A GUIDE TO

PRUDENTIAL’S GROUP ANNUITY

retirewithpru.com

Prudential is honored to provide the payments that your former employer purchased on your behalf as a participant—or as the beneficiary of a participant—in a defined benefit pension plan. You can have confidence in knowing your payments are absolutely secure and Prudential is wholly committed to providing you with guaranteed retirement income.

AFFIRMING OUR COMMITMENT

CONTENTS

Prudential Annuities .............................................................. 2–3

Safeguards and Guarantees .......................................................3–4

Prudential’s Financial Strength ................................................. 6–7

Focusing on Retirement Income ...................................................10

2

PROVIDING PEACE OF MIND SINCE 1875

LEADING THE PENSION MARKETPLACE

We understand the financial concerns you face today. We realize you count on your retirement payments for financial security, and we appreciate your need to know that these payments are coming from a trusted source of strength and stability.

Our heritage of pension plan expertise and financial strength ensures that the retirement payments we provide are well protected. This brochure is intended to provide insight about Prudential and the group annuity contracts we issue. It is also designed to help you understand the legal and regulatory protections you enjoy as a Prudential annuity certificate holder.

In 1928, Prudential completed a pension risk transfer transaction with the Cleveland Public Library. In 2016, Prudential celebrated the 88th anniversary of that transaction, with several of the original annuitants and beneficiaries still receiving pension payments.

As the largest pension annuity insurer in the U.S.,1 we are a proven leader in our ability to administer payments of benefits to participants and annuitants.

3 retirewithpru.com

The contracts employers purchase from Prudential to provide their workers with guaranteed income are group annuity contracts offered through The Prudential Insurance Company of America (PICA), a New Jersey life insurance company whose principal office is located in Newark, NJ.

Annuities are contracts sold by insurance companies that provide a reliable stream of income to covered persons, or annuitants, for their entire lives, or in some cases, for the lifetime of a joint annuitant (such as a spouse) thereafter.

Annuities can also be established for a specific period of time. The payments provided by annuities are guaranteed, with the guarantees backed by the financial strength and claims-paying ability of the issuing insurance company.

When an employer purchases a group annuity contract from Prudential, Prudential issues a legal document to each person who has a guaranteed annuity under the contract.

The legal document is called a certificate, and it describes the terms of the annuity to which the annuitant is entitled. The certificate explains the annuity payments that are irrevocably guaranteed by Prudential.

The following questions and answers can provide you with a better understanding of annuities and their benefits.

1. What is a group annuity?

Group annuities are large annuity contracts designed for employers. Rather than having a number of smaller annuities, with each covering an individual employee, the group annuity is a contract that covers all eligible employees.

2. How does a group annuity work?

A group annuity is a financial agreement between two parties. One party, the pension plan, pays an amount to the other party, the insurance company. The insurance company then converts that amount into periodic payments to provide guaranteed income for the group of employees covered by the agreement. This process is called annuitization, and in this instance the agreement is known as a group annuity contract.

3. What are the advantages of group annuities?

Group annuity contracts make it possible to provide more workers with guaranteed retirement income less expensively than if each worker had to be individually insured. And, similar to individual annuities, group annuities provide a number of advantages for annuitants, including:

• Guaranteed income for life, or for a specified period;

• The ability to provide ongoing income for a joint annuitant, such as a spouse

• Protection against the possibility of outliving retirement income

• Security against financial market ups and downs

4. What is a group annuity certificate?

A group annuity certificate is a legal document issued to each person who has a guaranteed annuity under a group annuity contract. It is evidence of the person’s right to payment under the group annuity contract.

The certificate describes the terms of the annuity to which the covered person is entitled, and explains the annuity payments that are irrevocably guaranteed by the insurance company issuing the annuity.

PRUDENTIAL ANNUITIESUNDERSTANDING PRUDENTIAL ANNUITIES

PRUDENTIAL ANNUITY ROADMAP

On behalf of plan sponsor, plan fiduciary

buys annuity from Prudential

Group annuity certificate

issued to each individual

Guaranteed payments to individuals, backed by

financial strength of Prudential

Annuitants receive guaranteed payments

from Prudential

4

5. How safe are annuities?

Because they are issued by highly regulated insurance companies that are required to maintain ample reserves to fully meet all of their financial obligations, annuities have proven to be very safe.

Annuities are also backed by state guaranty association protection to the extent provided by state law. No other financial vehicle can provide lifelong, guaranteed income as efficiently or as safely as an annuity.

Group annuity contracts are significantly different from typical pension plans. Pension plans:

• Often hold riskier investment portfolios

• Are not required to maintain additional reserves or explicit capital to cushion any losses that may occur

• Are only supported by the Pension Benefit Guaranty Corporation up to certain annual levels

For an assessment of group annuity contracts and defined benefit pension plans as forms of retirement income, please see our brochure titled Comparing Group Annuity Contracts and Defined Benefit Pension Plans.

Guarantees provided by insurance companies through group annuity contracts are among the strongest forms of benefit security available.

When issuing group annuity contracts, an insurance company is required to:

• Maintain ample reserves to cover the promises made

• Set aside additional capital to support the risk assumed

• Test the adequacy of its assets and reserves every year, posting additional reserves if needed

• Remain subject to state regulatory supervision

Annuitants also benefit from state guaranty association protections.

SAFEGUARDS AND GUARANTEESCOMPARING ANNUITIES TO PENSION PLANS

OFFERING SUPERIOR BENEFIT PROTECTION

Insurance companies are highly regulated

Must maintain ample reserves

Payments are irrevocably guaranteed

ANNUITY SAFETY NETS

Must set aside additional capital

5 retirewithpru.com

SAFEGUARDS AND GUARANTEESBACKING FROM STATE GUARANTY ASSOCIATIONS

The annuities Prudential issues are also safeguarded by state guaranty association protection, which provides additional security in the highly unlikely event an insurance company becomes insolvent and its assets are insufficient to fully cover its obligations.

This additional protection helps ensure every payment is made on time. Each state (as well as the District of Columbia and Puerto Rico) has a guaranty association that operates under individual state laws. The state you reside in determines your specific protection limits.

State guaranty associations act as a form of additional protection for customers of insurance companies, and are funded by insurance companies that sell insurance in any given state.

Coverage by guaranty associations is subject to certain limits, and the protections provided will vary based on state rules and the type of annuity benefit you are receiving.

Current coverage information can be found at nolhga.com.

PRUDENTIAL SEPARATE ACCOUNT PROTECTIONS

Guaranteed Income of Prudential Group Annuity:

Insulated Separate Account

PICA General Account

State Guaranty Association

PRUDENTIAL’S FINANCIAL

STRENGTH RATINGS

A+A.M. Best

AA-Standard & Poor’s

A1Moody’s

A+Fitch Ratings

The Prudential Insurance Company of America as of June 20, 2016

ADDING AN ADDITIONAL LAYER OF SECURITY

The annuity purchased on your behalf is a Separate Account annuity. This means the assets in the Separate Account are insulated from other liabilities of Prudential, providing enhanced annuitant security.

The assets in Prudential’s Separate Accounts primarily consist of high-grade, fixed-income securities. In the unlikely event the assets in a Separate Account are exhausted, the full faith and credit of Prudential stands behind our commitments, and we will pay any remaining obligations to annuitants using our General Account assets.

Similar to our Separate Account assets, Prudential’s General Account assets are invested primarily in fixed-income securities, such as high-grade bonds.

6

PRUDENTIAL’S FINANCIAL STRENGTHCREATING SECURE RETIREMENT OUTCOMES

Prudential has a long history of managing assets to match the liabilities of the promises we have made. As the second-largest insurance firm in the U.S.2, Prudential has:

• High ratings from the major independent ratings agencies

• A broadly diversified portfolio

• Strong risk controls

Prudential is strength-rated by the major independent ratings agencies for our ability to meet our financial obligations.3

Ratings agencies base their financial strength ratings on thorough evaluations of an insurer’s balance sheet strength, operating performance and business profile.

The financial strength ratings of The Prudential Insurance Company of America indicate that our position is solid, and that we have adequate capital and liquidity to meet our obligations.

PRUDENTIAL IS COMMITTED TO

BENEFIT SECURITY4

$9.4 BILLIONin annual

benefit payments

As of December 31, 2015

2.3 MILLIONcustomer calls

handled annually

10.8 MILLIONpayments disbursed

annually 

DELIVERING RETIREMENT CERTAINTY

Making annuity payments to hardworking individuals is one of Prudential’s key capabilities and we consider it our most important objective.

We firmly believe that pension benefits are exceptionally secure under a guaranteed group annuity. Prudential Retirement®, a business of Prudential Financial, has been guaranteeing pension plan payments since 1928, and is privileged to serve 4.1 million active workers and retirees.5

Our largest single client, with more than 220,000 annuitants, has been with us for over 60 years. And we are honored to still be making payments to our first pension buy-out client, the Cleveland Public Library, which partnered with Prudential in 1928.

7 retirewithpru.com

MANAGING THROUGH A CHANGING MARKET

Changing market conditions are challenging for companies around the world. Prudential prepares for this challenge with an investment portfolio that is conservatively invested in a wide range of mostly fixed-income securities across many industries and countries.

Prudential emerged from one of the most challenging economic eras in history—the Great Recession of 2008 –2009—in a stronger financial position. The balanced mix of risks and businesses we have built positioned us well to manage through the difficult economic environment.

With asset management and insurance solutions that help secure employee pensions and benefits in unpredictable times, we lead the way by turning uncertainty into confidence.

We take pride in having always been there for our customers, through good times and bad.

“With our financial strength,

investment capabilities and

actuarial expertise, Prudential is

uniquely suited to assume the

responsibility of guaranteeing

pension benefits.”

Christine Marcks President,

Prudential Retirement

UPHOLDING STRONG RISK-CONTROL MEASURES

Prudential has always maintained sufficient reserves and strong risk-control procedures to ensure that all of our obligations are met. Insurance regulators have long required insurers to retain ample reserves and increase capital, if necessary, to ensure all commitments are fulfilled.

In 2013, Prudential Financial, Inc. was designated as a non-bank systemically important financial institution, or SIFI, by the U.S. Government. As a SIFI, Prudential is:

• Monitored by the Federal Reserve Board

• Required to set aside additional reserves

• Limited on the use of credit and exposure to other financial companies

8

NOTES

9 retirewithpru.com

NOTES

FOCUSING ON RETIREMENT INCOME

Prudential’s experience and dependability have made us a trusted partner to millions of individuals and thousands of organizations. Keeping our promises, fulfilling our obligations and doing business the right way are principles that are firmly embedded in our corporate culture.

We are honored to make the retirement payments you earned as a participant—or as the beneficiary of a participant—in a defined benefit pension plan. And we are proud of our long heritage of customer focus, service excellence and, above all, integrity.

FOR ADDITIONAL INFORMATION

800-621-1089877-760-5155 (Hearing Impaired)

For more information about Prudential’s financial strength,

please visit prudential.com and click on Investor Relations.

1 LIMRA Group Annuity Risk Transfer Survey, 1Q16. Based on assets of single premium buy-outs which are group annuity contracts used to assume certain benefit liabilities of a terminating pension plan or, in some cases, a plan settlement of specific groups.

2A.M. Best, March 2016, data as of 12/31/2015; based on total admitted assets3 All ratings are as of June 20, 2016. Claims-paying ratings represent the opinions of rating agencies regarding the financial ability of an insurance company to meet its obligations under its insurance policies. While ratings can be objective indicators of an insurance company’s financial strength and can provide a relative measure to help select among insurance companies, they are not guarantees of the future financial strength and/or claims-paying ability of a company. Ratings are subject to change and do not reflect any subsequent rating agency actions. We make every effort to update our literature as soon as possible after a ratings change. Please consult with your financial professional or visit our investor relations site, investor.prudential.com, for the most current ratings information.

A.M. Best considers “A+” (2nd category of 15) rated companies to have a superior ability to meet their ongoing obligations to policyholders. “A++” is the highest rating assigned by A.M. Best.

Moody’s indicates that “A1” (5th category of 21) rated insurance companies offer good financial security. Insurance companies rated “Aaa” offer exceptional financial security. In addition, Moody’s appends numerical modifiers 1, 2, 3 to each generic rating classification, with 1 being the highest and 3 being the lowest. While the credit policy of these companies is likely to change, such changes as can be visualized are most unlikely to impair their fundamentally strong position. “Aaa” is the highest insurer financial strength rating assigned by Moody’s.

According to Standard & Poor’s publications, an insurer rated “AA-” (4th category of 21) has very strong financial security characteristics, differing only slightly from those rated higher. An insurer rated “AAA” has extremely strong financial security characteristics. “AAA” is the highest insurer financial strength rating assigned by Standard & Poor’s.

Fitch indicates that “A+” (5th category of 21) companies are viewed as possessing strong capacity to meet policyholder and contract obligations. Risk factors are moderate, and the impact of any adverse business and economic factors is expected to be small. “AAA” is the highest rating issued by Fitch.

4Based on total annuitants and participants as of December 31, 2015.5 Defined Contribution total 2,757,881 and Defined Benefit total 1,369,711. Defined Benefit includes Full Service (528,101) and Institutional Investment Products (841,610) as of March 31, 2015.

Prudential’s buy-out is a group annuity contract issued by The Prudential Insurance Company of America (PICA), Newark, NJ 07102. Amounts contributed to the contract are deposited in a separate account established by PICA. Payment obligations specified in the group annuity contract are insurance claims supported by the assets in the separate account and, if such assets are not sufficient, by the full faith and credit of PICA. All guarantees are dependent on the claims-paying ability of the insurance company and are subject to certain limits, terms and conditions.

Prudential Financial and The Prudential Insurance Company of America are each solely responsible for their own contractual obligations and financial condition.Products not available in all states.

Group annuity contracts are issued by The Prudential Insurance Company of America (PICA), Newark, NJ, a Prudential Financial company.

© 2016 Prudential Financial, Inc. and its related entities. Prudential, the Prudential logo, the Rock symbol, and Bring Your Challenges are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.0280995-00004-00 PRTBR023

07/2016

280 Trumbull Street Hartford, CT 06103

prudential.com