained in the accounting reports.

B. The Reinsurer shall pay losses as of the end of the calendar month
immediately following the calendar month when the losses are incurred.

4. REPORTS

Each party shall prepare periodic reports as described in Schedule D and
submit these to the other party within thirty (30) days of the end of each
calendar month. Amounts due to or from the parties shall be netted and only
net amounts paid. If an amount is due the Reinsurer, it shall be paid by
the due date of the report. If an amount is due the Ceding Company, it
shall be paid within thirty (30) days of receipt of the report. If,
subsequent to the Effective Date, either party determines that it needs
additional reports from the other party, it shall provide a written request
to the other party detailing its business needs for the additional report.
If the other party does not object in writing within 30 days of receiving
such a request, then Schedule D shall be updated to include such report in
the list of those to be provided on a regular basis. The Ceding Company
will provide the Reinsurer with information necessary to properly account
for the business reinsured, as specified in this Agreement.

6. EXPENSE, PROFIT AND RISK CHARGE

The Reinsurer will be entitled to a payment for EPRC as calculated pursuant
to the terms of Schedule C.

7. TERMINAL SETTLEMENTS

In the event this Agreement is terminated or part or all of the business
reinsured under this Agreement is recaptured pursuant to Article VII, an
accounting and settlement as to any balance due under this Agreement shall
be undertaken by the parties. The net payment to the Ceding Company shall
be an amount of cash equal to the Treaty Reserves related to the portion of
the business being reclaimed by the Ceding Company less any applicable
reinsurance premiums and EPRC due and not paid on the portion of the
business being reclaimed plus any losses due and not paid on the portion of
the business being reclaimed.

8. CLAIMS, EXPENSES AND EXTRA-CONTRACTUAL DAMAGES

Expenses incurred by the Ceding Company in settling, defending or
investigating a claim for Individual Policy liability relating to GB risks
reinsured under this Agreement shall be covered under this Agreement, but
in no event shall the following categories of expenses or liabilities be
covered under this Agreement:

A. routine investigative or administrative expenses;

B. expenses incurred in connection with a dispute or contest arising out
of the conflicting claims of entitlement to Policy proceeds or
benefits which the Ceding Company admits are payable;

C. expenses, fees, settlements or judgments arising out of, related to or
in connection with claims against the Ceding Company for
consequential, compensatory, punitive or exemplary damages; and

D. expenses, fees, settlements or judgments arising out

of, related to or in connection with claims against the Ceding Company
and based on alleged or actual bad faith, failure to exercise good
faith, or tortious conduct.

9. ALL SETTLEMENTS IN CASH

Notwithstanding any provision in this Agreement to the contrary, all
settlements of account between the Ceding Company and the Reinsurer shall
be made in cash or cash equivalents.

ARTICLE IV
ERRORS

This Agreement will not be abrogated by the failure of either the Ceding Company
or the Reinsurer to comply with any of the terms of this Agreement if it is
shown that said failure was unintentional and the result of a misunderstanding,
oversight or clerical error on the part of either the Ceding Company or the
Reinsurer. Both parties will be returned to the position they would have
occupied had no such oversight, misunderstanding or clerical error occurred. No
interest shall be paid on errors.

ARTICLE V
FORMS

Upon request, the Ceding Company will furnish the Reinsurer with any specimen
copies of its applications, forms, and any tables of rates and values which may
be required for the proper administration of the business reinsured under this
Agreement, and will keep the Reinsurer informed with proper documentation as to
any modifications or new forms which would be required for the proper
administration of reinsurance under this Agreement.

ARTICLE VI
REPRESENTATIONS, WARRANTIES
AND COVENANTS

1. CHANGES TO CEDING COMPANY PROCEDURES

Except as set forth in paragraph 2 below, during the term of this Agreement
the Ceding Company shall not permit a Material Change to its:

A. normal underwriting practices and procedures when issuing Contracts
with GB risks, particularly with regard to policy coverages and
benefits, classes of persons insured and requirements for medical
examinations and other underwriting information;

B. normal practices and procedures of investigating and administering
claims; and

C. method of determining any value used to compute net retained claims.

2. CONSENT TO CHANGES IN CEDING COMPANY PROCEDURES

The Ceding Company shall promptly notify the Reinsurer in writing of its
intent to take any action which, if performed, would breach one or more of
the covenants contained in paragraph 1. If the Reinsurer determines that
such action would not adversely affect its economic interests under this
Agreement, it shall consent in writing to the action by the Ceding Company.

ARTICLE VII
RECAPTURE PRIVILEGE

1. If the Agreement has been terminated as to new business by either party
pursuant to Article XII Section 2, then the Ceding Company may recapture
the GB risks in full and terminate this Agreement on thirty (30) days
written notice to the Reinsurer.

2. The Ceding Company retains the right to recapture portions of the reinsured
business at any time when the Reinsurer's cumulative EPRC equals at least
$250,000 upon thirty (30) days written notice to the Reinsurer. In order to
exercise this right, the Ceding Company must recapture all of the specified
risks within clearly defined ranges of any combination of the following
categories: attained age, duration from issue, gender, type of benefit, and
amount of LNAR. If requested by the Ceding Company, the Reinsurer agrees to
provide a new reinsurance quote reflecting the then current market
conditions for automatic yearly renewable term reinsurance for the business
reinsured. Such quote will be provided within thirty (30) days of the
notice of recapture. The Ceding Company is under no obligation to accept
such quote, and any reinsurance provided under such a quote shall be
subject to the negotiation and execution by both parties of a reinsurance
agreement acceptable to both parties.

3. In the event that more than 50% of the stock of the Reinsurer is ever held
by an individual or entity who is not affiliated with the Ceding Company,
then the Ceding Company may recapture the GB risks in full and terminate
this Agreement on thirty (30) days written notice to the Reinsurer. The
Reinsurer is obligated to provide the Ceding Company with written notice
immediately upon the transfer of 50% or more of its stock to an individual
or entity who is not affiliated with the Ceding Company.

ARTICLE VIII
AUDIT AND INSPECTION

1. The Reinsurer may audit, at any reasonable time and at its own expense, all
records and procedures relating to reinsurance under this Agreement. The
Ceding Company shall cooperate in the audit, including providing at the
office of the Reinsurer any information

requested by the Reinsurer in advance of the audit.

2. Each party, or its duly authorized representative, shall have access at any
reasonable time during regular business hours to the original and any
non-identical copies of all electronic and hard copy papers, books, records
and documents relating or referring to, connected with or affecting
reinsurance under this Agreement that are within the possession or control
of the other party.

ARTICLE IX
CONFIDENTIALITY

The Reinsurer and the Ceding Company may come into the possession or knowledge
of Confidential Information of either party in fulfilling their obligations
under this Agreement. The Reinsurer and the Ceding Company agree to hold such
information in confidence and to take all reasonable steps to ensure that such
Confidential Information is not disclosed in any form by any means by its
employees or third parties of any kind, except by advance written authorization
by an officer of the Reinsurer or the Ceding Company; provided however, that the
Reinsurer and the Ceding Company will be deemed to have satisfied their
obligations as to the Confidential Information by protecting its confidentiality
in the same manner that they would protect their own proprietary or confidential
information of like kind which will be at least a reasonable manner or, if it is
determined that such disclosure is necessary in order to avoid a violation or
potential violation of legal obligations in accordance with the following:

If the Reinsurer or the Ceding Company, their employees, directors or advisers
are requested or required (by oral questions, interrogatories, requests for
information or documents, subpoena, civil investigative demand or similar
process) to disclose Confidential Information, it will promptly notify the other
party in writing. The party notified will promptly determine whether to contest
such attempted discovery by legal means or to waive compliance by the notifying
party with the terms of this Agreement. If, in the opinion of its counsel, the
Reinsurer or the Ceding Company is subject to contempt, sanction or other
penalty for failure to disclose the requested Confidential Information, it may,
without violating the terms of this Agreement, disclose only that portion of the
Confidential Information that counsel advises is legally required to be
disclosed, provided that it exercises all reasonable efforts to preserve the
confidentiality of such information, including, without limitation, by
cooperating with the Reinsurer or the Ceding Company in obtaining a protective
order or other reliable assurance that the Confidential Information will be
protected from redisclosure, provided, however, that all expenses of such
efforts (other than allocated costs of home office employees at such location)
shall be borne by the party whose confidential information is sought to be
disclosed.

Notwithstanding anything in this Article IX to the contrary, both the Ceding
Company and the Reinsurer (and each employee, representative, or other agent of
either of them) may disclose to any and all persons, without limitation of any
kind, the tax treatment and tax structure contemplated by this Agreement and all
materials of any kind (including opinions or other tax analyses) that are
provided to either the Ceding Company or the Reinsurer relating to such tax
treatment and tax structure.

ARTICLE X
INSOLVENCY

1. In the event of the insolvency of the Ceding Company, all reinsurance under
this Agreement shall be payable by the Reinsurer directly to the Ceding
Company, its liquidator, receiver or statutory successor, on the basis of
the liability of the Ceding Company under the Individual Policies reinsured
without diminution because of the insolvency of the Ceding Company.

2. In the event of the insolvency of the Ceding Company, the domiciliary
liquidator, receiver or statutory successor of the Ceding Company shall
give the Reinsurer written notice of the pendency of a claim on a Contract
made against the Reinsurer within a reasonable time after such claim is
filed in the liquidation proceeding. During the pendency of the claim, the
Reinsurer may investigate the claim and interpose in the proceeding where
such claim is to be adjudicated at its own expense, any defenses that the
Reinsurer considers available to the Ceding Company or its liquidator,
receiver or statutory successor. If two or more assuming insurers are
involved in the same claim and a majority in interest elect to interpose a
defense to the claim, the claim shall be apportioned under the terms of the
reinsurance agreement as though the expense had been incurred by the Ceding
Company.

3. A proportionate share of the expense thus incurred by the Reinsurer shall
be charged, subject to court approval, against the Ceding Company as part
of the expense of liquidation, commensurate with the benefit which may
accrue to the Ceding Company as a result of the defense undertaken by the
Reinsurer.

4. The Reinsurer's liability will not increase as a result of the insolvency
of the Ceding Company.

5. In the event of the insolvency of the Reinsurer, the liability of the
Reinsurer shall not terminate but shall continue with respect to the
reinsurance ceded to the Reinsurer by the Ceding Company prior to the date
of such insolvency, and the Ceding Company shall continue to have a
security interest in any and all sums held by or under deposit in the name
of the Reinsurer.

ARTICLE XI
PARTIES TO THE AGREEMENT

This is an Agreement for indemnity reinsurance solely between the Ceding Company
and the Reinsurer. The acceptance of reinsurance hereunder will not create any
right or legal relation whatsoever between the Reinsurer and any annuitant,
contract owner, beneficiary or other insurance company affiliate under any
contracts of the Ceding Company which may be reinsured or retroceded hereunder.
In no instance shall anyone other than the Ceding Company or the Reinsurer have
any rights under this Agreement.

ARTICLE XII
DURATION AND TERMINATION OF AGREEMENT

1. Except as otherwise provided, this Agreement is unlimited in duration.

2. This Agreement can be terminated for new business by either the Ceding
Company or the Reinsurer, subject to thirty (30) days advance written
notice.

3. The Reinsurer may terminate this Agreement if the Ceding Company breaches a
covenant contained in Article VI.

4. The Ceding Company may terminate this Agreement if the Ceding Company is
unable to secure reserve credit as described in Article XIII, Section 1.

5. This Agreement is automatically terminated when all GB risks terminate.

ARTICLE XIII
RESERVE CREDIT

1. RESERVE CREDIT

It is the intention of the Ceding Company and the Reinsurer that the Ceding
Company receive full statutory accounting credit for reinsurance ceded to
the Reinsurer pursuant to this Agreement in all jurisdictions in which the
Ceding Company is authorized to do business or accredited as a reinsurer.
In addition to the requirements of other provisions of this Agreement, the
Reinsurer agrees to take any other steps necessary for the Ceding Company
to receive such statutory accounting treatment. If, despite its best
efforts, the Reinsurer is unable or fails to comply with the terms of this
section, it shall immediately notify the Ceding Company, and the Ceding
Company shall have the right to terminate this Agreement and recapture all
reinsurance hereunder pursuant to Articles VII and XII.

2. TRUST

A. In order for the Ceding Company to take full reinsurance credit in any
and all jurisdictions where the Ceding Company conducts business or is
accredited as a reinsurer, the Reinsurer may provide, at its sole
expense, one or more trust accounts for the sole use, benefit and
security of the Ceding Company. The Reinsurer and any such trust
account(s) shall comply with all applicable New York laws, including
New York Insurance Regulation 20 (11 NYCRR Part 125.5), New York
Insurance Regulation 114 (11 NYCRR Part 126) and New York Insurance
Law sections 1301 and 1308. To the extent that the Reinsurer opts to
use one or more trust accounts as Collateral, the following paragraphs
in this Article XIII, Section 2, shall apply to such trust(s).

B. Prior to depositing assets with the trustee, the Reinsurer shall
execute assignments, endorsements in blank, or transfer legal title to
the trustee of all shares, obligations or any other assets requiring
assignments, and take any other steps required in order that the
Ceding Company, or the Trustee upon the direction of the Ceding
Company, may whenever necessary, negotiate any such assets without
consent or signature from the Reinsurer or any other person or entity.

C. The assets in the trust(s) shall be invested and reinvested so as to
satisfy its obligation to ensure that the Ceding Company receives full
statutory accounting credit for reinsurance ceded to the Reinsurer in
all jurisdictions in which the Ceding Company is authorized to do
business. All investments shall be limited to those permitted by New
York Insurance Regulation 114 (11 NYCRR Part 126) and any successors
thereto.

D. If, at the end of any calendar month, the Treaty Reserve for the
Reinsurer's share of the premium payments (net of commissions)
relating to the GB risks on the Contracts exceeds the fair market
value of all Collateral, the Reinsurer shall either deposit cash or
securities which meet the requirements of paragraph C in an amount
equal to the shortfall into the trust(s), or furnish one or more
letters of credit consistent with the terms of Article XIII, section
3, so that the total Collateral meets the requirements of Article
XIII, Section 1. However, if at the end of any calendar month the fair
market value of all Collateral exceeds the Treaty Reserve required for
the Reinsurer's share of the GB risks, the Reinsurer may request that
the Ceding Company withdraw from the trust(s) an amount not greater
than such excess amount and deliver that amount to the Reinsurer,
consistent with applicable legal requirements. In addition, the
Reinsurer shall have the discretion to add additional amounts to the
trust(s) or to refrain from requesting a withdrawal of excess funds
from the trust(s). All withdrawals of assets from the trust(s) shall
be made by the Ceding Company.

E. The Reinsurer shall pay all trustee and custodial fees for the
trust(s). Assets in the trust(s) shall not be used to pay any such
fees.

F. The Ceding Company or its successors in interest may draw against the
assets in said trust account(s) at any time, notwithstanding any other
provision in this Agreement, and shall utilize the amount drawn for
one or more of the following reasons only:

(i) To pay the Reinsurer's share or to reimburse the Ceding Company
for the Reinsurer's share of any premiums returned to the owners
of Individual Policies reinsured under this Agreement on account
of cancellations of such Policies;

(ii) To reimburse the Ceding Company for the Reinsurer's share of GB
claims paid by the Ceding Company under the terms and conditions
of the Individual Policies reinsured under this Agreement;

(iii) To fund an account with the Ceding Company in an amount at least
equal to the deduction, for reinsurance ceded, from the Ceding
Company's liabilities for Contracts ceded under this Agreement
(such amount shall include, but not be limited to, amounts for
statutory policy reserves, claims and losses incurred, and
unearned premiums);

(iv) To pay any other amounts the Ceding Company claims are due under
this Agreement.

The foregoing limitation on the use of withdrawn funds shall apply to
the Ceding Company or any successor, including, without limitation,
any liquidator, rehabilitator, receiver or conservator of the Ceding
Company, and shall apply without diminution because of insolvency on
the part of the Ceding Company or the Reinsurer.

G. The rights and liabilities of the Ceding Company and the Reinsurer, as
set forth in this Article XIII, Section 2, shall not be diminished in
any manner by the insolvency of the other party.

3. LETTERS OF CREDIT

A. The Reinsurer shall provide one or more letters of credit payable to
the Ceding Company. The total amount of such letters of credit shall
equal the difference between the total Collateral required by Article
XIII, Section 1, and the amount of Collateral contained in all trusts
established pursuant to Article XIII, Section 2. The amount of such
letters of credit shall be adjusted annually. Any letters of credit
entered into pursuant to this subsection shall comply with all
applicable laws, including but not limited to the insurance laws of
the State of New York.

B. The Reinsurer and the Ceding Company agree that any letters of credit
provided by the Reinsurer may be drawn upon by the Ceding Company at
any time, notwithstanding any other provisions in this Agreement, and
be utilized and applied by the Ceding Company or any successor by
operation of law of the Ceding Company, including, without limitation,
any liquidator, rehabilitator, receiver or conservator of the Ceding
Company, without diminution because of insolvency on the part of the
Ceding Company or the Reinsurer, only for the following purposes:

(ii) To reimburse the Ceding Company for the Reinsurer's share of GB
claims paid by the Ceding Company under the terms and conditions
of the Individual Policies reinsured under this Agreement;

(iv) To pay any other amounts the Ceding Company claims are due under
this Agreement.

C. The foregoing limitation on the use of withdrawn funds shall apply to
the Ceding Company or any successor, including, without limitation,
any liquidator, rehabilitator, receiver or conservator of the Ceding
Company, and shall apply without diminution because of insolvency on
the part of the Ceding Company or the Reinsurer.

4. JURISDICTION ISSUES

To the extent necessary to meet its obligations pursuant to Article XIII,
Section 1, the Reinsurer hereby agrees to the following:

A. In the event that the Reinsurer fails to perform its obligations under
the terms of this Agreement, the Reinsurer, at the request of the
Ceding Company shall:

(i) submit to the jurisdiction of any court with jurisdiction in any
state of the United States;

(ii) comply with all requirements necessary to give the court
described in clause (i) above jurisdiction;

(iii) abide by the final decision of the court or of any appellate
court in the event of an appeal; and

(iv) designate the commissioner or an attorney licensed in, and
having offices in, New York as its true and lawful attorney upon
whom may be served any lawful process in any action, suit, or
proceeding instituted by or on behalf of the Ceding Company.

B. This Article XIII, Section 4 is not intended to conflict with or
override the obligation of the parties to arbitrate their disputes
pursuant to Article XIV.

ARTICLE XIV
ARBITRATION

1. ARBITRATION

If the Ceding Company and the Reinsurer cannot mutually resolve a dispute
regarding the interpretation or operation of this Agreement, the dispute
shall be decided through arbitration as set forth in Schedule E. The
arbitrators shall base their decision on the terms and conditions of this
Agreement, plus, as necessary, on the customs and practices of the
insurance and reinsurance industry rather than solely on a strict
interpretation of the applicable law. There shall be no appeal from their
decision, except that either party may petition a court having jurisdiction
over the parties and the subject matter to reduce the arbitrator's decision
to judgment.

2. FEDERAL ARBITRATION ACT

The parties intend this article to be enforceable in accordance with the
Federal Arbitration Act (9 U.S.C., Section 1) including any amendments to
that Act which are subsequently adopted. In the event that either party
refuses to submit to arbitration as required by paragraph 1, the other
party may request a United States Federal District Court to compel
arbitration in accordance with the Federal Arbitration Act. Both parties
consent to the jurisdiction of such court to enforce this article and to
confirm and enforce the performance of any award of the arbitrators.

ARTICLE XV
DEFERRED ACQUISITION COST TAX ELECTION

1. The Reinsurer and the Ceding Company each acknowledge that it is subject to
taxation under Subchapter "L" of the Internal Revenue Code of 1986 (the
"Code").

2. With respect to this Agreement, the Reinsurer and the Ceding Company agree
to the following pursuant to Section 1.848-2(g)(8) of the Income Tax
Regulations, whereby:

A. Each party shall attach a schedule to its federal income tax return
which identifies this Agreement for which the joint election under the
Regulation has been made;

B. The party with net positive consideration, as defined in the
Regulation promulgated under Code Section 848, for this Agreement for
each taxable year, shall capitalize specified policy acquisition
expenses with respect to this Agreement without regard to the general
deductions limitation of Section 848(c)(1);

C. Each party agrees to exchange information pertaining to the amount of
net consideration under this Agreement each year to ensure
consistency; and

D. This election shall be effective for the year that this Agreement was
entered into and for all subsequent years that this Agreement remains
in effect.

ARTICLE XVI
ENTIRE AGREEMENT

1. This Agreement represents the entire agreement between the parties with
respect to the business being reinsured hereunder and supercedes any prior
oral or written agreement between the parties regarding its subject matter.

2. Any changes or modifications to the Agreement will be null and void unless
made by amendment to the Agreement and signed by both parties.

3. A waiver of a right created by this Agreement shall constitute a waiver
only with respect to the particular circumstance for which it is given and
not a waiver of any future circumstance.

ARTICLE XVII
MISCELLANEOUS

1. CURRENCY

All currency will be payable in United States dollars.

2. HEADINGS AND SCHEDULES

Headings are not a part of this Agreement and shall not affect its terms.
The attached Schedules are a part of this Agreement.

3. NOTICES

All notices and communications hereunder shall be in writing and, except in
those instances when actual notice is required, shall be deemed given:
(a)(i) when delivered personally, (ii) when made or given via facsimile
transmission or electronic media, or (iii) when mailed by certified mail or
registered mail (return receipt requested); and (b) when addressed as
provided below.

All notices or communications to the Reinsurer under this Agreement shall
be addressed as follows:

Xx. Xxxxx X. Xxxx
Chief Financial Officer
Lincoln National Reinsurance Company (Barbados) Limited
0000 X. Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000-0000

All notices and communications to the Ceding Company under this Agreement
shall be directed to:

Xx. Xxxxx X. Xxxxx
Second Vice President
Lincoln Life & Annuity Company of New York
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000

4. SEVERABILITY

If any term or provision of this Agreement shall be held void, illegal, or
unenforceable, the validity of the remaining portions or provisions shall
not be affected thereby.

5. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.

6. SUCCESSORS AND ASSIGNS

This Agreement may not be assigned by either party without the prior
written consent of the other. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns.

7. COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which
shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.

8. AMENDMENT OR WAIVER

No amendment or waiver of any provision of this Agreement shall be
effective unless set forth in writing, signed by duly authorized officers
of the parties. A waiver shall constitute a waiver only with respect to the
particular circumstance for which it is given and not a waiver of any
future circumstance.

9. INTERPRETATION

For purposes of this Agreement, the words "hereof," "herein," "hereby," and
other words of similar import refer to this Agreement as a whole unless
otherwise indicated. Whenever the words "include," "includes," or
"including" are used in this Agreement, they shall be deemed to be followed
by the words "without limitation." Whenever the singular is used herein,
the same shall include the plural, and whenever the plural is used herein,
the same shall include the singular, where appropriate.

10. INVESTIGATIONS

The Ceding Company will notify the Reinsurer immediately, in writing, of
any and all investigations of the Ceding Company or its directors,
principal officers or shareholders conducted by any federal, state or local
governmental or regulatory agency other than routine state or federal
examinations. Likewise, the Reinsurer will notify the Ceding Company
immediately, in writing, of any and all investigations of the Reinsurer or
its directors, principal officers or shareholders conducted by any federal,
state or local governmental or regulatory agency other than routine state
or federal examinations.

LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK

By: /s/ Xxxxxx X. Xxxxxxxx Date: December 2007
-----------------------------------
Name
Title

LINCOLN NATIONAL REINSURANCE COMPANY (BARBADOS) LIMITED

By: /s/ Xxxxx X. Xxxx Date: December 2007
-----------------------------------
Xxxxx X. Xxxx
Chief Financial Officer

SCHEDULES

SCHEDULE A GB REINSURANCE BENEFITS

SCHEDULE B CONTRACTS WITH ACCEPTED COVERAGES

SCHEDULE C PREMIUM RATES

SCHEDULE D REPORTS

SCHEDULE E ARBITRATION

SCHEDULE A

GB REINSURANCE BENEFITS

Each contract listed in Schedule B contains one or more GB. GBs which are
covered by this Agreement include the following:

LINCOLN SMARTSECURITY(R) ADVANTAGE (FORMERLY PRINCIPAL SECURITY
BENEFIT) WITH FIVE YEAR OPTIONAL RESET

GUARANTEED INCOME BENEFIT

LINCOLN SMARTSECURITY(R) ADVANTAGE (FORMERLY PRINCIPAL SECURITY
BENEFIT) WITH ONE YEAR AUTOMATIC RESET

4LATER(SM) ADVANTAGE

SCHEDULE B

CONTRACTS WITH ACCEPTED
COVERAGES

Contracts covered by this Agreement include all Contracts issued by the Ceding
Company from the following list.

ChoicePlus Variable Annuity
ChoicePlus Access Variable Annuity
ChoicePlus II Variable Annuity
ChoicePlus II Access Variable Annuity
ChoicePlus II Bonus Variable Annuity
ChoicePlus II Advance Variable Annuity
ChoicePlus Assurance (A Share)
ChoicePlus Assurance (B Share)
ChoicePlus Assurance (C Share)
ChoicePlus Assurance (Bonus)
ChoicePlus Assurance (L Share)
ChoicePlus Momentum Income Option
ChoicePlus Design (includes all share classes)
American Legacy III
American Legacy III Plus
American Legacy III View
American Legacy III C-Share
Shareholders Advantage
American Legacy Design (includes all share classes)

SCHEDULE C

PREMIUM RATE SCHEDULE

INITIAL REINSURANCE PREMIUM:

The Initial Reinsurance Premium shall equal the Treaty Reserve applicable to
each Individual Policy inforce on the Effective Date.

BASE REINSURANCE PREMIUM RATES:

TYPE OF BENEFIT ALL RIDERS ALL CONTRACTS
--------------------------------- ---------------- ----------------
EXPENSE, PROFIT,
BASE REINSURANCE AND RISK
PREMIUM ANNUAL CHARGE ANNUAL
GLB TYPE RATE RATE APPLIED TO
-------------------------------------------------------------------------------------------------

Lincoln SmartSecuity Advantage -
5 Yr Optional Reset 0.400%* 0.050% Guar. Ben. (#)
Lincoln SmartSecurity Advantage -
1 Yr Automatic Reset 0.550% 0.050% Guar. Ben. (#)
Lincoln SmartSecurity Advantage -
1 Yr Automatic Reset - Single
Life Option 0.550% 0.050% Guar. Ben. (#)
Lincoln SmartSecurity Advantage -
1 Yr Automatic Reset - Joint Life
Option 0.550% 0.050% Guar. Ben. (#)
Lincoln SmartSecurity Advantage -
1 Yr Automatic Reset - Single
Life Option with Lifetime
Withdrawals 0.550% 0.050% Guar. Ben. (#)
Lincoln SmartSecurity Advantage -
1 Yr Automatic Reset - Joint Life
Option with Lifetime Withdrawals 0.700% 0.050% Guar. Ben. (#)
4LATER Advantage 0.450% 0.050% Current Income Base (#)
Guaranteed Income Benefit on
I4Life 0.400% 0.050% Variable Account Value
Increasing Guaranteed Income
Benefit 0.400% 0.050% Variable Account Value

* For Riders effective prior to 5/15/04, the Base Reinsurance Premium Annual
Rate shall be 0.350%.

# Guaranteed Benefit amount and Current Income Base amount are as calculated
by the terms of the applicable rider.

REINSURER'S EXPENSE, PROFIT, AND RISK CHARGE (EPRC):

EPRC shall equal the annual rates shown above, payable monthly in arrears
computed in the manner as more fully described below.

MONTHLY PAYMENT OF REINSURANCE PREMIUM:

Both the Base Reinsurance Premium and the EPRC are payable in arrears after the
end of each calendar month. The monthly payment for each benefit type shall be
computed as follows.

A. For all benefit types, except the Guaranteed Income Benefit types: For
each Individual Policy having a GB risk, the Ceding Company assesses a
charge against the contract holder on a quarterly basis as measured
from the Individual Policy issue date. In the calendar month in which
this occurs, the monthly payment to the Reinsurer with respect to
these impacted Individual Policies

shall be computed by adding the appropriate Base Reinsurance Premium
annual rate to the EPRC annual rate, then dividing the total by four
and multiplying the result by the Guaranteed Benefit amount (or
Current Income Base, as applicable).

B. For the Guaranteed Income Benefit types: The monthly payment for these
benefit types shall be computed by adding the Base Reinsurance Premium
annual rate to the EPRC annual rate, then dividing the total by twelve
and multiplying the result by the average monthly variable account
value.

SCHEDULE D

REPORTS

Within 30 days after the end of each calendar month, the Ceding Company will
furnish the Reinsurer with a summary report that includes claims relating to GB
risks, statutory reserves, Treaty Reserves and calculated reinsurance premium
for the business covered by this Agreement. Within 30 days after the end of each
calendar quarter, the Ceding Company will furnish the Reinsurer with a summary
report for tax reserves.

SCHEDULE E

ARBITRATION

To initiate arbitration, either the Ceding Company or the Reinsurer shall notify
the other party in writing of its desire to arbitrate, stating the nature of its
dispute and the remedy sought. The party to which the notice is sent shall
respond to the notification in writing within ten (10) days of its receipt.

The arbitration hearing shall be before a single arbitrator. In order to be
eligible to serve as an arbitrator, an individual must not be a present or
former officer, attorney or consultant of the Ceding Company or the Reinsurer or
of either of their affiliates. The arbitrator must be neutral, impartial, and
disinterested.

The Ceding Company and the Reinsurer shall each name three candidates to serve
as an arbitrator. The Ceding Company and the Reinsurer shall take turns striking
the name of one of the remaining candidates from the initial six candidates
until only one candidate remains. If the candidate so chosen shall decline to
serve as the arbitrator, the candidate whose name was stricken last shall be
nominated as the arbitrator. This process shall continue until a candidate has
been chosen and has accepted. The first turn at striking the name of a candidate
shall belong to the party that is responding to the other party's initiation of
the arbitration. Once chosen, the arbitrator is empowered to decide all
substantive and procedural issues.

It is agreed that the arbitrator shall be neutral, impartial, and disinterested
regarding the dispute on the basis described in the "Arbitration" article of the
Agreement. Therefore, at no time will either the Ceding Company or the Reinsurer
contact or otherwise communicate with any person who is to be or has been
designated as a candidate to serve as an arbitrator concerning the dispute,
except upon the basis of jointly drafted communications provided by both the
Ceding Company and the Reinsurer to inform the individual actually chosen as
arbitrator of the nature and facts of the dispute. Likewise, any written or oral
arguments provided to the arbitrator concerning the dispute shall be coordinated
with the other party and shall be provided simultaneously to the other party or
shall take place in the presence of the other party. Further, at no time shall
any arbitrator be informed that the arbitrator has been named or chosen by one
party or the other.

The arbitration hearing shall be held on the date fixed by the arbitrator. In no
event shall this date be later than six months after the appointment of the
arbitrator. The arbitration hearing shall be held in Syracuse, New York. As soon
as possible, the arbitrator shall establish prearbitration procedures as
warranted by the facts and issues of the particular case. At least ten (10) days
prior to the arbitration hearing, each party shall provide the other party and
the arbitrator with a detailed statement of the facts and arguments it will
present at the arbitration hearing. The arbitrator may consider any relevant
evidence; he or she shall give the evidence such weight as he or she deems it
entitled to after consideration of any objections raised concerning it. The
party initiating the arbitration shall have the burden of proving its case by a
preponderance of the evidence. Each party may examine any witnesses who testify
at the arbitration hearing. Within twenty (20) days after the end of the
arbitration hearing, the arbitrator shall issue a written decision that sets
forth his or her findings and any award to be paid as a result of the
arbitration,

except that the arbitrator may not award punitive or exemplary damages. In his
or her decision, the arbitrator shall also apportion the costs of arbitration,
which shall include, but not be limited to, his or her own fees and expenses.

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AUTOMATIC INDEMNITY REINSURANCE AGREEMENT

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