SEC Company Response from PRUCO LIFE FLEXIBLE PREMIUM VARIABLE ANNUITY ACCOUNT (CIK 0000947703) — Dec 6, 2021
PRUCO LIFE FLEXIBLE PREMIUM VARIABLE ANNUITY ACCOUNT (CIK 0000947703)
Date: Dec. 6, 2021 · CIK: 0000947703 · Accession: 0000947703-21-000278
AI Filing Summary & Sentiment
File numbers found in text: 333-256965, 333-256967, 811-07325
Letter
VIA EDGAR Division of Investment Management Securities and Exchange Commission File Nos. 333-256965 and 811-07325 Post-Effective Amendment No. 1 to Registration Statement on Form S-3 Pruco Life Insurance Company File No. 333-256967
Dear Mr. Zapata:
On behalf of the above-referenced Registrants, below are responses to Staff comments received orally on November 29, 2021 to the Post-Effective Amendment filings noted above. Included with this submission is a revised prospectus for the FlexGuard B Series contract which includes the changes described below. The Staff’s comments and our responses are as follows.
1.Comment:
In the second paragraph in the “Performance Lock” section of the prospectus (page 19), consider adding the word “that” in the third sentence so that it will read as follows, “We will use the Performance Lock Value at the end of the Valuation Day that we receive your Performance Lock Request.”
Response:
We have revised the sentence as requested.
2.Comment:
The last sentence of the third paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “Partial ‘locking’ of an Index Strategy is not permitted.” Explain/disclose what “partial locking” means in this context.
Alberto H. Zapata, Esq.
December 6, 2021
Page 2
Response:
We have deleted the sentence above and replaced it with the following sentence, “Performance Lock requests for less than the full amount of the Performance Lock Value are not permitted.”
3.Comment:
The first sentence of the fourth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “Once a Performance Lock has been executed it cannot be reversed and the Performance Lock Value will not fluctuate for the rest of the Index Strategy Term, with the exception of being reduced for withdrawals and partial reallocations.” Explain/disclose what “partial reallocations” are in this context.
Response:
We have revised the sentence to read as follows (revised language in red), “Once a Performance Lock has been executed it cannot be reversed and the Performance Lock Value will not fluctuate for the rest of the Index Strategy Term, with the exception of being reduced for withdrawals and reallocations to a different Index Strategy that are for an amount less than the full Performance Lock Value (partial reallocations).”
4.Comment:
The third sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “You may also request an automatic Performance Lock based on targets you set.” Please explain/disclose what is meant by “set targets.”
Response:
We have replaced the third sentence with two new sentences and revised the sentence that follows so that these sentences now read: “For an automatic Performance Lock, you set a target at which you would like the Performance Lock to take effect automatically. Targets are established as a percentage and reflect the change in the Performance Lock Value, known as the Performance Lock Value return. We calculate the Performance Lock Value return, and determine if a target is reached, by comparing the Performance Lock Value as of the close of business on the current Valuation Day to the Index Strategy Base.”
5.Comment:
The second-to-last sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “You can also ‘over-ride’ a target by requesting a manual Performance Lock before the target is reached.” Please explain/disclose more fully what is meant by “over-ride a target.”
Response:
We have replaced the word “over-ride” with the word “cancel” in the sentence so that it now reads as follows, “You can also cancel a target by requesting a manual Performance Lock before the target is reached.”
6.Comment:
The last sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “By setting targets you are authorizing us to automatically execute a Performance Lock at the end of the Valuation Day on the Performance Lock Date upon which the target is reached.” Please explain/disclose how a contract owner sets a target in connection with the automatic Performance Lock feature.
Alberto H. Zapata, Esq.
December 6, 2021
Page 3
Response:
We have added the following sentence to follow the sentence above, “You may establish and manage automatic Performance Lock targets by contacting us at our Service Center.”
We believe that this additional sentence along with the other revisions and added disclosure in the sixth paragraph (see Response to Comment 4 for example) address this Comment.
7.Comment:
Please bold the tenth paragraph in the “Performance Lock” section of the prospectus (page 19) beginning with the words, “We reserve the right . . . “
Response:
We have bolded this paragraph as requested.
8.Comment:
Please bold the second and third sentences in the eleventh paragraph in the “Performance Lock” section of the prospectus (page 19).
Response:
We have bolded these sentences as requested.
9.Comment:
Please confirm that the rates referenced in the “Rate Determination” section of the prospectus (page 33) associated with the Index Strategies are not part of the prospectus.
Response:
We confirm that the rates referenced in the “Rate Determination” section of the prospectus associated with the Index Strategies are not part of the prospectus. Such rates are reflected on the rate sheets found on our website (www.prudential.com). These rate sheets are not part of the prospectus.
If you have any questions, please call me at (203) 925-3707.
Very truly yours,
/s/Richard H. Kirk
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Richard H. Kirk
Vice President, Corporate Counsel
The Prudential Insurance Company of America
213 Washington Street, Newark, NJ 07102-2917
Tel 203-925-3707
richard.kirk@prudential.com
December 6, 2021
VIA EDGAR
Alberto H. Zapata, Esq.
Senior Counsel
Disclosure Review and Accounting Office
Division of Investment Management
Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549
Re: Responses to SEC Staff Comments
Post-Effective Amendment No. 1 to Registration Statement on Form N-4
Pruco Life Flexible Premium Variable Annuity Account
File Nos. 333-256965 and 811-07325
Post-Effective Amendment No. 1 to Registration Statement on Form S-3
Pruco Life Insurance Company
File No. 333-256967
Dear Mr. Zapata:
On behalf of the above-referenced Registrants, below are responses to Staff comments received orally on November 29, 2021 to the Post-Effective Amendment filings noted above. Included with this submission is a revised prospectus for the FlexGuard B Series contract which includes the changes described below. The Staff’s comments and our responses are as follows.
1.Comment:
In the second paragraph in the “Performance Lock” section of the prospectus (page 19), consider adding the word “that” in the third sentence so that it will read as follows, “We will use the Performance Lock Value at the end of the Valuation Day that we receive your Performance Lock Request.”
Response:
We have revised the sentence as requested.
2.Comment:
The last sentence of the third paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “Partial ‘locking’ of an Index Strategy is not permitted.” Explain/disclose what “partial locking” means in this context.
Alberto H. Zapata, Esq.
December 6, 2021
Page 2
Response:
We have deleted the sentence above and replaced it with the following sentence, “Performance Lock requests for less than the full amount of the Performance Lock Value are not permitted.”
3.Comment:
The first sentence of the fourth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “Once a Performance Lock has been executed it cannot be reversed and the Performance Lock Value will not fluctuate for the rest of the Index Strategy Term, with the exception of being reduced for withdrawals and partial reallocations.” Explain/disclose what “partial reallocations” are in this context.
Response:
We have revised the sentence to read as follows (revised language in red), “Once a Performance Lock has been executed it cannot be reversed and the Performance Lock Value will not fluctuate for the rest of the Index Strategy Term, with the exception of being reduced for withdrawals and reallocations to a different Index Strategy that are for an amount less than the full Performance Lock Value (partial reallocations).”
4.Comment:
The third sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “You may also request an automatic Performance Lock based on targets you set.” Please explain/disclose what is meant by “set targets.”
Response:
We have replaced the third sentence with two new sentences and revised the sentence that follows so that these sentences now read: “For an automatic Performance Lock, you set a target at which you would like the Performance Lock to take effect automatically. Targets are established as a percentage and reflect the change in the Performance Lock Value, known as the Performance Lock Value return. We calculate the Performance Lock Value return, and determine if a target is reached, by comparing the Performance Lock Value as of the close of business on the current Valuation Day to the Index Strategy Base.”
5.Comment:
The second-to-last sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “You can also ‘over-ride’ a target by requesting a manual Performance Lock before the target is reached.” Please explain/disclose more fully what is meant by “over-ride a target.”
Response:
We have replaced the word “over-ride” with the word “cancel” in the sentence so that it now reads as follows, “You can also cancel a target by requesting a manual Performance Lock before the target is reached.”
6.Comment:
The last sentence of the sixth paragraph in the “Performance Lock” section of the prospectus (page 19) reads as follows, “By setting targets you are authorizing us to automatically execute a Performance Lock at the end of the Valuation Day on the Performance Lock Date upon which the target is reached.” Please explain/disclose how a contract owner sets a target in connection with the automatic Performance Lock feature.
Alberto H. Zapata, Esq.
December 6, 2021
Page 3
Response:
We have added the following sentence to follow the sentence above, “You may establish and manage automatic Performance Lock targets by contacting us at our Service Center.”
We believe that this additional sentence along with the other revisions and added disclosure in the sixth paragraph (see Response to Comment 4 for example) address this Comment.
7.Comment:
Please bold the tenth paragraph in the “Performance Lock” section of the prospectus (page 19) beginning with the words, “We reserve the right . . . “
Response:
We have bolded this paragraph as requested.
8.Comment:
Please bold the second and third sentences in the eleventh paragraph in the “Performance Lock” section of the prospectus (page 19).
Response:
We have bolded these sentences as requested.
9.Comment:
Please confirm that the rates referenced in the “Rate Determination” section of the prospectus (page 33) associated with the Index Strategies are not part of the prospectus.
Response:
We confirm that the rates referenced in the “Rate Determination” section of the prospectus associated with the Index Strategies are not part of the prospectus. Such rates are reflected on the rate sheets found on our website (www.prudential.com). These rate sheets are not part of the prospectus.
If you have any questions, please call me at (203) 925-3707.
Very truly yours,
/s/Richard H. Kirk
Richard H. Kirk
Vice President, Corporate Counsel
PRUCO LIFE INSURANCE COMPANY
A Prudential Financial Company
751 Broad Street, Newark, NJ 07102-3777
PRUDENTIAL FLEXGUARD®
Flexible Premium Deferred Index-Linked and Variable Annuity (“B SERIES”)
PROSPECTUS: _____, 2021
This prospectus describes the B Series of a flexible premium deferred index-linked and variable annuity (“Annuity”) offered by Pruco Life Insurance Company (“Pruco Life”, “we”, “our”, or “us”). The Annuity provides for the potential accumulation of retirement savings and retirement income through annuitization. The Annuity is intended for retirement or other long-term investment purposes. This prospectus describes all material rights and obligations of Annuity purchasers under the Annuity contracts. This prospectus is being provided for informational or educational purposes only and does not take into account the investment objectives or financial situation of any client(s) or prospective client(s). The information is not intended as investment advice and is not a recommendation about managing or investing your retirement savings. Clients seeking information regarding their particular investment needs should contact a Financial Professional. The Annuity is offered as an individual annuity contract and has features and benefits that may be appropriate for you based on your financial situation, your age and how you intend to use the Annuity. The Annuity or certain of its Index Strategies, Variable Investment Subaccounts and/or features may not be available in all states.
Financial Professionals may be compensated for the sale of the B Series. Selling broker-dealer firms may not make available or may not recommend the B Series of the Annuity and/or benefits described in this prospectus. Please speak to your Financial Professional for further details.
We hold the assets for each Variable Investment Subaccount in a corresponding Subaccount of Pruco Life Insurance Company Flexible Premium Variable Annuity Account. Each Subaccount, in turn, invests in one of the following Portfolios:
MFS® International Growth Portfolio – Service Class
MFS® Total Return Bond Series – Service Class
MFS® Total Return Series – Service Class
MFS® Value Series – Service Class
PSF PGIM Government Money Market Portfolio – Class III
We hold the assets for each Index Strategy in a non-insulated, non-unitized separate account we have established to support our obligations with respect to the Index Strategies.
The Index Strategies currently available are:
Point-to-Point with Cap Index Strategy Step Rate Plus Index Strategy Tiered Participation Rate Index Strategy
1-year S&P 500®, 10% Buffer
1-year MSCI EAFE, 10% Buffer
1-year Invesco QQQ ETF, 10% Buffer
1-yr iShares® Russell 2000 ETF, 10% Buffer
1-year S&P 500®, 15% Buffer
1-year MSCI EAFE, 15% Buffer
1-year Invesco QQQ ETF, 15% Buffer
1-yr iShares® Russell 2000 ETF, 15% Buffer
1-year S&P 500®, 100% Buffer
3-year S&P 500®, 10% Buffer
3-year MSCI EAFE, 10% Buffer
3-yr iShares® Russell 2000 ETF, 10% Buffer
3-year S&P 500®, 20% Buffer
3-yr iShares® Russell 2000 ETF, 20% Buffer
3-year MSCI EAFE, 20% Buffer
6-year S&P 500®, 20% Buffer
6-year MSCI EAFE, 20% Buffer
6-yr iShares® Russell 2000 ETF, 20% Buffer
1-year S&P 500®, 5% Buffer
1-year MSCI EAFE, 5% Buffer
1-year S&P 500®, 10% Buffer
6-year S&P 500®, 5% Buffer
6-year MSCI EAFE, 5% Buffer
6-yr iShares® Russell 2000 ETF, 5% Buffer
6-year S&P 500®, 10% Buffer
6-year MSCI EAFE, 10% Buffer
A selling broker-dealer firm may elect to make available only certain strategies, features or benefits to its clients. For example, a firm may choose to not make one of the index strategies, such as the Step Rate Plus or Tiered Participation Rate, available. In addition, a firm may choose to not make
PLAZRILABPROS
available certain buffer levels, indices and index strategy terms that are described in the prospectus. Only those strategies, features and benefits available through your firm will be part of your contract and will be described in your firm’s marketing materials. You should ask your Financial Professional for details about the strategies and features available through their firm. The prospectus describes all the strategies, features and benefits that Prudential makes available under the contract. For additional information on all of the strategies, features or benefits available with FlexGuard please visit the following webpage: www.prudential.com/personal/annuities/products/flexguard-indexed-variable-annuity.
The guarantees provided by the Annuity contracts and payments Pruco Life makes under the Annuity contracts are the obligations of, and subject to the creditworthiness and claims paying ability of, Pruco Life. Certain terms are capitalized in this prospectus. Those terms are defined either in the Special Terms section or in the context of the particular section.
Flexible premium deferred index-linked and variable annuity contracts are complex insurance and investment vehicles. There is a risk of substantial loss of your principal. The risk of loss may be greater in the case of an early withdrawal due to any charges and adjustments applied to such withdrawals. These charges and adjustments may result in loss even when the value of an Index has increased. Refer to the Risk Factors section of this prospectus for more information. Investors should speak with a Financial Professional about the Annuity’s features, benefits, risks and fees, and whether the Annuity is appropriate for the investor based upon his or her financial situation and objectives.
IMPORTANT INFORMATION
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the annual and semi-annual shareholder reports for Portfolios available under your Annuity will no longer be sent by mail, unless you specifically request paper copies of the reports from us. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from us electronically anytime at our website www.prudential.com. You may elect to receive all future shareholder reports in paper free of charge by calling 1-888-PRU-2888. Your election to receive reports in paper will apply to all Portfolios available under your contract.
PLEASE READ THIS PROSPECTUS
This prospectus sets forth information about the Annuity that you should know before investing. Please read this prospectus and keep it for future reference. If you are purchasing the Annuity as a replacement for an existing variable annuity, variable life insurance policy, fixed annuity or fixed life insurance policy, you should consider any surrender or penalty charges you may incur and any benefits you may also be forfeiting when replacing your existing coverage and that the Annuity may be subject to a Contingent Deferred Sales Charge if you elect to surrender the Annuity or take a partial withdrawal. You should consider your need to access the Annuity’s Account Value and whether the Annuity’s liquidity features will satisfy that need. Please note that if you purchase the Annuity within a tax advantaged retirement plan, such as an IRA, SEP-IRA or Roth IRA, you will get no additional tax advantage through the Annuity itself. Because there is no additional tax advantage when an Annuity is purchased through one of these plans, the reasons for purchasing the Annuity inside a qualified plan are limited to the ability to allocate to the various Index Strategies and Variable Investment Subaccounts, and the opportunity to annuitize the contract, which might make the Annuity an appropriate investment for you. You should consult your tax and Financial Professional regarding such features and benefits prior to purchasing the Annuity for use with a tax-qualified plan.
For currently available Index Strategies, please refer to our website at www.prudential.com.
OTHER CONTRACTS
We offer a variety of annuity contracts. They may offer features, including investment options, and have fees and charges, that are different from the Annuity offered by this prospectus. Not every annuity contract we issue is offered through every selling broker-dealer firm. Upon request, your Financial Professional can show you information regarding other Pruco Life annuity contracts that he or she sells. You can also contact us to find out more about the availability of any of the Pruco Life annuity contracts. You should work with your Financial Professional to decide whether the Annuity contract is appropriate for you based on a thorough analysis of your particular needs, financial objectives, investment goals, time horizons and risk comfort level.
AVAILABLE INFORMATION
We have also filed a Statement of Additional Information dated the same date as this prospectus that is available from us, without charge, upon your request. The contents of the Statement of Additional Information are described at the end of this prospectus – see Table of Contents. The Statement of Additional Information is incorporated by reference into this prospectus. This prospectus is part of the registration statement we filed with the SEC regarding this offering. Additional information on us and this offering is available in the registration statement and the exhibits thereto. You may review and obtain copies of these materials at no cost to you by contacting us. These documents, as wel