AS FILED WITH THE SEC ON MARCH 7, 2007
REGISTRATION NO. 333-103474
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
POST-EFFECTIVE AMENDMENT NO. 8
PRUCO LIFE INSURANCE COMPANY
(Exact Name of Registrant)
ARIZONA
(State or other jurisdiction of incorporation or organization)
22-194455
(I.R.S. Employer Identification Number)
C/O PRUCO LIFE INSURANCE COMPANY
213 WASHINGTON STREET
NEWARK, NEW JERSEY 07102-2992
(973) 802-7333
(Address and telephone number of principal executive offices)
THOMAS C. CASTANO
SECRETARY
PRUCO LIFE INSURANCE COMPANY
213 WASHINGTON STREET
NEWARK, NEW JERSEY 07102-2992
(973) 802-4708
(Name, address, and telephone number of agent for service)
Copies to:
C. CHRISTOPHER SPRAGUE
VICE PRESIDENT, CORPORATE COUNSELPRUCO LIFE INSURANCE COMPANY
213 WASHINGTON STREET
NEWARK, NEW JERSEY 07102-2992
(973) 802-6997
Approximate date of commencement of proposed sale to the public--
Immediately upon effectiveness
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box: [ ]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering [ ]
If this Form is a registration statement pursuant to General Instruction I.D. or
a post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box [ ]
If this Form is a post-effective amendment to a registration statement filed
pursuant to General Instruction I.D. filed to register additional securities or
additional classes of securities pursuant to Rule 413(b) under the Securities
Act, check the following box [ ]
CALCULATION OF REGISTRATION FEE
TITLE OF EACH AMOUNT PROPOSED PROPOSED AMOUNT OF
CLASS OF SECURITIES TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED* PRICE PER UNIT* OFFERING PRICE FEE**
------------------------- ------------ ---------------- ------------------ -------------
Market-value adjustment
annuity contracts
(or modified guaranteed
annuity contracts) $200,000,000 $200,000,000 $-0-
* Securities are not issued in predetermined units.
** Registration fee for these securities was paid at the time they were
originally registered on Form S-3 as filed by Pruco Life Insurance Company on
February 27, 2003.
Prudential Investment Management Services LLC, the principal underwriter of
these contracts under a "best efforts" arrangement, will be reimbursed by Pruco
Life Insurance Company for its costs and expenses incurred in connection with
the sale of these contracts.
Note:
Registrant is filing this Post-Effective Amendment No. 8 to the Registration
Statement for the purpose of including in the Registration Statement two
Prospectus supplements. The Prospectus and Part II that was filed as part of
Post-Effective Amendment No. 6 with the SEC on April 21, 2006 as supplemented,
are hereby incorporated by reference. Other than as set forth herein, this
post-effective amendment to the registration statement does not amend or delete
any other part of the registration statement.
Pruco Life Insurance Company
Strategic Partners Annuity One 3
Strategic Partners Plus 3
Strategic Partners FlexElite (version of contract sold on or after May 1,
2003)
Supplement, dated March 19, 2007
To
Prospectuses, dated May 1, 2006
In this supplement, we reflect certain enhancements to the Highest Daily
Lifetime Five Benefit. In general, these enhancements result in an increased
amount that serves as the basis for your lifetime withdrawals, provided that the
conditions described below under "KEY FEATURE - Total Protected Withdrawal
Value" are met. We detail below how these enhancements affect each aspect of the
benefit. The supplement also describes a new return of principal guarantee.
Apart from the changes to Highest Daily Lifetime Five that we set forth below,
the prospectus changes set forth in the November 20, 2006 supplement to each
prospectus remain in effect. Moreover, these enhancements, which apply to both
existing elections of Highest Daily Lifetime Five and to new elections of the
benefit, will become effective only upon appropriate regulatory approval.
This Supplement should be read and retained with the current Prospectus for your
annuity contract. This Supplement is intended to update certain information in
the Prospectus for the variable annuity you own, and is not intended to be a
prospectus or offer for any other variable annuity listed here that you do not
own. If you would like another copy of the current Prospectus, please contact us
at (888) PRU-2888.
A. We revise the Glossary section as follows:
o We revise the first sentence of the definition of "Annual Income
Amount" to state: "Under the terms of the Lifetime Five Income Benefit,
an amount that you can withdraw each year as long as the annuitant
lives. For the Highest Daily Lifetime Five Benefit only, we refer to an
amount that you can withdraw each year as long as the annuitant lives
as the "Total Annual Income Amount."
o We revise the first sentence of the definition of "Excess Income/Excess
Withdrawal" to state: "Under the Lifetime Five Income Benefit, Spousal
Lifetime Five Income Benefit, and Highest Daily Lifetime Five Benefit,
Excess Income refers to cumulative withdrawals that exceed the Annual
Income Amount (the Total Annual Income Amount, for Highest Daily
Lifetime Five only)."
o We revise the definition of "Protected Withdrawal Value" to read as
follows: "Under the Lifetime Five Income Benefit and Spousal Lifetime
Five Income Benefit, an amount that we guarantee regardless of the
investment performance of your Contract Value. For the Highest Daily
Lifetime Five Benefit only, we refer to an amount that we guarantee
regardless of the investment performance of your Contract Value as the
"Total Protected Withdrawal Value".
We add the following new definitions:
ENHANCED PROTECTED WITHDRAWAL VALUE
Under the Highest Daily Lifetime Five Benefit only, an additional value (as
described below under "KEY FEATURE - Total Protected Withdrawal Value") that is
considered when we determine your Total Protected Withdrawal Value, provided
that you have not made any withdrawal during the first ten years that your
Highest Daily Lifetime Five Benefit has been in effect and you otherwise meet
the conditions set forth in the rider and this prospectus.
TOTAL ANNUAL INCOME AMOUNT
Under the Highest Daily Lifetime Five Benefit only, an amount that you can
withdraw each year as long as the annuitant lives, and which is equal to a
percentage of the Total Protected Withdrawal Value.
TOTAL PROTECTED WITHDRAWAL VALUE
Under the Highest Daily Lifetime Five Benefit only, an amount that we guarantee
regardless of the investment performance of your Contract Value, which is equal
to the greater of the existing Protected Withdrawal Value and any Enhanced
Protected Withdrawal Value.
B. The following replaces the description of the Highest Daily Lifetime
Five Income Benefit under Section 5 entitled "WHAT IS THE LIFETIME FIVE
INCOME BENEFIT?"(except that, the asset transfer formula set forth in the
November 20, 2006 supplement remains intact)
HIGHEST DAILY LIFETIME FIVE INCOME BENEFIT
(HIGHEST DAILY LIFETIME FIVE)
The Highest Daily Lifetime Five program described below is only being offered in
those jurisdictions where we have received regulatory approval and will be
offered subsequently in other jurisdictions when we receive regulatory approval
in those jurisdictions. Certain terms and conditions may differ between
jurisdictions once approved. Highest Daily Lifetime Five is offered as an
alternative to Lifetime Five and Spousal Lifetime Five. Currently, if you elect
Highest Daily Lifetime Five and subsequently terminate the benefit, you will not
be able to re-elect Highest Daily Lifetime Five, and will have a waiting period
until you can elect Spousal Lifetime Five or Lifetime Five. Specifically, you
will be permitted to elect Lifetime Five or Spousal Lifetime Five only on an
anniversary of the contract date that is at least 90 calendar days from the date
that Highest Daily Lifetime Five was terminated. We reserve the right to further
limit the election frequency in the future. The income benefit under Highest
Daily Lifetime Five currently is based on a single "designated life" who is at
least 55 years old on the date that the benefit is acquired. The Highest Daily
Lifetime Five Benefit is not available if you elect any other optional living
benefit, although you may elect any optional death benefit (other than the
Highest Daily Value Death Benefit). As long as your Highest Daily Lifetime Five
Benefit is in effect, you must allocate your Contract Value in accordance with
the then-permitted and available investment option(s) with this program.
We offer a benefit that guarantees until the death of the single designated life
the ability to withdraw an annual amount (the "Total Annual Income Amount")
equal to a percentage of an initial principal value (the "Total Protected
Withdrawal Value") regardless of the impact of market performance on the
Contract Value, subject to our program rules regarding the timing and amount of
withdrawals. The benefit may be appropriate if you intend to make periodic
withdrawals from your Contract, and wish to ensure that market performance will
not affect your ability to receive annual payments. You are not required to make
withdrawals as part of the program -- the guarantees are not lost if you
withdraw less than the maximum allowable amount each year under the rules of the
benefit. We discuss Highest Daily Lifetime Five in greater detail immediately
below. In addition, please see the Glossary section of this prospectus for
definitions of some of the key terms used with this benefit. As discussed below,
we require that you participate in our asset transfer program in order to
participate in Highest Daily Lifetime Five, and in the Appendices to this
prospectus, we set forth the formula under which we make those asset transfers.
As discussed below, a key component of Highest Daily Lifetime Five is the Total
Protected Withdrawal Value, which is an amount that is distinct from Contract
Value. Because each of the Total Protected Withdrawal Value and Total Annual
Income Amount is determined in a way that is not solely related to Contract
Value, it is possible for the Contract Value to fall to zero, even though the
Total Annual Income Amount remains. You are guaranteed to be able to withdraw
the Total Annual Income Amount for the rest of your life, provided that you have
not made "excess withdrawals." Excess withdrawals, as discussed below, will
reduce your Total Annual Income Amount. Thus, you could experience a scenario in
which your Contract Value was zero, and, due to your excess withdrawals, your
Total Annual Income Amount also was reduced to zero. In that scenario, no
further amount would be payable under Highest Daily Lifetime Five.
KEY FEATURE -- Total Protected Withdrawal Value
The Total Protected Withdrawal Value is used to determine the amount of the
annual payments under Highest Daily Lifetime Five. The Total Protected
Withdrawal Value is equal to the greater of the Protected Withdrawal Value and
any Enhanced Protected Withdrawal Value that may exist. We describe how we
determine Enhanced Protected Withdrawal Value, and when we begin to calculate
it, below. If the conditions described below for obtaining Enhanced Protected
Withdrawal Value are not met, then Total Protected Withdrawal Value is simply
equal to Protected Withdrawal Value.
The Protected Withdrawal Value initially is equal to the Contract Value on the
date that you elect Highest Daily Lifetime Five. On each business day
thereafter, until the earlier of the first withdrawal or ten years after the
date of your election of the benefit, we recalculate the Protected Withdrawal
Value. Specifically, on each such business day (the "Current Business Day"), the
Protected Withdrawal Value is equal to the greater of:
o the Protected Withdrawal Value for the immediately preceding
business day (the "Prior Business Day "), appreciated at the
daily equivalent of 5% annually during the calendar day(s)
between the Prior Business Day and the Current Business Day
(i.e., one day for successive business days , but more than one
calendar day for business days that are separated by weekends
and/or holidays), plus the amount of any Purchase Payment
(including any associated credit) made on the Current Business
Day; and
o the Contract Value.
If you have not made a withdrawal prior to the tenth anniversary of the date you
elected Highest Daily Lifetime Five (which we refer to as the "Tenth
Anniversary"), we will continue to calculate a Protected Withdrawal Value. On or
after the Tenth Anniversary and up until the date of the first withdrawal, your
Protected Withdrawal Value is equal to the greater of the Protected Withdrawal
Value on the Tenth Anniversary or your Contract Value.
The Enhanced Protected Withdrawal Value is only calculated if you do not take a
withdrawal prior to the Tenth Anniversary. If so, then on or after the Tenth
Anniversary up until the date of the first withdrawal, the Enhanced Protected
Withdrawal Value is equal to the sum of:
(a) 200% of the Contract Value on the date you elected Highest Daily
Lifetime Five;
(b) 200% of all Purchase Payments (and any associated Credits) made
during the one-year period after the date you elected Highest Daily
Lifetime Five; and (c) 100% of all Purchase Payments (and any
associated Credits) made more than one year after the date you
elected Highest Daily Lifetime Five, but prior to the date of your
first withdrawal.
We cease these daily calculations of the Protected Withdrawal Value and Enhanced
Protected Withdrawal Value (and therefore, the Total Protected Withdrawal Value)
when you make your first withdrawal. However, as discussed below, subsequent
Purchase Payments (and any associated Credits) will increase the Total Annual
Income Amount, while "excess" withdrawals (as described below) may decrease the
Total Annual Income Amount.
KEY FEATURE -- Total Annual Income Amount under the Highest Daily Lifetime
Five Benefit
The initial Total Annual Income Amount is equal to 5% of the Total Protected
Withdrawal Value. For purposes of the asset transfer formula described below, we
also calculate a Highest Daily Annual Income Amount, which is initially equal to
5% of the Protected Withdrawal Value. Under the Highest Daily Lifetime Five
Benefit, if your cumulative withdrawals in a Contract Year are less than or
equal to the Total Annual Income Amount, they will not reduce your Total Annual
Income Amount in subsequent Contract Years, but any such withdrawals will reduce
the Total Annual Income Amount on a dollar-for-dollar basis in that Contract
Year. If your cumulative withdrawals are in excess of the Total Annual Income
Amount ("Excess Income"), your Total Annual Income Amount in subsequent years
will be reduced (except with regard to required minimum distributions) by the
result of the ratio of the Excess Income to the Contract Value immediately prior
to such withdrawal (see examples of this calculation below). If you withdraw
Excess Income, your Highest Daily Annual Income Amount also will be reduced by
the same ratio. Reductions include the actual amount of the withdrawal,
including any CDSC that may apply. A Purchase Payment that you make will
increase the then-existing Total Annual Income Amount and Highest Daily Annual
Income Amount by an amount equal to 5% of the Purchase Payment (including the
amount of any associated Credits).
An automatic step-up feature ("Highest Quarterly Auto Step-Up") is included as
part of this benefit. As detailed in this paragraph, the Highest Quarterly Auto
Step-Up feature can result in a larger Total Annual Income Amount if your
Contract Value increases subsequent to your first withdrawal. We begin examining
the Contract Value for purposes of this feature starting with the anniversary of
the Contract Date (the "Contract Anniversary") immediately after your first
withdrawal under the benefit. Specifically, upon the first such Contract
Anniversary, we identify the Contract Value on the business days corresponding
to the end of each quarter that (i) is based on your Contract Year, rather than
a calendar year; (ii) is subsequent to the first withdrawal; and (iii) falls
within the immediately preceding Contract Year. If the end of any such quarter
falls on a holiday or a weekend, we use the next business day. We multiply each
of those quarterly Contract Values by 5%, adjust each such quarterly value for
subsequent withdrawals and Purchase Payments, and then select the highest of
those values. If the highest of those values exceeds the existing Total Annual
Income Amount, we replace the existing amount with the new, higher amount.
Otherwise, we leave the existing Total Annual Income Amount intact. In later
years, (i.e., after the first Contract Anniversary after the first withdrawal)
we determine whether an automatic step-up should occur on each Contract
Anniversary, by performing a similar examination of the Contract Values on the
end of the four immediately preceding quarters. If, on the date that we
implement a Highest Quarterly Auto Step-Up to your Total Annual Income Amount,
the charge for Highest Daily Lifetime Five has changed for new purchasers, you
may be subject to the new charge at the time of such step-up. Prior to
increasing your charge for Highest Daily Lifetime Five upon a step-up, we would
notify you, and give you the opportunity to cancel the automatic step-up
feature. If you receive notice of a proposed step-up and accompanying fee
increase, you should carefully evaluate whether the amount of the step-up
justifies the increased fee to which you will be subject.
The Highest Daily Lifetime Five program does not affect your ability to make
withdrawals under your contract, or limit your ability to request withdrawals
that exceed the Total Annual Income Amount. Under Highest Daily Lifetime Five,
if your cumulative withdrawals in a Contract Year are less than or equal to the
Total Annual Income Amount, they will not reduce your Total Annual Income Amount
in subsequent Contract Years, but any such withdrawals will reduce the Total
Annual Income Amount on a dollar-for-dollar basis in that Contract Year.
If, cumulatively, you withdraw an amount less than the Total Annual Income
Amount in any Contract Year, you cannot carry-over the unused portion of the
Total Annual Income Amount to subsequent Contract Years.
Examples of dollar-for-dollar and proportional reductions and the Highest
Quarterly Auto Step-Up are set forth below. The values depicted here are purely
hypothetical, and do not reflect the charges for the Highest Daily Lifetime Five
benefit or any other fees and charges. Assume the following for all three
examples:
|X| The Contract Date is December 1, 2006
|X| The Highest Daily Lifetime Five benefit is elected on March 5, 2007.
Dollar-for-dollar reductions
On May 2, 2007, the Total Protected Withdrawal Value is $120,000, resulting in a
Total Annual Income Amount of $6,000 (5% of $120,000). Assuming $2,500 is
withdrawn from the Contract on this date, the remaining Total Annual Income
Amount for that Contract Year (up to and including December 1, 2007) is $3,500.
This is the result of a dollar-for-dollar reduction of the Total Annual Income
Amount -- $6,000 less $2,500 = $3,500.
Proportional reductions
Continuing the previous example, assume an additional withdrawal of $5,000
occurs on August 6, 2007 and the Contract Value at the time of this withdrawal
is $110,000. The first $3,500 of this withdrawal reduces the Total Annual Income
Amount for that Contract Year to $0. The remaining withdrawal amount -- $1,500 -
reduces the Total Annual Income Amount in future Contract Years on a
proportional basis based on the ratio of the excess withdrawal to the Contract
Value immediately prior to the excess withdrawal. (Note that if there were other
withdrawals in that Contract Year, each would result in another proportional
reduction to the Total Annual Income Amount).
Here is the calculation:
Contract value before withdrawal $110,000.00
Less amount of "non" excess withdrawal -$3,500.00
Contract value immediately before excess withdrawal of $1,500 $106,500.00
Excess withdrawal amount $1,500.00
Divided by Contract Value immediately before excess withdrawal $106,500.00
Ratio 1.41%
Total Annual Income Amount $6,000.00
Less ratio of 1.41% -$84.51
Total Annual Income Amount for future Contract Years $5,915.49
Highest Quarterly Auto Step-Up
On each Contract Anniversary date, the Total Annual Income Amount is stepped-up
if 5% of the highest quarterly value since your first withdrawal (or last
Contract Anniversary in subsequent years), adjusted for excess withdrawals and
additional Purchase Payments, is higher than the Total Annual Income Amount,
adjusted for excess withdrawals and additional Purchase Payments.
Continuing the same example as above, the Total Annual Income Amount for this
Contract Year is $6,000. However, the excess withdrawal on August 6 reduces this
amount to $5,915.49 for future years (see above). For the next Contract Year,
the Total Annual Income Amount will be stepped-up if 5% of the highest quarterly
Contract Value, adjusted for withdrawals, is higher than $5,915.49. Here are the
calculations for determining the quarterly values. Only the June 1 value is
being adjusted for excess withdrawals as the September 1 and December 1
Valuation Days occur after the excess withdrawal on August 6.
Highest Quarterly
Value (adjusted with Adjusted Total Annual
withdrawal and Income Amount (5% of the
Date* Contract Value Purchase Payments)** Highest Quarterly Value)
June 1, 2007 $118,000.00 $118,000.00 $5,900.00
August 6, 2007 $120,000.00 $112,885.55 $5,644.28
September 1, 2007 $112,000.00 $112,885.55 $5,644.28
December 1, 2007 $119,000.00 $119,000.00 $5,950.00
*In this example, the Contract Anniversary date is December 1. The quarterly
valuation dates are every three months thereafter - March 1, June 1, September
1, and December 1. In this example, we do not use the March 1 date as the first
withdrawal took place after March 1. The Contract Anniversary Date of December 1
is considered the fourth and final quarterly valuation date for the year.
**In this example, the first quarterly value after the first withdrawal is
$118,000 on June 1, yielding an adjusted Total Annual Income Amount of
$5,900.00. This amount is adjusted on August 6 to reflect the $5,000 withdrawal.
The calculations for the adjustments are:
|X| The Contract Value of $118,000 on June 1 is first reduced
dollar-for-dollar by $3,500 ($3,500 is the remaining Total Annual
Income Amount for the Contract Year), resulting in an adjusted Contract
Value of $114,500 before the excess withdrawal.
|X| This amount ($114,500) is further reduced by 1.41% (this is the ratio
in the above example which is the excess withdrawal divided by the
Contract Value immediately preceding the excess withdrawal) resulting
in a Highest Quarterly Value of $112,885.55.
The adjusted Total Annual Income Amount is carried forward to the next quarterly
anniversary date of September 1. At this time, we compare this amount to 5% of
the Contract Value on September 1. Since the June 1 adjusted Total Annual Income
Amount of $5,644.28 is higher than $5,600.00 (5% of $112,000), we continue to
carry $5,644.28 forward to the next and final quarterly anniversary date of
December 1. The Contract Value on December 1 is $119,000 and 5% of this amount
is $5,950. Since this is higher than $5,644.28, the adjusted Total Annual Income
Amount is reset to $5,950.00.
In this example, 5% of the December 1 value yields the highest amount of $
5,950.00. Since this amount is higher than the current year's Total Annual
Income Amount of $5,915.49 adjusted for excess withdrawals, the Total Annual
Income Amount for the next Contract Year, starting on December 2, 2007 and
continuing through December 1, 2008, will be stepped-up to $5,950.00.
BENEFITS UNDER THE HIGHEST DAILY LIFETIME FIVE PROGRAM
o To the extent that your Contract Value was reduced to zero as a result of
cumulative withdrawals that are equal to or less than the Total Annual Income
Amount and amounts are still payable under Highest Daily Lifetime Five, we will
make an additional payment, if any, for that Contract Year equal to the
remaining Total Annual Income Amount for the Contract Year. Thus, in that
scenario, the remaining Total Annual Income Amount would be payable even though
your Contract Value was reduced to zero. In subsequent Contract Years we make
payments that equal the Total Annual Income Amount as described in this section.
We will make payments until the death of the single designated life. To the
extent that cumulative withdrawals in the current Contract Year that reduced
your Contract Value to zero are more than the Total Annual Income Amount, the
Highest Daily Lifetime Five benefit terminates, and no additional payments will
be made.
o If Annuity payments are to begin under the terms of your Contract, or if
you decide to begin receiving annuity payments and there is a Total Annual
Income Amount due in subsequent Contract Years, you can elect one of the
following two options:
(1) apply your Contract Value to any annuity option available; or (2)
request that, as of the date annuity payments are to begin, we make annuity
payments each year equal to the Total Annual Income Amount. We will make
payments until the death of the single designated life.
We must receive your request in a form acceptable to us at our office.
In the absence of an election when mandatory contract payments are to begin, we
will make annual contract payments in the form of a single life fixed contract
with ten payments certain, by applying the greater of the contract rates then
currently available or the contract rates guaranteed in your Contract. The
amount that will be applied to provide such annuity payments will be the greater
of:
(1) the present value of the future Total Annual Income Amount
payments. Such present value will be calculated using the greater of the single
life fixed contract rates then currently available or the single life fixed
contract rates guaranteed in your Contract; and
(2) the Contract Value.
o If no withdrawal was ever taken, we will calculate the Total Annual
Income Amount as if you made your first withdrawal on the date the
contract payments are to begin.
o Please note that payments that we make under this benefit after the
contract anniversary coinciding with or next following the annuitant's
95th birthday will be treated as annuity payments.
Other Important Considerations
o Withdrawals under the Highest Daily Lifetime Five benefit are subject
to all of the terms and conditions of the Contract, including any CDSC.
o Withdrawals made while the Highest Daily Lifetime Five Benefit is in
effect will be treated, for tax purposes, in the same way as any other
withdrawals under the Contract. The Highest Daily Lifetime Five Benefit
does not directly affect the Contract Value or surrender value, but any
withdrawal will decrease the Contract Value by the amount of the
withdrawal (plus any applicable CDSC). If you surrender your Contract
you will receive the current surrender value.
o You can make withdrawals from your Contract while your Contract Value
is greater than zero without purchasing the Highest Daily Lifetime Five
benefit. The Highest Daily Lifetime Five benefit provides a guarantee
that if your Contract Value declines due to market performance, you
will be able to receive your Total Annual Income Amount in the form of
periodic benefit payments.
o You must allocate your Contract Value in accordance with the then
available investment option(s) that we may permit in order to elect and
maintain the Highest Daily Lifetime Five benefit.
Election of and Designations under the Program
For Highest Daily Lifetime Five, there must be either a single Owner who is the
same as the Annuitant, or if the Contract is entity-owned, there must be a
single natural person Annuitant. In either case, the Annuitant must be at least
55 years old.
Any change of the Annuitant under the Contract will result in cancellation of
Highest Daily Lifetime Five. Similarly, any change of Owner will result in
cancellation of Highest Daily Lifetime Five, except if (a) the new Owner has the
same taxpayer identification number as the previous owner (b) both the new Owner
and previous Owner are entities or (c) the previous Owner is a natural person
and the new Owner is an entity.
Currently, if you terminate the Highest Daily Lifetime Five benefit, you will
(a) not be permitted to re-elect the benefit and (b) will be allowed to elect
the Spousal Lifetime Five Benefit or the Lifetime Five Income Benefit on any
anniversary of the Contract Date that is at least 90 calendar days from the date
the Highest Daily Lifetime Five Benefit was terminated. We reserve the right to
further limit the election frequency in the future. Before making any such
change to the election frequency, we will provide prior notice to Owners who
have an effective Highest Daily Lifetime Five benefit.
Termination of the Program
You may terminate the benefit at any time by notifying us. If you terminate the
benefit, any guarantee provided by the benefit will terminate as of the date the
termination is effective, and certain restrictions on re-election will apply as
described above. The benefit terminates: (i) upon your termination of the
benefit (ii) upon your surrender of the Contract (iii) upon your election to
begin receiving contract payments (iv) upon the death of the Annuitant (v) if
both the Contract Value and Total Annual Income Amount equal zero or (vi) if you
fail to meet our requirements for issuing the benefit.
Upon termination of Highest Daily Lifetime Five, we cease deducting the charge
for the benefit. With regard to your investment allocations, upon termination we
will: (i) leave intact amounts that are held in the variable investment options,
and (ii) transfer all amounts held in the Benefit Fixed Rate Account (as defined
below) to your variable investment options, based on your existing allocation
instructions or (in the absence of such existing instructions) pro rata (i.e. in
the same proportion as the current balances in your variable investment
options).
Return of Principal Guarantee
If you have not made a withdrawal before the Tenth Anniversary, we will increase
your Contract Value on that Tenth Anniversary (or the next business day, if that
anniversary is not a business day), if the requirements set forth in this
paragraph are met. On the Tenth Anniversary, we add:
(a) your Contract Value on the day that you elected Highest Daily Lifetime Five;
and
(b) the sum of each Purchase Payment you made (including any Credits) during the
one-year period after you elected the benefit.
If the sum of (a) and (b) is greater than your Contract Value on the Tenth
Anniversary, we increase your Contract Value to equal the sum of (a) and (b), by
contributing funds from our general account. If the sum of (a) and (b) is less
than or equal to your Contract Value on the Tenth Anniversary, we make no such
adjustment. The amount that we add to your Contract Value under this provision
will be allocated to each of your variable investment options and the Benefit
Fixed Rate Account (described below), in the same proportion that each such
investment option bears to your total Contract Value, immediately prior to the
application of the amount. Any such amount will not increase your Total
Protected Withdrawal Value, your death benefit, or the amount of any other
optional benefit that you may have selected. This potential addition to Contract
Value is available only if you have elected Highest Daily Lifetime Five and if
you meet the conditions set forth in this paragraph.
Asset Transfer Component of Highest Daily Lifetime Five
As indicated above, we limit the sub-accounts to which you may allocate Contract
Value if you elect Highest Daily Value Lifetime Five. For purposes of this
benefit, we refer to those permitted sub-accounts as the "Permitted
Sub-accounts". As a requirement of participating in Highest Daily Lifetime Five,
we require that you participate in our specialized asset transfer program, under
which we may transfer Contract Value between the Permitted Sub-accounts and a
fixed interest rate account that is part of our general account (the "Benefit
Fixed Rate Account"). We determine whether to make a transfer, and the amount of
any transfer, under a non-discretionary formula, discussed below. The Benefit
Fixed Rate Account is available only with this benefit, and thus you may not
allocate Purchase Payments to that Account.
Under the asset transfer component of Highest Daily Lifetime Five, we monitor
your Contract Value daily and, if necessary, systematically transfer amounts
between the Permitted Sub-accounts you have chosen and the Benefit Fixed Rate
Account. Any transfer would be made in accordance with a formula, which is set
forth in the schedule supplement to the endorsement for this benefit (and also
appears in the Appendices to this prospectus). Speaking generally, the formula,
which we apply each business day, operates as follows. The formula starts by
identifying your Protected Withdrawal Value for that day and then multiplies
that figure by 5%, to produce a projected (i.e., hypothetical) Highest Daily
Annual Income Amount. Then, using our actuarial tables, we produce an estimate
of the total amount we would target in our allocation model, based on the
projected Highest Daily Annual Income Amount each year for the rest of your
life. In the formula, we refer to that value as the "Target Value" or "L". If
you have already made a withdrawal, your projected Highest Daily Annual Income
Amount (and thus your Target Value) would take into account any automatic
step-up that was scheduled to occur according to the step-up formula described
above. Next, the formula subtracts from the Target Value the amount held within
the Benefit Fixed Rate Account on that day, and divides that difference by the
amount held within the Permitted Sub-accounts. That ratio, which essentially
isolates the amount of your Target Value that is not offset by amounts held
within the Benefit Fixed Rate Account, is called the "Target Ratio" or "r". If
the Target Ratio exceeds a certain percentage, it means essentially that too
much Target Value is not offset by assets within the Benefit Fixed Rate
Account, and therefore we will transfer an amount from your Permitted
Sub-accounts to the Benefit Fixed Rate Account. Conversely, if the Target Ratio
falls below a certain percentage, then a transfer from the Benefit Fixed Rate
Account to the Permitted Sub-accounts would occur. Note that the formula is
calculated with reference to the Highest Daily Annual Income Amount, rather
than with reference to the Total Annual Income Amount.
As you can glean from the formula, a downturn in the securities markets (i.e.,
a reduction in the amount held within the Permitted Sub-accounts) may cause us
to transfer some of your variable Contract Value to the Benefit Fixed Rate
Account, because such a reduction will tend to increase the Target Ratio.
Moreover, certain market return scenarios involving "flat" returns over a
period of time also could result in the transfer of money to the Benefit Fixed
Rate Account. In deciding how much to transfer, we use another formula, which
essentially seeks to re-balance amounts held in the Permitted Sub-accounts and
the Benefit Fixed Rate Account so that the Target Ratio meets a target, which
currently is equal to 80%. Once you elect Highest Daily Lifetime Five, the
ratios we use will be fixed. For contracts issued in the future, however, we
reserve the right to change the ratios.
While you are not notified when your Contract reaches a reallocation trigger,
you will receive a confirmation statement indicating the transfer of a portion
of your Contract Value either to or from the Benefit Fixed Rate Account. The
formula by which the reallocation triggers operate is designed primarily to
mitigate the financial risks that we incur in providing the guarantee under
Highest Daily Lifetime Five.
Depending on the results of the calculation relative to the reallocation
triggers, we may, on any day:
o Not make any transfer; or
o If a portion of your Contract Value was previously allocated to the
Benefit Fixed Rate Account, transfer all or a portion of those amounts
to the Permitted Sub-accounts, based on your existing allocation
instructions or (in the absence of such existing instructions) pro rata
(i.e., in the same proportion as the current balances in your variable
investment options). Amounts taken out of the Benefit Fixed Rate
Account will be withdrawn for this purpose on a last-in, first-out
basis (an amount renewed into a new guarantee period under the Benefit
Fixed Rate Account will be deemed a new investment for purposes of this
last-in, first-out rule); or
o Transfer all or a portion of your Contract Value in the Permitted
Sub-accounts pro-rata to the Benefit Fixed Rate Account. The interest
that you earn on such transferred amount will be equal to the annual
rate that we have set for that day, and we will credit the daily
equivalent of that annual interest until the earlier of one year from
the date of the transfer or the date that such amount in the Benefit
Fixed Rate Account is transferred back to the Permitted Sub-accounts.
If a significant amount of your Contract Value is systematically transferred to
the Benefit Fixed Rate Account during periods of market declines or low interest
rates, less of your Contract Value may be available to participate in the
investment experience of the Permitted Sub-accounts if there is a subsequent
market recovery. Under the reallocation formula that we employ, it is possible
that a significant portion of your Contract Value may be allocated to the
Benefit Fixed Rate Account.
Additional Tax Considerations for Qualified Contracts
If you purchase a contract as an investment vehicle for "qualified" investments,
including an IRA, SEP-IRA, Tax Sheltered Annuity (or 403(b)) or employer plan
under Code Section 401(a), the minimum distribution rules under the Code require
that you begin receiving periodic amounts from your contract beginning after age
70 1/2. For a Tax Sheltered Annuity or a 401(a) plan for which the participant
is not a greater than 5 percent owner of the employer, this required beginning
date can generally be deferred to retirement, if later. Roth IRAs are not
subject to these rules during the owner's lifetime. The amount required under
the Code may exceed the Total Annual Income Amount, which will cause us to
increase the Total Annual Income Amount in any Contract Year that required
minimum distributions due from your Contract are greater than such amounts. In
addition, the amount and duration of payments under the contract payment and
death benefit provisions may be adjusted so that the payments do not trigger any
penalty or excise taxes due to tax considerations such as minimum distribution
requirements.
SPVASUP8
Pruco Life Insurance Company
Pruco Life Insurance Company Of New Jersey
Strategic Partners Annuity One
Strategic Partners Plus
Strategic Partners Annuity One 3
Strategic Partners Plus 3
Strategic Partners FlexElite
Strategic Partners Advisor
Supplement, dated March 19, 2007
To
Prospectuses, dated May 1, 2006
We are issuing this supplement to each of the above-referenced prospectuses for
actively-sold contracts, in order to describe an alternative way in which the
death benefit under your annuity may be paid to your beneficiaries.
This Supplement should be read and retained with the current Prospectus for your
annuity contract. This Supplement is intended to update certain information in
the Prospectus for the variable annuity you own, and is not intended to be a
prospectus or offer for any other variable annuity listed here that you do not
own. If you would like another copy of the current Prospectus, please contact us
at (888) PRU-2888.
A. In the "What Is The Death Benefit?" section of each prospectus, in the
sub-section entitled "Payout Options," we re-word the lead-in language to the
second paragraph to state "With respect to a death benefit paid on or before
March 19, 2007, the death benefit payout options are . . . ", and we add the
following to the end of that section:
With respect to a death benefit paid after March 19, 2007, unless the surviving
spouse opts to continue the contract (or spousal continuance is required under
the terms of your contract), a beneficiary may, within 60 days of providing
proof of death, take the death benefit as follows:
o as a lump sum. If the beneficiary does not choose a payout option within
sixty days, the beneficiary will be paid in this manner; or
o as payment of the entire death benefit within a period of 5 years from
the date of death; or
o as a series of payments not extending beyond the life expectancy of the
beneficiary, or over the life of the beneficiary. Payments under this option
must begin within one year of the date of death; or
o as the beneficiary continuation option, described immediately below.
Upon our receipt of proof of death, we will send to the beneficiary materials
that list these payment options, as well as an election form with which the
beneficiary may choose an option.
Beneficiary Continuation Option
Instead of receiving the death benefit in a single payment, or under an annuity
option, a beneficiary may take the death benefit under an alternative death
benefit payment option, as provided by the Code. This "Beneficiary Continuation
Option" is described below and is available for both qualified contracts (i.e.,
contracts sold to an IRA, Roth IRA, SEP IRA, or 403(b)) and non-qualified
contracts. In the section below entitled "Alternative Death Benefit Payment
Options - Qualified Contracts", we describe Beneficiary Continuation Option
provisions that are unique to qualified contracts.
Under the beneficiary continuation option:
o The Owner's contract will be continued in the Owner's name, for the benefit of
the beneficiary.
o Beginning on the date we receive an election by the beneficiary to take
the death benefit in a form other than a lump sum, we charge an amount
equal to 1.00% annually, imposed daily against the average daily net
assets allocated to the variable investment options.
o Beginning on the date we receive an election by the beneficiary to take
the death benefit in a form other than a lump sum, the beneficiary will
incur an annual maintenance fee equal to the lesser of $30 or 2% of
contract value if the contract value is less than $25,000 at the time
the fee is assessed. The fee will not apply if it is assessed 30 days
prior to a surrender request.
o The initial contract value will be equal to any death benefit
(including any optional death benefit) that would have been payable to
the beneficiary if the beneficiary had taken a lump sum distribution.
o The available variable investment options will be among those available
to the Owner at the time of death, however certain variable investment
options may not be available.
o The beneficiary may request transfers among variable investment
options, subject to the same limitations and restrictions that applied
to the Owner. Transfers in excess of 20 per year will incur a $10
transfer fee.
o No fixed interest rate options will be offered. o No additional Purchase
Payments can be applied to the contract.
o The basic death benefit and any optional benefits elected by the Owner will no
longer apply to the beneficiary. o The beneficiary can request a withdrawal of
all or a portion of the contract value at any time without application of any
applicable CDSC.
o Upon the death of the Beneficiary, if the beneficiary's successor does
not take a lump sum, the successor may take any remaining benefit over
the life expectancy of the beneficiary.
Currently, only Investment Options corresponding to Portfolios of the American
Skandia Trust and the Prudential Money Market Portfolio of The Prudential Series
Fund are available under the Beneficiary Continuation Option.
In addition to the materials referenced above, the beneficiary will be provided
with a prospectus and a settlement agreement describing the Beneficiary
Continuation Option. Please contact us for additional information on the
availability, restrictions and limitations that will apply to a beneficiary
under the Beneficiary Continuation Option. We may pay compensation to the
selling broker-dealer based on amounts held in the Beneficiary Continuation
Option.
Alternative Death Benefit Payment Options - Qualified Contracts
The Code provides for alternative death benefit payment options when a contract
is held through a tax-qualified arrangement that requires minimum distributions.
Upon death under an IRA, 403(b) or other "qualified investment", a beneficiary
may generally elect to continue the contract and receive minimum distributions
under the contract instead of receiving the death benefit in a single payment.
The available payment options will depend on whether death occurred on or before
the date minimum distributions under the Code were required to begin, and
whether the beneficiary is the surviving spouse.
o If death occurs before the date minimum distributions must begin under the
Code (i.e., by April 1 of the year after the year the Owner reaches age 70
1/2), the death benefit can be paid out in either a lump sum, within five
years from the date of death, or over the life or life expectancy of the
designated beneficiary (as long as payments begin by December 31st of the
year following the year of death). However, if the spouse is the
beneficiary, the death benefit can be paid out over the life or life
expectancy of the spouse with such payments beginning no later than
December 31st of the year following the year of death or December 31st of
the year in which the deceased would have reached age 70 1/2, which ever is
later.
o If death occurs after the date minimum distributions must begin under the
Code (i.e., by April 1 of the year after the year the Owner reaches age 70
1/2), the death benefit must be paid out at least as rapidly as under the
method that had been in effect when the Owner was receiving distributions.
A beneficiary has the flexibility to take out more each year than required
Until withdrawn, amounts in an IRA, 403(b) or other "qualified investment"
continue to be tax deferred. Amounts withdrawn each year, including amounts that
are required to be withdrawn under the minimum distribution rules, are subject
to tax. You may wish to consult a professional tax advisor for tax advice as to
your particular situation.
For a Roth IRA, if death occurs before the entire interest is distributed, the
death benefit must be distributed under the same rules applied to IRAs where
death occurs before the date minimum distributions must begin under the Code.
The tax consequences to the beneficiary may vary among the different death
benefit payment options. See the Tax Considerations section of this prospectus,
and consult your tax advisor.
B. For each of the above-referenced prospectuses, we revise the section entitled
"Summary of Contract Expenses" to the extent indicated below to illustrate the
fees that are unique to the Beneficiary Continuation Option:
CONTRACT OWNER TRANSACTION EXPENSES
Maximum Transfer Fee
Each transfer after 20
(Beneficiary Continuation Option ONLY) $10.00
The next table describes the fees and expenses you will pay periodically during
the time that you own the contract, not including underlying mutual fund fees
and expenses.
PERIODIC ACCOUNT EXPENSES
Maximum Annual Contract Fee
If Contract Value is less than $25,000
(Beneficiary Continuation Option ONLY) esser of $30 or 2% of Contract Value
INSURANCE AND ADMINISTRATIVE EXPENSES
AS A PERCENTAGE OF CONTRACT VALUE IN VARIABLE INVESTMENT OPTIONS
Settlement Service Charge* 1.00%
* The other Insurance and Administrative Expense Charges do not apply if you are
a beneficiary under the Beneficiary Continuation Option. Instead, the Settlement
Service Charge set forth here applies, if your beneficiary elects the
Beneficiary Continuation Option. The 1.00% charge is an annual charge that is
assessed daily against the assets in the variable investment options.
C. For each of the above-referenced prospectuses, in the section entitled "What
Are the Expenses Associated With The . . . Contract", the following paragraph is
added, immediately before "Taxes Attributable To Premium" (and an entry entitled
"Beneficiary Continuation Option Charges" is added as a new line item to the
Table of Contents):
Beneficiary Continuation Option Charges: If your beneficiary takes the
death benefit under the beneficiary continuation option, we deduct a
Settlement Service Charge. The charge is assessed daily against the average
assets allocated to the variable investment options, and is equal to an
annual charge of 1.00%. In addition, the beneficiary will incur an annual
maintenance fee equal to the lesser of $30 or 2% of contract value if the
contract value is less than $25,000 at the time the fee is assessed. The
fee will not apply if it is assessed 30 days prior to a surrender request.
Finally, transfers in excess of 20 per year will incur a $10 transfer fee.
SPVASUP9
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this post-effective
amendment to be signed on its behalf on this 7th day of March, 2007.
Pruco Life Insurance Company
(Registrant)
Attest: /s/Thomas C. Castano /s/Scott D. Kaplan
Thomas C. Castano Scott D. Kaplan
Secretary President
SIGNATURES
As required by the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities and on the date
indicated.
Signature and Title
*
JAMES J. AVERY JR.
VICE CHAIRMAN AND DIRECTOR Date: March 7, 2007
* * *By: /s/ Thomas C. Castano
SCOTT D. KAPLAN THOMAS C. CASTANO
PRESIDENT AND DIRECTOR (ATTORNEY-IN-FACT)
*
TUCKER I. MARR
VICE PRESIDENT, AND
CHIEF FINANCIAL OFFICER
*
BERNARD J. JACOB
DIRECTOR
*
RONALD P. JOELSON
DIRECTOR
*
HELEN M. GALT
DIRECTOR
*
DAVID R. ODENATH, JR.
DIRECTOR
>
Exhibit 23
Consent of Independent Registered Public Accounting Firm
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated March 24, 2006 relating to the
financial statements, which appear in Pruco Life Insurance Company's Annual
Report on Form 10-K for the year ended December 31, 2005.
New York, New York
March 2, 2007