Cigna Reports Strong Full Year 2012 Results, Expects Continued Positive Momentum for 2013

Consolidated Adjusted income from operations, per share^1,3

Notes:

1.

Cigna measures the financial results of its segments using segment earnings (loss), which is defined as shareholders' net income (loss) before net realized investment results. Adjusted income (loss) from operations is defined as segment earnings (loss) excluding special items (which are identified and quantified in Note 4) and the results of Cigna's GMIB business. Adjusted income (loss) from operations is a measure of profitability used by Cigna's management because it presents the underlying results of operations of Cigna's businesses and permits analysis of trends in underlying revenue, expenses and shareholders' net income. This measure is not determined in accordance with generally accepted accounting principles (GAAP) and should not be viewed as a substitute for the most directly comparable GAAP measures, which are segment earnings (loss) and shareholders' net income; see Exhibits 1 and 2 for reconciliations of the non-GAAP measure to the most directly comparable GAAP measures.

Effective December 31, 2012, Cigna made changes to external reporting segments to reflect the Company's realignment of its businesses to leverage distribution and service delivery capabilities for the benefit of our global clients and customers. Prior period amounts have been presented on a comparable basis.

2.

The Guaranteed Minimum Income Benefits (GMIB) business and Guaranteed Minimum Death Benefits business, also known as Variable Annuity Death Benefits (VADBe), are included in our Run-off Reinsurance operations. These businesses have been in run-off since 2000.

During the first quarter of 2013, Cigna entered into a definitive agreement with Berkshire Hathaway to exit the Run-off Reinsurance businesses.

3.

Information is not available for management to (1) reasonably estimate future net realized investment gains (losses) or (2) reasonably estimate future GMIB business results due in part to interest rate and stock market volatility and other internal and external factors; therefore, it is not possible to provide a forward-looking reconciliation of adjusted income from operations to shareholders' income from continuing operations. We expect that special items for 2013 will include an after-tax charge of $500 million related to the transaction to exit the GMIB and VADBe businesses and may also include potential adjustments associated with litigation and assessment related items. Other than these items, information is not available for management to identify, or reasonably estimate additional 2013 special items.

4.

Special items included in shareholders' net income and segment earnings (loss), but excluded from adjusted income (loss) from operations, and the calculation of adjusted margins include:

Fourth Quarter 2012

-- After-tax loss of $68 million related to litigation matters.

Third Quarter 2012

-- After-tax loss of $50 million related to a realignment and efficiency plan.

-- After-tax loss of $12 million related to transaction costs for the 2012 acquisition of HealthSpring, Inc. ("HealthSpring").

First Quarter 2012

-- After-tax loss of $28 million related to transaction costs for the 2012 acquisition of HealthSpring.

-- After-tax loss of $13 million related to a litigation matter.

Fourth Quarter 2011

-- After-tax loss of $28 million related to transaction costs for the 2012 acquisition of HealthSpring and after-tax loss of $3 million related to transaction costs for the 2011 acquisition of FirstAssist Group Holdings Limited ("FirstAssist").

5.

The application of the FASB's fair value disclosure and measurement guidance (ASC 820-10), which impacts reinsurance contracts covering GMIB, does not represent management's expectation of the ultimate payout. Changes in underlying contract holder account values, interest rates, stock market volatility, and other factors may result in changes to the fair value assumptions, and/or amount that will be required to ultimately settle Cigna's obligations, which could result in a material adverse or favorable impact on the Run-off Reinsurance segment and Cigna's results of operations.

6.

Share repurchases may from time to time be made pursuant to written trading plans under Rule 10b5-1, which permit shares to be repurchased when Cigna might otherwise be precluded from doing so under insider trading laws or because of self-employed trading blackout periods.

7.

Adjusted margins in this press release are calculated by dividing adjusted income from operations¹ by segment revenues. For the three months ended September 30, 2012 and year ended December 31, 2012, segment margins including special items were 6.5% and 6.1% for Global Health Care, respectively, 6.5% and 6.8% for Global Supplemental Benefits, respectively, and 7.5% and 8.2% for Group Disability and Life, respectively. For the three months ended December 31, 2011, segment margins including special items were 2.8% for Global Supplemental Benefits.

8.

The number of customers and policies reported in prior periods has been adjusted to conform to the current basis of reporting.

9.

Global Health Care medical claims payable are presented net of reinsurance and other recoverables. The gross Global Health Care medical claims payable balance was $1,856 million as of December 31, 2012 and $1,305 million as of December 31, 2011.

the ability to successfully complete the integration of acquired businesses, including the acquired HealthSpring businesses by, among other things, operating Medicare Advantage coordinated care plans and HealthSpring's prescription drug plan, retaining and growing the customer base, realizing revenue, expense and other synergies, renewing contracts on competitive terms, successfully leveraging the information technology platform of the acquired businesses, and retaining key personnel;

the ability of the Company to execute its growth plans by successfully leveraging its capabilities and those of the businesses acquired in serving the Seniors market segment and the Company's other market segments, including through successful execution of the Company's physician engagement strategy;

the possibility that the acquired HealthSpring business may be adversely affected by economic, business and/or competitive factors; or by federal and/or state regulation, including health care reform, reductions in funding levels for Medicare programs, and potential changes in risk adjustment data validation audit and payment adjustment methodology;

risks associated with pending and potential state and federal class action lawsuits, disputes regarding reinsurance arrangements, other litigation and regulatory actions challenging the Company's businesses, including disputes related to payments to health care professionals, government investigations and proceedings, tax audits and related litigation, and regulatory market conduct and other reviews, audits and investigations;

heightened competition, particularly price competition, that could reduce product margins and constrain growth in the Company's businesses, primarily the Global Health Care business;

risks associated with the Company's mail order pharmacy business that, among other things, includes any potential operational deficiencies or service issues as well as loss or suspension of state pharmacy licenses;

downgrades in the financial strength ratings of the Company's insurance subsidiaries, that could, among other things, adversely affect new sales and retention of current business; downgrades in financial strength ratings of reinsurers or adjustments to the assumptions used in estimating liabilities for the Company's reinsurance contracts, that could result in increased statutory reserves or capital requirements of the Company's insurance subsidiaries;

Segment Earnings (Loss)

(1)

Includes pre-tax futures and swaps contracts entered into as part of a dynamic hedge program to manage equity and growth interest rate risks in Cigna's Run-off Reinsurance operations. Cigna recorded related offsets in Benefits and Expenses to adjust liabilities for reinsured guaranteed minimum death benefit and guaranteed minimum income benefit contracts. For more information, please refer to Cigna's Form 10-K for the period ended December 31, 2012, which is expected to be filed on February 28, 2013.

(2)

Adjusted income (loss) from operations is segment earnings (loss) (shareholders' net income (loss) before net realized investment gains (losses)) excluding results of Cigna's guaranteed minimum income benefits business and special items. See Exhibit 2 for a detailed reconciliation of adjusted income (loss) from operations to segment earnings (loss) and shareholders' net income presented in accordance with generally accepted accounting principles.

(3)

The three months and year ended December 31, 2012 includes pre-tax charges of $104 million ($68 million after-tax) resulting from litigation matters in Corporate.

(4)

The year ended December 31, 2012 includes pre-tax charges of $77 million ($50 million after-tax) for a realignment and efficiency plan: $65 million pre-tax ($42 million after-tax) in Global Health Care; $9 million pre-tax ($6 million after-tax) in Global Supplemental Benefits; and $3 million pre-tax ($2 million after-tax) in Group Disability and Life.

(5)

The year ended December 31, 2012 includes pre-tax charges of $53 million ($40 million after-tax) for costs associated with the 2012 acquisition of HealthSpring: $42 million pre-tax ($33 million after-tax) in Corporate and $11 million pre-tax ($7 million after-tax) in Global Health Care.

(6)

The year ended December 31, 2012 includes a pre-tax charge of $20 million ($13 million after-tax) resulting from a litigation matter in Global Health Care.

(7)

The three months and year ended December 31, 2011 includes pre-tax charges of $39 million ($31 million after-tax) for costs associated with acquisitions: $35 million pre-tax ($28 million after-tax) in Corporate for the 2012 acquisition of HealthSpring and $4 million pre-tax ($3 million after-tax) in Global Supplemental Benefits for the 2011 acquisition of FirstAssist Group Holdings Limited ("FirstAssist").

(8)

The year ended December 31, 2011 includes a net tax benefit of $24 million resulting from the completion of the 2007 and 2008 IRS examinations: after-tax benefit of $1 million in Global Health Care; after-tax benefit of $5 million in Group Disability and Life; after-tax benefit of $4 million ($9 million pre-tax charge) in Other Operations and an after-tax benefit of $14 million in Corporate.

(1)

Cigna measures the financial results of its segments using "segment earnings (loss)", which is defined as shareholders' net income (loss) before net realized investment gains (losses). Adjusted income (loss) from operations is defined as segment earnings excluding special items and results of Cigna's guaranteed minimum income benefits business.

(3)

The three months and year ended December 31, 2012 includes pre-tax charges of $104 million ($68 million after-tax) resulting from litigation matters in Corporate.

(4)

The year ended December 31, 2012 includes pre-tax charges of $77 million ($50 million after-tax) for a realignment and efficiency plan: $65 million pre-tax ($42 million after-tax) in Global Health Care; $9 million pre-tax ($6 million after-tax) in Global Supplemental Benefits; and $3 million pre-tax ($2 million after-tax) in Group Disability and Life.

(5)

The year ended December 31, 2012 includes pre-tax charges of $53 million ($40 million after-tax) for costs associated with the 2012 acquisition of HealthSpring: $42 million pre-tax ($33 million after-tax) in Corporate and $11 million pre-tax ($7 million after-tax) in Global Health Care.

(6)

The year ended December 31, 2012 includes a pre-tax charge of $20 million ($13 million after-tax) resulting from a litigation matter in Global Health Care.

(7)

The three months and year ended December 31, 2011 includes pre-tax charges of $39 million ($31 million after-tax) for costs associated with acquisitions: $35 million pre-tax ($28 million after-tax) in Corporate for the 2012 acquisition of HealthSpring and $4 million pre-tax ($3 million after-tax) in Global Supplemental Benefits for the 2011 acquisition of FirstAssist Group Holdings Limited ("FirstAssist").

(8)

The year ended December 31, 2011 includes a net tax benefit of $24 million resulting from the completion of the 2007 and 2008 IRS examinations: after-tax benefit of $1 million in Global Health Care; after-tax benefit of $5 million in Group Disability and Life; after-tax benefit of $4 million ($9 million pre-tax charge) in Other Operations and an after-tax benefit of $14 million in Corporate.