(Reuters) – Prudential Financial Inc beat Wall Street estimates for quarterly adjusted profit on Tuesday, as a strong performance at the U.S. insurer’s life and annuity units offset weakness in its investment business.
PGIM, Prudential’s asset management arm, reported a nearly 12% fall in adjusted operating income to $327 million, the company said, while assets under management rose to $1.73 trillion from $1.65 trillion a year earlier.
The company’s U.S. individual life insurance segment posted an adjusted operating profit of $210 million, compared with $101 million a year earlier, helped by higher net investment spread results.
Adjusted operating income at its annuity segment jumped more than 22% to $499 million. An annuity is a long-term insurance contract which allows consumers to generate a steady income during retirement.
Global life insurers are taking steps to curb payouts stemming from the COVID-19 pandemic and have been helped by a rebound in investment income as well as a fall in dental and other non-medical health claims.
Prudential’s U.S. group insurance business swung to a loss in the quarter, partly reflecting less favorable underwriting results in the group life and disability lines, driven by the pandemic.
Total after-tax adjusted operating income rose to $1.49 billion, or $3.78 per share, in the third quarter ended Sept. 30, from $1.24 billion, or $3.08 per share, a year earlier.
Analysts had expected a profit of $2.74 per share, according to IBES data from Refinitiv.
(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Devika Syamnath)