Investing internationally involves risks not associated with investing solely in the United States, such as currency fluctuation, political or regulatory risk, currency exchange rate changes, differences in accounting and the limited availability of information.
2Small & Mid Cap
Funds that invest in small and/or mid-size company stocks typically are more volatile and involve greater risk, particularly in the short term, than those investing in larger, more established companies.
3Money Market Funds
An investment in a money market fund is not insured or guaranteed by the FDIC or any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share (or for the LVIP Money Market Fund $10.00 per share), it is possible to lose money by investing in the fund.
An index is unmanaged, and one cannot invest directly in an index. Indices do not reflect the deduction of any fees.
Funds that target exposure to one region or industry may carry greater risk and higher volatility than more broadly diversified funds.
The return of principal in bond portfolios is not guaranteed. Bond Portfolios have the same interest rate, inflation, credit, duration, prepayment and market risks that are associated with the underlying bonds owned by the fund (or account).
7Asset Allocation Portfolios
Asset allocation does not ensure a profit, nor protect against loss in a declining market.
8High Yield or Mortgage Backed Portfolios
High yield portfolios may invest in high-yield or lower rated fixed-income securities (junk bonds) or mortgage-backed securities, with exposure to sub-prime mortgages, which may experience higher volatility and increased risk of non-payment or default.
REITs involve risks such as refinancing, economic conditions in the real estate industry, declines in property values, dependency on real estate management, property taxes, changes in interest rates and other risks associated with a portfolio that concentrates its investments in one sector or geographic region.
Investing in emerging markets can be riskier than investing in well-established foreign markets. International investing involves special risks not found in domestic investing, including increased political, social and economic instability, all of which are magnified in emerging markets.
11Fund of Funds
Each Fund is operated as a fund of funds which invests primarily in other funds rather than in individual securities. Funds of this nature may be more expensive than other investment options. Each Fund invests its assets in a number of underlying funds. From time to time, the Fund's adviser may modify the asset allocation for the underlying funds in which each Fund invests including the addition of new funds. A Fund's actual allocation may vary from the target strategic allocation at any point in time. Additionally, the Fund's adviser may also manage assets of the underlying funds directly for a variety of purposes.
The Index this portfolio is managed to (the "Index") is a product of S&P Dow Jones Indices LLC ("SPDJI") and has been licensed for use by one or more of the portfolio's service providers ("Licensee"). Standard & Poor's® and S&P® are registered trademarks of Standard & Poor's Financial Services LLC ("S&P"); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks have been licensed for use by SPDJI. S&P®, S&P GSCI® and the Index are trademarks of S&P and have been licensed for use by SPDJI and its affiliates and sublicensed for certain purposes by Licensee. The Index is not owned, endorsed, or approved by or associated with any additional third party. Licensee's product(s) is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, their respective affiliates, or their third party licensors and none of SPDJI, Dow Jones, S&P nor their respective affiliates or third party licensors make any representation regarding the advisability of investing in such product(s).
This fund operates under a Master-Feeder structure. The fund invests all its assets in a separate mutual fund (the Master Fund) which in turn purchases investment securities. Funds of this nature may be more expensive than other investment options. Performance shown is from the inception date of each Master Fund, which was purchased by the applicable LVIP American Fund (the Feeder Fund in the Master-Feeder fund structure). Performance information shown is that of each Master Fund as adjusted for the Feeder Fund expenses, including the fees and expenses of the Service Class II shares and product fees. The performance information shown is not the Feeder Fund's own performance, and should not be considered indicative of past or future performance or a substitute for the fund's performance.
An investment in a separate account is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. Although the separate account seeks to preserve capital, it is possible to lose money by investing in this separate account. When interest rates rise, the value of the fixed-income securities generally decline. Likewise, when interest rates fall, the value of fixed-income securities generally increase. There is no assurance that private guarantors or insurers will meet their obligations.
Exposure to the commodities markets may subject the Fund to greater volatility than investments in traditional securities, particularly if the investments involve leverage. This Fund will typically seek to gain exposure to the commodity markets by investing in commodity-linked derivative instruments, swap transactions, or index- and commodity-linked "structured" notes. These instruments may subject the Fund to greater volatility than investments in traditional securities. A Commodities fund may be non-diversified, which can mean it may incur greater risk by concentrating its assets in a smaller number of issuers than a diversified fund.
16Cash Management Funds
An investment in Cash Management Fund is not a bank deposit and is not insured or guaranteed by the FDIC or any other government agency. Although this option seeks to preserve the value of your investment, it is not managed to maintain a stable net asset value of $1 per share and it is possible to lose money by investing in this investment option.
Collective trusts are non-deposit investment products, which are not bank deposits or obligations, are not guaranteed by any bank, and are not insured or guaranteed by the FDIC, the Federal Reserve Board, or any other government agency.
Exchange-traded funds (ETFs) in this lineup are available through collective trusts or mutual funds. Investors cannot invest directly in an ETF.
19Target Date Funds
The target date is the approximate date when investors plan to retire or start withdrawing their money. Some target date funds make no changes in asset allocations after the target date is reached; other target date funds continue to make asset allocation changes following the target date (see prospectus for the fund's allocation strategy). The principal value is not guaranteed at any time, including at the target date.
The fund described herein is indexed to an MSCI® index. The fund referred to herein is not sponsored, endorsed, or promoted by MSCI®, and MSCI® bears no liability with respect to any such fund, or an index on which each fund is based. The prospectus and statement of additional information contain a more detailed description of the limited relationship MSCI has with Lincoln Investment Advisors Corporation and any related funds.
Floating rate funds should not be considered alternatives to CDs or money market funds, and should not be considered as cash alternatives.
Investments in Delaware Investments VIP Series, Delaware Funds, LVIP Delaware Funds or Lincoln Life accounts managed by Delaware Investment Advisors, a series of Delaware Management Business Trust, are not and will not be deposits with or liabilities of Macquarie Bank Limited ABN 46008 583 542 and its holding companies, including their subsidiaries or related companies, and are subject to investment risk, including possible delays in prepayment and loss of income and capital invested. No Macquarie Group company guarantees or will guarantee the performance of the Series or Funds or accounts, the repayment of capital from the Series or Funds or account, or any particular rate of return.
23Risk Management Strategy
The Fund's risk management style is not a guarantee, and the Fund's shareholders may experience losses. The Fund employs hedging strategies designed to provide for downside protection during sharp downward movements in equity markets. The cost of these hedging strategies could limit the upside participation of the Fund in rising equity markets relative to other un-hedged funds.
24Managed Volatility Strategy
Fund's Managed Volatility strategy is not a guarantee, and the Fund's shareholders may experience losses. The Fund employs hedging strategies designed to reduce overall portfolio volatility. The cost of these hedging strategies could limit the upside participation of the Fund in rising equity markets relative to un-hedged funds.
Certain funds (sometimes called "alternative funds" expect to invest in (or may invest in some) positions that emphasize alternative investment strategies and/or non-traditional asset classes and, as a result, are subject to the risk factors of those asset classes and/or investment strategies. Some of those risks may include general economic risk, geopolitical risk, commodity-price volatility, counterparty and settlement risk, currency risk, derivatives risk, emerging markets risk, foreign securities risk, high yield bond exposure, index investing risk, exchange traded notes risk, industry concentration risk, leveraging risk, real estate investment risk, master limited partnership risk, master limited partnership tax risk, energy infrastructure companies risk, sector risk, short sales risk, direct investments risk, hard assets sectors risk, active trading and "overlay" risks, event driven investing risk, global macro strategies risk, temporary defensive positions and large cash positions. If you are considering investing in alternative investments funds, you should ensure that you understand the complex investment strategies sometimes employed, and be prepared to tolerate the risks of such asset classes. For a complete list of risks, as well as a discussion of risks and investment strategies, please refer to the funds' prospectus. The Fund may invest in derivatives, including futures, options, forwards and swaps. Investments in derivatives may cause the Fund's losses to be greater than if it invested only in conventional securities and can cause the Fund to be more volatile. Derivatives involve risks different from, or possibly greater than, the risks associated with other investments. The Fund's use of derivatives may cause the Fund's investment returns to be impacted by the performance of securities the Fund does not own and result in the Fund's total investment exposure exceeding the value of its portfolio.
Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"). The trademark has been licensed to S&P Dow Jones Indices LLC and have been sublicensed for use for certain purposes by First Trust Advisors L.P. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of purchasing the product.
Standard & Poor's®," "S&P®," "Standard & Poor's Equal Weight Index," "S&P EWI," "S&P 500®," "Standard & Poor's 500" and "500" are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by the Invesco V.I. Equally-Weighted S&P 500 Fund. The fund is not sponsored, endorsed, sold or promoted by S&P, and S&P makes no representation regarding the advisability of investing in the fund.
Subject to the Fund's Board approval, Lincoln has the right to engage or terminate a money manager at any time and without a shareholder vote, based on an Exemptive order from the Securities and Exchange Commission. While the investment styles employed by the Fund's money managers are intended to be complementary, they may not in fact be complementary. A multi-manager approach could result in more exposure to certain types of securities and higher portfolio turnover.
The Fund is subject to certain underlying risks which affect the listed private equity companies in which the Fund invests and could include but are not limited to, additional liquidity risk, industry risk, non-U.S. security risk, currency risk, valuation risk, credit risk, managed portfolio risk and derivatives risk. There are inherent risks in investing in private equity companies, as generally, little public information exists for private and thinly traded companies, and there is a risk that investors may not be able to make a fully informed investment decision. Listed private equity companies may have relatively concentrated portfolios which may lead to more volatility. Certain Fund investments may be exposed to liquidity risk due to low trading volume, lack of a market maker or legal restrictions limiting the availability of the Fund to sell particular securities at any given price and/or time. As a result these securities may be more difficult to value.
This variable annuity contract has limitations and expense charges. For costs and complete details of the coverage contact your Lincoln plan representative.
The Lincoln DirectorSM is a group variable annuity contract issued by The Lincoln National Life Insurance Company, Fort Wayne, IN on policy form #19476 7/94 and variations thereof. It is distributed by Lincoln Financial Distributors, Inc., a broker-dealer.
Lincoln Financial Group
1300 S. Clinton St.
P.O. Box 2248
Fort Wayne, IN 46801-2248