PRUCO LIFE INSURANCE OF NEW JERSEY 10-K

Liability for Future Policy Benefits (Tables)

12 Months Ended

Dec. 31, 2023

The balances of and changes in Benefit Reserves as of and for the periods indicated consist of the three tables presented below: Present Value of Expected Net Premiums rollforward, Present Value of Expected Future Policy Benefits rollforward, and Net Liability for Future Policy Benefits.


	Year Ended December 31, 2023
	Present Value of Expected Net Premiums
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	1,416,807	$	0	$	1,416,807
Effect of cumulative changes in discount rate assumptions, beginning of period	73,563		0		73,563
Balance at original discount rate, beginning of period	1,490,370		0		1,490,370

Effect of assumption update	(152)		0		(152)
Effect of actual variances from expected experience and other activity	(62,690)		(554)		(63,244)
Adjusted balance, beginning of period	1,427,528		(554)		1,426,974
Issuances	88,929		2,998		91,927
Net premiums / considerations collected	(165,337)		(2,444)		(167,781)
Interest accrual	67,614		0		67,614

Balance at original discount rate, end of period	1,418,734		0		1,418,734
Effect of cumulative changes in discount rate assumptions, end of period	(29,313)		0		(29,313)
Balance, end of period	$	1,389,421	$	0	$	1,389,421


	Year Ended December 31, 2023
	Present Value of Expected Future Policy Benefits
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	2,551,191	$	16,460	$	2,567,651
Effect of cumulative changes in discount rate assumptions, beginning of period	137,962		1,899		139,861
Balance at original discount rate, beginning of period	2,689,153		18,359		2,707,512

Effect of assumption update	(202)		0		(202)
Effect of actual variances from expected experience and other activity	(82,200)		482		(81,718)
Adjusted balance, beginning of period	2,606,751		18,841		2,625,592
Issuances	88,929		2,998		91,927
Interest accrual	129,375		673		130,048
Benefit payments	(160,052)		(2,463)		(162,515)
Other adjustments	(1,112)		(50)		(1,162)
Balance at original discount rate, end of period	2,663,891		19,999		2,683,890
Effect of cumulative changes in discount rate assumptions, end of period	(44,322)		(1,510)		(45,832)
Balance, end of period	$	2,619,569	$	18,489	$	2,638,058


	Year Ended December 31, 2023
	Net Liability for Future Policy Benefits (Benefit Reserves)
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, end of period, pre-flooring	$	1,230,148	$	18,489	$	1,248,637
Flooring impact, end of period	0		0		0
Balance, end of period, post-flooring	1,230,148		18,489		1,248,637
Less: Reinsurance recoverable	1,054,226		18,489		1,072,715
Balance after reinsurance recoverable, end of period, post-flooring	$	175,922	$	0	$	175,922


	Year Ended December 31, 2022
	Present Value of Expected Net Premiums
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	1,641,933	$	0	$	1,641,933
Effect of cumulative changes in discount rate assumptions, beginning of period	(253,752)		0		(253,752)
Balance at original discount rate, beginning of period	1,388,181		0		1,388,181

Effect of assumption update	174,263		0		174,263
Effect of actual variances from expected experience and other activity	(29,416)		(746)		(30,162)
Adjusted balance, beginning of period	1,533,028		(746)		1,532,282
Issuances	58,215		2,110		60,325
Net premiums / considerations collected	(170,297)		(1,364)		(171,661)
Interest accrual	69,424		0		69,424

Balance at original discount rate, end of period	1,490,370		0		1,490,370
Effect of cumulative changes in discount rate assumptions, end of period	(73,563)		0		(73,563)
Balance, end of period	$	1,416,807	$	0	$	1,416,807


	Year Ended December 31, 2022
	Present Value of Expected Future Policy Benefits
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	3,041,562	$	19,314	$	3,060,876
Effect of cumulative changes in discount rate assumptions, beginning of period	(561,455)		(1,459)		(562,914)
Balance at original discount rate, beginning of period	2,480,107		17,855		2,497,962

Effect of assumption update	255,336		0		255,336
Effect of actual variances from expected experience and other activity	(60,049)		149		(59,900)
Adjusted balance, beginning of period	2,675,394		18,004		2,693,398
Issuances	58,215		2,111		60,326
Interest accrual	129,657		627		130,284
Benefit payments	(173,998)		(2,308)		(176,306)
Other adjustments	(115)		(75)		(190)
Balance at original discount rate, end of period	2,689,153		18,359		2,707,512
Effect of cumulative changes in discount rate assumptions, end of period	(137,962)		(1,899)		(139,861)
Balance, end of period	$	2,551,191	$	16,460	$	2,567,651


	Year Ended December 31, 2022
	Net Liability for Future Policy Benefits (Benefit Reserves)
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, end of period, pre-flooring	$	1,134,384	$	16,460	$	1,150,844
Flooring impact, end of period	0		0		0
Balance, end of period, post-flooring	1,134,384		16,460		1,150,844
Less: Reinsurance recoverable	1,002,277		16,460		1,018,737
Balance after reinsurance recoverable, end of period, post-flooring	$	132,107	$	0	$	132,107


	Year Ended December 31, 2021
	Present Value of Expected Net Premiums
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	1,762,111	$	0	$	1,762,111
Effect of cumulative changes in discount rate assumptions, beginning of period	(352,891)		0		(352,891)
Balance at original discount rate, beginning of period	1,409,220		0		1,409,220

Effect of assumption update	5,651		0		5,651
Effect of actual variances from expected experience and other activity	(13,285)		0		(13,285)
Adjusted balance, beginning of period	1,401,586		0		1,401,586
Issuances	75,944		3,763		79,707
Net premiums / considerations collected	(155,282)		(3,763)		(159,045)
Interest accrual	65,933		0		65,933

Balance at original discount rate, end of period	1,388,181		0		1,388,181
Effect of cumulative changes in discount rate assumptions, end of period	253,752		0		253,752
Balance, end of period	$	1,641,933	$	0	$	1,641,933


	Year Ended December 31, 2021
	Present Value of Expected Future Policy Benefits
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, beginning of period	$	3,212,658	$	17,969	$	3,230,627
Effect of cumulative changes in discount rate assumptions, beginning of period	(753,963)		(2,188)		(756,151)
Balance at original discount rate, beginning of period	2,458,695		15,781		2,474,476

Effect of assumption update	5,817		0		5,817
Effect of actual variances from expected experience and other activity	(9,219)		(297)		(9,516)
Adjusted balance, beginning of period	2,455,293		15,484		2,470,777
Issuances	75,944		3,763		79,707
Interest accrual	120,981		620		121,601
Benefit payments	(171,572)		(2,012)		(173,584)
Other adjustments	(539)		0		(539)
Balance at original discount rate, end of period	2,480,107		17,855		2,497,962
Effect of cumulative changes in discount rate assumptions, end of period	561,455		1,459		562,914
Balance, end of period	$	3,041,562	$	19,314	$	3,060,876


	Year Ended December 31, 2021
	Net Liability for Future Policy Benefits (Benefit Reserves)
	Term Life		Fixed Annuities		Total
	(in thousands)
Balance, end of period, pre-flooring	$	1,399,629	$	19,314	$	1,418,943
Flooring impact, end of period	899		0		899
Balance, end of period, post-flooring	1,400,528		19,314		1,419,842
Less: Reinsurance recoverable	1,216,756		19,314		1,236,070
Balance after reinsurance recoverable, end of period, post-flooring	$	183,772	$	0	$	183,772

The following tables provide supplemental information related to the balances of and changes in Benefit Reserves included in the disaggregated tables above, on a gross (direct and assumed) basis, as of and for the periods indicated:


	Year Ended December 31, 2023
	Term Life			Fixed Annuities
	($ in thousands)
Undiscounted expected future gross premiums	$	3,017,106		$	0
Discounted expected future gross premiums (at original discount rate)	$	2,021,858		$	0
Discounted expected future gross premiums (at current discount rate)	$	1,988,469		$	0
Undiscounted expected future benefits and expenses	$	4,298,438		$	25,823
Interest accrual	$	61,760		$	673
Gross premiums	$	236,148		$	2,974
Weighted-average duration of the liability in years (at original discount rate)	10			6
Weighted-average duration of the liability in years (at current discount rate)	10			6
Weighted-average interest rate (at original discount rate)	5.27		%	3.59		%
Weighted-average interest rate (at current discount rate)	5.00		%	4.90		%


	Year Ended December 31, 2022
	Term Life			Fixed Annuities
	($ in thousands)
Undiscounted expected future gross premiums	$	3,073,048		$	0
Discounted expected future gross premiums (at original discount rate)	$	2,069,441		$	0
Discounted expected future gross premiums (at current discount rate)	$	1,973,031		$	0
Undiscounted expected future benefits and expenses	$	4,352,500		$	24,056
Interest accrual	$	60,233		$	627
Gross premiums	$	242,406		$	1,700
Weighted-average duration of the liability in years (at original discount rate)	11			7
Weighted-average duration of the liability in years (at current discount rate)	10			6
Weighted-average interest rate (at original discount rate)	5.33		%	3.56		%
Weighted-average interest rate (at current discount rate)	5.40		%	5.30		%


	Year Ended December 31, 2021
	Term Life			Fixed Annuities
	($ in thousands)
Undiscounted expected future gross premiums	$	3,309,037		$	0
Discounted expected future gross premiums (at original discount rate)	$	2,185,726		$	0
Discounted expected future gross premiums (at current discount rate)	$	2,597,734		$	0
Undiscounted expected future benefits and expenses	$	4,023,185		$	23,747
Interest accrual	$	55,048		$	620
Gross premiums	$	241,783		$	4,553
Weighted-average duration of the liability in years (at original discount rate)	11			7
Weighted-average duration of the liability in years (at current discount rate)	11			7
Weighted-average interest rate (at original discount rate)	5.37		%	3.56		%
Weighted-average interest rate (at current discount rate)	2.54		%	2.48		%

For additional information regarding observable market information and the techniques used to determine the interest rate assumptions seen above, see Note 2

The balances of and changes in Deferred Profit Liability for the years ended December 31, are as follows:


	2023		2022		2021
	Fixed Annuities
	(in thousands)


Balance, beginning of period	$	1,684	$	1,726	$	984


Effect of actual variances from expected experience and other activity	(681)		(169)		98
Adjusted balance, beginning of period	1,003		1,557		1,082
Profits deferred	511		309		771
Interest accrual	49		60		60
Amortization	(196)		(222)		(187)

Other adjustments	(2)		(20)		0
Balance, end of period	1,365		1,684		1,726


Less: Reinsurance recoverable	1,365		1,684		1,726
Balance after reinsurance recoverable	$	0	$	0	$	0

The following table provides supplemental information related to the balances of and changes in Deferred Profit Liability, included in the disaggregated table above, on a gross (direct and assumed) basis, for the years ended December 31,:

(1)Represents the gross premiums collected in changes in deferred profit liability.

The following table shows a rollforward of AIR balances for variable and universal life products, for the years ended December 31,:


	2023		2022		2021

	(in thousands)


Balance including amounts in AOCI, beginning of period, post-flooring	$	827,478	$	703,968	$	642,514
Flooring impact and amounts in AOCI	91,115		(71,467)		(95,331)

Balance, excluding amounts in AOCI, beginning of period, pre-flooring	918,593		632,501		547,183



Effect of assumption update	9,713		180,404		369
Effect of actual variances from expected experience and other activity	(8,234)		(39,475)		8,089
Adjusted balance, beginning of period	920,072		773,430		555,641
Assessments collected(1)	99,311		134,822		62,891
Interest accrual	32,814		27,479		20,039
Benefits paid	(9,544)		(17,138)		(6,070)
Balance, excluding amounts in AOCI, end of period, pre-flooring	1,042,653		918,593		632,501



Flooring impact and amounts in AOCI	(56,487)		(91,115)		71,467


Balance, including amounts in AOCI, end of period, post-flooring	986,166		827,478		703,968
Less: Reinsurance recoverable	943,991		793,577		666,813
Balance after reinsurance recoverable, including amounts in AOCI, end of period	$	42,175	$	33,901	$	37,155

(1)Represents the portion of gross assessments required to fund the future policy benefits.


	2023			2022			2021

	($ in thousands)
Interest accrual	$	32,814		$	27,479		$	20,039
Gross assessments	$	245,024		$	303,979		$	215,741
Weighted-average duration of the liability in years (at original discount rate)	27			28			26
Weighted-average interest rate (at original discount rate)	3.40		%	3.41		%	3.44		%

The following table presents the reconciliation of the ending balances from the above rollforwards, Benefit Reserves, Deferred Profit Liability and Additional Insurance Reserves including other liabilities, gross of related reinsurance recoverables, to the total liability for Future Policy Benefits as reported on the Company's Statements of Financial Position for the years ended December 31,:


	2023		2022		2021

	(in thousands)
Benefit reserves, end of period, post-flooring	$	1,248,637	$	1,150,844	$	1,419,842
Deferred profit liability, end of period, post-flooring	1,365		1,684		1,726
Additional insurance reserves, including amounts in AOCI, end of period, post-flooring	986,166		827,478		703,968
Subtotal of amounts disclosed above	2,236,168		1,980,006		2,125,536
Other Future policy benefits reserves(1)	162,275		150,036		235,587
Total Future policy benefits	$	2,398,443	$	2,130,042	$	2,361,123

(1)Represents balances for which disaggregated rollforward disclosures are not required, including unpaid claims and claims expenses, and incurred but not reported and in course of settlement claim liabilities.

The following tables present revenue and interest expense related to Benefit Reserves, Deferred Profit Liability and Additional Insurance Reserves, as well as related revenue and interest expense not presented in the above supplemental tables, in the Company's Statement of Operations for the periods indicated:


	Year Ended December 31, 2023
	Revenues(1)
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	2,974	$	236,148	$	0	$	239,122
Deferred profit liability	319		0		0		319
Additional insurance reserves	0		0		245,024		245,024
Total	$	3,293	$	236,148	$	245,024	$	484,465


	Year Ended December 31, 2022
	Revenues(1)
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	1,700	$	242,406	$	0	$	244,106
Deferred profit liability	42		0		0		42
Additional insurance reserves	0		0		303,979		303,979
Total	$	1,742	$	242,406	$	303,979	$	548,127


	Year Ended December 31, 2021
	Revenues(1)
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	4,553	$	241,783	$	0	$	246,336
Deferred profit liability	(742)		0		0		(742)
Additional insurance reserves	0		0		215,741		215,741
Total	$	3,811	$	241,783	$	215,741	$	461,335

(1)Represents "Gross premiums" for benefit reserves; "Gross assessments" for additional insurance reserves; and "Revenue" for deferred profit liability.


	Year Ended December 31, 2023
	Interest Expense
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	673	$	61,760	$	0	$	62,433
Deferred profit liability	49		0		0		49
Additional insurance reserves	0		0		32,814		32,814
Total	$	722	$	61,760	$	32,814	$	95,296


	Year Ended December 31, 2022
	Interest Expense
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	627	$	60,233	$	0	$	60,860
Deferred profit liability	60		0		0		60
Additional insurance reserves	0		0		27,479		27,479
Total	$	687	$	60,233	$	27,479	$	88,399


	Year Ended December 31, 2021
	Interest Expense
	Fixed Annuities		Term Life		Variable and Universal Life		Total
	(in thousands)
Benefit reserves	$	620	$	55,048	$	0	$	55,668
Deferred profit liability	60		0		0		60
Additional insurance reserves	0		0		20,039		20,039
Total	$	680	$	55,048	$	20,039	$	75,767

Fixed Annuities

(in thousands)

Revenue(1)

Interest accrual