Jackson® Reports Record IFRS Net Income Of $683 Million In 2011

Jackson National Life Insurance Company ® (Jackson) achieved record IFRS 1 net income of $683 million during 2011, up 34 percent over 2010. Jackson has generated more than a half-billion dollars in IFRS net income in seven out of the past eight years.

Jackson, an indirect wholly owned subsidiary of the United Kingdom’s Prudential plc (NYSE: PUK), generated a record $22.9 billion in total sales and deposits 2, up 16 percent over 2010. Retail net flows also increased 11 percent over 2010 to a record $13.6 billion. The record sales and net flows were driven primarily by growth in variable annuity (VA) sales at Jackson and deposits at Jackson’s retail asset management subsidiary Curian Capital, ® LLC (Curian). VA sales rose 19 percent to $17.5 billion, while Curian deposits increased 28 percent to $2.7 billion.

“Our Long-Term Smart ® strategy of balancing sales opportunities with strict financial discipline enables Jackson to deliver sustainable, profitable growth,” said Mike Wells, Jackson’s president and chief executive officer. "By remaining disciplined, Jackson did not just withstand the headwinds of market volatility and low interest rates during 2011, but was able to generate the highest level of IFRS earnings in company history."

Jackson’s total IFRS assets increased to $120.2 billion at the end of 2011, up from $107.0 billion at the end of 2010. 3 At December 31, 2011, Jackson had $3.9 billion of regulatory adjusted capital, more than eight times the regulatory requirement 4, after remitting a dividend of $530 million to its parent company, Prudential plc.

"Jackson generated record earnings during 2011 due to a 34-percent increase in fee income and net realized gains on debt securities of $170 million, compared to $17 million in 2010," said Chad Myers, Jackson’s executive vice president and chief financial officer. "Additionally, Jackson increased its operational efficiency during 2011, reducing its statutory general expense-to-average asset ratio to 42 basis points, down from 44 basis points in 2010.”

Curian generated $10 million in IFRS pretax operating income during 2011, up from $2 million during 2010. As of December 31, 2011, Curian's assets under management totaled $7.3 billion, up 32 percent from the end of 2010.

Jackson continues to manage fixed index annuity and fixed annuity sales volumes. Consumer demand for these products fell during 2011 due to the low interest rate environment. During 2011, Jackson sold $1.5 billion in fixed index annuities, compared to $1.7 billion in 2010. Sales of traditional deferred fixed annuities totaled $756 million during 2011, compared to $1.3 billion during the prior year. Jackson took advantage of the availability of wider spreads during 2011 by issuing $382 million in institutional products, a market in which the company participates on an opportunistic basis.

During 2011, all four primary rating agencies – A.M. Best, Standard & Poor’s, Fitch Ratings and Moody’s Investor Service, Inc. – affirmed Jackson’s financial strength ratings. Jackson has maintained the same financial strength ratings for more than nine years. As of February 29, 2012, Jackson had the following ratings 5:
  • A+ (superior) A.M. Best financial strength rating, the second-highest of 16 rating categories
  • AA (very strong) Standard & Poor's insurer financial strength rating, the third-highest of 21 rating categories
  • AA (very strong) Fitch Ratings insurer financial strength rating, the third-highest of 24 rating categories
  • A1 (good) Moody's Investors Service, Inc. insurance financial strength rating, the fifth-highest of 21 rating categories

Jackson ranked third in both total annuity 6 and VA sales, 7 and second in VA net flows 8 during the first nine months of 2011. The company achieved the following rankings and market share:
  • Third in total annuity sales with a market share of 8.4 percent;6
  • Third in variable annuity sales with a market share of 11.8 percent;7
  • Ninth in fixed index annuity sales with a market share of 4.6 percent;9
  • 14th in traditional deferred fixed annuity sales with a market share of 1.9 percent.10

Jackson’s affiliate, National Planning Holdings ®, Inc. (NPH ®), a network of four independent broker-dealers, also had a very strong year, with IFRS revenue of $788 million, up 14 percent over 2010, and IFRS pretax operating income of $22 million, up 32 percent over 2010. The network reported record gross product sales of $16.3 billion in 2011, an increase of 14 percent over the prior year.

“Jackson continues to benefit from a flight to quality in the retirement services industry due to the company’s focus on sustainable growth," Wells said. “Our reputation for financial discipline has helped establish Jackson as a reliable business partner among advisers and their clients.”

1 International Financial Reporting Standards (IFRS) is a principles-based set of international accounting standards indicating how transactions and other events should be reported in financial statements. IFRS is issued by the International Accounting Standards Board in an effort to increase global comparability of financial statements and results. Jackson’s parent, Prudential plc, uses IFRS to report the Group's financial results.

2 Sales and deposits from Jackson’s subsidiaries Jackson National Life Insurance Company of New York ® and Curian Capital have been included in Jackson’s total sales and deposits figures.

3 Jackson also has $109 billion of IFRS policy liabilities primarily set aside to pay future policyowner benefits (as of 12/31/11).

4 Based on authorized control level capital requirements.

5 Financial strength ratings do not apply to the principal amount or investment performance of the separate account or underlying investments of variable products.

6 Sources: LIMRA International U.S. Individual Annuities Sales Survey, Third Quarter 2011 YTD. Jackson ranked third in total annuity sales out of 58 companies during 3Q11 YTD.

7 Source: The Morningstar Annuity Research Center, Third Quarter 2011 YTD Sales Report. Jackson ranked third in new variable annuity sales out of 38 companies during 3Q11 YTD.

8 Source: The Morningstar Annuity Research Center, Third Quarter 2011 YTD Net Flow Report and Company Financial Supplements. Jackson ranked second in VA net flows out of 24 companies during 3Q11 YTD.

9 Source: AnnuitySpecs Indexed Sales & Market Report, Third Quarter 2011 YTD. Jackson ranked ninth in fixed index annuity sales out of 36 companies during 3Q11 YTD.

10 Source: LIMRA International U.S. Individual Annuities Sales Survey, Third Quarter 2011 YTD. Jackson ranked 14th in traditional deferred fixed annuity sales out of 60 companies during 3Q11 YTD.

Before investing in variable products, investors should carefully consider the investment objectives, risks, charges and expenses of the variable product and its underlying investment options. The current contract prospectus and underlying fund prospectuses, which are contained in the same document, provide this and other important information. Please contact your representative or the Company to obtain the prospectuses. Please read the prospectuses carefully before investing or sending money.

About Jackson National Life Insurance Company

With $120 billion in assets (IFRS)*, Jackson National Life Insurance Company (Jackson) is a leading provider of retirement solutions. The company sells variable, fixed and fixed index annuities, life insurance and institutional products. Through its affiliates and subsidiaries, Jackson also provides asset management and retail brokerage services. Jackson markets its products in 49 states and the District of Columbia through independent and regional broker-dealers, wirehouses, financial institutions and independent insurance agents. Jackson’s subsidiary, Jackson National Life Insurance Company of New York ® , similarly markets products in the state of New York. For more information, visit www.jackson.com .

*Jackson has $120 billion in total IFRS assets and $109 billion in IFRS policy liabilities primarily set aside to pay future policyowner benefits (as of 12/31/11).

Annuities and life insurance products are issued by Jackson National Life Insurance Company (Home Office: Lansing, Michigan) and Jackson National Life Insurance Company of New York (Home Office: Purchase, New York). Variable products are distributed by Jackson National Life Distributors LLC. May not be available in all states and state variations may apply. These contracts have limitations and restrictions, including possible withdrawal charges, recapture charges and excess interest adjustments. Contact your representative or the Company for more information.

Please remember that a Jackson annuity is intended to be a long-term, tax-deferred vehicle for retirement. An annuity's earnings are taxable as ordinary income when withdrawn and, if taken before age 59 1/2, may be subject to a 10% federal tax penalty. Variable annuities involve investment risks and may lose value.

Jackson National Life Insurance Company is an indirect subsidiary of Prudential plc, a company incorporated and with its principal place of business in the United Kingdom. Prudential plc and its affiliated companies constitute one of the world's leading financial service groups. It provides insurance and financial services directly and through its subsidiaries and affiliates throughout the world. It has been in existence for over 160 years and had $545 billion in assets under management as of December 31, 2011. Prudential plc is not affiliated in any manner with Prudential Financial, Inc., a company whose principal place of business is in the United States of America.

The following cautionary statement is included to make applicable and take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for any forward-looking statements made by, or on behalf of, the Company. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements which are other than statements of historical facts. However, as with any projection or forecast, forward-looking statements are inherently susceptible to a number of risks and uncertainties and actual results and events could differ materially from those currently being anticipated as reflected in such forward-looking statements. There can be no assurance that management’s expectations, beliefs or projections will result or be achieved or accomplished.

Copyright Business Wire 2010

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