Insurers are finally getting approval to receive money from the Troubled Asset Relief Program, which is likely welcome relief for a sector that has been struggling, but continues to raise questions about how the government draws the line in terms of which companies it’s bailing out.

The Hartford Financial Services Group (HIG) announced Thursday that it has been given preliminary approval to receive $3.4 billion from TARP’s Capital Purchase Program, while Lincoln National (LNC) announced it is set to receive $2.5 billion.

A Treasury Department spokesman told FOX Business that Prudential Financial Group (PRU) and Principal Financial Group (PFG) had also been given clearance to receive TARP funds. He said Allstate (ALL) and Ameriprise Financial (AMP), two other insurance companies, would also be offered TARP money.

Ameriprise said on Friday that it would not take the TARP funds. Recently, some of the banks that received TARP money have been chafing under the rules the government imposed, including restrictions on executive compensation. Some of the insurers may feel the restrictions aren't worth the boost the money would give to their balance sheets.

"While we appreciate Treasury's approval of our application, we have elected not to accept funding," said Jim Cracchiolo, Ameriprise chairman and chief executive officer, in a statement. "We have carefully evaluated our current position and expectations for the future, and we are confident that our current capital position and access to potential additional funding sources are more than adequate."

Recently, only a bit over $100 billion was left out of the $700 billion originally allocated to TARP, though some financial institutions are making moves to pay back the money to the Treasury and add to that total. The Wall Street Journal cited a person familiar with the matter as saying the Treasury Department planned to approve as much as $22 billion for the life-insurance sector.

"We are pleased that we received preliminary approval to participate in Treasury's Capital Purchase Program," said Ramani Ayer, chairman and chief executive officer of The Hartford, in a statement. "Applying for participation in the CPP was a prudent step for The Hartford, particularly given the continued economic uncertainty. These funds would further fortify our capital resources and provide us with additional financial flexibility during one of the most volatile market climates in our nation's history."

Lincoln National President and CEO Dennis Glass said, “access to the Treasury's Capital Purchase Program is a means to further enhance the company's financial flexibility and capital in what has continued to be an unprecedented economic environment. We appreciate this preliminary approval for inclusion in the CPP program, subject to a final review of its terms and conditions."

Prudential said in a press release that it was "currently evaluating all options available to the company." A spokeswoman declined to comment on how much money the company had been approved to receive.

Allstate noted in a press release that its recent $1 billion debt offering was oversubscribed and it considers itself "well-capitalized."

"We remain confident in our current capital position," Allstate CEO Thomas Wilson said. "We will, however, undertake a prudent review of our participation in CPP in light of market conditions and our current capital position before responding to the Treasury's preliminary approval."

Principal issued a press release on Friday saying it had received preliminary approval for $2 billion from TARP.

Larry Zimpelman, Principal's president and CEO, noted in the release that the company made a $1 billion secondary offering this week, and said that "as always, we will continue to consider a range of options to position us to take advantage of opportunities and to meet any further challenges.  Our decision about whether to participate in CPP and, if so, at what level, will be based on a review following receipt of all the terms and conditions, both economic and non-economic.” 

The Treasury spokesman said these insurers were approved because they had bank-holding company status and applied by the Nov. 14 deadline. A number of insurers that weren’t already bank-holding companies moved last fall to purchase bank-holding companies with the express purpose of becoming eligible to receive TARP money.

Still, the development shows that Treasury is willing to continue to expand the horizons of the TARP program. FOX Business has previously outlined some of the issues surrounding whether life insurers should get TARP money. 

Sector advocates cheered the news.

“By including life insurers in TARP, it helps ensure the recovery effort is broad and covers all aspects of the economy,” said Steve Bartlett, president and CEO of the Financial Services Roundtable, in a statement.

An industry lobbyist said that insurers are suffering the same as everyone, noting that the bailout approval was likely because insurers have a direct relationship with commercial borrowers, and that market is frozen. The lobbyist said the TARP money would ideally help unfreeze the market.