PRUDENTIAL FINANCIAL INC
For the period ended Dec 31, 2024. Filed Feb 13, 2025.
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FY2024 · Filed Feb 13, 2025
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Group Insurance
U.S. Businesses—Group Insurance
Provides and distributes a full range of group life, long-term and short-term group disability and group corporate bank and trust-owned life insurance across the U.S. to institutional clients, professional associations and affinity groups to enhance employee and membership benefit plans. Additionally, we offer voluntary products including accident, critical illness and hospital indemnity. Our services also include plan administration and absence management, covering employee paid and unpaid leave including the Family Medical Leave Act, the Americans with Disabilities Act and Paid Family Leave. In 2024, we expanded into the medical stop loss market, with coverage effective dates starting from January 1, 2025.
| ProductsWe offer a variety of products, through both non-experience- rated contracts (where we assume all mortality/morbidity risk) and experience-rated contracts (where mortality/morbidity experience is shared between us and the clients), and services through the following businesses:Group Life Insurance•Employer-paid, employee-paid and member-paid coverages for term life, group universal life and group variable universal life insurance, as well as accidental death and dismemberment insurance. Certain coverages allow employees to retain their coverage when they change employers or retire, and we offer waiver of premium coverage in the event the insured suffers a qualifying disability. •Group corporate-, bank- and trust-owned life insurance in the form of group variable life insurance contracts utilizing separate accounts. These products are typically used by large corporations to fund deferred compensation plans and benefit plans for retired employees.Group Disability Insurance & Other•Short-term and long-term group disability insurance, which protect against loss of wages due to illness or injury. Short-term disability generally provides weekly benefits for three to six months while long-term disability benefits are typically paid monthly, following a waiting period, and generally continue until the insured either returns to work or reaches normal retirement age.•Other supplemental health solutions, including accident, critical illness and hospital indemnity plans which help offset expenses associated with medical events.•Plan administration and absence management services. State, federal and company paid-leave solutions that assist employers in minimizing the administrative workload of managing their leave programs while ensuring compliance with complex state legislation.•Medical stop loss insurance, which is a risk management product aimed at helping protect self-insured employers against catastrophic medical claims that exceed predetermined levels. Our stop loss product offerings include both specific and aggregate stop loss coverage. Specific stop loss covers claims for an individual at a set deductible level while aggregate stop loss limits total claims paid by an employer for an entire group of employees during a contract period. | Marketing and DistributionWe primarily distribute products through a proprietary sales force organized around market segments in conjunction with employee benefit brokers and consultants. We define our market segments as follows: •National Market—employer groups having over 5,000 benefit eligible employees.•Premier Market—employer groups having between 100 and 5,000 benefit eligible employees.•Association—affinity groups, regardless of size. |
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Group Insurance (Continued)
| Revenues and ProfitabilityOur revenues primarily come in the form of:•Premiums and policy charges for our group life, group disability and supplemental health products.•Investment income (which contributes to the net spread over interest credited on our products and related expenses).Our profitability is substantially impacted by our ability to appropriately price our products, many of which include multiple year premium rate guarantees.We price our products based on: •Underwriting practices and rating systems that consider company, industry and/or other experience. •The expected pay-out of benefits and other costs that we calculate using assumptions for mortality and morbidity rates, interest rates and expenses, depending upon the specific product features. | CompetitionWe compete with many large, well-established life and health insurance providers in mature markets. Our primary competitive advantages include brand recognition, financial strength and a diverse range of product offerings that help employers create comprehensive benefits programs that support the well-being of their employees. Additionally, we emphasize customer relationships and overall experience. While the majority of our premiums are derived from the National Market segment, we continue to diversify our book through growth of the Premier Market and Association segments.Employee-paid coverage is important as employers attempt to control costs and shift benefit decisions and funding to employees who continue to value workplace benefits. Our profitability is dependent, in part, on the voluntary coverage marketplace, which will be affected by future employment and compensation rates. |
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