PRUDENTIAL FINANCIAL INC
For the period ended Mar 31, 2024. Filed May 2, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2024 · Filed May 2, 2024
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8. Separate Accounts
- SEPARATE ACCOUNTS
The Company issues variable annuity and variable life insurance contracts through its separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder. Most variable annuity and variable life insurance contracts are offered with both separate and general account options. See Note 10 for additional information.
The assets supporting the variable portion of variable annuity and variable life insurance contracts are carried at fair value and reported as “Separate account assets” with an equivalent amount reported as “Separate account liabilities.” The liabilities related to the net amount at risk are reflected within future policy benefits or market risk benefits. Amounts assessed against the contractholders for mortality, administration, and other services are included within revenue in “Policy charges and fee income” and changes in liabilities for minimum guarantees are generally included in “Policyholders’ benefits” or “Realized investment gains (losses), net.”
Separate Account Assets
The aggregate fair value of assets, by major investment asset category, supporting separate accounts is as follows:
| March 31,2024 | December 31,2023 | |
|---|---|---|
| (in millions) | ||
| Asset Type: | ||
| U.S. Treasury securities and obligations of U.S. government authorities and agencies | $4,169 | $4,411 |
| Obligations of U.S. states and their political subdivisions | 2,152 | 2,116 |
| Foreign government bonds | 108 | 101 |
| U.S. corporate securities | 12,566 | 12,782 |
| Foreign corporate securities | 3,201 | 3,288 |
| Asset-backed securities | 1,256 | 1,211 |
| Mortgage-backed securities | 14,156 | 14,253 |
| Mutual funds: | ||
| Equity | 92,751 | 88,397 |
| Fixed Income | 35,762 | 37,065 |
| Other | 5,919 | 5,587 |
| Equity securities | 4,651 | 5,410 |
| Commercial mortgage and other loans | 64 | 67 |
| Other invested assets | 19,679 | 20,739 |
| Short-term investments | 1,443 | 1,202 |
| Cash and cash equivalents | 2,187 | 2,259 |
| Total | $200,064 | $198,888 |
For the periods ended March 31, 2024 and December 31, 2023, there were no transfers of assets, other than cash, from the general account to a separate account; therefore, no gains or losses were recorded.
Separate Account Liabilities
The balances of and changes in separate account liabilities as of and for the periods ended are as follows:
| Three Months Ended March 31, 2024 | |||||||
|---|---|---|---|---|---|---|---|
| Retirement Strategies | |||||||
| PGIM · Institutional · Individual · Group Insurance · Individual Life · Total | |||||||
| (in millions) | |||||||
| Balance, BOP | $32,648 | $11,011 | $94,130 | $25,021 | $39,223 | $202,033 | |
| Deposits | 8,411 | 51 | 151 | 160 | 752 | 9,525 | |
| Investment performance | (537) | (60) | 4,308 | 265 | 3,155 | 7,131 | |
| Policy charges | (18) | (2) | (563) | (31) | (280) | (894) | |
| Surrenders and withdrawals | (8,270) | (716) | (3,354) | (8) | (240) | (12,588) | |
| Benefit payments | (858) | (137) | (20) | (56) | (116) | (1,187) | |
| Net transfers (to) from general account | (35) | (24) | 6 | 0 | (123) | (176) | |
| Other | (456) | (49) | 1 | (137) | 48 | (593) | |
| Balance, EOP | $30,885 | $10,074 | $94,659 | $25,214 | $42,419 | $203,251 | |
| Other businesses(1) | (3,187) | ||||||
| Total separate account liabilities | $200,064 | ||||||
| Cash surrender value(2) | $30,885 | $10,074 | $93,526 | $25,157 | $38,958 | $198,600 | |
(1)Primarily represents activity from the Company’s Divested and Run-off Businesses as well as the impact of intercompany eliminations. There are no associated cash surrender charges.
(2)“Cash surrender value” represents the amount of the contractholder's account balances distributable at the balance sheet date less certain surrender charges. There are no cash surrender charges for the PGIM and Institutional Retirement Strategies segments.
| Three Months Ended March 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|
| Retirement Strategies | |||||||
| PGIM · Institutional · Individual · Group Insurance · Individual Life · Total | |||||||
| (in millions) | |||||||
| Balance, BOP | $40,056 | $11,428 | $93,395 | $23,513 | $32,930 | $201,322 | |
| Deposits | 1,279 | 51 | 94 | 6 | 667 | 2,097 | |
| Investment performance | 174 | 454 | 4,627 | 702 | 1,938 | 7,895 | |
| Policy charges | (21) | (3) | (594) | (42) | (262) | (922) | |
| Surrenders and withdrawals | (1,012) | (45) | (2,285) | (2) | (178) | (3,522) | |
| Benefit payments | (857) | (137) | (23) | (77) | (97) | (1,191) | |
| Net transfers (to) from general account | (168) | (14) | (11) | 0 | (67) | (260) | |
| Other | (190) | 128 | 3 | 561 | 20 | 522 | |
| Balance, EOP | $39,261 | $11,862 | $95,206 | $24,661 | $34,951 | 205,941 | |
| Other businesses(1) | (3,647) | ||||||
| Total separate account liabilities | $202,294 | ||||||
| Cash surrender value(2) | $39,261 | $11,862 | $93,618 | $24,542 | $31,955 | $201,238 | |
(1)Primarily represents activity from the Company’s Divested and Run-off Businesses as well as the impact of intercompany eliminations. There are no associated cash surrender charges.
(2)“Cash surrender value” represents the amount of the contractholder's account balances distributable at the balance sheet date less certain surrender charges. There are no cash surrender charges for the PGIM and Institutional Retirement Strategies segments.
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