PRUDENTIAL FINANCIAL INC

For the period ended Dec 31, 2024. Filed Feb 13, 2025.

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FY2024 · Filed Feb 13, 2025

PRU$123.30+1.0%Stored close · as of Nov 10, 2026

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Contents

Retirement Strategies

U.S. Businesses—Retirement Strategies

Serves the retirement needs of both our institutional and individual customers. Our Institutional Retirement Strategies business develops and distributes retirement investment and income products and services to retirement plan sponsors in the public, private and not-for-profit sectors, both domestically and internationally, primarily within the United Kingdom. Our Individual Retirement Strategies business develops and distributes individual variable and fixed annuity products in the U.S., primarily to mass affluent (households with investable assets or annual income in excess of $100,000) and affluent (households with investable assets in excess of $250,000) customers with a focus on innovative product design and risk management strategies.

Products

We offer a variety of products and solutions to serve different retirement needs and goals: Institutional Retirement StrategiesPayout Annuities: products that provide a predictable source of monthly income, generally for the life of the annuitant.•Pension risk transfer—non-participating group annuity insurance and reinsurance contracts issued to pension plan sponsors and intermediaries, under which we assume all investment and actuarial risk associated with a group of specified participants within a plan in return for a premium typically paid as a lump-sum at inception.•Pension risk transfer—longevity reinsurance contracts with counterparties from which we earn a fee for assuming the longevity risk of pension plans that have been insured by third-parties. Premiums for these products are typically paid over the duration of the contract as opposed to a lump-sum at inception.Stable Value: products where our obligations are backed by our general account, and where we bear some or all of the investment and asset-liability management risk, depending on the product.•Investment-only products—for use in institutional capital markets and qualified plans primarily including fee-based wraps through which customers’ funds are held in a client-owned trust and investment results pass through to the customer. We earn fee revenue for providing a guaranteed minimum interest rate backed by the general account.•Guaranteed Investment Contracts and Funding Agreements—contain an obligation to pay interest at a specified rate and to repay principal at maturity or following contract termination. Other products: includes structured settlements and other group annuities.Individual Retirement StrategiesIndexed Variable Annuities •The Prudential FlexGuard® indexed variable annuity, offers the contractholder an opportunity to allocate funds to variable subaccounts and index-based strategies. The strategies provide an interest component linked to, but not an investment in, the selected index, and its performance over the elected term, subject to certain contractual minimums and maximums, and also provides varying levels of downside protection at pre-determined levels and durations. The product also allows for additional deposits and provides a Return of Purchase Payment (“ROP”) death benefit at no additional charge.

•The Prudential FlexGuard® Income indexed variable annuity offers similar investment and crediting features as the Prudential FlexGuard® product, with a focus on income protection by providing a protected income benefit for an additional fee. Crediting strategies are limited during the income phase.Traditional Variable Annuities•The Prudential Premier® Investment Variable Annuity (“PPI”) offers tax-deferred asset accumulation, annuitization options and an optional death benefit that guarantees the contractholder’s beneficiary a return of total purchase payments made to the contract, adjusted for any partial withdrawals, upon death.•The Prudential MyRock® Advisor Variable Annuity, a fee-based product that offers an optional Dynamic Income Benefit (“IB”) rider that provides longevity protection through a preset withdrawal percentage applied to a variable income base. In addition, the product offers either a basic death benefit or an ROP death benefit. Both the IB and the ROP are available for an additional fee.Fixed Annuities•PruSecure®, SurePath® and SurePath® Income, all single premium fixed indexed annuities, offer flexibility to allocate account balances between an index-based strategy and a fixed rate strategy. The index-based strategy provides interest or an interest component linked to, but not an investment in, the selected index, and its performance over the elected term (i.e., 1, 3 or 5 years for PruSecure® and 1 or 3 years for SurePath® and SurePath® Income), subject to certain contractual minimums and maximums. The fixed rate strategy, not associated with an index, offers a guaranteed growth at a set interest rate for one year and can be renewed annually. Additionally, SurePath® Income offers a benefit that provides for guaranteed lifetime withdrawal payments.•The Prudential Fixed Annuity with Daily Advantage Income Benefit® (“DAI”), a single premium fixed annuity, provides principal protection as well as a guaranteed lifetime withdrawal income payment for an additional fee. The lifetime income amount increases daily without exposure to the equity market until the contractholder begins taking withdrawals.•The Prudential WealthGuardSM Multi-Year Guaranteed Annuity, a single premium fixed rate deferred annuity launched in August 2023, provides tax-deferred growth and guaranteed rate of return over an initial guaranteed rate period (i.e., 3, 5 or 7 years).•The Prudential Immediate Income Annuity (“PIIA”), a single premium immediate annuity, provides a regular stream of benefit payments. The payments are guaranteed, cannot be changed and are higher than those guaranteed on products that provide liquidity.

Retirement Strategies (Continued)

Revenues and ProfitabilityOur revenues primarily come in the form of:Institutional Retirement Strategies•Premiums associated with insurance and reinsurance contracts and our payout annuities.•Policy charges and fee income based on account values of our fee-based stable value and longevity reinsurance 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. We price our products based on pricing models that consider the investment environment and our risk, fees, expenses, profitability targets, and assumptions for mortality and potential for early retirement. These assumptions may be less predictable in certain markets.Individual Retirement Strategies•Fee income from asset management fees and service fees, which represent administrative service and distribution fees from many of our proprietary and non-proprietary mutual funds. The asset management fees are determined as a percentage of the average assets of our proprietary mutual funds in our variable annuity products (net of sub-advisory expenses related to non-proprietary sub-advisors).•Policy charges and fee income representing mortality, expense and other fees for various insurance-related options and features based on the average daily net asset value of the annuity separate accounts, account value, premium, or guaranteed value, as applicable.•Investment income (which contributes to the net spread over interest credited on certain products and related expenses) and interest income on collateral posted to counterparties.Our profitability is substantially impacted by our ability to appropriately price our products. We price our products based on: •An evaluation of the risks assumed and consideration of applicable risk management strategies, including hedging and reinsurance costs.•Assumptions regarding investment returns and contractholder behavior, including persistency, benefit utilization and the timing and efficiency of withdrawals for contracts with living benefit features, as well as other assumptions.

Marketing and DistributionInstitutional Retirement StrategiesWe primarily distribute products through the following channels:•Pension risk transfer through actuarial consultants and third-party brokers.•Structured settlements through third-party specialized brokers.•Voluntary income products and other group annuities directly to plan sponsors.•Stable value products through our proprietary sales force and third-party intermediaries.Individual Retirement StrategiesOur distribution efforts, which are supported by a network of internal and external wholesalers, are executed through a diverse group of distributors, including:•Third-party distribution through:◦Broker-dealers; ◦Banks and wirehouses;◦Independent financial planners; and◦Independent Marketing Organizations (“IMO”) (specifically for SurePath® and SurePath® Income).•Financial professionals associated with Prudential Advisors, Prudential’s proprietary nationwide sales organization.CompetitionInstitutional Retirement StrategiesWe compete with other large, well-established insurance companies, asset managers and diversified financial institutions primarily based on:•Pricing.•Structuring capabilities.•Our ability to offer innovative product solutions and successfully execute large-scale transactions.We are a leader in providing innovative pension risk management solutions to plan sponsors and in the stable value market. We believe the pension risk transfer market continues to offer attractive opportunities that are aligned with our expertise. Individual Retirement StrategiesWe are among the industry’s largest providers of individual annuities and we compete with other providers of retirement savings and accumulation products, including large, well-established insurance and financial services companies, and private equity firms.We believe our competitive advantage lies primarily in our innovative product features and our risk management strategies as well as brand recognition, financial strength, the breadth of our distribution platform and our customer service capabilities.We periodically adjust product offerings, prices and features based on the market and our strategy, with a goal of achieving customer and enterprise value.

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