AM Best Affirms Credit Ratings of Prudential Financial, Inc. and Its Life/Health Subsidiaries

Key Terms

financial strength rating financial

A financial strength rating is an assessment of an organization's overall financial health, indicating how well it can meet its financial commitments. Think of it as a report card that shows whether a company or institution is financially stable and capable of withstanding economic challenges. This rating helps investors gauge the level of risk involved in engaging with or investing in that organization.

long-term issuer credit ratings financial

Long-term issuer credit ratings are assessments of a borrower's ability to repay debt over a period longer than one year. They help investors understand the level of risk involved in lending to that entity, similar to how a credit score indicates trustworthiness. These ratings influence borrowing costs and investment decisions, guiding investors on the safety and stability of their investments.

best’s capital adequacy ratio financial

A.M. Best’s Capital Adequacy Ratio (BCAR) is a proprietary measure that compares an insurance company’s available financial cushion with the risks on its books, like checking how much emergency savings a household has relative to its monthly bills. Investors watch it because a higher ratio indicates the insurer is better positioned to absorb unexpected losses, which supports stronger credit assessments and lowers the chance of capital shortfalls affecting returns.

commercial paper program financial

A commercial paper program is a formal way a company issues very short-term IOUs to raise quick cash, typically for days to months, without using a bank loan. Investors care because it shows how the company manages short-term funding and how trustworthy it appears—like watching whether someone keeps using and repaying a credit card; frequent use or higher costs can signal cash strain, while smooth issuance suggests healthy liquidity.

senior unsecured notes financial

Senior unsecured notes are a type of loan a company borrows from investors, promising to pay back with interest. They are called "unsecured" because they aren’t backed by specific assets like buildings or equipment, but "senior" because they are paid back before other debts if the company gets into trouble. Investors see them as a relatively safer way for companies to raise money.

junior subordinated notes financial

Junior subordinated notes are a type of bond: a loan investors make to a company that ranks low in the repayment order if the company runs into trouble. Because they are paid after other creditors, they usually offer higher interest to compensate for greater risk; think of them as being near the back of the line at a crowded payout window. Investors care because these notes affect potential returns and downside exposure, and they influence a company’s overall borrowing risk and credit profile.

funding agreement backed commercial paper financial

A funding agreement backed commercial paper is a short-term IOU sold by a company to raise cash, with a separate promise from a bank or insurer to cover repayments if the seller cannot. Think of it like a short-term loan with a standby check from a trusted third party: investors get quicker access to money markets with reduced risk because a financially strong backer guarantees payment. That guarantee matters to investors because it lowers default risk and affects the paper’s safety, yield and liquidity in the market.

enterprise risk management financial

Enterprise Risk Management is a process companies use to identify, assess, and prepare for potential problems that could disrupt their success, like financial losses or reputation damage. It’s like a safety plan that helps a business stay strong and adapt quickly when unexpected challenges come up. This helps the company protect its future and keep running smoothly.

OLDWICK, N.J.--(BUSINESS WIRE)-- AM Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” (Superior) of the life/health insurance subsidiaries of Prudential Financial, Inc. (PFI) (Newark, NJ) [NYSE: PRU], collectively referred to as Prudential. Concurrently, AM Best has affirmed the Long-Term ICR of “a-” (Excellent) of PFI and all Long- and Short-Term Issue Credit Ratings (Long-Term IR; Short-Term IR) of the group. The outlook of these Credit Ratings (ratings) is stable. (Please see below for a detailed listing of the companies and ratings.)

The ratings reflect Prudential’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, very favorable business profile and very strong enterprise risk management.

Prudential’s very strong balance sheet assessment is supported by its very strong Best’s Capital Adequacy Ratio (BCAR) assessment, which is reflective of the group’s efforts balance sheet over the past few years. The group’s investments supporting its insurance liabilities are of the highest quality with moderate exposure to below investment grade bonds, mortgage loans and structured securities. The insurance entities leverage the expertise of PFI’s global asset manager, PGIM. Furthermore, Prudential’s access to capital markets and additional financial flexibility through PFI adds to its balance sheet strength. The organization exhibits strong liquidity measures and more-than-adequate cash and short-term security holdings as of PFI’s last reported quarter ending Sept. 30, 2025. One of Prudential’s offsetting balance sheet strength attributes is the reliance on internal captives. Internal reinsurance allows the group to manage its capital more efficiently and more effectively on an economic basis and enables an aggregation and transfer of risk; however, AM Best notes that this partially reduces the overall quality of the group’s capital.

Prudential offers a very wide range of products in the life/annuity product space that is complemented by the asset management services offered by PGIM. AM Best recognizes its leading market positions in the pension risk transfer business, institutional stable value, indexed universal life and variable universal life protection and accumulation products. Strong sales have supported the group’s operating performance, which is driven by its diversified business lines of both insurance from its individual and group segments and non-insurance asset management services. Furthermore, AM Best recognizes Prudential’s stable net investment income growth over the past five years.

The FSR of A+ (Superior) and the Long-Term ICRs of “aa-” (Superior) have been affirmed with stable outlooks for the following subsidiaries of Prudential Financial, Inc.:

• The Prudential Insurance Company of America
• Pruco Life Insurance Company
• Pruco Life Insurance Company of New Jersey

The following Long-Term IRs have been assigned with stable outlooks:

PRICOA Global Funding I— “aa-” (Superior) program rating

--“aa-” (Superior) on $500 million 4.35% medium term notes, due 2030
--“aa-” (Superior) on $500 million 4.65% medium term notes, due 2033

The following Short-Term IRs have been affirmed:

Prudential Financial, Inc.—

-- AMB-1 (Outstanding) on $3 billion commercial paper program

Prudential Funding, LLC—

-- AMB-1 (Outstanding) on $6 billion commercial paper program

PRICOA Short-Term Funding, LLC—

-- AMB-1 (Outstanding) on $3 billion Funding Agreement Backed Commercial Paper

The following Long-Term IRs have been affirmed with stable outlooks:

Prudential Financial, Inc.—

-- “a-” (Excellent) on JPY 23.0 billion 2.62% senior unsecured notes, due 2026
-- “a-” (Excellent) on JPY 17.5 billion 2.76% senior unsecured notes, due 2026
-- “a-” (Excellent) on JPY 9 billion 3.099% senior unsecured notes, due 2027
-- “a-” (Excellent) on $500 million 5.75% senior unsecured notes, due 2033
-- “a-” (Excellent) on $350 million 6.625% senior unsecured notes, due 2040
-- “a-” (Excellent) on $325 million 5.80% senior unsecured notes, due 2041
-- “a-” (Excellent) on $895.8 million 3.905% senior unsecured notes, due 2047
-- “a-” (Excellent) on $1.039 billion 3.935% senior unsecured notes, due 2049
-- “bbb” (Good) on $750 million 4.5% fixed to floating junior subordinated notes, due 2047
-- “bbb” (Good) on $1.0 billion 5.70% junior subordinated notes, due 2048
-- “bbb” (Good) on $800 million 3.70% junior subordinated notes, due 2050
-- “bbb” (Good) on $1.0 billion 5.125% junior subordinated notes, due 2052
-- “bbb” (Good) on $1.2 billion 6.0% junior subordinated notes, due 2052
-- “bbb” (Good) on $500 million 6.75% junior subordinated notes, due 2053
-- “bbb” (Good) on $1.0 billion 6.5% junior subordinated notes, due 2054
-- “bbb” (Good) on $500 million 5.625% junior subordinated notes, due 2058
-- “bbb” (Good) on $500 million 4.125% junior subordinated notes, due 2060
-- “bbb” (Good) on $300 million 5.95% junior subordinated notes, due 2062

Prudential Financial, Inc.— “a-” (Excellent) program rating

-- “a-” (Excellent) on all outstanding notes issued under the program

PRICOA Global Funding I— “aa-” (Superior) program rating

-- “aa-” (Superior) on all outstanding notes issued under the program

Prudential Funding, LLC— “a+” (Excellent) program rating

The following indicative Long-Term IRs have been affirmed with stable outlooks:

Prudential Financial, Inc.—

-- “a-” (Excellent) on senior unsecured debt
-- “bbb+” (Good) on subordinated debt
-- “bbb” (Good) on preferred stock

Prudential Financial Capital Trust II and III—

-- “bbb” (Good) on preferred securities

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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Wayne Kaminski, FLMI, ARA, MBA

Associate Director

+1 908 882 1916

wayne.kaminski@ambest.com



Kate Steffanelli

Associate Director

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Source: AM Best