Prudential Financial Reports Fall in Third-Quarter Adjusted Profit

(Reuters) – Insurer Prudential Financial (NYSE:PRU) reported a decline in third-quarter adjusted profit on Wednesday, affected by weakness in its international business due to less favorable underwriting results and increased expenses.

The insurance sector is facing rising claim costs and evolving market pressures, leading to tighter policy terms and higher premiums to manage increased risk.

The Newark, New Jersey-based company's international operations posted an adjusted operating income of $766 million for the third quarter, down from $811 million in the same quarter last year.

The life planner unit, part of the broader international segment, also faced challenges with weaker underwriting results, higher expenses, and adverse foreign currency impacts, resulting in an adjusted operating income of $464 million in the quarter, compared to $527 million a year earlier.

In contrast, PGIM, Prudential's global investment management business, reported an adjusted operating income of $241 million, an increase from $211 million a year ago, driven by higher asset management fees.

Assets under management climbed to $1.56 trillion in the third quarter, compared with $1.36 trillion a year ago.

The insurer is aiming to shift its business model away from market-sensitive segments towards more stable and recurring income sources such as underwriting.

The company's after-tax adjusted operating income was $1.26 billion, or $3.48 per common share, for the three months ending September 30, compared with $1.33 billion, or $3.62 per share, a year earlier.