-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, XXL1zfmUwOKtp5dkCqvob+RTtj7y1Lx9mdJ18uGXtHF+a1Up8JZNK/tkwttYB0rL 78ig607IoTwnSNzICX0MrA== 0000912057-95-003893.txt : 19950516 0000912057-95-003893.hdr.sgml : 19950516 ACCESSION NUMBER: 0000912057-95-003893 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PRUCO LIFE INSURANCE CO CENTRAL INDEX KEY: 0000777917 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 221944557 STATE OF INCORPORATION: AZ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 033-37587 FILM NUMBER: 95539849 BUSINESS ADDRESS: STREET 1: PRUDENTIAL INSURANCE & FINANCIAL SERVICE STREET 2: 111 DURHAM AVENUE CITY: SOUTH PLAINFIELD STATE: NJ ZIP: 07080 BUSINESS PHONE: 2018026000 MAIL ADDRESS: STREET 1: 213 WASHINGTON STREET CITY: NEWARK STATE: NJ ZIP: 07102 10-Q 1 10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 1995 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] Commission file number 33-37587 PRUCO LIFE INSURANCE COMPANY (Exact name of Registrant as specified in its charter) Arizona 22-1944557 - --------------------------- ------------------------------- (State or other (IRS Employer Identification No.) jurisdiction,incorporation or organization) 213 Washington Street, Newark, New Jersey 07102-2992 ---------------------------------------------------- (Address of principal executive offices) (Zip Code) (201) 802-6149 ---------------------------------------------------- (Registrant's Telephone Number, including area code) Securities registered pursuant to Section 12 (b) of the Act: NONE Securities registered pursuant to Section 12 (g) of the Act: NONE Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES _X_ NO ___ State the aggregate market value of the voting stock held by non-affiliates of the registrant: NONE Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of May 15, 1995: Common stock, par value of $10 per share: 250,000 shares outstanding PRUCO LIFE INSURANCE COMPANY (Registrant) INDEX Page No. Cover Page - Index 2 PART I - FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements Statements of Financial Position - March 31, 1995 (Unaudited) and December 31, 1994 3 Statements of Operations (Unaudited) - Periods Ended March 31, 1995 and 1994 4 Statements of Cash Flows (Unaudited) - Periods Ended March 31, 1995 and 1994 5 Notes to the Consolidated Financial Statements (Unaudited) 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II - OTHER INFORMATION Item 1. Legal Proceedings 9 Item 2. Change in Securities 9 Item 3. Defaults Upon Senior Securities 9 Item 4. Submission of Matters to a Vote of Security Holders 9 Item 5. Other Information 9 Item 6. Exhibits, Financial Statements and Reports on Form 8-K 9 Signature Page 11 2 CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE INSURANCE COMPANY AND SUBSIDIARIES STATEMENTS OF FINANCIAL POSITION
(Unaudited) March 31, December 31, 1995 1994 ---------- ---------- ($000's) ASSETS Fixed maturities (market value $2,569,116 and $2,596,172). . . . . . . . . . . . . $2,571,814 $2,647,315 Equity securities (cost $5,517 and $5,434) . . . . . . . . . . . . . . . . 6,049 3,326 Mortgage loans. . . . . . . . . . . . . . . 65,488 71,919 Investment in real estate . . . . . . . . . 4,130 7,189 Policy loans. . . . . . . . . . . . . . . . 507,830 493,862 Other long-term investments . . . . . . . . 4,325 4,044 Short-term investments. . . . . . . . . . . 136,262 191,455 ---------- ---------- Total Investments. . . . . . . . . . . . 3,295,898 3,419,110 Cash. . . . . . . . . . . . . . . . . . . . 33,724 27,780 Accrued investment income . . . . . . . . . 56,253 59,382 Premiums due and deferred . . . . . . . . . 17,273 16,821 Receivable from affiliates. . . . . . . . . 7,642 7,517 Federal income taxes-from affiliate . . . . - 23,306 Other assets. . . . . . . . . . . . . . . . 20,601 25,102 Assets held in Separate Accounts. . . . . . 3,696,022 3,511,784 ---------- ---------- TOTAL ASSETS. . . . . . . . . . . . . . . . . $7,127,413 $7,090,802 ---------- ---------- ---------- ---------- LIABILITIES AND STOCKHOLDER'S EQUITY LIABILITIES: Policy liabilities and insurance reserves: Future policy benefits and claims . . . . $2,593,049 $2,767,552 Other policy claims and benefits payable. 16,199 15,184 Interest Maintenance Reserve (IMR). . . . 19,822 21,802 Payable to affiliates . . . . . . . . . . . 31,484 30,257 Federal income taxes-to affiliate . . . . . 871 - Other liabilities . . . . . . . . . . . . . 118,642 131,695 Asset Valuation Reserve (AVR) . . . . . . . 28,773 23,690 Liabilities related to Separate Accounts . . 3,605,647 3,424,535 ---------- ---------- TOTAL LIABILITIES . . . . . . . . . . . . . . 6,414,487 6,414,715 ---------- ---------- STOCKHOLDER'S EQUITY: Common Stock, $10 par value; authorized, 1,000,000 shares, issued and outstanding, 250,000 shares . . . . . . . . . . . . . . 2,500 2,500 Paid-in capital . . . . . . . . . . . . . . . 439,582 439,582 Unassigned surplus . . . . . . . . . . . . . 270,844 234,005 ---------- ---------- TOTAL STOCKHOLDER'S EQUITY. . . . . . . . . . . 712,926 676,087 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY. . . $7,127,413 $7,090,802 ---------- ---------- ---------- ----------
SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3 CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Periods Ended March 31, ------------------------------- 1995 1994 ---------- ----------- ($000's) REVENUE Premiums and annuity considerations . . . $ 139,974 $ 152,975 Net investment income . . . . . . . . . . 63,604 59,522 Net realized investment(losses) . . . . . (1,210) (909) Other income. . . . . . . . . . . . . . . 3,660 2,236 ---------- ----------- TOTAL REVENUE . . . . . . . . . . . . . . 206,028 213,824 ---------- ----------- BENEFITS AND EXPENSES Current and future benefits and claims . 116,324 133,715 Commission expenses. . . . . . . . . . . 6,206 7,414 General, administrative and other expenses . . . . . . . . . . . . . . . 27,547 23,447 ---------- ----------- TOTAL BENEFITS AND EXPENSES . . . . . . . 150,077 164,576 ---------- ----------- Income before provision in lieu of federal income tax . . . . . . . . . . 55,951 49,248 Provision in lieu of federal income tax . . . . . . . . . . . . . . (20,470) (17,999) ---------- ----------- NET INCOME . . . . . . . . . . . . . . . $ 35,481 $ 31,249 ---------- ----------- ---------- -----------
SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 4 CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE INSURANCE COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Three Months Ended March 31, ------------------------------- 1995 1994 ---------- ---------- ($000's) CASH FLOW FROM OPERATING ACTIVITIES Net income. . . . . . . . . . . . . . . $ 35,481 $ 31,249 Adjustments to reconcile net income to net cash from operations:. . . . . (170,423) (9,307) ---------- ---------- CASH FLOW FROM OPERATING ACTIVITIES . . . (134,942) 21,942 ---------- ---------- CASH FLOW FROM INVESTING ACTIVITIES Proceeds from the sale/maturity of: Fixed maturities. . . . . . . . . . . 540,378 639,456 Equity securities . . . . . . . . . . 215 - Mortgage loans. . . . . . . . . . . . 6,461 92 Other long-term investments . . . . . 55 70 Net proceeds of short-term investments . . . . . . . . . . . . 55,251 - Investment in real estate . . . . . . 2,925 - Payments for the purchase of: Fixed maturities. . . . . . . . . . . (463,750) (596,510) Equity securities . . . . . . . . . . (313) - Other long-term investments . . . . . (336) (307) Net proceeds (payments) of short-term investments . . . . . . . . . . . . - (61,227) ---------- ---------- CASH FLOW FROM (USED FOR) INVESTING ACTIVITIES . . . . . . . . . . . . . . 140,886 (18,426) ---------- ---------- CASH FLOW FROM FINANCING ACTIVITIES Net increase (decrease) in Cash . . . . 5,944 3,516 Cash, beginning of year . . . . . . . . 27,780 671 ---------- ---------- CASH, END OF PERIOD . . . . . . . . . . . $ 33,724 $ 4,187 ---------- ---------- ---------- ---------- SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Cash received in lieu of income taxes.. $ - $ 3,030 ---------- ---------- ---------- ----------
SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 5 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS OF PRUCO LIFE INSURANCE COMPANY AND SUBSIDIARIES FOR THE PERIODS ENDED MARCH 31, 1995 AND 1994 (UNAUDITED) 1. GENERAL The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles (GAAP), which are considered statutory accounting practices for a wholly owned stock subsidiary of a mutual life insurance company. The Financial Accounting Standards Board (the "FASB") issued Financial Interpretation No. 40, "Applicability of Generally Accepted Accounting Principles to Mutual Life Insurance and Other Enterprises", which, as amended is effective for fiscal years beginning after December 15, 1995. Interpretation No. 40 changes the current practice of the Company with respect to utilizing statutory basis financial statements for general purposes in that it would not allow such financial statements to be referred to as having been prepared in accordance with GAAP pronouncements, unless specifically exempted. Implementation of the Interpretation will require significant effort and judgment as to determining GAAP for insurance operations. The Company is currently unable to determine the impact of Interpretation No. 40 on its financial statements. Certain financial information which is normally included in financial statements, prepared in accordance with generally accepted accounting principles, but which is not required for interim reporting purposes, has been omitted. The financial statements for the three months ended March 31, 1995 and 1994 include all adjustments (consisting of only normal recurring accruals) which, in the opinion of management, are necessary for a fair presentation of results for that interim period. The results for the three months ended March 31, 1995 and 1994, are not necessarily indicative of the results for a full year. These statements should be read in conjunction with the consolidated financial statements and notes thereto included on Form 10-K for the fiscal year ended December 31, 1994. 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Pruco Life Insurance Company consists of Pruco Life Insurance Company (Pruco Life), Pruco Life Insurance Company of New Jersey and The Prudential Life Insurance Company of Arizona (collectively, the Company). Pruco Life is a wholly owned subsidiary of The Prudential Insurance Company of America (The Prudential), a mutual life insurance company. The Company markets individual life insurance and single pay deferred annuities primarily through The Prudential's sales force. The Company held over $7 billion in assets at March 31, 1995, $3.7 billion of which were held in Separate Accounts under variable life insurance policies and variable annuity contracts. The remaining assets were held in the general account for investment primarily in bonds, short-term investments and mortgage loans. 1. RESULTS OF OPERATIONS (FOR THE THREE MONTHS ENDED MARCH 31, 1995, COMPARED WITH THE THREE MONTHS ENDED MARCH 31, 1994) Net income for the three month period ended March 31, 1995 was $35 million. This represents a $4 million increase over the same period in 1994. Premiums and annuity considerations decreased from $153 million for the three month period ended March 31, 1994 to $140 million for the same period in 1995. This decrease is primarily due to the decline in first year premiums for certain life insurance contracts. Net investment income increased from $60 million for the three month period ended March 31, 1994 to $64 million for the same period ending March 31, 1995. This growth was due primarily to the increase in income generated by mortgage and policy loans. The lower invested asset base compared to the same period in 1994 was offset by a higher rate of return for the portfolio. Current and future benefits and claims decreased $17 million for the three month period ended March 31, 1995, from the same period in 1994. This was primarily driven by the change in reserves which decreased from $(129) million for the three month period ended March 31, 1994 to $(184) million for the three month period ended March 31, 1995. The lower change in reserves resulted from less new business, and higher benefit and withdrawal activity. Withdrawals totaled $233 million for the three month period ended March 31, 1994 and $267 million for the three month period ended March 31, 1995. A portion of the withdrawal activity, which is inversely related to reserve levels, is due to contractholders exercising a provision included in the contract which allows withdrawal of funds if the Company's renewal crediting rate is more than 1% below the initial crediting rate (renewal crediting rates are established at January 1 each year). Total expenses for the three month period ended March 31, 1995 increased by $3 million from the same period in 1994. General, administrative, and other expenses for the period ended March 31, 1995, increased $4 million when compared to the same period in 1994, due to the increase in costs being allocated by The Prudential. Offsetting this increase was an decrease in commission expense of $1.2 million from the same period in 1994, which is consistent with the decrease in first year premiums. Provision in lieu of federal income taxes increased $2 million from the same period in 1994. This increase is proportional to the increase in income before taxes. 7 2. INVESTMENTS MORTGAGE LOANS. The balance of mortgage loans at March 31, 1995, was $65 million, a $6.4 million decrease from the end of 1994. Mortgage loans are carried at the lower of unpaid principal balance or fair value of the underlying property. Currently, the Company has two loans with restructured terms in the amount of $7.1 million. REAL ESTATE. As of March 31, 1995, the Company's investment in real estate was $4 million. Real estate is carried at the lower of cost or fair value less encumberances. Pruco Life sold one property during the first quarter of 1995 for $3.1 million, accounting for the decrease in this asset category since the beginning of the year. 8 PART II ITEM 1. LEGAL PROCEEDINGS Pruco Life is not involved in any litigation that is expected to have a material effect. ITEM 2. CHANGES IN SECURITIES Not applicable. ITEM 3. DEFAULTS UPON SENIOR SECURITIES Not applicable. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS No actions were taken during the first quarter of 1995. ITEM 5. OTHER INFORMATION Not applicable. ITEM 6. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (a) (1) and (2) Financial Statements of registrant and subsidiaries are listed on pages 3-6 hereof and are filed as part of this Report. (a)(3) EXHIBITS REGULATION S-K 2. Not applicable. 4. Exhibits Modified Guaranteed Annuity Contract, incorporated by reference to Registrant's Form S-1 Registration Statement, Registration No. 33-37587, filed November 2, 1990. 11. Not applicable. 9 15. Not applicable. 18. None. 19. Not applicable. 20. Not applicable. 23. None. 24. Not applicable. 25. Not applicable. 28. None. (b) Reports on 8-K No reports on Form 8-K were filed during the first quarter of 1995. 10 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. . . . . . . . . . . . PRUCO LIFE INSURANCE COMPANY (Registrant) Signature Title Date - ---------- ------- ------ /s/ Esther H. Milnes President and Director May 15, 1995 - ----------------------- Esther H. Milnes /s/ Stephen P. Tooley Vice President and Comptroller May 15, 1995 - ----------------------- Stephen P. Tooley 11 EX-27 2 EXHIBIT 27
7 3-MOS DEC-31-1995 MAR-31-1995 0 2,571,814 2,596,116 6,049 65,488 4,130 3,295,898 33,724 137 0 7,127,413 0 0 16,199 2,904 0 2,500 0 0 710,426 7,127,413 139,974 63,604 (1,210) 3,660 116,324 6,206 27,547 55,951 20,470 35,481 0 0 0 35,481 0 0 0 0 0 0 0 0 0
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