Prudential Financial earnings beats estimates on annuity life and strength


The PGIM logo can be seen at the entrance to the company’s office in Tokyo, Japan on April 5, 2017. Photo taken on April 5, 2017. REUTERS / Issei Kato

Nov. 2 (Reuters) – Prudential Financial Inc (PRU.N) beat Wall Street estimates for quarterly adjusted earnings on Tuesday as strong performance in the US insurer’s life insurance and annuity units offset the weakness of its investment activities.

PGIM, the asset management arm of Prudential, announced an almost 12% drop in adjusted operating income to $ 327 million, the company said, while assets under management reached 1.73 trillion dollars versus $ 1.65 trillion a year earlier.

The company’s U.S. individual life insurance segment posted adjusted operating income of $ 210 million, up from $ 101 million a year earlier, helped by net investment gap results higher.

Adjusted operating income for its annuities segment jumped more than 22% to $ 499 million. An annuity is a long-term insurance contract that allows consumers to generate a stable income during retirement.

Global life insurers are taking action to reduce payments stemming from the COVID-19 pandemic and have been helped by a rebound in investment income as well as a drop in dental and other non-medical health claims.

Prudential’s group insurance business in the United States recorded a loss during the quarter, partly reflecting less favorable underwriting results in the group life and disability lines of business, due to the pandemic.

After-tax adjusted total operating income reached $ 1.49 billion, or $ 3.78 per share, in the third quarter ended September 30, from $ 1.24 billion, or $ 3.08 per share, one year earlier.

Analysts had expected earnings of $ 2.74 per share, according to IBES data from Refinitiv.

Report by Noor Zainab Hussain in Bengaluru; Editing by Devika Syamnath

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