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Prudential Financial profit beats estimates on life, annuity strength – Metro US

Prudential Financial profit beats estimates on life, annuity strength

The logo of PGIM is seen at the entrance of
The logo of PGIM is seen at the entrance of the compan’s office in Tokyo

(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)

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