================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the period ended June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 333-18053
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
------------------------------------------------------
(Exact name of Registrant as specified in its charter)
NEW JERSEY 22-2426091
- ----------------------------- -------------------
(State or other jurisdiction, (IRS Employer
incorporation or organization) Identification No.)
213 Washington Street, Newark, New Jersey 07102
----------------------------------------------------
(Address of principal executive offices) (Zip Code)
(973) 802-2859
----------------------------------------------------
(Registrant's Telephone Number, including area code)
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: NONE
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
--- ---
State the aggregate market value of the voting stock held by non-affiliates
of the registrant: NONE
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of August 14, 1998. Common stock, par value of $5
per share: 400,000 shares outstanding
================================================================================
<PAGE>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
INDEX TO FINANCIAL STATEMENTS
PAGE NO.
--------
COVER PAGE 1
INDEX 2
PART I -- FINANCIAL INFORMATION
- -------------------------------
ITEM 1. (UNAUDITED) FINANCIAL STATEMENTS
STATEMENTS OF FINANCIAL POSITION -- JUNE 30, 1998
AND DECEMBER 31, 1997 3
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME--
THREE AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997 4
STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY --
SIX MONTHS ENDED JUNE 30, 1998 AND THE YEAR
ENDED DECEMBER 31, 1997 5
STATEMENTS OF CASH FLOWS -- SIX MONTHS ENDED
JUNE 30, 1998 AND 1997 6
NOTES TO FINANCIAL STATEMENTS 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS 9
PART II -- OTHER INFORMATION
- ----------------------------
ITEM 1. LEGAL PROCEEDINGS 11
ITEM 2. CHANGES IN SECURITIES 11
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 11
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 11
ITEM 5. OTHER INFORMATION 11
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 11
SIGNATURE PAGE 13
2
<PAGE>
<TABLE>
<CAPTION>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
STATEMENTS OF FINANCIAL POSITION (UNAUDITED)
JUNE 30, 1998 AND DECEMBER 31, 1997 (IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------
JUNE 30, DECEMBER 31,
1998 1997
----------- -----------
<S> <C> <C>
ASSETS
Fixed maturities
Available for sale, at fair value (amortized cost, 1998: $592,646;
1997: $585,109) $ 599,034 $ 592,361
Policy loans 134,276 127,306
Short-term investments 52,367 52,464
---------- ----------
Total investments 785,677 772,131
Cash 904 3
Deferred policy acquisition costs 103,879 101,625
Accrued investment income 13,806 14,075
Other assets 3,198 4,037
Separate Account assets 1,356,847 1,110,561
---------- ----------
TOTAL ASSETS $2,264,311 $2,002,432
========== ==========
LIABILITIES AND STOCKHOLDER'S EQUITY
LIABILITIES
Policyholders' account balances $ 385,126 $ 379,744
Future policy benefits and other policyholder liabilities 109,061 108,077
Cash collateral for loaned securities 25,802 33,663
Income taxes payable 4,971 12,963
Deferred income tax liability 21,164 22,188
Payable to affiliates 26,427 4,307
Other liabilities 11,615 17,103
Separate Account liabilities 1,355,187 1,108,994
---------- ----------
TOTAL LIABILITIES 1,939,353 1,687,039
---------- ----------
CONTINGENCIES (SEE NOTE 4)
STOCKHOLDER'S EQUITY
Common stock, $5 par value;
400,000 shares, authorized;
issued and outstanding at
June 30, 1998 and December 31, 1997 2,000 2,000
Paid-in-capital 125,000 125,000
Retained earnings 194,920 185,437
Accumulated other comprehensive income 3,038 2,956
---------- ----------
TOTAL STOCKHOLDER'S EQUITY 324,958 315,393
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDER'S EQUITY $2,264,311 $2,002,432
========== ==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
3
<PAGE>
<TABLE>
<CAPTION>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)
SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (IN THOUSANDS)
- ------------------------------------------------------------------------------------------------------------
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
---------------------- -----------------------
1998 1997 1998 1997
------- ------- ------- -------
REVENUES
<S> <C> <C> <C> <C>
Premiums $ 529 $ 390 $ 166 $ 130
Policy charges and fee income 24,623 26,791 11,556 12,641
Net investment income 24,096 21,476 12,217 10,303
Realized investment gains, net 1,823 446 681 117
Other income 2,665 1,928 774 1,512
------- ------- ------- -------
TOTAL REVENUES 53,736 51,031 25,394 24,703
------- ------- ------- -------
BENEFITS AND EXPENSES
Policyholders' benefits 12,988 15,334 4,997 (2,898)
Interest credited to policyholders'
account balances 9,691 9,485 4,369 4,705
General, administrative and other expenses 16,354 12,083 10,559 4,359
------- ------- ------- -------
TOTAL BENEFITS AND EXPENSES 39,033 36,902 19,925 6,166
------- ------- ------- -------
Income from operations before income taxes 14,703 14,129 5,469 18,537
------- ------- ------- -------
Income taxes
Current 5,105 5,252 1,924 1,996
Deferred 115 (239) 18 4,431
------- ------- ------- -------
Total income taxes 5,220 5,013 1,942 6,427
------- ------- ------- -------
NET INCOME 9,483 9,116 3,527 12,110
------- ------- ------- -------
Unrealized gains (losses) on
securities, net of reclassification
adjustment 82 (2,602) 1,705 284
------- ------- ------- -------
COMPREHENSIVE INCOME $ 9,565 $ 6,514 $ 5,232 $12,394
======= ======= ======= =======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
<TABLE>
<CAPTION>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
STATEMENTS OF CHANGES IN STOCKHOLDER'S EQUITY (UNAUDITED)
JUNE 30, 1998 AND DECEMBER 31, 1997 (IN THOUSANDS)
- ------------------------------------------------------------------------------------------------------------------------
ACCUMULATED
OTHER
RETAINED- COMPREHENSIVE COMMON PAID-IN-
TOTAL EARNINGS INCOME STOCK CAPITAL
-------- -------- ------------- ------- --------
<S> <C> <C> <C> <C> <C>
BALANCE, DECEMBER 31, 1996 $295,246 $166,214 $ 2,032 $ 2,000 $125,000
Net income 19,223 19,223 - - -
Unrealized gains on
securities, net of
reclassification adjustment 924 - 924 - -
-------- -------- ------- ------- --------
BALANCE, DECEMBER 31, 1997 315,393 185,437 2,956 2,000 125,000
Net income 9,483 9,483 - - -
Unrealized gains on
securities, net of
reclassification adjustment 82 - 82 - -
-------- -------- ------- ------- --------
BALANCE, JUNE 30, 1998 $324,958 $194,920 $ 3,038 $ 2,000 $125,000
======== ======== ======= ======= ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
<TABLE>
<CAPTION>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
STATEMENTS OF CASH FLOWS (UNAUDITED)
SIX MONTHS ENDED JUNE 30, 1998 AND 1997 (IN THOUSANDS)
- ------------------------------------------------------------------------------------------------------------------
1998 1997
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 9,483 $ 9,116
Adjustments to reconcile net income to net cash (used in) provided by
operating activities:
Policy charges and fee income (3,692) (2,912)
Interest credited to policyholders' account balances 9,691 9,485
Net (increase) decrease in Separate Accounts (93) 332
Realized investment gains, net (1,823) (446)
Amortization and other non-cash items 2,209 (45)
Change in:
Future policy benefits and other policyholders' liabilities 984 3,548
Accrued investment income 269 (755)
Payable to affiliates 22,120 544
Policy loans (6,970) (6,320)
Deferred policy acquisition costs (2,254) 1,681
Income taxes payable (7,992) 4,929
Deferred income tax liability (1,024) 352
Other, net (4,649) (32,068)
--------- ---------
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES 16,259 (12,559)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale/maturity of:
Fixed maturities:
Available for sale 298,205 392,572
Payments for the purchase of:
Fixed maturities:
Available for sale (305,188) (382,243)
Cash collateral for loaned securities, net (7,861) --
Short-term investments, net 103 12,002
--------- ---------
CASH FLOWS (USED IN) FROM INVESTING ACTIVITIES (14,741) 22,331
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Policyholders' account balances:
Deposits 175,341 43,261
Withdrawals (175,958) (52,059)
--------- ---------
CASH FLOWS USED IN FINANCING ACTIVITIES (617) (8,798)
--------- ---------
Net increase in Cash 901 974
Cash, beginning of year 3 3,928
--------- ---------
CASH, END OF PERIOD $ 904 $ 4,902
========= =========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
1. BUSINESS
Pruco Life Insurance Company of New Jersey (the Company) is a stock life
insurance company organized in 1982 under the laws of the state of New Jersey.
It is licensed to sell individual life insurance and deferred annuities (the
Contracts) only in the states of New Jersey and New York.
The Company is a wholly owned subsidiary of Pruco Life Insurance Company (Pruco
Life), a stock life insurance company organized in 1971 under the laws of the
state of Arizona. Pruco Life, in turn, is a wholly owned subsidiary of The
Prudential Insurance Company of America (Prudential).
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying unaudited financial statements of the Company have been
prepared in accordance with the requirements of Form 10-Q and generally accepted
accounting principles for interim financial information. These statements should
be read in conjunction with the financial statements and notes thereto for the
year ended December 31, 1997 included in the Company's Annual Report on Form
10-K for that year.
The accompanying financial statements have not been audited by independent
accountants in accordance with generally accepted auditing standards, but in the
opinion of management such financial statements include all adjustments,
consisting only of normal recurring accruals necessary to summarize fairly the
Company's financial position and results of operations. The results of
operations for the six months ended June 30, 1998 may not be indicative of the
results that may be expected for the year ending December 31, 1998.
NEW PRONOUNCEMENTS
In June 1997, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 130, "Reporting Comprehensive Income"
(Statement No. 130). Statement No. 130 establishes standards for the reporting
and display of comprehensive income and its components in a full set of
general-purpose financial statements. All items that are required to be
recognized under Statement No. 130 as components of comprehensive income are to
be reported in a financial statement that is displayed with the same prominence
as other financial statements. Statement No. 130 stipulates that comprehensive
income reflect the change in equity of an enterprise during a period from
transactions and other events and circumstances from non-owner sources.
Statement No. 130 is effective for fiscal years beginning after December 15,
1997. The Company has adopted Statement No. 130, resulting primarily in
reporting unrealized gains and losses on investments in debt and equity
securities in comprehensive income.
On June 15, 1998, FASB issued Statement of Financial Accounting Standards No.
133, Accounting for Derivative Instruments and Hedging Activities (Statement No.
133). Statement No. 133 is effective for all fiscal quarters of all fiscal years
beginning after June 15, 1999 (January 1, 2000 for the Company). Statement No.
133 requires that all derivative instruments be recorded on the balance sheet at
their fair value. Changes in the fair value of derivatives are recorded each
period in current earnings or other comprehensive income, depending on whether a
derivative is designated as part of a hedge transaction and, if it is, the type
of hedge transaction. Management of the Company anticipates that due to its
limited use of derivative instruments, the adoption of Statement No. 133 will
not have a significant effect on the Company's results of operations or its
financial position.
RECLASSIFICATIONS
Certain amounts in the prior years have been reclassified to conform to current
year presentations.
3. INVESTMENTS
FIXED MATURITIES classified as "available for sale" are carried at estimated
fair value. The amortized cost of fixed maturities is written down to estimated
fair value when considered impaired and the decline in value is considered to be
other than temporary. Unrealized gains and losses on fixed maturities "available
for sale", net of income tax, the effect on deferred policy acquisition costs
and participating annuity contracts, that would result from the realization of
unrealized gains and losses are included in a separate component of equity,
"Accumulated other comprehensive income."
7
<PAGE>
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
3. INVESTMENTS (CONTINUED)
The following reconciles the Net unrealized investment gains recorded in
Stockholder's equity at June 30, 1998 and December 31, 1997.
JUNE 30, DECEMBER 31,
1998 1997
-------- -----------
(000'S)
Fixed maturities - Available for sale:
Fair Value $ 599,034 $ 592,361
Amortized cost 592,646 585,109
-------- --------
Unrealized investment gains 6,388 7,252
Related adjustments:
Deferred policy acquisition costs (2,888) (3,379)
Policyholders' account balances 697 544
Deferred federal income tax liability (1,159) (1,461)
-------- --------
(3,350) (4,296)
-------- --------
Net unrealized investment gains $ 3,038 $ 2,956
======== ========
4. CONTINGENCIES
Several actions have been brought against the Company on behalf of those persons
who purchased life insurance policies based on complaints about sales practices
engaged in by Prudential, the Company and agents appointed by Prudential and the
Company. Prudential has agreed to indemnify the Company for any and all losses
resulting from such litigation.
In the normal course of business, the Company is subject to various claims and
assessments. Management believes the settlement of these matters would not have
a material effect on the financial position or results of operations of the
Company.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
- -------------------------------------------------------------------------------
OF OPERATIONS.
--------------
The Company markets individual life insurance, variable life insurance, variable
annuities and deferred annuities through Prudential's sales force in New Jersey
and New York.
The Company markets its products in the life insurance and annuity sectors of
the insurance industry. These markets are faced with an increased tightening of
the regulatory environment with particular emphasis placed on company solvency
and sales practices. The legal barriers which have historically segregated the
markets of the financial services industry are being challenged through both
legislative and judicial processes. Regulatory changes which opened the
insurance industry to other financial institutions, particularly banks and
mutual funds, heightened competition in investment type products since those
institutions were positioned to deliver the same products through large, stable
distribution channels.
The Company held $2.3 billion in assets at June 30, 1998 compared to $2.0
billion at December 31, 1997, of which $1.4 billion and $1.1 billion were held
in Separate Accounts as of June 30, 1998 and December 31, 1997 under variable
life insurance policies and variable annuity contracts. The remaining assets
were held in the general account for investment primarily in bonds, policy loans
and short-term investments.
1. RESULTS OF OPERATIONS
1998 versus 1997
Net income for the six months ended June 30, 1998 amounted to $9.5 million,
compared to $9.1 million in the six months ended June 30, 1997.
Separate Account activity was a factor in operating results during
the first six months of 1998. Separate Account assets increased 22.1% as of June
30, 1998, from $1.1 billion as of December 31, 1997 to $1.4 billion.
Approximately 62% ($153 million) of the increase is due to sales of the
Company's variable products and the remaining 38% ($93 million) is a result of
portfolio appreciation. Sales of variable products primarily relate to the
Discovery Select product which was added to the Company's portfolio as of
January 1997. Separate Account asset based charges such as mortality and expense
charges, administration fees and Separate Account gains are the operating
results elements effected by this growth.
The Company's net investment income for the period ended June 30, 1998 was $24.1
million representing a $2.6 million increase from the period ended June 30,
1997. The increase in net investment income is a result of higher beginning of
year portfolio assets partially offset by declining interest rates.
Other income increased $.8 million from $1.9 million for the six months ended
June 30, 1997 to $2.7 million for the six months ended June 30, 1998. This is
primarily attributable to the increase in investment management fees which are
received by the Company for services Prudential provides to The Prudential
Series Funds, an underlying investment option of the Separate Accounts.
Policyholders' benefits decreased $2.3 million from $15.3 million for the six
months ended June 30, 1997 to $13.0 million for the six months ended June 30,
1998. This decrease is attributable to two factors. 1998 death benefits have
declined slightly from 1997 levels & policyholder benefits in 1997 include the
effect of a valuation modeling change.
General, administrative, and other expenses increased $4.3 million from $12.1
million for the six months ended June 30, 1997 to $16.4 million for the six
months ended June 30, 1998. This change is primarily due to an increase in sales
activity of the Discovery Select product which resulted in increased expenses.
2. LIQUIDITY AND CAPITAL RESOURCES
The Company's liquidity requirements include the payment of sales commissions
and other underwriting expenses and the funding of its contractual obligations
for the life insurance and annuity contracts it has in-force. The Company has
developed and utilizes a cash flow projection system and regularly performs
asset/liability duration matching in the management of its asset and liability
portfolios. The Company anticipates funding all its cash requirements utilizing
cash from operations, normal investment maturities, and anticipated calls and
repayments, consistent with prior years. As of June 30, 1998, the Company's
assets included $581.2 million of cash, short-term investments and investment
grade publicly traded fixed maturity securities that could be liquidated if
funds were required.
9
<PAGE>
The Company conducts a thorough review of the adequacy of statutory insurance
reserves and other actuarial liabilities. The review is performed to ensure that
the Company's statutory reserves are computed in accordance with accepted
actuarial standards, reflect all contractual obligations, meet the requirements
of state laws and regulations and include adequate provisions for any other
actuarial liabilities that need to be established. All significant reserve
changes are reviewed by the Board of Directors and are subject to approval by
the New Jersey Department of Banking and Insurance. The Company believes that
its statutory capital is adequate for its currently anticipated levels of risk
as measured by regulatory guidelines.
3. THE YEAR 2000 ISSUE
The Company is a direct subsidiary of Prudential; therefore, is impacted by the
enterprise focus on the Year 2000 Issue. The Year 2000 issue is best understood
as a computer hardware and software problem involving the way dates are stored
and processed in computers. Many computer systems are programmed to recognize
only the last two digits in a date. As a result, any computer programs that have
date-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. If this anomaly is not corrected, the year "00" could cause
systems to perform date comparisons and calculations incorrectly which could in
turn affect the accuracy and compromise the integrity of business records.
Business operations could be interrupted when companies are unable to process
transactions, send invoices, or engage in similar normal business activities.
The Year 2000 issue presents critical business risks for public and private
sector entities across the globe.
Prudential identified the Year 2000 issue as a critical priority in 1995 and
established a Company-wide Program Office (CPO) to develop and coordinate an
operating framework for the Year 2000 compliance activities. The CPO assessed
potential business impact, identified software and hardware components that will
require upgrading, renovating, or replacing, and developed a strategy for
renovation, replacement or retirement of all affected business applications. The
initial assessment, completed in 1995, provided an estimate of the magnitude of
the project and necessary resources. Prudential's CPO has established quality
assurance procedures including a certification process to monitor and evaluate
enterprise-wide conversion and upgrading of systems for Year 2000 compliance.
Prudential is utilizing both internal and external resources to reprogram or
replace and test software. Prudential plans to complete its adaptation, testing
and certification of software for Year 2000 compliance by December 31, 1998 and
to conduct additional testing pertaining to the securities industry (in a
scheduled industry-wide effort) as well as complete its "business partner"
analysis and contingency planning during 1999. Prudential believes that it is
well positioned to achieve the necessary modifications and mitigate the Year
2000 risks.
Prudential has commenced contacting and communicating formally with major
suppliers and customers, including brokers, vendors, health care providers, and
institutions that pass electronic information to Prudential, to determine the
significance of the potential exposure that could result from their failure to
achieve Year 2000 compliance on a timely basis.
While, as indicated above, Prudential believes that it is well positioned
to mitigate its Year 2000 issue, this issue by its nature carries the risk of
unforeseen problems of internal or external origin. There can be no assurance
that the required systems modifications will be completed in accordance with
current estimates of timing and cost, or that the systems of other companies
with which some of Prudential's systems interface will be converted on a timely
and compatible basis. In the event that the required adaptations to mitigate the
Year 2000 issue are not completed on a timely basis, this issue could have a
material adverse impact on the Company's operations. The discussion of the Year
2000 issue herein, and in particular the Company's plans to remediate this issue
and estimated costs thereof, are forward-looking in nature. See cautionary
statement below relating to forward-looking statements.
4. INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
Certain of the statements contained in Management's Discussion and Analysis may
be considered forward-looking statements. Words such as "expects," "believes,"
"anticipates," "intends," "plans," or variations of such words are generally
part of forward-looking statements. Forward-looking statements are made based
upon management's current expectations and beliefs concerning future
developments and their potential effects upon the Company. There can be no
assurance that future developments affecting the Company will be those
anticipated by management. There are certain important factors that could cause
actual results to differ materially from estimates or expectations reflected in
such forward-looking statements including without limitation, changes in general
economic conditions, including the performance of financial markets and interest
rates; market acceptance of new products and distribution channels; competitive,
regulatory or tax changes that affect the cost or demand for the Company's
products; and adverse litigation results. While the Company reassesses material
trends and uncertainties affecting its financial condition and results of
operations, it does not intend to review or revise any particular
forward-looking statement referenced in this Management's Discussion and
Analysis in light of future events. The information referred to above should be
considered by readers when reviewing any forward-looking statements contained in
this Management's Discussion and Analysis.
10
<PAGE>
PART II
ITEM 1 LEGAL PROCEEDINGS
- ------------------------
Pruco Life Insurance Company of New Jersey is not involved in any litigation
that is expected to have a material effect.
ITEM 2 CHANGES IN SECURITIES
- ----------------------------
The following table presents sales and related expenses of the Flexible
Premium Variable Annuity Account since December 17, 1996, the effective date of
the registration statement (SEC file number 333-18053).
<TABLE>
<CAPTION>
FOR THE ACCOUNT(S) OF THE
FOR THE ACCOUNT OF THE COMPANY CONTRACTHOLDER(S)
------------------------------ ------------------------------
AGGREGATE
OFFERING PRICE
OF AMOUNT
REGISTERED AMOUNT SOLD AMOUNT SOLD
-------------- ------------- --------------
(000's)
<S> <C> <C> <C>
Flexible Premium Variable Annuity Account* $150,000 $15,195 $344,291
Underwriter discounts and commissions** (532)
Other expenses*** (174)
-------
Total (706)
-------
Net offering proceeds $14,489
=======
</TABLE>
* Securities are not issued or sold in predetermined units.
** Amount represents estimated general commissions paid to affiliated parties.
*** Amount represents estimated general administrative expenses paid to the
parent under service and lease agreement.
ITEM 3 DEFAULTS UPON SENIOR SECURITIES
- --------------------------------------
Not Applicable
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ----------------------------------------------------------
At the annual meeting of the stockholder held on June 9, 1998, the sole
stockholder of the Company elected the directors of the Company. The following
are the elected members to the Board of Directors: James J. Avery, Jr. (Chairman
of the Board); I. Edward Price (Vice Chairman of the Board); William Bethke; Ira
J. Kleinman; Esther H. Milnes; and Mendel Melzer.
ITEM 5 OTHER INFORMATION
- ------------------------
Not Applicable
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
- ---------------------------------------
(a) (1) and (2) Financial Statements of registrant are listed on pages
3-6 hereof and are filed as part of this Report. There have been no
8-K's filed during the first quarter of 1998.
(a) (3) Exhibits
--------
Regulation S-K
--------------
2. Not Applicable
3. Documents Incorporated by Reference
(i) The Articles of Incorporation of Pruco Life Insurance Company of New
Jersey, as amended February 12, 1998 are incorporated herein by
reference to Form 10-Q for the period ended March 31, 1998 and dated May
15, 1998 on behalf of Pruco Life Insurance Company of New Jersey; (ii)
Bylaws of Pruco Life Insurance Company of New Jersey, as amended May 5,
1997 are incorporated herein by reference to Form 10-Q, Registration No.
333-18117-01, filed August 15, 1997 on behalf of Pruco Life Insurance
Company of New Jersey.
4. Exhibits
Market-Value Adjustment Annuity Contract, incorporated by reference to
Registrant's Form S-1 Registration Statement, Registration No.
333-18053, filed December 17, 1996.
10. None.
11. Not Applicable.
15. Not Applicable.
18. None.
19. Not Applicable.
20. Not Applicable.
22. None.
11
<PAGE>
PART II
23. None.
24. Not Applicable.
25. Not Applicable.
27. Exhibit 27, Financial Data Schedule appended to this form in
accordance with EDGAR instructions.
99. None.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf of the
undersigned, thereunto duly authorized.
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
(Registrant)
SIGNATURE TITLE DATE
- --------- ----- ----
/s/ ESTHER H. MILNES President and Director August 14, 1998
- --------------------------
Esther H. Milnes
/s/ JAMES M. SCHLOMANN Vice President and Comptroller August 14, 1998
- -------------------------- and Chief Accounting Officer
James M. Schlomann
<TABLE> <S> <C>
<ARTICLE> 7
<LEGEND>
FINANCIAL DATA SCHEDULE
Article 7 of Regulation S-X
Pruco Life Insurance Company of New Jersey
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<DEBT-HELD-FOR-SALE> 599,034
<DEBT-CARRYING-VALUE> 0
<DEBT-MARKET-VALUE> 0
<EQUITIES> 0
<MORTGAGE> 0
<REAL-ESTATE> 0
<TOTAL-INVEST> 785,677
<CASH> 904
<RECOVER-REINSURE> 0
<DEFERRED-ACQUISITION> 103,879
<TOTAL-ASSETS> 2,264,311
<POLICY-LOSSES> 385,126
<UNEARNED-PREMIUMS> 0
<POLICY-OTHER> 109,061
<POLICY-HOLDER-FUNDS> 0
<NOTES-PAYABLE> 0
0
0
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529
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</TABLE>
